SRS Old Norcross DST

555-565, Lawrenceville, GA 30045

Beneficial Interests: $3,600,000

Offering Price: $8,000,000

  • Loan Proceeds: $4,400,000
  • Loan-to-Offering Price Ratio: 55.00%
  • Minimum Investment[1031]: $360,000

Old Norcross consists of two medical office buildings, comprising 36,251 sq. ft., proximate to and servicing the Gwinnett Medical Center Campus. Gwinnett Medical Center is a financially strong hospital that is experiencing tremendous growth and expansion that includes construction of a new $92 million, 155-bed patient tower, and a planned $33 million Open-Heart Surgery Program.

Gwinnett Hospital System

Gwinnett Hospital System is a 500-bed, healthcare network including two hospitals and  consists of more than 4,100 employees and over 800 affiliated physicians serving the North Atlanta Market. The Old Norcross project is located in close proximity to the Gwinnett Medical Center, which is the flagship hospital of the Gwinnett Hospital System

INVESTMENT HIGHLIGHTS

According to National Real Estate Investor, Medical Office buildings can offer the potential for long term cash flow, rent stability, and fewer tenant improvement costs. Medical tenants typically sign long-term leases and have high renewal rates. They often spend more on high end finishes and expensive equipment installation, making it costly to relocate. Medical tenants also tend to congregate and refer patients to other physicians in the building, making it more profitable to stay in one place.

• Near Gwinnett County Medical Center

• Historically well occupied

• Located in one of the fastest growing counties in Georgia and the U.S.

• Contractual rent increases

• Acquired significantly below appraised value.

INVESTMENT OVERVIEW

Year Built: 1994 & 1997 

Minimum Investment: $360,000

Sq. Ft.: 36,251 

Expected Hold Period: 10 Years

Parking Ratio: 4.88/1,000 SF Total 

Expected Investors: 10

Total Offering Amount: $8,000,000 

Loan Terms: Fixed interest rate of 6.0%

Loan Amount $4,400,000 Non-Recourse (except standard carve-outs)

Total Equity $3,600,000 5 year term with 3 years interest only. “No Mac Clause.”

 

Old Norcross 10-Year Building Occupancy History

The Old Norcross project has maintained an average occupancy of 96% over the last ten years.* The occupancy dipped to 90% in 2008, but due to the proposed expansion of Gwinnett Hospital and the return of a tenant who left for one year and has now signed a ten year lease, the buildings are projected to be 100% occupied for 2009.

*Source: Occupancy history based on utilities records provided by the City of Lawrenceville

PROPERTY OVERVIEW

Gwinnett Hospital System

Gwinnett Hospital System is a 500-bed, healthcare network including two hospitals and other supporting outpatient facilities. The hospital system consists of more than 4,100 employees and over 800 affiliated physicians serving the North Atlanta Market. The Old Norcross project is located in close proximity to the Gwinnett Medical Center, which is the flagship hospital of the Gwinnett Hospital System. In 2006 & 2008, Gwinnett Medical Center received the Health Grades Distinguished Hospital Award for Clinical Excellence, ranking in the top five percent of the nation for clinical quality. More information on the Gwinnett Hospital System can be obtained at http://www.gwinnettmedicalcenter.org.

 The Gwinnett Medical Center is experiencing tremendous growth and expansion as part of the Project PA TH program launched by the hospital system in 2007. The planned expansion of the Gwinnett Medical Center Campus includes construction of a $92 million, 155-bed patient tower scheduled for completion in 2009, and a planned $33 million Open-Heart Surgery Program recently approved by state regulators.

ABOUT SRS Investments LLC

SRS Investments, LLC (“SRS”) is a private equity real estate investment firm that specializes in the creation of client wealth through innovative real estate investments. We are focused on the acquisition, improvement and ownership of properties on a nationwide basis. Through proprietary deal channels, diligent and conservative underwriting, and hands-on property management, SRS is able to consistently deliver attractive risk-adjusted returns for its investors. We co-invest with institutions, family offices and high net worth investors.