MESA OFFICE BUILDING 7670 OPPORTUNITY RD. SAN DIEGO, CA 92111

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1 MESA OFFICE BUILDING 7670 OPPORTUNITY RD. SAN DIEGO, CA 92111

2 7670 OPPORTUNITY RD SAN DIEGO, CA EXCLUSIVELY LISTED BY NICK TOTAH First Vice President, Investments (858) License: CA GREG FARRIS Investment Associate (858) License: CA RICKY PARTIDA Licensed Managing Partner (858) License: CA TABLE OF CONTENTS EXECUTIVE SUMMARY 6 PROPERTY OVERVIEW 10 DEBT + EQUITY BY CHAD O CONNOR MMCC Senior Vice President Capital Corporation (858) Chad.OConnor@marcusmillichap.com FINANCIAL ANALYSIS 13 MARKET ANALYSIS 16 COMPARABLE SET 20 Marcus & Millichap is exclusively marketing this Office offering to a select group of qualified investors. The prospective purchaser will be selected by the Seller in consultation with Marcus & Millichap on the basis of, among other things, (i) price, (ii) certainty of closing, (iii) financial strength, (iv) level of discretion to invest funds, and (v) industry reputation. MARKET OVERVIEW 21

3 OFFERINGMEMORANDUM This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must 4 verify the information and bears all risk for any inaccuracies. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services of California 2017 Marcus & Millichap. Activity ID: 5

4 OFFERINGMEMORANDUM THEHIGHLIGHTS VALUE ADD OPPORTUNITY IN PLACE AVG. RENT OF INVESTMENT OVERVIEW EXECUTIVE SUMMARY $1.51 (FSG) WITH A MARKET AVG. OF $1.85 (MG) + RECORD LOW OFFICE VACANCY OF 5.4% - THE LOWEST IN THE PAST 15 YEARS + 64 PARKING STALLS A RATIO OF 3.2 PER 1,000 OF RENTABLE SQUARE FEET + SHORTER TERM IN PLACE LEASES ALLOW FOR A REPOSITION OPPORTUNITY IN THE NEAR TERM + EXTREMELY LOW VELOCITY SUB-MARKET ACCORDING TO COSTAR, ONLY 5 OFFICE BUILDINGS BETWEEN 10K-30K SF SOLD IN THE PAST 12 MONTHS. + LOCATED ½ MILE FROM THE HIGHWAY 805 ENTRANCE AND IN THE HEART OF KEARNY MESA Marcus & Millichap is pleased to present for sale 7670 Opportunity Rd. San Diego, CA This 95% Leased Office building was built in 1979 from masonry construction. The two-story office project is comprised of 20,874 square-feet of rentable building area; situated on over 37,897 square-feet of land, with frontage to Convoy Street & Ruffner St. in Kearny Mesa. In the center of one of San Diego s most desired office sub-markets with very low sales velocity, in addition to the average in-place rent of $1.51/SF (FSG), which is approximately 19% below the market rate of $1.83/SF (MG). This presents an excellent and unique opportunity for an investor to reposition the asset through lease negotiations and tenant improvement. The building has recently undergone multiple upgrades new exterior and interior paint. All doors and frames painted, new commercial carpet throughout all common areas, refinished Italian Travertine in the lobby and all restrooms. Excellent parking ratio, with off street parking located all around the building. Two entrances to the building with secured after hours and weekend access. Additionally, the property is positioned in an amenity rich neighborhood with great street exposure and has easy access to freeways 805, 163, 15 & 52. 7

5 OFFERINGMEMORANDUM INVESTMENTOVERVIEW FINANCIAL HIGHLIGHTS Offering Price $4,000,000 Price/SF $ Building SF 20,874 SF CAP Rate - (Current/ProForma) 5.40% / 8.01% NOI - (Current/ProForma) $215,906 / $320,506 Average Rent Per SF - Current/Market $1.51 (FSG) / $1.85 (MG) This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must 8 verify the information and bears all risk for any inaccuracies. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services of California 2017 Marcus & Millichap. Activity ID: 9

