LAS VEGAS, Nevada, August 11, 2016 – BKM Capital Partners, an institutional fund manager with a niche focus on value-add, multi-tenant light industrial investments, has acquired Spencer Airport Center, a seven-building 177,597 square-foot multi-tenant industrial park in Las Vegas, Nevada for $15,650,000.
This is the BKM’s fourth acquisition in the Las Vegas market, bringing the firm’s local assets under management to 710,538 square feet.
“The Las Vegas airport submarket in which Spencer Airport Center is located, has demonstrated tremendously high occupancy and consistent demand that is significantly outpacing supply,” says Brian Malliet, CEO and Co-Founder of BKM Capital Partners. “Quality market fundamentals and ongoing growth in the region make our below-replacement-cost and significantly below peak pricing, acquisition of this asset particularly noteworthy.”
BKM purchased Spencer Airport Center at more than 40 percent below replacement costs, according to Malliet.
“We focus on acquiring assets with intrinsic value that can be grown over time through our unique operator platform,” he says. “Because we specialize in light
industrial product, our team understands how to operate these properties in order to deliver optimum performance over time, resulting in strong yields for our investors.”
Malliet explains that the region surrounding Spencer Airport Center boasts 92 percent occupancy and is continuing to thrive. Nevada added more than 32,700 jobs over the past year, and its tax incentives continue to drive industrial tenants to the area. The property itself is approximately 78 percent occupied.
“The property’s low occupancy, coupled with strong demand throughout the region will provide immediate stabilized cash flow and the opportunity to increase NOI as we begin to lease vacant space,” says Malliet. “In addition, in-place rents are currently 10-18 percent below market value, delivering a deeper opportunity for increased revenue as leases begin to roll.”
According to Brett Turner, Director of Acquisitions at BKM Capital Partners, “This acquisition further expands our foothold in the Las Vegas market. We plan to utilize our existing presence and local property management infrastructure in order to decrease operating costs and increase overall revenue for the asset. During escrow we were able to leverage our existing Las Vegas platform to increase occupancy by 10%, already exceeding underwriting.”
Built in 2000, Spencer Airport Center’s buildings are highly functional and feature a mix of low finish distribution suites and higher finish R&D units, but lack key cosmetic upgrades.
“We plan to implement a series of capital improvements that will enhance the interior/exterior of the buildings and return suites back to low finish warehouse space, providing a more modernized look and consistent with current demand,” explains Turner. “These property improvements will provide a multi-pronged benefit, ultimately driving rent growth and property value.”
Planned improvements include parking lot and exterior building upgrades, new landscaping to increase street-front presence, and interior improvements in vacant units, among others.
Spencer Airport Center is located minutes from McCarran International Airport and in close proximity to the I-15, I-215 and the Las Vegas Strip. This central location further adds to the appeal of the property making it a desirable location for industrial tenants, adds Turner.
The property is located at 6744, 6754 & 6830 Spencer Street; 1857, 1863 & 2055 E. Helm Avenue; 1856 & 2060 Pama Lane; and 6745 Surrey Street in Las Vegas, Nevada. The seller, Guardian Financial, was represented by CB Richard Ellis.
About BKM Capital Partners
BKM Capital Partners was founded in 2013 by Brian Malliet and Nima Taghavi. Headquartered in Irvine, California, bkm Capital Partners is a fund manager specializing in the acquisition and improvement of value-add multi-tenant light industrial properties in metro areas across the Western U.S. Combining a deep knowledge of this niche industrial product type with in-house capabilities including on-site property management, asset/construction management, and structured financing, the firm continues to build on its proven track record, generating strong results with high levels of transparency and engagement for investors. Additional information is available at www.bkmcapitalpartners.com.