OVERVIEW
The Presidio is a four-story, 81,000 s.f. office building located in Colorado Springs. The property is immediately adjacent to Interstate 25 and has tremendous views of Pikes Peak. The building’s unique shape and location contribute to its iconic reputation in the market.
OPPORTUNITY
Presidio Property Trust acquired The Presidio in 2012 from a ministry which was in the process of liquidating its office properties. Due to excessive defeasance costs, the property was sold subject to the existing loan.
CHALLENGE AND OUTCOME
Presidio Property Trust acquired the property for $7.3 million and assumed the $5.6 loan. This represented a 9.4% capitalization rate on the in-place 79% leased NOI. We were able to take advantage of the seller’s unique circumstance to purchase the property at an excellent in-place return, with additional value achievable through increasing occupancy and raising rents to market. To facilitate this business plan, Presidio Property Trust undertook a complete common area renovation.
In 2014, Presidio Property Trust refinanced the property with a new $7.4 million loan, which effectively returned the company’s initial equity.
The property was sold to an investor in 2019 for approximately $12.3 million.