lancaster, ca - loopnet...lancaster is a charter city in northern los angeles county, in the...

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TWENTIETH STREETOFFICE BUILDING

Conf ident ia l Of fe r ing Memorandum

44451 20th Street, WestLancaster, CA

SITE

Table of Contents

Exclusive Advisors

44451 20th Street, WestLancaster, CA

I Executive Summary Offering

II Property Information Site Overview

Replacement Cost Analysis

Property Aerials

Floor Plan

Site Plan

III Market Overview High Desert Overview

Lancaster Overview

Demographics

Points of Interest / Medical Office Buildings

Antelope Valley Office Market Overview

IV Comparables Active Sale Comparables

Sold Comparables

Janette WehrmannVice [email protected] BRE Lic #01213603

Walt WehrmannVice [email protected] BRE Lic #01168981

Danny [email protected] BRE Lic #02047757

44451 20TH STREET W 3

44451 20th Street WLancaster, CA

This is a confidential memorandum intended solely for your own limited use in considering whether to pursue negotiations to purchase 44451 20th Street West, Lancaster, California (the “Property”). The Owner has retained NAI Capital (“NAI”) as the exclusive sales broker to sell the Property. No other agent or broker is authorized to offer the Property unless and until that agent or broker has executed a written agreement with NAI and that agreement has been executed by their interested purchaser.

This confidential memorandum contains brief, selected information pertaining to the business and affairs of the Property and has been prepared by NAI. Although this confidential memorandum has been reviewed by representatives of the Owner, it does not purport to be all-inclusive or to contain all of the information which a prospective purchaser may desire. Neither the Owner nor NAI, nor any of their partners, officers, employees or agents have independently verified the information contained herein and they are not responsible for any errors or inaccuracies in the information. No representation or warranty, express or implied, is made as to the accuracy or completeness of this confidential memorandum or any of its contents, or any other written or oral communication transmitted to a prospective purchaser in the course of its evaluation of the proposed sale of the Property. There is no representation as to the environmental condition of the Property.

You agree that the memorandum and its contents are confidential, that you will hold and treat it in confidence and that you will not disclose this memorandum or its contents to any other firm or entity without prior written authorization. Photocopying or other duplication is prohibited. You will use this confidential memorandum only for the purpose of evaluating the possible acquisition of the Property. All prospective purchasers agree that they will conduct their own independent investigation of those matters which they deem appropriate in order to evaluate this offering.

Owner and NAI expressly reserve the right at their sole discretion to reject any or all proposals, offers, or expressions of interest in the Property and to terminate discussions with any party at any time with or without notice.

This confidential memorandum shall not be deemed a representation of the state of affairs of the Property or imply that there has been no change in the business or affairs of the Property since the date of preparation of this memorandum. The Property is submitted for sale subject to the right to make changes in any of the terms without notice.

Janette Wehrmann, Vice President949.468.2339 • [email protected] BRE Lic #01213603

Walt Wehrmann, Vice President949.468.2326 • [email protected] BRE Lic #01168981

Danny Delgado, Associate949.468.2331 • [email protected] BRE Lic #02047757

Exclusively Offered By:

Confidentiality & Restricted Use Agreement

Executive SummaryNAI Capital, as the exclusive advisor

to the Owner, is pleased to present for

review the pricing and market analysis

for 44451 20th Street West, Lancaster,

California.

Investment Summary

Price: $2,300,000.00

Price PSF: $154.66

Building Size: 14,871 SF

Asset Type:Commercial/Office,

Class B

Owner/User: Vacant

THE OFFERING

Built in 2000, this single-story asset was custom-built for the Social Security Administration office, which has outgrown their location. Its new owner/user will appreciate all the benefits utilized by the administration. Some of the features of the property include, but not limited to, the nicely landscaped with a portico entrance, welcoming employees and their visitors with automatic retractable doors leading to the vestibule and large reception area with guest restrooms. The interior makeup includes the build-out of three private offices, large storage room, file cabinet area, server/IT room, electrical room (lots of power!), janitorial closet, kitchen/dining area with enclosed patio and equipped with heavy data wiring.

Home and close to Edwards Air Force Base, the facility is conveniently located off the Antelope Valley Freeway. Lancaster is a charter city in northern Los Angeles County, in the Antelope Valley of the western Mojave Desert in Southern California; the 31st largest city in the state. In 2007 and 2013, the City of Lancaster was honored with the Eddy Award for Most Business-Friendly City in L.A. County from the Los Angeles County Economic Development Corporation (LAEDC) and has a refreshing entrepreneurial spirit and a “can-do” approach through creative problem solving and innovative approaches to addressing unique business needs.

