Value-add Case Study (active)

The Boulevard At Surprise Pointe

The Opportunity

• CIRE purchased the newly constructed 141,507 SF multi-tenant REO asset from a Southern California private investment firm that acquired the note in 2011 as part of a bundled secured loan portfolio

• CIRE negotiated an all-cash purchase price representing a 70% discount to the original $57,000,000 construction loan made to the original developer in 2007-2009

• Own and operate a best-in-class retail asset with a diverse and stable tenant base including Ultra Star Cinemas (39% of total SF) and Walgreen’s (10.5% of total SF)

Value-add Strategy

• Transition the property from a mismanaged REO asset to a best-in-class service offering focused on attracting and retaining quality tenants and providing institutional quality services

• Lease up and stabilize the remaining 38% vacancy through an aggressive marketing campaign offering a compelling value proposition—top quality real estate at below market lease rates and above market tenant improvement packages

• Build 2nd story in Building M adding appx 5,350 SF

• Option to develop or sell off the remaining six (6) undeveloped pads consisting of 6.6 acres

Execution/ Results

• Executed 29,625 SF of new leases within 6 months of ownership

• Outperforming proforma lease rates, lease term, TI allowances, and abated rents

• Realized 49% savings in operating expenditures through vendor contract renegotiations and optimization of service contractor schedules

• Added 5,350 SF to the property with the addition of a 2nd floor in Building M