Investment Overview

Marcus & Millichap is please to offer for sale the 6,500 square foot, 2 story, single tenant office building at 1707 Fort View Road (the "Property"). The Property sits on 0.58 acres on the North Hwy 290 frontage road roughly half way between I-35 and Mopac and about 1/2 mile West of St. David's South Austin Medical Center. The Lease is an absolute NNN lease where tenant is responsible for everything including the roof, structure and parking lot. The tenant, Texas Health & Science University, has been at the Property since 2007. Based on State addressing requirements for universities, retention probability is exceptionally high. While the current lease expires in March 2025, the high retention probability couple with the rent structure increasing at 5% per year, buyers can acquire an asset that will materially appreciate in value in a high growth area of Austin. In addition to buyer's option to continue to lease the Property in its current state, the location offers buyer the option of redeveloping the site. The Property is zoned general commercial/Mixed use (GR-MU) allowing development of up to 5 stories for a 25,000 square foot building. Per the attached proforma, assuming 57% leverage at a 7% interest rate, buyers can achieve a 13.5% IRR providing for over a 3x equity multiple return on a 10 year hold with an investment of roughly $1,750,000. With a cash on cash return eclipsing 10% in year 9 of the proforma hold period, should a buyer choose to hold the Property in excess of 10 years, even if the rental rate never increased beyond the rental rate for year 10, buyer's could continue to achieve in excess of an 11% cash on cash return.