25,000 sf Retail Investment in Prescott, Arizona

25,000 SF Retail - Prescott, Arizona

25,000 SF Retail - Prescott, Arizona

Goodwill of Central Arizona has just signed a new 10 year lease offering an 8% Cash on Cash return.

This is an excellent opportunity for an investor to acquire a value added, well located commercial investment property in Prescott, Arizona.

The existing lease is a new 10-year absolute NNN lease with increases and percentage rent and two five-year options to renew.

In addition, the property includes a 4,500 sf pad for retail expansion.

Property Description:
ASSUMABLE FINANCING. 5.75%, 27 year note, 15 years with option to renew at market rates. 8% CASH ON CASH. Single Tenant new 10-year Absolute NNN Lease with Escalations and Percentage Rents. 25,000 sf. Investor opportunity to acquire a well located, value-added asset with no landlord responsibilities. Includes a 4,500 sf Pad for additional expansion. Goodwill of Central Arizona is one of the largest and oldest nonprofits operating in the state of Arizona for more than 60 years.

Location Description:
Located within the Prescott Towne Center, a 53,000 sf retail center comprised of 3 buildings directly across from Village at the Boulders with Super Wal-Mart, Big Lots, Tuesday Morning, JoAnn’ s and Dollar Tree.
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Facing a New Commercial Reality

slice-leftWhen I am asked, “What do you think my commercial property is worth?” I cringe and feel less than completely at ease with the answers I know honesty demands.

It is not that I am reluctant to be completely transparent with a client. That is the easy part. The difficulty lies in communicating to commercial property investors that they may be facing a new commercial reality.

Our new commercial reality contains several characteristics that make buying and selling, leasing and landlording and other forms of investment more precarious than perhaps in times past.

Heads I Win Tails You Lose

Commercial real estate values are tipping and for some investors it doesn’t matter what side of the coin comes up.

In a majority of major commercial markets commercial property is softening and for those who purchased in 2005-2007, things may be less than stellar. This is also true of commercial real estate markets like Prescott, Arizona.

Owners who purchased in the 2005-07 framework invested at the top of the market…they bought high.
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Real Estate Owned Services

reos1Arizona Commercial has launched a comprehensive real estate owned services (REOS) division as an investment channel for commercial investors.

Commercial capital and financial experts are predicting that the commercial market will begin to experience an accelleration of “Bank Owned” (REO) properties as more and more owners experience downturns in tenant performance and the inability to service existing mortgage debt, note calls and stringent refinance requirements.

It’s About the Money. Throughout 2009 and well into 2010, commercial owners are going to come under some pressure with respect to turning properties and even exchanging out due to the financial markets.

Sellers are already having problems finding buyers for conventional property investments. Why? It’s about the money AND it’s about the decline in values that buyers don’t want to face after they purchase.

New Market Realities. Savvy investors are thinking about the new market realities and where they need to park their money for the next 24-48 months. The key is minimizing risk.

This investment reluctance is leading investors to pursue real estate owned property (REOs) and that is why Arizona Commercial, my company, has established “REOS” or, Real Estate Owned Services” as am owner consulting and investment service.

REOS involves consulting services for existing owners, bank asset managers and of course, investors who are resisting declining property values found in traditional investments.

Want to know more about REOS? Register with us for confidential inclusion in REOS. Or, if you prefer, email me or, better yet, call me, toll free at 1-877-777-9100.

Market Aloft: The Birdseye Approach

prescott-center-map-250Sound commercial investment is always based upon a perspective from aloft.

This aerial image of Prescott, Arizona’s downtown commercial area does not tell us much. It simply makes me wonder what is happening north, south east and west of the core area. There is a need to pan.

Market perspective plays a huge role in the analysis and decision making behind NOI, ROI and long term wealth accumulation for an investor. Putting distance between oneself and the market creates a better view.

Today, perhaps more than at any time in the last decade, market perspective counts and can easily impact a commercial transaction’s ability to perform and deliver the desired financial objective.

Lenders are looking at transactions with an eye toward long term performance based upon what I might call property actuaries. If a property segment (type) such as retail, medical, industrial, multi-family is on life support, the lenders are going to factor that illness into the capital risk formula.
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