CORDOVAN PARK 5840-5850 W I-20, Arlington PROPERTY REPOSITIONING Case Study
ABOUT CORDOVAN Cordovan Park is a two building complex of low rise garden office style brick buildings located in South Arlington at 5840 and 5850 W Interstate 20. Both are two stories, multi tenant, with two story atrium type lobbies, elevators. Built in 1980, ownership had changed several times prior to bank foreclosure in 2010. Almost immediately after foreclosure, the HVAC system at one of the properties completely failed and had to be replaced by the bank at a cost of $100,000. The interior common areas of the property were dimly lit, with dated and torn wall coverings in the hallways. The 5840 building lobby had previously been updated with ceramic tile, the 5850 building s lobby was worn and faded carpet. At the time of foreclosure, the property s occupancy was 80%. Over the next few months, the property lost tenants, and by the time of acquisition, the property became another 5% vacant.
THE REPOSITIONING PLAN The Hangover Opportunity Fund acquired the property in September 2010 for a price of $2,800,000. By the time the acquisition was finalized, the repositioning strategy was emerging. The plan had three parts: Reverse deferred maintenance, particularly the exterior of the property, parking lot and landscaping to improve the functionality of access and to allow the building to be visible from interstate 20 and the service road. Resolve city code and handicap accessibility issues, both for the restrooms of the property and the parking lot Make aesthetic improvements, particularly in the interior common areas and lobbies to increase attractiveness for prospective tenants
EXTERIOR CHANGES HAPPENED IMMEDIATELY $15,000 was spent on landscaping clean up, pole light replacements, and wall lighting to improve visibility. $10,000 in new exterior LED lighting was installed once trees were thinned so the building could be seen at night from the service road and highway. $60,000 was invested in a complete re-paving of the parking lot for both buildings, with grade changes made to allow for handicap parking to meet city code requirements, and removal of an ugly and unnecessary median at the mouth of the driveway to the property.
INTERIOR IMPROVEMENTS Interior improvements were slower to happen. The challenge was which building to begin working on. The renewal of a major tenant influenced the decision to start on the 5850 building, which was also the most in need of updating. Interior designers were engaged for ideas on what should be updated, whether wall coverings should be replaced with paint, whether the ceiling grid should be replaced, whether to update the elevator, and so on. Common area restroom improvements had to be made to bring current with ADA standards. Total of interior improvements at the 5850 building: $230,000. The budget for all interior improvements - both buildings was $250,000,
INTERIOR IMPROVEMENTS Replaced carpet in lobby, stairs, elevator, and common area hallways Replaced elevator cab wall covering Removed wall coverings in common area hallways and lobby and replace with paint, using accent wall colors and artwork to distract attention from hallway length. Repainted ceiling grid in common area hallways. 2 x 4 ceiling tiles were replaced with tiles giving the appearance of updated 2 x 2 tiles. Inserts were installed into the recessed can light fixtures to lower the light bulbs, which allowed more light to reach the hallway walls. Door frames were painted a consistent color Door hardware was replaced, again to achieve consistency. Replaced outdated door knobs with newer style lever handles. Tenant door signage, lobby directory, and service areas signage were all replaced with matching updated signage. Common area restrooms were renovated with new tile, vanities, and wall coverings, and with changes to plumbing and hardware to bring them into compliance with Texas Accessibility Standards. Lobby staircase to 2 nd floor was updated with new rails to meet Texas Accessibility standards