Commercial Appraisal: National Credit Capitalization Rates Orange
Commercial Real Estate Appraisal: National Credit Tenant Capitalization Rate Sale and Rent Study + Opinion Survey for Orange County & Los Angeles Fast Food Restaurant, Bank and Coffee, Westminster, Regionally & Surrounding Areas
As a service to you, I’ve included a recent: Orange and Los angeles counties, Credit Tenant Restaurants, Banks, Coffee & regional areas Retail Ground Rent Market Level Land Study. Real time information that is market participants derived, verified and compiled. The most up-to-date, detailed rent comparables and Capitalization Rate of Return Sales or Investor Required Rate of Return to help either a Tenant or Landlord, Investor, Seller or Buyer solidly understand: current state of the market conditions, trends & leasing & sales activity. This extremely difficult and time-consuming findings process is based upon numerous, confirmation discussions directly with primary parties to each individual, successfully closed transaction. The methodology absolutely yields the most recently transacted and accurate type of highly reliable & well supported data.
To ensure even more solid reinforcement, several comments and opinions from local leasing and sale experts in the specific subject property immediate area are obtained to explain market micro and macro dynamics and nuances. This combination enables clients to have an even higher level of confidence to better make educated decisions, resulting in the best & most profitable investment decisions from initial and unknown possible option scenarios that are at first wide open and unclear.
ORANGE AND LOS ANGELES COUNTIES, WESTMINSTER FAIR MARKET RENT & FAIR MARKET VALUE - REAL ESTATE VALUATION STUDY & APPRAISAL ADVISORY PROJECT:
• General Real Property Use(s): Restaurant, Retail
• Specific Use(s): Fast Food, Sit Down & Quasi Restaurant, Bank, General Retail Ground Lease Land
• Location(s): La Mirada, Signal Hill, Fountain Valley, Laguna Niguel, Pico Rivera
• Base Rent Range: Up to Mid to High $.60 per month + NNN's or CAM's for dirt only
• Landlord Provided Concessions or Discount Incentives to Tenants to construct building improvements:
o Free Rent Range: Up to 8 months Build Out Time base rent discount or abatement
o Tenant Improvement Range: Up to Mid to High $2.00 / sf Landlord contribution towards improvement work build out of a new building
• Additional NNN or CAM Operating Expense Pass Throughs: Up to Low to Mid $.30 / sf /month that Tenant also pays to Landlord as reimbursement payment for proportionate or pro rata share of Common Area Maintenance Expenses or CAM's for Property Taxes, Insurance, etc. Can also include extra expense pay back of lighting, landscaping, security, etc.
• Lease Up Absorption or On the Market Period(s): Not Available for a tenant to lease the land for a proposed building
• Opinion Survey Estimate of the Subject Property's Market Level NNN Land Rent Leased to a Tenant: Up to Mid to High $.40 / sf / month
• Capitalization Rate of Return Sale Range for Leased Investments Sold: As Low as Low to Mid 3% overall.
• Opinion Survey Estimate of the Subject Property's Capitalization Rate Investor Required Rate of Return: As Low as Low to Mid 5%
• Sell Out Absorption or On the Market Sale Period(s): Not available for a buyer to purchase a property
• Opinion Survey Estimate of the Subject Property's Market Level Land only Sale Price to an Investor Developer Buyer: Up Low to Mid $50 / sf
* Conclusion: Total $ / sf Rent Range - Including Base Rent + Additional NNN Expenses: Up to Mid to High $1.00 / sf / month. A huge +43% difference exists end of the day Total Rent that is paid, not yet taking into consideration yearly rate increases that are fixed, stepped or inflation based upon the CPI or Consumer Price Index.
Surprisingly, huge net effective rent discrepancies exist over a lease term. Even though a majority of the completed rent comparable transactions are in close proximity from the subject property, properties next door or even across the street are unique and not similar or alike.
Dissimilar physical characteristics vastly exist, due to general and specific location(s), specific use(s), year built, quality and condition of improvements build out. These are just some of the major important items that substantially affect rent obtained or paid. The length of the leases were up to a very protracted 420 months.
Depending on which polar end of the spectrum you are and your strategic goals, a Landlord seeks to obtain maximum rent, conversely, a Tenant strives to achieve maximum cost containment. A large amount of money can unnecessarily be lost or saved over a fairly short time period of year over year.
If interested, I’m more than happy to discuss the other facets of this study and opinion survey in more detail.
Looking forward to working with you and your clients.