Santa Monica, CA Stabilized Office Acquisition

12.0%
gross ann. return*
43 mo.
term remaining
C
Cash Flowing to Investors
Current Ann. Return 6.0%
Accrued Ann. Return 6.0%
Gross Ann. Return* 12.0%

Investment Details

Current Ann. Return 6.0%
Accrued Ann. Return + 6.0%
Gross Ann. Return* 12.0%
Term Remaining 43 of 60 mo.
Min. Investment $5,000
Investment Size $4,000,000
Underlying Security Preferred Equity

Investment Summary

This is an opportunity to invest in a series of Notes tied to a preferred equity investment in the acquisition of a stabilized, 100% leased 23,557 SF Class A Office building located in the heart of Santa Monica, CA. Reflective of the asset's best-in-class positioning, existing leases are all triple net ("NNN"), with tenants paying all expenses, real estate taxes and insurance, and feature an average annual rent increase of 3%. The sponsor, JOSS Realty Partners, is targeting further rent increases at rollover in 2017 and 2020 before taking out the Fundrise investment via sale by April 2020.

Drone Flyover

Key Deal Points

Location

Santa Monica, CA is one of the premiere office markets on the West Coast. 1315 Lincoln is located in the heart of Silicon Beach - Southern California's technology center and home to over 600 tech, media, entertainment, and creative companies. The region is considered to be one of the most dynamic and fastest growing technology markets in the United States. This coastal micro-market has consistently outperformed neighboring markets and has historically achieved the highest rents and lowest vacancies in the region. 

100% Leased Asset

The property was recently 100% leased with all NNN leases (tenants pay all expenses, real estate taxes and insurance). The most recently signed tenant, City National Bank, is expected to move in by July 2015, which will bring occupancy to 100%.  Per the Purchase and Sale Agreement, the Seller has agreed to pay (i) all remaining leasing costs (tenant improvements, leasing commissions, rent and common area maintenance abatements) for City National Bank, and (ii) the remaining rent abatement for Dethrone Basecamp, which occupied the property in January 2015. Lease expirations are staggered during the term of the investment, with 27.6% of the space expiring in 2017, and 22.8% expiring in 2020.

High Barriers to Entry

Given the significantly high barriers to entry in Santa Monica—a result of limited land available for development, challenging regulatory approvals, strict government restrictions, and high costs associated with new construction, there are virtually no new office projects in the pipeline within Downtown Santa Monica.

Experienced Office Sponsor

Since their founding in 2005, JOSS Realty Partners have acquired 17 office assets consisting of over 2M SF in New York, Washington, DC, and Philadelphia, with a portfolio value of over $750M.

High Quality Class A Asset with Above-Average Parking Ratio

Built in 2005, 1315 Lincoln was designed and constructed to the highest institutional quality standards and is highlighted by a unique curvilinear facade with attractive window lines that allows for an abundance of natural light and spectacular views. Interior features include 20-foot high ceilings on both floors, above-average power capable of meeting the demands of the most technology driven user, high-efficiency air conditioning units, and modern creative office space with in-suite restrooms and private kitchens. Moreover, the property includes 136 parkings spaces, which equates to 5.77 spaces per 1,000 rentable SF - a rare amenity given Santa Monica's infill location.

Projected Return Calculator

Principal
$5,000
Gross Annual Return* 12.0%
Term 60 mo.
Total Return*

Fundrise Rating

The Fundrise Rating is a letter rating ranging from A to E that provides investors with the ability to easily compare investments across the Fundrise platform. The Fundrise rating measures the relative risk-adjusted return of an investment. Learn more
C1
A
1
2
3
B
1
2
3
C
1
2
3
D
1
2
3
E
1
2
3
Category Assessment Points
Capital Senior to Fundrise 70-79% 4
Capital Junior to Fundrise 10-19% 4
Location Primary 1
Occupancy Occupied 1
Development Phase Stabilized 1
Sponsor’s Track Record $250 million or more 1
Overall 12 C1

The information contained in the Fundrise Rating is for informational purposes only. It is impersonal and not individualized for any specific investor's financial situation and is not investment advice. These ratings are not intended to be, nor should you interpret them to be, a prediction of how a particular investment will actually perform. You should always carefully consider investments in any security and be comfortable with your understanding of the investment. You may also consider consulting investment professionals.

Risk-Adjusted Return

Capital Structure

Type Source % of Total Amount
Equity Sponsor and LPs 12.9% $3,050,000
Preferred Equity Fundrise Investment 16.9% $4,000,000
Senior Debt 70.2% $16,600,000
Total 100.0% $23,650,000

Property Summary

1315 Lincoln was constructed in 2005 and consists of one office building with two sub-grade levels of parking. The building comprises of 23,531 square feet of rentable building area and 17,202 square feet of garage space. 1315 Lincoln was designed and constructed to the highest institutional quality standards and is highlighted by a unique curvilinear façade with attractive window lines that allows for an abundance of natural light and spectacular views. Interior features include 20-foot high ceilings on both floors, above-average power capable of meeting the demands of the most technology driven user, high-efficiency air conditioning units, and modern creative office space with in-suite restrooms and private kitchens. Moreover, the Property includes 136 parking spaces, which equates to 5.77 spaces per 1,000 rentable square- feet—a rare amenity given Santa Monica’s infill location.

Address 1315 Lincoln Blvd
City & State Santa Monica, CA
Neighborhood Silicon Beach
Product Type Office / Class A Office
Project Phase Stabilized / Acquisition

Market Summary

Located on the southern coast of California, Los Angeles County covers 4,061 square miles and includes San Clemente and Santa Catalina islands. Los Angeles County is the most heavily populated county in the country with approximately 10.8 million residents within the city limits and the unincorporated areas of the county. Los Angeles County is home to one of the most educated labor pools in the country and offers a labor force of more than 4.7 million, of which more than 1.5 million are college graduates.

About the Sponsor

Larry Botel

Managing Partner - Head of Firm

Ameet Amin

Principal - Investments

Michele Balfour

Principal - Investor Relations

Shannon Brusca

Controller

Since 2005 JOSS Realty Partners has successfully utilized its real estate operating and investment management expertise to maximize returns for investors. We have made over $750 million of commercial office acquisitions since our founding. In ten representative JOSS investments, we have invested $247.9MN and returned $365.9MN, generating a multiple of 1.48X for our investors.

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Fee Schedule

Gross ann. return* 12.0%
Servicing and administration fee -0.3%
Net ann. return to investors 11.7%

Other Past Investments

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B
Gross Ann. Return* 14.0%
Term Remaining 0 mo.
Underlying Security Senior Debt

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B
Gross Ann. Return* 11.0%
Term Remaining 0 mo.
Underlying Security Senior Debt