Buying office buildings for redevelopment is a very different undertaking than acquiring such structures as investments for continued operation as offices.

That's reflected in recently recorded deeds for Commerce Park IV and V, which an affiliate of Wangard Properties of Milwaukee acquired at auction earlier this year. Wangard paid a total of $7.33 million for the 1980-vintage buildings, an August property filing reported.

The portfolio price works out to about $30 a square foot for eight-story Commerce Park IV and the four-floor Commerce Park V, on the 26000 block of Chagrin Boulevard in Beachwood.

CoStar reports other recent sales of office buildings have been in the range of $140 a square foot.

Wangard, which declined to comment on the price it paid for the properties, plans to invest heavily in the taller building to convert it to luxury apartments. It also plans to invest in upgrades at the smaller building to attract office tenants for its continued use as an office building.

However, the lender-directed auction on the foreclosed properties had a starting ask of just $2 million for both buildings, and insiders say most bidders fell into the same range as Wangard paid.

Moreover, the most striking figures are what the prior ownership, an investor group led by the late Mark Munsell, paid for the structures in two deals nearly 20 years ago.

That was $28 million for Commerce Park IV and $4.83 million for Commerce Park V. By contrast, the Wangard affiliate just paid $5.43 million for Commerce Park IV and $1.93 million in for Commerce Park V, according to individually recorded sale prices for the properties.

The steeply discounted prices reflect the massive amount of dollars Wangard will need to invest in each of the properties to make a go of it. Offices falling into disfavor likely also played a big factor in the low price the lender fetched.

Although it's a draconian situation, with millions of dollars on the line, it reminds me of the old real estate joke I first heard from Beachwood realty developer Bart Simon at an interview in the 1980s: "The way to make a little money in real estate is to start with a lot of money."

• Independence-based Redwood Living is extending its reach in the Detroit area.

The producer and operator of single-story apartment homes with private entrances and separate garages has announced it is starting to construct a 121-unit property in Rochester Hills, Michigan.

Mike VanGelder, Redwood senior vice president of operations, said this will be the company's 27th community in Michigan. All told, Redwood Living has 14,000 units in Ohio and seven other states.

• Let Me Be Ministries Inc. of Chagrin Falls announced it has opened the Trilogy Retreat Property in Southington, Ohio, between Cleveland and Youngstown.

Situated on a gated, bucolic 24-acre parcel, the property will function as a location for retreats, getaways and off-site meetings. It consists of a four-bedroom main house and guest cottage.

LMBM called it a mix of a mini-resort with a bed-and-breakfast. The property offers meeting rooms, a fitness center, a sauna and a heated swimming pool, among other amenities.

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