Recentric Realty Capital acquires, adds value, and repositions under-valued, under-managed, under-performing, and improperly capitalized, yet income-generating, medical office buildings and net lease medical retail in Denver, Tucson, Phoenix and Las Vegas. Recentric’s sole focus is creating a diversified portfolio, generating income and equity growth. The exit strategy is to position our assets to maximize cash flow and appreciation and dispose of the properties in 5-10 years when the health care real estate markets are maximized and market conditions are favorable.
Recentric utilizes its unique and proactive approach to sourcing off-market acquisition opportunities in these regions.
The Recentric team handles all aspects of the investment including sourcing the properties to acquisition, completing the due diligence and handling the closing. They are also responsible for enacting a turnaround plan, managing and leasing the properties, handling all financial responsibilities and developing appropriate exit strategies. The managers will be investing in Member Capital. Investors can expect to receive quarterly updates and quarterly distributions, with the first distribution expected in 6-9 months from the date of each property closing.
Investment highlights include*:
- Strong Sponsor with Significant Market Presence: Recentric has a strong team with an extensive 14-year track record of managing, brokering, and developing/entitling commercial real estate.
- High Demand for Medical Office Space:
- Denver is a high growth city right now, for both baby boomers and young families with children. Colliers reports forecasted population growth of 24.4 percent for people 65 and older for Denver by 2019, and the city also boasts one of the highest absorption rates in the country for healthcare properties. At mid-year 2014, the average vacancy rate in Denver was 7.8 percent, according to Marcus & Millichap, while quoted rents averaged $23.99 per sq. ft., according to Colliers. Cap rates on investment sales transactions involving healthcare assets averaged 8.4 percent, with the average price of $105 per sq. ft.
- Tucson has an average vacancy of city healthcare properties rate of 19.9% as of mid-year 2015. This market is a baby boomer attraction, because it is warm and affordable. Tucson offers higher returns due to higher risk, but also long term potential with population growth.
- Phoenix is similar to Tucson with strong potential. Marcus and Millichap estimated is average vacancy rate at 21.6%. At the same time, Phoenix ranked 9th on Colliers list of US cities with the largest forecasted increase in population 65 years of age and older between now and 2019. Average quoted rents in the city in 2014 were a decent $22.62 per sq. ft. Meanwhile, investors were paying average cap rates of 7.7 percent and average prices of $122 per sq. ft. for Phoenix assets, compared to the average of 7.23 percent and $216 per sq. ft. for the nation.
- Las Vegas is a market that tends to be among the favorite destinations for retirees. Given the abundance of desert land available for future construction projects, Las Vegas allows for significant residential/multi-family development. At mid-year 2014, quoted rents at healthcare properties in Las Vegas averaged $25.80 per sq. ft., above the national average, according to Colliers International. Prices on property acquisitions averaged $263 per sq. ft., compared to the national average of $216 per sq. ft. for the fourth quarter of 2014 reported by Real Capital Analytics (RCA), a New York City-based research firm.
- Stable and Predictable Income Stream: Recentric primarily focuses on NNN and NN investments of medical office buildings and net leased medical retail with credit quality corporate and well qualified practices with ample time remaining on leases.
This is not a solicitation to invest. If you have further interest, please contact us.