OFFERING SUMMARY:

PRICE: $3,100,000
CAP RATE: 6.00%
BUILDING SIZE: 19,540 Sq Ft
NOI: $186,000
YEAR BUILT | RENOVATED: 1996 | 2023
LOT SIZE: +/- 3.94 Acres

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HIGHLIGHTS:

  • Brand New Seven Year Lease with Above Market Annual Rent Increases – After the business acquisition of One Source Equipment Rentals in 2022, the landlord was able to negotiate a new seven year lease with H&E Equipment Services. The lease offers a strong hedge against inflation with scheduled annual rent increases that average 4.34%: 9.67% increase in year three, and 3% annual increases thereafter.
  • Strong Corporate Guarantee from H&E Equipment Services (NASDAQ:HEES) – H&E Equipment Services is one of the largest integrated equipment services companies in the United States with over 120 branch locations nationwide. The company achieved over $1 Billion in total revenue and is ranked in the Top Ten Equipment Rentals Companies in the Unites States. After a record year of growth in 2022 in which they expanded by 18%, H&E Equipment Services plans to accelerate their expansion in 2023 and grow their footprint by another 10 to 15 locations.
  • Low Rent/SF with Ideal Lot Coverage Ratio for Equipment Rentals/Industrial Outdoor Storage – An investment in the subject property offers minimal risk due to the future replaceability of income. The modest rent of $9.52 per square foot is well below the tenant’s national average across their 120 locations and is very replaceable within the submarket. In addition to that, the Subject Property is ideally positioned for Equipment Rentals with a building to land coverage ratio of 11.39%. Industrial Outdoor Storage vacancy dropped below 3% in mid-2022, which is well below the historical average.
  • Greater Lafayette Ranked #1 Emerging Housing Market by Wall Street Journal – The subject property is well located within the Lafayette/ West-Lafayette submarket which was recently ranked No. 1 in the latest Wall Street Journal/Realtor.com Emerging Housing Market Index. Situated 63 miles northwest of Indianapolis and 125 miles southeast of Chicago, Lafayette has become one of the fastest growing areas of Indiana and the Unites States. Purdue University which is one of the main economic drivers of the area recently set an all-time student enrollment record in 2022. The tenant will benefit from a number of economic development initiatives in the surrounding areas including the Sagamore Winds multifamily development directly east of the Subject Property and many other neighborhood and high-rise developments. H&E Equipment Services is strategically positioned in this market to service the needs of all of these construction projects arising from the submarkets explosive growth.

EXCLUSIVELY LISTED BY:

DOMINIC SULO
Senior Managing Director Investments
Senior Director, Net Lease Properties Division
(630) 570-2171
dominic.sulo@marcusmillichap.com

BRETT WINGER
Associate
(630) 570-2159
brett.winger@marcusmillichap.com

INDIANA BOR
Josh Caruana
Lic #RB14034355