• Stand-alone, Single User

• Well-Constructed & Maintained

• Ample Surface, Lit Parking

• Conveniently Located near Freeway, Retail, Hospitals

& More




Address 44451 20th St. W, Lancaster, 93534

APN# 3122-038-045

County Los Angeles

Market Los Angeles

Submarket Antelope Valley

Property Type Single Story Office

Year Built 2000

Ownership Interest

Fee Simple

Building Size ±14,871 SF

Available SF ±14,871 SF

Land Size 1.78 Acre

Percent Leased Vacant

Zoning Commercial

Parking Stalls 95

Parking Ratio 6.38:1,000

Major TenantPreviously Social Security Administration

Ingress/Egress20th St. W (shared easement)

Site Overview



Replacement Cost Analysis

BUILDING SQ FT. OF 44451 20TH ST. W, LANCASTER 14,871

TOTALPER BUILDING SQUARE FOOT

Shell & Core Cost $2,3793,60 $160

Soft Cost (taxes, insurance, development fee, etc.) $892,260 $60

Tenant Improvements $892,260 $60

Site Work (est. 95 parking stalls @ avg. of $3,000 per stall) $285,969 $19.23

Estimated Land Cost (per building sqft.) $297,420 $20

Total Replacement Cost $4,747,269 $319.23



Aerial Overview

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Retail Aerial

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Valley Central

Lancaster Marketplace

Antelope Valley Plaza

®

CEDAR Performing Arts & Playhouse

TM



1446K VPD

14K VPD

40K VPD

28K VPD

26K VPD

27K VPD

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Traffic Count

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Floor Plan



Site Plan


The High Desert refers to

the elevated portion of

the Mojave Desert that

is spread across four

counties in Southern

California. The Western

Antelope Valley portion of

the High Desert contains

the two largest cities of

Palmdale and Lancaster, and has a total population

of 341,219 residents. This portion is also part of Los

Angeles County, and is seventh largest urban area in the

Greater Los Angeles Metropolitan Area. The Antelope

Valley’s economy is built around the aerospace industry

surrounding Edward’s Air Force Base, which serves both

the Department of Defense and NASA. The Palmdale-

Lancaster urban area also benefits from its location on

the California State Route 14, which gives the region

easy access to Los Angeles County and the Ports of Los

Angeles and Long Beach.

The next largest region is centered on the Victorville-

Hesperia urban area, which is located in the Victor

Valley in the Inland Empire. This urban area is home

to 328,454 residents located across four incorporated

cities, Adelanto, Apple Valley, Hesperia, and Victorville,

and several unincorporated communities. The economy

of the Victorville-Hesperia urban area is similarly built

around the aerospace and transportation industries

surrounding the Southern California Logistics Airport,

which replaced George Air Force Base. The surrounding

industry supports logistics, as well as the manufacture of

several aircraft, including the Predator Drone in Adelanto.

The Victorville-Hesperia urban area also benefits from its

location to Interstate 15 and California State Route 18,

which gives the region broader access to Inland Empire

and the neighboring state of Nevada.

The remaining regions of the High Desert are located

in the eastern portion of Kern County and Inyo County.

The Kern County portion of the High Desert includes the

nearby cities of California City and Mojave City, which

support the immediate needs of the nearby Edwards

Air Force Base. This portion is connected to Bakersfield

and the western portion of Kern County in the Central

Valley by California State Route 58, which crosses the

Tehachapi Mountains. The Inyo County portion of the

High Desert is dominated by Death Valley National Park,

and serves as a border region to neighboring Nevada.


High Desert Overview



LANCASTER is a city in northern Los Angeles County and is a principal city in the Antelope Valley region and South-ern California’s High Desert. Lancaster is located approximately 70 miles north of Downtown Los Angeles, near the Kern County line. It is separated from the Los Angeles Basin by the San Gabriel Mountains to the south, and from Bakersfield and the San Joaquin Valley by the Tehachapi Mountains to the north.

According to the League of California Cities, Lancaster was the 35th largest city in California as of 2017. The current population is estimated to be 168,588 and is projected to increase 4.2% over the next five years to reach 175,657 in 2022. Lancaster’s population is diverse, with 48% identifying as white, 20% identifying as black, 1% as American Indi-an, 5% Asian, 20% as another race and 6% multiracial. Average household income in 2017 is $69,152 and is projected to increase 12.5% in five years to $77,786.

