Northpoint Office Towers
Location
Modesto, California
Property Type
Office
Square Footage
90,000 square feet
Northpoint Office Towers is a Class A office property well-located at the northernmost end of the Modesto market
Key Features
High visibility, with more than 123,000 cars per day passing by on Highway 99
Features underground parking, abundant surface parking, and is the northernmost major building in Stanislaus County
Situated to serve employers in both Stanislaus and the rapidly growing southern San Joaquin County
Purchase Price
$10,350,000
Invested Equity
$4,338,250
Current NOI
$1,300,000
Target Return
27%
Hold Period
7–9 years
Going in Cap Rate
9.4%
Northpoint Office Towers
Business plan
The property was acquired for a cost basis of $10.4 million and an additional $2.0 million is planned to be borrowed to build out the approximately 15,000 sf of cold shell space and 15,000 sf of built out space that needs to be reconfigured.
Acquired at 67% below replacement cost
The property was 59% occupied but was purchased at a 9.4% cap rate on in place income.
ESG initiatives included LED exterior and parking lighting, the addition of umbrellas and drought tolerant landscaping to improve the outdoor environment. The newly built out office space includes high ceilings to embrace natural light and the latest energy efficiency upgrades including LED lighting.
Three new leases were signed, taking up 36% of the vacant space and bringing occupancy from 59% to 74% and adding $300,000 to NOI
A large institutional tenant will be targeted for the full 15,000 sf third floor
The lobbies and exterior common areas were renovated
Current NOI of $1.3 million vs $1.0 million at acquisition
