Investment Snapshot
Property Information
Property Type
Industrial Park
Size
130,916 SF
Year Built
1991
Market
Ceres/Modesto
Sourcing
Off-Market broker relationship
Acquisition
Acquisition Date
June 2022
Purchase Price
$15,900,000 ($121 PSF)
Invested Equity
$5,654,000
Debt (% LTC)
68%
Type of Debt
Regional bank with five-year fixed rate financing of 3.9% with two years interest only
Going in Cap Rate
4.9%
In-Place Rent
30% below market
Disposition
Anticipated Hold Period
Five Years
Anticipated Sale Price
$22,454,571 ($172 PSF)
Anticipated Gross IRR
17.57%
Anticipated Equity Multiple
2.16x
Investment Overview
Deal Sourcing
Off-market sourced through broker relationship. Previously managed property so was very familiar with the asset
Property Type
130,916 SF industrial park
Year Built
1991
Occupancy at Acquisition
100%
Location
South of Modesto along the Highway 99 corridor
Attractive Opportunity
In-place rents were 30% below market with 80% of the leases expiring in the first three years. Acquisition price of $121 PSF was a 20%–25% discount of similar assets in Stockton/Sacramento market. The Ceres submarket has minimal competitive buildings with a high demand from tenants to service the local area.
Value-Add Strategy
CapEx Requirements
Capex work completed includes exterior painting of both buildings and asphalt/concrete repairs
Anticipated Hold
Five year anticipated hold
Rent Strategy
In-place rents were 30% below market with 80% of the leases expiring in the first three years
Anticipated Returns
Anticipated Gross IRR 17.57%
Anticipated MOIC 2.16x
