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Office

560 5th St. NW

560 5th St NW, Grand Rapids, MI 49504

Listing Price: $7,310,000

Cap Rate
8.02%
Gross SF
108,100
Rentable SF
108,100
Price/Gross SF
$67.62
Lot Size
4.34 acres
Year Built
1879

Investment Overview

This beautifully constructed 1879 structure gives the property a rustic feel while the newly renovated common areas provide a clean, modern finish. In fact, the aesthetic appeal speaks to the reason that four out of the sixteen tenants currently occupying office warehouse space happen to be architectural firms. The four-story, 108,100-square-foot, multi-tenant office property has views to the southeast of the Grand Rapids city center just minutes away. 560 Fifth St. provides tenants and their customers with an ample amount of free on site and adjacent parking which is an especially attractive feature in this neighborhood. Other features include a new roof in 2019 and fire alarm system in 2018 and 2019.

The property has a diverse mix of tenants ranging from industries such as technology and media to furniture and logistics. The building has a current occupancy of 90.04% with two pending RFPs bringing the property to a 98.03% occupancy. During the Coronavirus pandemic, tenants showed no sign of distress with seven of them renewing and two new tenants signing. Tenants attraction to the property is likely due to its prime location and size being a low-rise building on the outskirts of downtown. Over the next three years, there is no more than 10.21 percent lease rollover by square footage in any single year. Additionally, nine of the office tenants leases are based on useable square footage while the other seven are leased on rentable square footage, with no drop off in rental rate which provides an upside, if and when those tenants are replaced. Out of the sixteen tenants that occupy office or warehouse space, about 94% of them have annual rent escalations of 2.0%, 2.5%, and 3.0%.

The Grand Rapids NW Side has grown to be a creative neighborhood with a number of restaurants, breweries, brand new apartment buildings, and entertainment options. The convenient distance to grocery being just four blocks away is only one benefit of the location of this property. Furthermore, tenants and customers have direct access to the bus route that takes them throughout the Grand Rapids metropolitan area.

The property is professionally managed by Rockford Property Management which prefers to remain in that role after the sale.

An entity related to Seller also owns the adjacent property at 665 Seward and prefers to sell both 560 Fifth and 665 Seward as a package but will certainly consider separate sales.

Investment Highlights

  • 7 Tenants Renewed and 2 Tenants Signed During the Coronavirus Pandemic
  • Ample Parking - 278 Spaces Being Conveyed with the Property
  • Annual Increases Ranging from 2.0% to 3.0% for Nearly 94% of Tenants
  • 90.04% Currently Leased with 2 RFP Tenants Bringing Occupancy to 98.03%
  • Recent Capital Expenditures Include a New Roof and a New Fire Alarm System
  • 7 Leases Based on Rentable Square Footage while 9 Others Leased on Useable

Exclusively Listed By

Listing Price: $7,310,000

Cap Rate
8.02%
Gross SF
108,100
Rentable SF
108,100
Price/Gross SF
$67.62
Lot Size
4.34 acres
Year Built
1879

Investment Highlights

  • 7 Tenants Renewed and 2 Tenants Signed During the Coronavirus Pandemic
  • Ample Parking - 278 Spaces Being Conveyed with the Property
  • Annual Increases Ranging from 2.0% to 3.0% for Nearly 94% of Tenants
  • 90.04% Currently Leased with 2 RFP Tenants Bringing Occupancy to 98.03%
  • Recent Capital Expenditures Include a New Roof and a New Fire Alarm System
  • 7 Leases Based on Rentable Square Footage while 9 Others Leased on Useable

Investment Overview

This beautifully constructed 1879 structure gives the property a rustic feel while the newly renovated common areas provide a clean, modern finish. In fact, the aesthetic appeal speaks to the reason that four out of the sixteen tenants currently occupying office warehouse space happen to be architectural firms. The four-story, 108,100-square-foot, multi-tenant office property has views to the southeast of the Grand Rapids city center just minutes away. 560 Fifth St. provides tenants and their customers with an ample amount of free on site and adjacent parking which is an especially attractive feature in this neighborhood. Other features include a new roof in 2019 and fire alarm system in 2018 and 2019.

The property has a diverse mix of tenants ranging from industries such as technology and media to furniture and logistics. The building has a current occupancy of 90.04% with two pending RFPs bringing the property to a 98.03% occupancy. During the Coronavirus pandemic, tenants showed no sign of distress with seven of them renewing and two new tenants signing. Tenants attraction to the property is likely due to its prime location and size being a low-rise building on the outskirts of downtown. Over the next three years, there is no more than 10.21 percent lease rollover by square footage in any single year. Additionally, nine of the office tenants leases are based on useable square footage while the other seven are leased on rentable square footage, with no drop off in rental rate which provides an upside, if and when those tenants are replaced. Out of the sixteen tenants that occupy office or warehouse space, about 94% of them have annual rent escalations of 2.0%, 2.5%, and 3.0%.

The Grand Rapids NW Side has grown to be a creative neighborhood with a number of restaurants, breweries, brand new apartment buildings, and entertainment options. The convenient distance to grocery being just four blocks away is only one benefit of the location of this property. Furthermore, tenants and customers have direct access to the bus route that takes them throughout the Grand Rapids metropolitan area.

The property is professionally managed by Rockford Property Management which prefers to remain in that role after the sale.

An entity related to Seller also owns the adjacent property at 665 Seward and prefers to sell both 560 Fifth and 665 Seward as a package but will certainly consider separate sales.

Exclusively Listed By

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