Avistone Acquires Watt 80 Business Park in Sacramento, CA

By David Sheets | Nov 06, 2014 News
Watt 80 Business Park

Avistone is  pleased to announce in October of 2013 the acquisition by Avistone Northern Highland LLC of the 62,000 square foot Watt 80 Business Park located in Sacramento, CA .   This investment offered a healthy average annual cash on cash yield to the investors of 9.26% and an estimated annual return on investment (IRR) of 15% projected over the 5 year investment horizon.  The company was able to negotiate an acquisition price of $5,300,00 ($84.63/sq ft) which represents approximately 70% of current replacement cost.

Dan Culler, a Principal at Avistone stated that “purchasing multi-tenant industrial property at prices below replacement value in growing markets enhances the appreciation potential of the property because as new construction comes on line it will produce upward pressure on rents and valuations.  It also reduces the risk of downside depreciation.”  Occupancy of Watt 80 was 91% at the time of sale in a market that is expected to experience significant growth over the coming years thus offering investors the potential of a bright future.   The investment meets Avistone’s investment criteria of  optimal mix of yield, return and risk.

The Sacramento area for industrial and business park properties is very high on Avistone’s list of interesting markets.  California is now running a budget surplus, which is good news for the City and State.  In addition, the recently enacted Resources Reform and Development Act of 2014 is a major game changer for the Sacramento market. Among other things, it authorizes the U.S. Army Corps of Engineers to proceed with a $600 million to $1 billion project to finish the river levee work on the Natomas basin (Sacramento and American Rivers), with work slated to begin in 2015. Because this levee work has been badly needed to meet the community’s water requirements, Sacramento enacted a building moratorium several years ago that halted numerous residential projects in the region. Now, with passage of the Act, the city is seeking to lift the moratorium, thus allowing major construction projects to start and to resume… all of which bodes very well for the region’s economy; and in particular, firms in the construction and housing trades – building contractors, construction material suppliers,  household goods suppliers and supporting industries will require flex space in business parks. Further, we expect the eastward flow of businesses and residents from the high-priced San Francisco Bay area to continue and pick-up steam with the end of the moratorium.

Avistone is a real estate investment management firm that specializes in the acquisition of  high-yield, multi-tenant industrial business parks located throughout the U.S.  We target stabilized properties that can be acquired below replacement cost in growing markets that also have healthy cash flow, which improves the risk profile of these investments.

Our principals have over 50 years of combined experience acquiring and managing commercial real estate investments on behalf of individual and institutional investors.  Avistone’s expertise  is the acquisition and management of commercial real estate that optimizes  yield, return and risk for our investors.

Investment units in the Watt 80 Business Park, priced at $25,000 each,  are sold out.  Investment units in the Meridian Gateway Business Center, priced at $50,000 each, are sold out.  If you have interest in Avistone’s future investment offerings, please contact us at [email protected]

*Important Disclosures:

This communication is intended solely for accredited investors as such is defined in the Securities Act, and is not intended as an offer to sell, or the solicitation of an offer to buy any securities or ownership interests. The opinions and forecasts expressed herein are solely those of Avistone, LLC, as of February 24, 2023, and subject to change. Actual results, future events, predictions, circumstances and events will vary and be different from those set forth herein, and there are no guarantees that any positive or successful results, express or implied, by investors will be realized. Avistone specifically disclaims any right or obligation to provide investor returns at forecasted levels. Avistone’s track record from 2013 to December 2022; no guarantee of future results. The performance information of Avistone’s prior projects has not been audited by any third-party. The track record metrics reflect the weighted average performance of all our clients, and not every investor experienced exactly these same returns. Any and all evaluations for investment purposes must be considered in conjunction with a final Private Placement Memorandum (the “PPM”); all prospective investors are strongly encouraged to read all “risk factors” in the PPM. Further, some of the initial information provided above contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements involve numerous risks and uncertainties, and investors should not rely on them as predictions of future events. Investments in private securities contain a high degree of risk and often have long hold periods. They are illiquid and may result in the loss of principle. Avistone’s strategy may not occur due to numerous external influences.