Marcus & Millichap is pleased to present the opportunity to acquire the property located at 909 Hawkins Boulevard in El Paso, Texas, leased to Baker Distributing Company. The subject property consists of approximately 31,800 square feet of warehouse space and is situated on 1.74 acres of land. The two-building asset features a clear height of 12’, two grade-level doors, two dock-high doors set in a truck well, 29 parking spaces, four evaporative HVAC units, and three refrigerated HVAC units. Attached to the property is a 2,660-square-foot canopy with a clear height of 14’. Recent tenant improvements to the property include a new coat of paint to the front building and resurfacing the front parking lot. Situated in a dense industrial district three blocks south of Interstate 10, the property has access to a Union Pacific rail spur.
This sale offers investors a long-term value-add opportunity secured by a tenant in place since 2000 and currently serving a triple-net lease that runs through July 2028. At $3.77 per square foot, the rent is less than half the average asking rent in the submarket. As a result, buyers can acquire the property well below replacement costs at $63 per square foot. In business since 1945, Baker Distributing Company is a leading national provider of high-quality HVAC, foodservice and commercial refrigerant equipment, parts, and supplies. As a subsidiary of Watsco (the largest distributor of air conditioning, heating, and refrigeration equipment, parts, and supplies), Baker Distributing Company maintains more than 200 sales centers across 26 states (Baker).
The subject property sits in East El Paso, a large submarket containing 48.2 million square feet of industrial space. At the midway point of 2024, the vacancy rate topped a 10-year high of 10.9 percent as Q2 net absorption (-325,000 square feet) fell behind net deliveries (841,000 square feet). However, among comparable properties up to 50,000 square feet, vacancies rose 50 basis points on the quarter but remained historically tight at 2.3 percent. Year-over-year rent growth continued to slow down to 2.6 percent in Q2, averaging about $8.36 per square foot on asking rents across East El Paso. With 1.75 million square feet of industrial space underway at the start of Q3, the submarket’s inventory was set to expand by 3.6 percent (CoStar).
The El Paso metro is located at the westernmost corner of Texas, bordering New Mexico and the state of Chihuahua in Mexico. It is composed of El Paso and Hudspeth counties. Access to Mexico plays a major role in the local economy. The city of El Paso, when combined with Las Cruces, New Mexico, and Ciudad Juarez in Mexico, is sometimes referred to as the international metropolitan area of Paso del Norte and has one of the largest bilingual and binational labor pools in the western United States.
As the largest metro along the Texas-Mexico border and the sixth-largest city in Texas, El Paso is a top 20 percent U.S. performing economy and represents one of the largest manufacturing centers in North America. Recognized as globally competitive, the region boasts the largest bilingual and bi-cultural workforce in the Western Hemisphere (elpasotexas.gov). El Paso was a finalist for the 2018 National League of Cities “All-America City,” 2018 Best of Texas Awards, and WalletHub’s #1 Best Run City in Texas in 2017. In 2018 alone, El Paso County added 4,200 jobs. Major employers include Pacific Union Financial, UPS, Veritas Management Group, and iFly.
This information has been secured from sources we believe to be reliable, but we make no representations or warranties, express or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2024 Marcus & Millichap. All rights reserved. (Activity ID: ZAF0490085)
