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Current Case Studies

85,000 SF Three Building Industrial Flex Portfolio

networktech crop temp

Acquired September 2015, San Antonio, Texas
$10.5 million or $124 PSF
40% Discount-to-Replacement Cost

Market Opportunity

In-fill industrial flex buildings partially converted to office use, 79% occupied at acquisition. Absence of strong marketing and property management had resulted in tenant dissatisfaction, dated and tired curb appeal, financial underperformance and persistent vacancy.

Strategy & Implementation

Invested $1.4 million to rebrand the property, enhance curb appeal and correct deferred maintenance. Completed conversion from flex industrial to office use, and successfully transformed buildings to best-in-market. Led the market in pushing rental rates. Achieved 97% occupancy in two years.

Results

Sold September 2018 for $15 million or $177 PSF generating a 27% property internal rate of return during the three-year hold period.


217,000 SF Office Building

6116 crop tempAcquired April 2017, North Bethesda, Maryland
$9.5 million or $44 PSF
80% Discount-to-Replacement Cost

Market Opportunity

Foreclosed eight-story, vacant office building acquired through auction. Building systems and structure in need of major repair, dated and tired finishes and significant deferred maintenance. No on-site tenant amenities and poor street visibility. No market presence or curb appeal.

Strategy & Implementation

Invested $12 million to construct best-in-market common areas and amenities, install new signage and branding concept, correct deferred maintenance and effect system and structural repairs. Rebranded and reintroduced the building. Rezoned to increase future density and expand approved uses. Delivered fall 2018. Investing $15 million in leasing transaction costs.

Results

Successfully executed the marketing, rebranding and property awareness campaign, and delivered best-in-class, competitively priced product to coincide with submarket stabilization. Actively marketing to new tenants. www.6116exec.com.


216,000 SF Office Building

argentspring crop tempAcquired December 2017, Silver Spring, Maryland
$38 million or $177 PSF
60% Discount-to-Replacement Cost

Market Opportunity

Sixteen-story office tower, 65% leased at acquisition. Minimal investments by prior owner over two decades resulted in dated and tired common areas, poor curb appeal, negative tenant and broker perceptions and lackluster demand.

Strategy & Implementation

Investing $5 million in common areas, amenity spaces and building systems to enhance tenant and visitor experiences. Investing $6 million in leasing transaction costs. Rebranding with new name, logo and property awareness campaign. Pursuing early renewals to stagger lease expirations. Constructing the submarket’s only full-floor coworking and shared amenity space exclusively for that floor’s tenants.

Results

Repositioning capital investments, rebranding and property awareness campaign are underway. The market is responding positively and leasing velocity and rental rates are exceeding pro forma. 


127,000 SF Two Building Office Portfolio

newpointe crop tempAcquired February 2018, Reston, Virginia
$24 million or $189 PSF
55% Discount-to-Replacement Cost

Market Opportunity

Two office buildings, 78% leased at acquisition. Minimal investments by prior owner had resulted in dated common areas, poor curb appeal and financial underperformance. Outcome of pending small public sector land condemnation unknown. Adjacent to-be-developed private sector mixed-use project expected to be disruptive. Potential opportunity to develop multifamily on the site's surface parking lots.

Strategy & Implementation

Investing $1.8 million to create brand identity by implementing high-impact exterior and interior improvements. Pursuing condemnation award and negotiating with adjacent property owner to facilitate the development of both sites. Evaluating multifamily development potential. Building new and modern spec suites to accelerate leasing velocity. Investing $3 million in leasing transaction costs.

Results

Rebranding capital investments are underway, as is a marketing campaign featuring the coming amenities and new logo and name. Expect positive condemnation award outcome and attractive adjacent property owner development agreement. Leading the competitive set in pushing rental rates in advance of the Reston Metrorail Station opening in 2020.

Goodstone LLC
1050 30th Street, NW
Washington, DC 20007

202 524 6800
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Goodstone LLC is a commercial real estate investment management firm headquartered in Washington, DC. We source, acquire and manage commercial office building investment opportunities on behalf of private clients and financial institutions. We invest alongside our clients, ensuring a commonality of purpose and an alignment of financial interest.

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