Eastmont Town Center

Oakland, CA

Address:   7200 Bancroft and 6955 Foothill

Year Built:   1965-1972 (Renovated in 1997 & 2009)

Building SF:   541,000 SF

Purchase Price:   $57 million

Closing Date:   March 6, 2015

Projected Hold Period:   4 years

Highlights

Vertical Ventures acquired the enclosed shopping mall originally known as Eastmont Mall in 2015. Located on 33 acres in East Oakland, the 540,000 square foot space was converted to multi-tenant office. At 82% occupancy with strong in-place cash flow, the project was acquired using a CMBS loan.
  • Acquired asset for a 10% cap rate with over 60% of the project occupied by credit tenants.
  • Executed approximately one million dollars of capital improvements including a new energy efficient “cool white” roof. Implemented other “green” energy improvements such as rooftop solar panels to reduce carbon footprint and utility cost
  • Increased NOI by over $1M in first 24 months of ownership due to significant reduction of operating expenses and aggressive lease-up of vacant space. Completed over 100,000 square feet of leases since acquisition
  • Refinanced the property in year 3 and returned over 100% of investor equity. Refinancing was achieved at a value 60% higher than acquisition price due to strong property cash flow and increased in NOI.
  • Produced an annual 15% cash on cash return in year 3 of ownership.

Overview - Projected Project Level Returns

36.2%

Projected IRR

3.2X

Equity Multiple

4 years

Hold Period