This investment is a 39.26 acre heavy industrial zoned parcel that is in an excellent location for an industrial outdoor storage site which are in extremely high demand due to limited supply of properly zoned sites in the Phoenix Metro that have outdoor storage space. We are purchasing this property at an incredible basis of $4.46/SF. The property has in place cash flow that is significantly below market rent and is currently not efficiently utilizing the gross leasable area. The combination of the incredible purchase basis, the supply/demand imbalance for industrial outdoor storage sites, below market rents, and inefficient use of the gross leasable area make this property a tremendous investment opportunity for us and our partners.
Glendale Industrial Outdoor Storage Opportunity
11748 W. Glendale Ave. Glendale, AZ
The two transcontinental railroads and the 10 interstate railroads conveniently connecting Phoenix to the rest of the southwest -along with Phoenix’s proximity to the ports in Los Angeles, Long Beach, and Mexico continue to position Phoenix as an attractive, low-cost option for warehouse and distribution users. Large manufacturers, like TSMC, have further sparked tenant demand as more of their suppliers and vendors are choosing to relocate to Phoenix. Direct average asking rents grew by 9.4% quarter-over-quarter.
Vacancy continues to drop, despite a record-shattering year of new supply being introduced to the Phoenix industrial market. More than 64% of the speculative product that was delivered in the first half of the year was leased up prior to delivery, and an additional 19 million s.f. of the remaining development pipeline has already been preleased. In the long run, a slowdown in deliveries is probable as a shortage of material may hamper development timelines and dissuade construction starts. Leasing activity remains strong as nearly three million s.f. of space was leased in Q3 2022.
Glendale Industrial Outdoor Storage Opportunity
11748 W Glendale Ave. Glendale, AZ
We conservatively underwrite all of our projects in an attempt to under promise and overdeliver. We also compare our conservative underwriting to three different scenarios. The first scenario, the 20-Year Avg. Growth model, incorporates the average annual rent growth and cap rate compression that has occurred over the last 20 years in Metro Phoenix for each year of the investment period.
Glendale Industrial Outdoor Storage Opportunity
11748 W. Glendale Ave. Glendale, AZ
Hanson Capital Group is a team of commercial real estate experts with a combined 50+ years of experience in the industry, offering a unique approach to investing in commercial real estate. We manage over $75mm in equity and oversee over $250mm in assets. We specialize in value-add industrial and multifamily product types as well as horizontal multifamily development, opportunistically shifting our focus from one specialty to another to capitalize on market inefficiencies as they present themselves. This diversified approach to investing provides the flexibility necessary to navigate complex and evolving market conditions and cycles, and affords us with the ability to stay several steps ahead of trends and potential headwinds.
We are on the path to building a portfolio of industrial investment product that will be securitized or sold to either an institution or REIT in $50-$100mm tranches. We have developed a proprietary system for sourcing and securing off-market industrial investment product (including establishing programmatic broker agreements to ensure that we are the broker’s first call on deals that meet our investment criteria) which provides unprecedented access to deal flow. Our primary focus is on the Phoenix and Dallas-Fort Worth metropolitan statistical areas which have become the shining stars in industrial real estate.
In 2021, we launched Hanson Capital Industrial Fund I, which is a $100M private equity fund dedicated exclusively to acquiring industrial investment product. Our affiliate, HC Industrial Fund I GP, LLC acts as the general partner and has full discretionary authority to deploy the capital raised into the fund as opportunities present themselves, which allows the fund to act quickly and provide assurance of closing, which further enhances our ability to secure the very best opportunities.
In addition, as an affiliate of Hanson Capital, LLC, a state licensed bank that originates hard money and bridge loans and which manages in excess of $40mm, we are uniquely prepared to work with our lending partners to secure the very best terms and to make their review and underwriting process as easy as possible.
Lastly, our organization’s core principals are to always remain relationship minded and not transactional, and always do what we say we will do. With this focus, we look to develop strategic alliances that produce mutually beneficial results for all involved for years to come.
29th Drive Multi-Tenant Industrial
2901 N 29th Dr. Phoenix, AZ
Originally from Lake Oswego, Oregon, Chris settled in Scottsdale, Arizona after graduating from the University of Arizona in 2005. Chris originally spent 3 years in the mortgage business before recognizing an opportunity in real estate during the Great Recession. Chris entered the real estate market as an individual investor before forming Hanson Capital Group, LLC as an auction bidding service provider for many of the industry’s most recognizable institutions. Hanson Capital Group was credited with having acquired over 1,500 single family homes out of foreclosure on his own behalf and assisting these institutions in under 6 years.
While Chris was acquiring single family homes on behalf of institutions, he discovered that he could dramatically increase bidding business through the facilitation of acquisition funding, and in 2010 Chris established Hanson Capital, LLC as a state licensed mortgage bank. Hanson Capital continues to operate today as a hard money and bridge debt provider and is licensed in multiple states across the country. Hanson Capital is responsible for well over $500mm in transactions since its inception and maintains an average portfolio of $40mm in equity.
Although Chris, through his affiliated entities, continues to opportunistically acquire portfolios of single-family homes on behalf of institutions, Chris’ primary focus has been on value-add multifamily, value-add industrial investment product, and horizontal multifamily since 2016. Chris’ affiliated entities manage over $75mm in equity and oversee a portfolio of over $250mm in assets.
In 2021, Chris received the Phoenix Business Journal’s 40 under 40 award. The annual award program recognizes leaders in the region who are making major strides in their careers while leaving positive impacts on communities in the region. In addition, Chris and his affiliated companies have been recognized and featured by Business Insider, Fox News, People and CNBC to name a few.