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I N V E S T M E N T S U M M A R Y
PRISM at MIDTOWN
CONTACT
RICH YOUNG JRVice President972 236 [email protected]
ANDY FOLMERSenior Vice President 972 236 [email protected]
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EXECUTIVE SUMMARY
THE INVESTMENT OPPORTUNITY
Rich Young Company is pleased to exclusively offer to qualified investors (and owner occupants) the Prism at Midtown, a 52,933 rsf two story office building located at 5580 Peterson Lane in Dallas (the “Property”). This property is in the heart of the Midtown mixed use redevelopment project which includes the complete redevelopment of the land under the former Valley View Mall as well as surrounding areas from Dallas Tollway to Preston, and from LBJ to Spring Valley: www.DallasMidtown.com
At one time this building was occupied by a single tenant but is now setup for multi-tenant occupancy. It is parked at a ratio of 3.1:1,000 totaling 170 spaces with 129 of these being under the building (structured parking). The common areas and rest rooms were recently remodeled.
This building is currently 75% leased to ten tenants at an average rental rate of $14.83 which is well below the $18.00-$20.00 at competitive properties in the sub-market. Especially after being remodeled, this rate is extremely attractive to value-oriented tenants looking in the area. Renewal rates for these tenants should be significantly higher. The largest vacant block is 6,090rsf (divisible) on the second floor.
This offering will allow an investor the opportunity to add value while the projected redevelopment around it occurs. When that happens, this will be one of the few less expensive (value) office options in the sub-market. Several potential buyers have even looked at this as a ten-year hold “land play” thinking that the land will be more valuable for a higher end, mid-rise, mixed use tenancy at that time.
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PRISM@ MIDTOWN QUICK HITTERSSubstantial CAPEX Completed by Ownership
• Full common area remodel (main Atrium, elevator lobbies, first and second floor corridors, outside seating areas)
• All common area bathrooms are ADA compliant
• All common area bathrooms are ADA compliant
• New counters and faucets in bathrooms
• Replaced all 220 sprinkler heads in parking garage
• New card access readers throughout building
• New motion sensing, third-party monitored security cameras 24/7 (15 cameras)
• HVAC balancing enhancements
• New remote access gate in underground parking garage
• Full Atrium window new tinting with 75% reduction of heat load in building Atrium
• New monument signage
• New interior building signage directories
• Full parking lot restriping
• New exterior building lighting
• New corridor lighting (72 fixtures)
• New sensors in fire suppression system
• New A/C compressor installed for 2nd floor A/C unit·
TENANT QUALITY / DIVERSIFICATION
• 25% of building leased to credit tenant software company on a 10-year term
• 13% of building leased to credit-tenant engineering services firm on a 5-year term
• No current delinquency
• Blend of 3-year, 5-year and 10-year leases
Value Add for New Ownership
• Ideal building for a Owner/User
• Downstairs blocks of space (6k contiguous and 9k non-contiguous)
• Substantial new investment within 3 blocks of the Prism Building:
o Valley View Mall demolition and redevelopment
o KDC/Seritage Growth Properties project (SW Corner of Valley View mall)
• New Marriott Hotel (250 rooms)
• Over 600 new class A apartments constructed
• Pegasus-Ablon project
• Over time, market rents should increase by $3 to $5 psf as new development occurs
• Continue to increase occupancy from 74% level
• Many leases were signed at below market rates when occupancy was lower ($3-4 psf higher market rents probably upon renewal)
• Convert full-service leases to plus E upon renewal ($2 psf opportunity)
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BUILDING ADDRESS
LAND AREA
NET RENTABLE AREA
OCCUPANCY
YEAR BUILT/RENOVATED
PARKING RATIO
SUBMARKET
5580 Peterson LaneDallas TX, 75240
1.63 ACRES
52,933 RSF
75%
1983/ 2017
3.1/1,000 SF
LBJ/Tollway
ASSET PROFILE
5580 Peterson
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EXCLUSIVELY OFFERED BY RICH YOUNG COMPANY | 17480 N DALLAS PARKWAY, SUITE 116 | DALL AS, TEXAS | 972 236 7645
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O F F E R I N G M E M O R A N D U M
CONTACT
RICH YOUNG JRVice President972 236 [email protected]
ANDY FOLMERSenior Vice President 972 236 [email protected]
