Builders FirstSource,
North Highlands, CA Investment Summary
| Price | $12,053,000 |
| Cap Rate | |
| NOI | |
| Lease Term | 10 Years With 8.5 Years Remaining |
| Lease Type | Net Lease, With Tenant Responsible For All Taxes, Insurance, Maintenance, Excluding Structural Elements of the Roof, Load Bearing Walls, and Supports and Foundations |
| Rental Increases | 2.5% Annual Rental Increases |
| Year Built | N/A |
| Building Size | 107,908 SF |
| Lot Size | 4.91 Acres (213,880 SF) |
| Status | Sold |
| Lead Brokers | Ryan Forsyth Executive Director 415.413.3005 ryan.forsyth@cushwake.com CA RE License #01716551 Matt Cologna Senior Director 916.288.4805 matt.cologna@cushwake.com CA RE License #01210309 Michael T. Yuras, CCIM Executive Managing Director 415.481.0788 michael.yuras@cushwake.com CA RE License #01823291 Vincent Aicale Executive Director 415.690.5522 vince.aicale@cushwake.com CA RE License #01728696 Scott Crowle Executive Director 415.604.4288 scott.crowle@cushwake.com CA RE License #01318288 |
Investment Highlights
LONG-TERM NET LEASE TO A PUBLICALLY OWNED COMPANY
» Builders FirstSource has over 550 distribution and manufacturing locations, and combined sales of approximately $11.7 billion
» 100% leased to BMC West LLC, a wholly owned subsidiary of Builders FirstSource. BMC Stock Holding, Inc merged with Builders FirstSource in January 2021, which is now traded on the Nasdaq under the stock ticker “BLDR” with a market cap of $9.92 billion
» Rare annual rental increases, providing an excellent hedge against inflation
» Minimal landlord management
» These locations provide manufacturing, distribution, and installation for Northern California and Northern Nevada for doors and molding
SECURE NET LEASE WITH LONG-TERM APPRECIATION
» Both properties have been occupied by predecessor door companies for decades demonstrating a commitment to a long-term and strategic location
» Before merging with Builders FirstSource, the previous tenant was the largest door and finished carpentry company in California
» Inplace rents 20% below current market creating long-term NOI growth
» Low price per square foot at $111, which is below replacement costs
» Robust submarket with a low vacancy rate of 5.5% and rent growth of 6.9% over the past 12 months
» Two individual buildings and parcels providing an investor with additional long-term diversification
» Significant recent capital improvements including partial roof, offices, and HVAC
MISSION CRITICAL FULFILLMENT AND DISTRIBUTION LOCATION
» Located at the confluence of highly-trafficked California thoroughfares and distribution arteries, including Interstate 80, Interstate 5, Watt Avenue, and Auburn Boulevard (combined 609,800 AADT)
» Within the McClellan Business park submarket, which includes more than 15 million square feet with prominent tenants such as Amazon’s new distribution center
» Investor interest in the Sacramento industrial market remains high as evidenced by the recent uptick in sales volume and price growth over the last year
Property Description
SOLD
The property is located at the confluence of highly-trafficked Northern California thoroughfares and distribution arteries, including Interstate 80, Watt Avenue, and Auburn Boulevard (combined 449,100 AADT). The property resides within a beneficial proximity to a wide array of industrial, distribution, and warehousing facilities and parks with commercial spaces available for machine and sheet metal repair, welding, composite manufacturing, ultrasonic non-building material supplies, medical laboratory services, truck driving schools, destructive inspection, plating and cleaning, warehouses, refrigerated transport services, logistics services, and more. The site is also 2.3 miles from Sacramento McClellan Airport, a major Sacramento transportation hub that experiences approximately 10,000 annual aircraft operations. Sacramento is home to an abundance of logistics and warehousing operations and is near major distribution hubs like East Bay, Reno, and Stockton.
