Investment Overview

Marcus & Millichap is pleased to present the opportunity to acquire the property located at 7404 Buttrum Way in New Braunfels, Texas. Situated on a total of 128.5 acres of land, the newly constructed asset features an industrial park and RV resort. The inclusion of the D&R River City R.V. Resort offers buyers a diverse investment with a core asset that generates strong positive cash flow. The upscale resort contains 181 RV sites and includes a variety of amenities such as a fitness center, laundry facility, and swimming pool. The RV industry has experienced historical growth in recent years and with the help of the pandemic, a record 11 million households now own an RV. Among all states, Texas ranks first in annual RV sales and shipments (RV Industry Association). Consisting of 16 buildings, the industrial park contains approximately 113,320 square feet of industrial space. With about 11 acres of undeveloped land available, the property can accommodate roughly 57,000 square feet of additional industrial space. Located just off Interstate 35, the property is equal distance from Downtown Austin and Downtown San Antonio, making the property’s location prime for further development of small industrial buildings. In addition, the property provides about 26 acres of industrial outdoor storage (IOS) space. Only about half of the IOS space is currently occupied, offering a lease-up opportunity in a niche segment of the industrial market that has witnessed rapid growth since the pandemic. The area between Austin and San Antonio along Interstate 35 (referred to as the I-35 Corridor in the subject material), is a sizeable submarket, containing 25 million square feet of industrial space. During the third quarter of 2023, the vacancy rate in the I-35 Corridor rose to 14.3 percent, up from just 3.8 percent a year earlier. While this level of availability is concerning as new supply continues to outweigh demand, vacancies are largely impacting big-box warehouses that are 100,000 square feet and larger. On the other end of the spectrum, the vacancy rate among properties up to 50,000 square feet remained low at only 3.9 percent in Q3 2023. Going into the last quarter of the year, there were only 113,000 square feet of this small industrial space under construction, representing 1.4 percent of this group’s inventory (CoStar). This means that for the foreseeable future, new supply will have minimal effects on vacancies and rent growth of small industrial properties. With a population of over 2.4 million residents, the population of Metro Austin has grown significantly in recent decades along with economic growth. Known as the home of South by Southwest, the Austin-Round Rock metro covers about 4,225 square miles and consists of five counties in central Texas: Travis, Williamson, Hays, Caldwell, and Bastrop. Austin’s population of 964,177 people makes Travis the most populous county in the metro. Employment gains in the tech sector have contributed significantly to the metro’s recent population and median household income growth. Tesla’s newly constructed Gigafactory is expected to generate at least 5,000 jobs, supporting future relocations and increased demand for housing. The government is a significant driver in the local economy as Austin is the state capital and home to an IRS regional processing center as well as military bases. Located within a border state, the metro benefits significantly from international trade agreements with Mexico. Home to the Alamo and famous River Walk, San Antonio metro is the primary residence of 2.5 million people. San Antonio is the second most populous city in Texas behind Houston, housing more than 1.5 million residents. The local economy is anchored by the industries of healthcare, tourism, and national defense. An extensive transportation network provides shipping options to domestic and international markets. Additionally, the formation of the Eagle Ford Shale that runs through Atascosa and Wilson counties has cultivated a thriving energy sector. Valero Energy, one of the largest oil companies in the U.S., is headquartered in San Antonio. Major private employers include AT&T, Wells Fargo, USAA, and Toyota. San Antonio offers a high-quality of life with a variety of entertainment including the NBA’s San Antonio Spurs, SeaWorld, and Six Flags.