|Address||Signal Hill, California|
|Project Size||109,900 Sq.Ft. Office Building|
|Acquisition Date||November 2000|
|Sale Date||Feburary 2006|
|Investor Cash Multiple||3.45x|
|Investor Level IRR||36.94%|
Town Center Signal Hill
The Signal Hill project is a two-building complex totaling 108,863 square feet that we acquired for $9,305,000, or approximately $85 per square foot. The initial capital invested was $2.8 million. The project was largely overlooked by the investment community as there was an oil well in the parking lot and structural shortfalls from the original construction that required retrofitting.
WCCP was able to evaluate and mitigate the environmental risk with extensive due diligence, allowing us to obtain environmental insurance. Our structural engineer designed a fix for the office buildings to maintain the integrity of the project in the event of an earthquake.
The project was 84% leased at the time of acquisition and additional leases pending elevated the occupancy to almost 95%. The business plan was straightforward: purchase a building with good occupancy and low rents that services the back office needs of tenants with visibility in the class “A” buildings in the area.
We completed the structural retrofit on budget and cash flowed the asset for the next five years. WCCP sold the project for $17 million in February 2006, providing an excellent IRR and cash multiple to our investors over an extended investment period.