Case Study: 10461-10463 Austin DR
Property Profile
$4,800,000Challenge
10461-10463 Austin Drive is an incubator industrial project that was purchased off-market at a well-below-market price with a value-add through leasing and management strategy. The property consists of two buildings totaling 22,089 square feet. The previous owner’s biotech company was occupying one entire building, totaling 40% of the property. The remainder of the property consisted of incubator industrial tenants, which, at the time, were all on gross, under-market lease rates with short-term lease expirations.
Strategy
The agents successfully negotiated a sale-leaseback with the previous owner, securing a long-term anchor tenant on a NNN lease with above-market fixed rent increases. During the escrow period, the agents also renewed over 60% of the property’s month-to-month leases at market rates. During this time, they began a two-year, gross-to-net lease structure conversion that would ultimately increase effective rents by over 50% on the property and result in a more desirable structure at the time of exit.
Results
As of Q3 2023, the property currently is stabilized above a 7.0% cap rate and is being prepared to be exited to an investment buyer looking for a stabilized multi-tenant park. Over $250,000 in physical improvements have also been completed, and 95% of the property has been converted to NNN at market rents.
Recent News
Recent Media & Thought Leadership
3/7/2024
Case Study: Three Property Multifamily Portfolio Refinance
2/26/2024
Case Study: 10365 Parker Rd
2/6/2024
Case Study: 1269 Broadway
1/29/2024
Case Study: 970 Flushing Avenue
1/26/2024
Case Study: 1056 Rogers Avenue
1/25/2024
Case Study: Safe Store Surry, NH
1/23/2024
Case Study: 237A 27th Street
12/12/2023
Case Study: 3546 Emery St
11/28/2023