Transforming a Foreclosed Office and Retail Property into a Marketable Investment

Background

When we were engaged to manage a multi-tenant retail property in Tacoma, the investment was facing significant challenges. The property owner, frustrated by the proximity to the site and the escalating issues, was considering selling the asset.

The Challenge

Key problems included a vacancy caused by a former tenant who left a suite in disrepair, a restaurant tenant who had repeatedly failed health inspections, and another tenant who was engaging in illegal activities. Furthermore, the property had suffered from inadequate oversight, resulting in a substantial accounts receivable balance. At the time, only one tenant was consistently paying rent and NNN charges.

Our Work

Our team implemented a strategic turnaround plan. Where feasible, we collaborated with tenants to establish manageable payment plans. We advised the landlord to reconfigure and optimize the vacant space to enhance its marketability. Additionally, we facilitated the eviction of the restaurant tenant who was unable to operate responsibly, restoring professionalism to the tenant mix.

The Results

These efforts improved operational efficiency and resulted in significant cash flow improvements for our client. To further enhance the property’s income potential, we leased an underutilized portion of the parcel to a utility provider for the installation of a cell phone tower. This 50-year lease not only generated additional income but also increased the property’s overall value by approximately $350,000.

Through diligent management and innovative solutions, we transformed a struggling investment into a thriving asset that delivers strong financial performance for our client.