In 2017, Lancaster was ranked by Los Angeles Economic Development Corporation (LAEDC) as one of the most busi-ness-friendly cities in California. The city is home to major contractors such as Boeing, Northrop Grumman, Lockheed Martin, BAE, and government agencies, such as the NASA Dryden Flight Research Center, which are all active in de-sign, testing, and manufacturing of a variety of military and commercial equipment. Notable include the Space Shuttle orbiters, B-1 Lancer bomber, B-2 Spirit bomber, F-117 Nighthawk fighter, F-35 Joint Strike Fighter, and the Lockheed L-1011. The region is also proximate to the Mojave Air & Space Port, which is famous as the base of operations for Virgin Galactic and Scaled Composites.

Victorville Top Employers

Rank Employer Employees

1 Edwards AFB 11,990

2 China Lake NWC 6,520

3 Northrop Grumman 4,020

4 County of Los Angeles 3,912

5 Lockheed Martin 3,000

6 Antelope Valley Hospital 2,600

7Antelope Valley Union High School District

2,500

8 Lancaster School District 2,200

9 Palmdale School District 2,001

10 Antelope Valley Mall 1,975

Source: City of Lancaster CAFR 2016

*ProjectionSource: U.S. Census Bureau, Esri

Lancaster Overview

150,000

156,000

162,000

168,000

174,000

180,000

2010 2017 2022*

POPULATION ESTIMATED AVERAGE HOUSEHOLD INCOME

$50,000

$56,000

$62,000

$68,000

$74,000

$80,000

2010 2017 2022*



Population 1 Mile 3 Mile 5 Mile

2017 Male Population 6,584 43,407 80,137

2017 Female Population 7,012 46,474 80,436

2017 Total Population: Adult 13,596 89,881 160,573

2017 Total Daytime Population 10,791 37,005 51,314

2017 Total Businesses 927 3,914 5,518

Race 1 Mile 3 Mile 5 Mile

2017 White 7,438 45,072 80,144

2017 Black or African American 2,326 18,252 31,232

2017 American Indian or Alaska Native 119 937 1,560

2017 Asian 968 5,179 9,259

2017 Hawaiian or Pacific Islander 28 212 361

2017 Other Race 1,921 15,213 29,356

2017 Two or More Races 797 5,016 8,662

2017 Hispanic 1,274 10,198 18,696

2017 Not Hispanic 9,109 56,969 99,580

Age 1 Mile 3 Mile 5 Mile

Median Age 35.5 33.7 33.3

Age 19 Years or Less 3,599 25,957 46,828

Age 20 to 64 Years 8,098 53,065 95,887

Age 65 Years or Over 1,899 10,859 17,858

2017 Total population: 10 to 14 years 879 6.5% 6,346 7.1% 11,464 7.1%

2017 Total population: 15 to 19 years 1,000 7.4% 6,483 7.2% 12,581 7.8%














2017 Total population: 85 years and over 292 2.1% 1,376 1.5% 2,092 1.3%

Income 1 Mile 3 Mile 5 Mile

2017 Household Income: Average $80,515 $68,087 $71,387

2017 Household Income: Median $60,270 $54,062 $56,992

2017 Per Capita Income $27,693 $22,984 $22,943

Households 1 Mile 3 Mile 5 Mile

2017 Estimated Households 4,633 30,156 49,973

2022 Projected Households 4,948 32,287 53,240

2010 Census Households 4,554 28,937 48,293

2000 Census Households 4,382 25,126 40,633

Demographics



Tarzana Treatment Ctr.

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Hospital

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Kaiser Permanente Med Group

Sierra Medical Group

Complete FamilyCare Medical

Lancaster Urgent Care

Antelope Valley Community Clinic

Points of Interest – MOB



MARKET TRENDS

OFFICE ASKING RENT & VACANCY

3Q17 2Q17 3Q16

Asking Rent (Price/SF) $1.80 $1.85 $1.88

Vacancy Rate (%) 11.8% 11.8% 12.7%

Lease Volume (SF) 12,383 33,304 43,564

Sale Volume (SF) 98,046 166,994 22,363

Under Construction (SF) 0 0 0

Deliveries (SF) 0 0 0

The Antelope Valley office market vacancy rate dropped

90 basis points, going from 12.7% in the third quarter of

2016 to 11.8% in the third quarter of 2017. Comparatively,

the vacancy rate in the Los Angeles office market as

a whole was 11.2%, up 20 basis points over the prior

year. Rents in Antelope Valley have fluctuated over the

year, reflecting the moderate demand of the market. As

of the third quarter of 2017, asking gross rents averaged

$1.80/SF, representing a decline of 2.7% from the prior

quarter and 4.3% from the previous year. The majority of

the office buildings in the market are class B/C buildings

as opposed to Los Angeles’ extensive office market that

includes many newer, class A buildings that demand a

premium, bringing up the average gross rents to $3.02/

SF this quarter.