6 PROPERTY OVERVIEW

7 7670 OPPORTUNITY RD SAN DIEGO, CALIFORNIA PROPERTY OVERVIEW PROPERTY OVERVIEW ADDRESS 7670 Opportunity Rd., San Diego, CA INGRESS/EGRESS Clairemont Mesa Blvd & Ruffin Rd NET RENTABLE AREA 20,874 SF NUMBER OF BUILDINGS One YEAR BUILT 1979 PARKING 64 Spaces or 3.20/1,000 SF LAND SIZE ZONING FOUNDATION CONSTRUCTION 37,897 SF Commercial Concrete Masonry FINANCIAL ANALYSIS ROOF Flat HVAC Packaged Units ELEVATOR None LANDSCAPE & SITE Palm Trees & Shrub Surround Building SAFETY N/A ADA (Buyer to Verify) 12 This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services of California 2017 Marcus & Millichap. Activity ID:

8 MARKET ANALYSIS OFFERINGMEMORANDUM The first urbanization of Kearny Mesa began in 1937 with Gibbs Airfield, now Montgomery Field. In 1948, the City of San Diego acquired the airfield and 1,400 acres of surrounding property as a replacement site for San Diego International Airport. When airspace conflicts with MCAS Miramar preempted the proposed airport, the surplus acreage became an industrial park. AVAILABILITY SURVEY 5-YEAR AVG Rent Per SF $23.12 $21.98 Vacancy Rate 5.4% 9.9% Vacant SF 298, ,500 Availability Rate 11.1% 12.7% VACANCY CHART MARKET ANALYSIS Beginning in 1955 with General Dynamics, numerous aerospace, electronic, and other industrial and office firms have located in the area. Portions of Kearny Mesa, predominantly west of SR-163, also include commercial development. Residential development is limited but increasing in recent years, particularly with the development of Stonecrest in the southeast corner of the community and the redevelopment of the General Dynamics site, now known as Spectrum. Available SF 518, ,359 Sublet SF 23,804 14,835 Months on Market INVENTORY SURVEY 5-YEAR AVG Existing Buildings Existing SF 4,795,520 4,836,858 ASKING RENT CHART The City of San Diego has kicked off Kearny Mesa Connected (link is external), a collaborative effort to update the Kearny Mesa Community Plan. This process will help the City and the community determine how Kearny Mesa will develop in the future to ensure it continues to thrive as a key employment center for the City, while enhancing the diverse opportunities that the community has to offer. 12 Mo. Const. Starts 0 0 Under Construction Mo. Deliveries

9 7670 OPPORTUNITY RD SAN DIEGO, CALIFORNIA MARKET ANALYSIS OFFERINGMEMORANDUM NEW DEVELOPMENTS CENTRUMPLACE DEMOGRAPHICS 1 MILE RADIUS SURVEY Population 24,270 Households 8,347 Average Age 31.8 Median Household Income $56,797 Restaurants 29 Fitness & Rec Centers 21 Grocery Stores 7 VIVE ON THE PARK 3 MILE RADIUS SURVEY Population 154,234 Households 64,032 Average Age 34.9 Median Household Income $66,439 Restaurants 453 Fitness & Rec Centers 194 Grocery Stores 116 This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must 18 verify the information and bears all risk for any inaccuracies. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services of California 2017 Marcus & Millichap. Activity ID: 19

10 MESA OFFICE BUILDING 7670 OPPORTUNITY RD. SAN DIEGO, CALIFORNIA EXCLUSIVELY LISTED BY NICK TOTAH First Vice President, Investments (858) License: CA GREG FARRIS Investment Associate (858) License: CA RICKY PARTIDA Licensed Managing Partner (858) License: CA DEBT + EQUITY BY CHAD O CONNOR MMCC Senior Vice President Capital Corporation (858) Chad.OConnor@marcusmillichap.com