2599 Wadsworth Blvd.
Stand-alone, single pad site.
4,800 sq ft, (4) units
- Dental buildings can be great long-term investments.
- Dentistry is still needed during recessionary times.
- There is a high cost to relocate for dental tenants.
- Owning on a main thoroughfare at a stoplight can provide good traffic for tenants
- Purchased October of 2014 for $735,000 at a 7.3% cap rate(no leverage utilized)
- The building was fully occupied with well-below market rents and modified gross leases. 75% of tenants have renewed with NNN leases and rent increases, but still at below-market rates.
- The building required capital expenditures for deferred maintenance. Examples include:
- Replacement of lower parking lot and part of the upper parking lot
- Replacement of all common area light fixtures, doors, trim, flooring, and ceilings/wall textures
- Front façade redone
- Tenant leaves and units need to be rehabbed.
- Front façade needs to be updated to improve future potential leasing activity.
OUTLOOK & EXIT
- If the property was sold today at a similar cap rate of when it was purchased, the projected-annualized,un-levered return would be approximately 12.35%.
- The projected 10-year annualized return is 9.1%.