Employment is the main driver of office demand in Southern

California. As of September 2017, the unemployment

rate in Lancaster was 5.4% while in Palmdale it was

6.5%. Los Angeles County has effectively reached full

employment this quarter, increasing just 1.2% for a net

gain of 50,800 jobs from September 2016 to September

2017. Employment in office occupying sectors grew by

1.4%, representing a net gain of 25,600 new jobs, while

the unemployment rate dropped 20 basis points over the

year from 5.6% to 5.4% over the same period.

Source: NAI Capital Research Department, CoStar

Antelope Valley Office Market Trends 3Q 2017

10.0%

11.0%

12.0%

13.0%

14.0%

15.0%

$1.75

$1.80

$1.85

$1.90

$1.95

$2.00

3Q15 4Q15 1Q16 2Q16 3Q16 4Q16 1Q17 2Q17 3Q17

Vacancy (%) Asking Rent (Price/SF)

LEASE & SALE VOLUME

Source: NAI Capital Research Department, CoStar

0

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Squa

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Lease Volume Sale Volume



1

1805 W Avenue K, Lancaster, CA 93534Sale Price $1,750,000Sale Date 7/25/2017Building SF 10,688 SFPrice PSF $163.74 Lot Size 0.57AcresYear Built 1987Parking Spaces 47Property Type Office

3

1220 W Avenue J, Lancaster, CA 93534Sale Price $2,950,000 Sale Date 2/3/2017Building SF 17,066 SFPrice PSF $172.86 Lot Size 1.15 AcresYear Built 1990Parking Spaces 28Property Type Office

2

44444 16th St W, Lancaster, CA 93534Sale Price $1,752,381Sale Date 3/31/2017Building SF 10,120 SFPrice PSF $173.16 Lot Size 1.13 AcresYear Built 1986Parking Spaces 60Property Type Office

4

44404 16th St W , Lancaster, CA 93534Sale Price $2,847,619 Sale Date 3/31/2017Building SF 16,445 SFPrice PSF $173.16 Lot Size 0.89 AcresYear Built 1986Parking Spaces 60Property Type Office

Subject Property: 44451 20th Street W, Lancaster, CA 93534

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LANCASTER

PALMDALE

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PALMDALE REGIONALAIRPORT

Active Sale Listings



Sold Comparables

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LANCASTER

PALMDALE

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PALMDALE REGIONALAIRPORT

Subject Property: 44451 20th Street W, Lancaster, CA 93534

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936 W Avenue J-4 Lancaster, CA 93534Sale Price $799,900 Sale Date FOR SALEBuilding SF 8,000 SFPrice PSF $99.99 Lot Size 0.46 AcresYear Built 1985Parking Spaces 40Property Type Office

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1220 E Avenue S Palmdale, CA 93550Sale Price $1,649,000 Sale Date FOR SALEBuilding SF 20,000 SFPrice PSF $82.45 Lot Size 1.73 AcresYear Built 1986Parking Spaces 80Property Type Office

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1037 E Palmdale Blvd Palmdale, CA 93550Sale Price $2,995,000 Sale Date FOR SALEBuilding SF 13,752 SFPrice PSF $217.79 Lot Size 0.71 AcresYear Built 1987Parking Spaces 52Property Type Office

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Exclusive Advisors


Janette WehrmannVice [email protected] BRE Lic #01213603

Walt WehrmannVice President949.468.2326 [email protected] BRE Lic #01168981

Danny DelgadoAssociate949.468.2331 [email protected] BRE Lic #02047757

No warranty, express or implied, is made as to the accuracy of the information contained herein. This information is submitted subject to errors, omis-sions, change of price, rental or other conditions, withdrawal without notice, and is subject to any special listing conditions imposed by our principals. Cooperating brokers, buyers, tenants and other parties who receive this document should not rely on it, but should use it as a starting point of analysis, and should independently confirm the accuracy of the information contained herein through a due diligence review of the books, records, files and documents that constitute reliable sources of the information described herein. Logos are for identification purposes only and may be trademarks of their respective companies. NAI Capital, Inc. CA BRE Lic. #01990696.

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