NNN Engineering Drive, LLC

Available for §1031 exchange w llc investment

Offering Purchase Price: $22,898,000

Offering Price Per SF: $231.04

  • Purchase Date: 2nd Quarter, 2007
  • Offering LTV: 58.73%
  • Offering Price Cap Rate: 5.93%
  • 1st Year Cash Flow: 6.20%

Engineering Drive is a four-story office building totaling approximately 99,000 square feet in the Atlanta suburb of Norcross, Georgia. Located in the Technology Business Park of Peachtree Corners, the Property offers convenient access to Atlanta’s major northeast thoroughfares, including I-285, I- 85, GA-400 and Peachtree Industrial Boulevard.

Available for §1031 exchange w llc investment

Engineering Drive is 100 percent leased with an existing rent roll that is fully stabilized with staggered lease expirations. The Property is leased to numerous global, national and local companies, a number of which specialize in financial services, information technology, general contracting, legal and insurance industries. The major tenants are Fair Isaac Corporation and Novasoft Information Technology Corporation.

Property Summary

Engineering Drive is a four-story office building totaling approximately 99,000 square feet in the Atlanta suburb of Norcross, Georgia. Located in the Technology Business Park of Peachtree Corners, the Property offers convenient access to Atlanta’s major northeast thoroughfares, including I-285, I- 85, GA-400 and Peachtree Industrial Boulevard. Engineering Drive is 100 percent leased with an existing rent roll that is fully stabilized with staggered lease expirations. The Property is leased to numerous global, national and local companies, a number of which specialize in financial services, information technology, general contracting, legal and insurance industries. The major tenants are Fair Isaac Corporation and Novasoft Information Technology Corporation.

TIC Offering

  • Offering Size: $9,450,000
  • Price Per 1% Ownership: $94,500 equity: $134,480  and assumed debt
  • Minimum Investment per SPE: 3.00% =$283,500 equity and $403,440 assumed debt for a total purchase price of $686,940
  • Suitability: Accredited Investors Only

LLC Offering

  • Offering Size: $472,500
  • Price Per Unit: $5,000
  • Minimum Investment: $25,000
  • Suitability: Accredited investors only

Business Plan

  • Preserve the capital investment.
  • Realize income through the acquisition, operation and sale of the
    property.
  • Make monthly distributions, which may be partially tax-deferred as a result of depreciation and amortization expenses.
  • Within approximately five years, profitably sell the property based on the value added through effective management and operation of the property.
  • There is no guarantee that the business plan will be successfully executed, that the property’s value will be enhanced, or that the property will be sold within the planned time period.
  • The Property is largely dependent on two tenants, which collectively lease 73% of the Property.
  • At lease one tenant, Novasoft, relies in part on the residential mortgage industry for their business operations, which has been affected by a soft
    residential housing market.
  • A high vacancy rate of approximately 19.8% in the Peachtree Corners office submarket of Atlanta, Georgia could cause aggressive competition
    for new and renewal tenants at the Property.
  • Unless extended by the tenants, the leases representing approximately 27% of the Property will expire within the next five calendar years. In addition, the leases representing approximately 73% of the Property contain early termination options.

Major Tenants (8 Total Tenants)

Fair Isaac Corporation
Square Feet: 46,873 Lease Expiration: 2/2018

Fair Isaac is a leading provider of decision management solutions powered by advanced analytics. Fair Isaac solutions make missioncritical business decisions that are precise, consistent and agile.

Thousands of companies in more than 80 companies use Fair Isaac technology to acquire customers more efficiently, increase customer value and retention, reduce fraud and credit losses, lower operating costs and enter new markets more profitably. Fair Isaac was ranked as the 2006 worldwide revenue leader in the Business Rules Management Systems software market by International Data Corporation. Today, Fair Isaac’s solutions, software and consulting services power more than 180 billion smarter business decisions each year for companies worldwide. Fair Isaac clients include: nine of the top ten companies in the Fortune 500, 99 of the top 100 United States banks and half of the top 50 banks in the world, nine of the top ten United Kingdom banks, and more than 400 personal and commercial lines insurers in North America and Europe.

Option to terminate on January 14, 2014 by providing written notice and payment of a termination penalty of $918,918.

Novasoft Information Technology Corporation

Square Feet: 25,544 or  the property
Lease Expiration: 2/2018

Novasoft Information Technology Corporation (“Novasoft”) provides full service consulting and outsourcing services to the financial and mortgage lending industries. Products offered by Novasoft include software for mortgage lenders and back office operations services for mortgage lenders and brokers.

Novasoft was founded in 1993 and is headquartered in Conshohocken, Pennsylvania. Novasoft has offices in Bethlehem, Pennsylvania, Des Moines, Iowa, Pleasanton, California and at the Property. Novasoft owns a controlling interest in MortgageHub, a pioneer of web service platforms in the mortgage lending industry. early 2007, through an affiliate, Novasoft acquired additional key assets and products of MortgageHub from Fair Isaac Corporation.

Option to terminate on January 14, 2014 by providing written notice and payment of a termination penalty of $514,404.

Location Information

Founded in 1837, Atlanta is the capitol and most populous city in the state of Georgia. In the last decade, Atlanta has experienced unprecedented growth – the official city population remains steady at about 420,000, but the metropolitan population has skyrocketed nearly 40 percent to
5,138,223. With the addition of 890,000 residents since April 1, 2000, the Greater Atlanta area boasts the largest numerical gain of any metropolitan area in the United States during that time. A good measure of growth is the ever-changing downtown skyline, along with skyscrapers constructed in the Midtown, Buckhead, and outer perimeter (fringing I- 285) business districts. Atlanta ranks third in the number of Fortune 500 companies headquartered in its metropolitan area, behind only New York and Houston.

Office Market

  • Rental rates grew by $0.27 metro wide to finish the first quarter at $20.39 per rentable square foot, their highest levels since the third quarter of 2003.
  • Atlanta posted more than a quarter of a million square feet of net occupancy gains in the first quarter with 284,317 square feet of absorption sustaining a string of 14 quarters of occupancy growth.
  • Torto Wheaton forecasts 5% rent growth annually for the next 5 years in the Atlanta Metropolitan office market.
Economic Trends
  • The Georgia State University Economic Forecasting Center projects 65,000 new jobs for Georgia in 2007, 97,600 in 2008 and 94,500 in 2009.
  • The Bureau of Labor Statistics reports an unemployment rate of 3.9% for the Atlanta MSA as of March 2007, a decrease from 4.5% a year earlier.

ABOUT Triple Net Properties, LLC

Triple Net Properties, LLC has time-tested experience in real estate syndications, acquisitions, development, construction, leasing and property management. Triple Net currently manages a growing portfolio of over 35 million square feet of property in 28 states valued at more than $4.7 billion. Although past performance is no guarantee of future results, Triple Net Properties, LLC has an unparalleled track record and has acquired 256 properties to date. Triple Net and affiliates have sold 93 properties for over $2.1 billion since 2000.

Triple Net Properties, LLC is a wholly-owned subsidiary of NNN Realty Advisors, Inc., a nationwide commercial real estate asset management and services firm.