1000 N State St
Hemet, CA 92543

Textbook Value-Add Opportunity: With a current occupancy of 51% and low in-place rents averaging $0.92/SF gross, the asset features significant room for increased NOI and value creation.
13.80% Proforma Yield at 90% Occupancy: If leased to 90% occupancy at an average lease rate of $1.00/SF gross, the property features an estimated proforma NOI of $680,000, translating to an 13.80% yield. At an estimated 7.50% exit cap rate, a conservative proforma exit value is approximately $9,120,000 ($102/SF), providing upwards of $4M in upside potential, not including the potential value of the additional land.
Low Cost Basis - Far Below Replacement Cost: Priced at an attractive $55/SF, investors are provided with a cost-effective entry point compared to developing new industrial-flex/commercial property (currently estimated at $300 to $400/SF, not including land cost) or compared to acquiring other existing commercial assets at significantly higher price points per square foot.
Multiple Paths to Create Value: Including the lease-up of the existing 49% of vacant space, development or sale of the additional 1.55 acres of land (which is included in the sale and already separately parceled), or piecing off individual portions of the property and selling them separately at a higher price per square foot.
Multiple Exit Strategies: Upon stabilization, one could potentially sell the property and conservatively realize an estimated profit of $4 million or more, or refinance to recover the initial investment while retaining ownership of the asset, creating a stream of cash flow with likely none of their initial equity remaining in the deal. At 65% LTV on a $9,120,000 valuation, an investor could achieve approximately $6,000,000 in loan proceeds (recovering their entire $5M initial investment plus an additional $1M) and retain ownership of the asset with an estimated $260,000 in annual after-debt cash flow.
±1.55 Acres of Additional Land at Virtually No Cost: No value has been attributed to the land as a part of the asking price. The land is separately parceled and could be sold separately to lower one's basis in the property, it could be developed into heavy manufacturing/industrial as currently zoned, or it could potentially re-zoned to another use.
Small, Versatile Flex Space with Large Tenant Pool: With an average space size of under 1,000 SF, the industrial flex design allows for a diverse mix of tenants, appealing to a broad number of businesses across sectors such as light to heavy manufacturing, warehousing, office uses, retailers, automotive, service providers, and more.