630k - loopnet › d2 › dbmulb4s7err6_msrkbztfzy... · 2019-10-22 · serves as the new home of...
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630KS A C R A M E N T O , C A630KS A C R A M E N T O , C A
EXECUTIVE SUMMARY
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THE OFFERINGCushman & Wakefield, as exclusive advisor, is pleased to present the exciting opportunity to acquire the 100% fee simple interest in 630 K Street (the “Property”), a 5-story, 87,140 square foot mixed-use office and retail building in Downtown Sacramento, CA. Situated directly adjacent to Downtown Commons and the Golden 1 Center and just four blocks from the State Capitol, 630 K Street is an irreplaceable asset located in the heart of one of the most rapidly evolving urban markets in the country.
This unique offering provides a generational opportunity to acquire a mixed-use asset immediately adjacent to a state-of-the-art entertainment and sports complex that serves as the new home of the NBA’s Sacramento Kings. By repositioning the asset and leasing up the available space, investors can unlock significant value in a truly one-of-a-kind building situated in the heart of Downtown’s entertainment district.
PROPERTY SUMMARYAddress 630 K Street, Sacramento, CABuilding Area 1 87,140 SFYear Built / Renovated 1957 / 2007Number of Stories 5
% Leased 2 28%
1 Includes 62,148 SF of Office and 24,992 SF of Retail.2 Office is currently vacant. Retail is 100% leased.
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INVESTMENT HIGHLIGHTS
INVESTMENT HIGHLIGHTS
WORLD CLASS LOCATION AT THE FRONT DOOR OF DOWNTOWN COMMONS AND GOLDEN 1 CENTERSituated in the heart of Downtown Sacramento, 630 K is Street located at the 7th Street terminus of K Street, the main pedestrian entrance to Downtown Commons (“DOCO”). Since its completion in 2016, DOCO has become the social epicenter of Sacramento and is the region’s leading live/work/play destination. This mixed-use entertainment and shopping complex attracts more than 1.6 million visitors annually and boasts an impressive 630,000 square feet of premier restaurant and entertainment space. Furthermore, the complex features the 17,500-seat Golden 1 Center which serves as the home to the Sacramento Kings and hosts over 200 entertainment events per year.
EXTREMELY RARE VALUE-ADD CBD OPPORTUNITYHigh quality office assets located within major sports and entertainment districts in California (Downtown Commons, Staples Center/LA Live, Chase Center, and Angel Stadium/Honda Center) command rent premiums of 18.8% over similar Class A office properties found within a 0.5-mile radius. The Property provides investors the coveted opportunity to realize significant upside by taking advantage of this rent premium through the lease up of the four contiguous available floors of office space.
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DIVERSIFIED INCOME STREAMS WITH PREMIER SIGNAGE COMPONENTThe retail space is currently 100% leased to an outstanding roster of credit retail tenants: Starbucks, T-Mobile, and Union Bank. With a WALT of 6.2 years, these tenants provide future investors a durable and growing stream of income. In addition, 630 K Street’s comprehensive signage program will not only enhance the building’s identity at DOCO, but will also allow investors to increase income through two wall billboard signs - one on each side of the building.
SACRAMENTO OFFERS RELATIVE VALUE TO THE OTHER WEST COAST CBDSThe capital city offers an alluring alternative for office users seeking quality space at affordable rates while maintaining a desirable CBD location. With average rents in Downtown Sacramento 40% and 52% of those found in San Francisco’s and Oakland’s CBD’s, respectively, Sacramento continues to offer attractive yields to investors seeking new investment opportunities in cap rate compressed markets. Sacramento’s economy remains robust with signs of sustained growth across all economic sectors, providing a compelling path for near-term rental growth.
TRANSIT-ORIENTED DESTINATIONThis unmatched location provides direct access to multiple public transportation options, including an extensive regional commuter bus and light-rail system – with stops immediately in front of 630 K Street. Interstate 5, with ±200,000 vehicles per day, is just a few blocks west of the Property. An exit ramp at J Street and entry ramp at L Street conveniently links the Property to the Greater Sacramento Region and beyond.
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LOCATED IN THE HEART OF THE SACRAMENTO’S RETAIL RENAISSANCE
In addition to its proximity to DOCO, the Property enjoys frontage directly along K street – the premier shopping, dining, and entertainment destination in Downtown Sacramento. K Street offers a
plethora of amenities for office tenants including 135 bars and restaurants, three movie theaters, five gyms, and 15 retailers within five blocks of the Property.
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FLEXIBLE EXIT STRATEGYIn addition to a traditional hold strategy, a future investor can pursue a compelling alternative exit strategy by creating a condo interest that bifurcates the retail and office components of the building. The strength of the retail tenancy and yield premium between office and retail assets presents the opportunity to maximize residual sale proceeds.
DYNAMIC SACRAMENTO MARKET FUNDAMENTALSThe Downtown Sacramento office market has seen 184,054 square feet of net absorption in the past four quarters with no new construction starts. Average asking rates have climbed consistently and are currently $2.58/sf/mo full service—a 24% increase from just five years ago, while vacancy rates have decreased 39% in that same time to 6.1% overall. Downtown Sacramento is among the strongest CBDs in the nation and the consistent market activity has extended through the region’s submarkets. In 2018, the capital city was the fastest growing major city in California in 2018, gaining more than 7,000 residents and adding more than 2,350 new housing units, much of it in Downtown.
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STATE CAPITOL
THE RAILYARDSKIMPTON HOTEL
HYATT CENTRIC
OLD SACRAMENTOWATERFRONT REDEVELOPMENT
GOLDEN 1 CENTER & DOWNTOWN COMMONS
THE BRIDGEDISTRICT
TOWER BRIDGE
RIVER ONE
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INVESTMENT SALES
LOCAL MARKET ADVISORY FINANCING
TERRY DALYLic. #01330089 ph | [email protected]
CONTACTS
KEVIN PARTINGTONLic. # 01199010ph | 916.288.4807 [email protected]
ADAM LASOFFLic. #01891096ph | [email protected]
RYAN VENEZIALic. #01864838ph | [email protected]
SETH SIEGELLic. #01493953ph | [email protected]
STEVE HERMANNLic. #01352679ph | [email protected]
RON THOMASLic. # 01193241ph | [email protected]
ERIC FOXLic. #01209035ph | [email protected]