An affiliate of Wyatt Capital, LLC (“Wyatt”) acquired 1874 Defoor Avenue (“1874”) for $3.9 MM in July 2018. 1874 is a 43,000 sf brick warehouse building situated on 3.4 acres and was occupied by a tenant who had been at this location for 40+ years and was planning to vacate within six months of acquisition. The property included an excessively large existing parking lot for a warehouse building of this size along with a parcel of raw, undeveloped land situated contiguous to the parking lot.
The initial investment thesis was to maintain flexibility with the direction of this asset and allow market demand to dictate the strategic direction for the asset; which included either to sell the property outright, relet the building as-is, or redevelop it for a different use- all to be dictated by market demand and by what would be the most reasonably accretive path for capital.
Wyatt sold the property in March 2020 for $6.3 MM to an investor/owner occupant who engaged our team to redevelop the property for the purchaser’s own occupancy in a conversion of the building to 100% loft office usage.
Annualized project level returns for this investment were 53% with an equity multiple of 1.875X.