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Feb 17, 2016 11:58 EST

Downtown Vegas Redevelopment: Preferred equity investment in the development of a retail center

iCrowdNewswire - Feb 17, 2016

Small metro final

The Sponsor is under contract to acquire two additional properties in the Downtown Las Vegas Arts District for $1,900,000. The property located at 1201 South Main Street is a free standing 10,784 SF retail building and the adjacent property located at 1208 South Casino Center Blvd. is a 7,000 SF parking lot. The Sponsor has secured financing in the amount of $1,275,000 from Pender Capital. The loan is interest only with the principal balance due at the end of twelve (12) months.

Within the first 12 months of ownership, Sponsor intends to lease 1201 South Main Street to 100% occupancy. Sponsor has already received tenant interest in 50% of the space at the property, and has received expressions of interest from tenants including a local multi-location restaurant and bar operator, a salon, a craft brewery, a coffee shop, a dance studio, a cold press juice company, and multiple clothing stores. The property also benefits from attractive floor plans ranging from 720 SF to 4,160 and larger, that can accommodate a wide range of tenant demands.

In October 2013, Main Street Investments acquired 1209 South Main Street which is a single tenant retail building directly next to 1201 South Main Street. The property was successfully renovated and a national tenant, Buffalo Exchange, signed a long-term 10-year NNN lease. The investment generated an estimated increase in property value of more than 200% in less than 15 months.

THE PROPERTY

1201 South Main Street Property Rendering

1201 South Main Street – Preliminary Floor Plan

1209 South Main Street – Buffalo Exchange 

 

AREA/LOCATION

MARKET – DEMOGRAPHICS

The Property benefits from a dense, highly educated and eclectic population base. The 3-mile population density is 88,238, with a median household income of $35,488. A number of new projects have come to fruition through Zappos.com CEO Tony Hsieh’s Downtown Project’s real estate development arm, RCG, including the Inspire Theater, Container Park, Gold Spike, and Carson Hotel (mixed-use development). Currently, all the residential buildings in the area are above 90% occupancy, and more housing projects are planned.

Downtown Las Vegas is the central business district of Las Vegas, Nevada; it features a number of hotels, business highrises, cultural centers, historical buildings, and government institutions, as well as residential and retail developments. It is the original gambling district of Las Vegas, and still incorporates downtown gaming.

In 2012 several new downtown projects were completed. The Smith Center for the Performing Arts, the new Mob Museum and a new City Hall building opened. The DISCOVERY Children’s Museum opened next door to The Smith Center in 2013.

Zappos.com significantly renovated and moved into the old Las Vegas City Hall in late 2013, which now houses its corporate headquarters. Zappos.com CEO Tony Hsieh has taken a personal, as well as a professional, interest in the urban area and is contributing $350 million of his personal wealth toward a multifaceted revitalization effort called the Downtown Project.

Las Vegas Review Journal Articles:

http://www.reviewjournal.com/business/economic-development/governor-praises-state-s-job-growth-business-creation-muddles-along

http://www.reviewjournal.com/life/food-and-dining/restaurants-see-vibrant-scene-growing-downtown-las-vegas

Video of Tony Hsieh talking about the Downtown Las Vegas development projects.

https://www.youtube.com/watch?v=ytpI3SYSr-4

The map below shows the distance between the subject properties and Tony Hsieh’s area of development.

 

WHO WE ARE

The Sponsor, Metroplex Group (“Metroplex” or the “Sponsor”) is an experienced owner-operator based in Downtown Las Vegas since 2005. Metroplex Group is a full service real estate development, brokerage, and property management company that is actively involved in commercial real estate investments.

DEVELOPMENT

By using a comprehensive approach to real estate development, Metroplex Group adds significant value throughout the multiple phases of the development cycle.

Based on our experience in Downtown Las Vegas, we add value in the following phases of the development cycle:

  • Site Selection
  • Purchase and Feasibility
  • Design
  • Entitlements
  • Financing
  • Construction
  • Branding and Marketing
  • Leasing
  • Property Management

Although we consider the above phases independently, the success of every project is a result of bringing these disciplines together and creating a synergistic relationship between all the different stages of development. Metroplex strives to grow and expand its expertise in these disciplines with each project that the company develops.

Currently, Metroplex is exploring projects in markets and neighborhoods that are on the brink or in the early stages of redevelopment, such as the Arts District in Downtown Las Vegas and Downtown Los Angeles. We have been focused on the niche opportunities on Main Street in Downtown Las Vegas Arts District for 3 years and have market leading expertise in that area.

The company also has a full service real estate brokerage and property management division that has been in business since 2007 and that enables us to further manage the value chain and hence reduce development risks while maximizing returns to our investors.

INVESTMENT

Over the past 12 years, Metroplex and its principals have invested in a variety of real estate assets in Nevada, Florida, and Oklahoma. Our main focus is investing in emerging and urban neighborhoods and markets.

The real estate investment philosophy of Metroplex is to purchase assets in emerging markets, and develop as well as financially restructure them. With experienced property management and brokerage division under the same corporate umbrella, the company is able to stay flexible and informed so that strategic decisions can be made quickly and efficiently in anticipation of changes in the marketplace.

OUR EXPERIENCE

Over the course of the last 2 years, the Sponsor has acquired and redeveloped two commercial projects in Downtown Las Vegas on Main Street with 6 commercial units in one and 2 commercial units in the other. The ROI was 111% and more than 200% respectively. Prior to that, in 2011 thru 2013, the Sponsor has acquired, rehabbed and flipped about 20 residential units in Las Vegas with an average ROI of 55% within time periods of a few weeks to a few months on different properties. The principal of the Sponsor and the Sponsor entity will personally and corporately guarantee the preferred equity payments and preferred equity investment.

Since 2007 the Sponsor’s brokerage firm has been involved with more than $100 million worth of real estate and over 300 commercial and residential transactions.

 
Contact Information:

Paul Murad

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