Locating Commercial Real Estate Investments

Locating Commercial Real Estate Investments

RES 431

Commercial Real Estate Investments

Locating Commercial Real Estate Investments

Commercial Real Estate is one of the most efficient ways to build wealth today. Commercial Property is a business property, which includes office space, shopping centers, stores, theaters, hotels and parking facilities (Geshwender, 2010).

The property is located at 22912 Pacific Park Drive, Aliso Viejo, CA 92656. This property is a two-story Mixed-use Retail and Office space. The subject lot size is a 1.18-acres, and the total square footage of leasing space is 15,395. The property is zoned CN- Neighborhood Commercial and has a private 52 space parking lot. The property is at 100% occupancy, with the next lease ending in late 2019. The ownership is fee simple (Fee simple is a legal term describing the most common and absolute type of property ownership. The owner’s property rights are indefinite and can be freely transferred or inherited as the owner desires), land and building.

The subject property is located in a heavily trafficked area; The site is near the signalized, hard corner intersection of Pacific Park Drive and Aliso Viejo Parkway (32,000 combined vehicles per day). (Crexi.com) It surrounded by both active commercial district and a residential neighborhood (median home price $632,000). The site is located in an affluent densely populated part of southern Orange County. It sits across from a master planned community with a population of over 267,000 people with an average household income of over $130,000.

When evaluating the property from an investment perspective, the biggest selling point of this location is location, location, location. This property is near has the entire first floor occupied by e-commerce resistant businesses and services. Medical office, dry cleaners, and restaurants. The site is also located close to large shopping centers that house grocery stores, home improvement stores, movie cinema, gym, Wal-Mart, Target, and Costco. And directly across the street is a 160,000-foot corporate/office park.

This provides a steady customer base, but there is room for growth. Over the next few years, some leases will become available for renegotiation. If not renewed then it will allow for more popular food chains to be targeted.

The building is currently fully occupied. This is positive because there are paying tenants within the shopping center. The building is newer, built in 1999, and has been brought to current code unit by unit, in between occupancy. All retail locations are on a triple net lease. This is a close net community so joining the Chamber of Commerce and local social settings/ groups may be an excellent idea (deRoos, D. 2008).

This is a unique property, after searching several free sites that do not require you to be a real estate professional to access their information. I found that in the last five years there has been no property like this on the market. Now that’s not say that none exist. But based on my limited access I could not locate one. If I where in the market for such an investment I would surely locate a commercial specialist to have them run a comp report for me. Unlike Residential real estate, commercial real estate is not an open book. There is no public site that allows you to run comps like residential sites like Zillow.

References:

Find you next commercial property. (n.d) Retrieved July 25, 2018, from Retrieved from https://www.crexi.com

de Roos, D. (2008). Commercial real estate investing. Hoboken, NJ: John Wiley & Sons

Geshwender, A. (2010). Real Estate Practice and Principle. South-Western, Cengage Learning.