Asset Management Services

Pacific Starr Group (“Asset Manager”) provided asset management services for the Owner of an industrial park consisting of six industrial buildings in San Diego, California (“Owner”).

Asset Manager saw a major opportunity to add value through envisioning and achieving a higher and better use for this property by providing various services including:

  • Coordinating and overseeing acquisition due diligence and acquisition financing
  • Repositioning the property from industrial to office R & D to attract both higher quality tenants and significantly higher rents
  • Instituting a capital expenditure program to correct deferred maintenance deficiencies and upgrade project attractiveness and competitiveness within the market
  • Establishing and managing a flexible business plan with detailed budgets and reporting to increase bottom operational line cash flow
  • Changed standard lease type from full service gross to triple net, effectively passing on all operating expenses to tenants immediately at inception of each lease and increasing cash flow
  • Selected and closely supervised third party property management and leasing companies as well as the lease and sales effort
  • Subdivided the property then, managed the sale and marketing effort through complete disposition

Since sales to owner/users began to achieve higher prices than sale of a single, leased integrated property, we recognized an opportunity. Upon Owner’s approval, we sub-divided the property by creating a Planned Industrial Development (PID) resulting in six, individual buildings, each on its own fee lot. This enabled Owner to either sell each individually to an owner/user buyer or to lease individually and then sell to smaller, individual buyers at a higher, retail price creating a broader market for exit and a material increase in total value and liquidity.

The result was successful disposition through six individual sales—some to owner/users buyers, others to investor buyers—at significantly higher prices compared to selling to one institutional buyer.