A real estate investment firm that specializes in small-suite industrial parks has bought Renaissance Tech Centre in Richardson, its second property of that kind in the city.
Avistone announced that it closed on the 81,805-square-foot park, which it describes as shallow-bay industrial space, the end of the warehouse market made up of smaller suites leased to trades, wholesalers, service firms and small manufacturers. The firm said 20 tenants occupied 92% of the space when the deal closed and has averaged about 91% occupancy over time.
Average asking rent is $11.30 per square foot on a triple-net basis, according to the firm.
The announcement does not give a purchase price or name the seller. Avistone said it paid roughly 35% less than it would cost to build a comparable property today.
What the new owner plans
Avistone said it sees room for rents to rise more than 20% to reach market levels and laid out a two-part plan. The first part is exterior work: fresh paint, new signs and landscaping. The second happens suite by suite.
As leases end, the company plans to turn surplus office space inside older units into warehouse space, which it says is what today's small-business tenants are looking for.
The firm pointed to Central Park Business Center, another Richardson property it owns, where it says the same approach lifted occupancy from 59% to 81%.