Case Study

In 2017 the Management Company acquired 2020-2030 South Susan Street, an industrial park in Santa Ana, CA from an individual who had owned it for over 20 years. The property is well-located in a highly visible industrial zone accessible to labor as well as management, divided into multiple suites with sufficient power, large roll-up doors and above-average interior clearance.  The prior owner had operated the property with an emphasis on high occupancy but little increase in rental rates, providing the Management Company with the opportunity to increase revenues quickly and renovate the property at little expense.  On a purchase price of $4.5 million, the Management Company invested repositioning capital for new signage, paint and landscaping totaling less than $100,000, or 2.2% of the purchase basis.  The property was sold after 20 months for $6.2 million, a net realized gain of $1.26 million resulting in a gross IRR of 44.2% and a multiple of 1.87 on invested equity.