13434 & 13436 McGrath Road
- 13434 & 13436 McGrath Road, Houston, TX 77047
- Property Type:
- Multi Tenant
- Cap Rate:
- 7.00% cap
- Square Feet:
- 25,800 sqft
- Lot Size:
- 2.03 Acres
- Price Per Square Foot:
- Year Built:
- Property Sits in Close Proximity to Newly Built-Out Highway 288
- Multi-Tenant Property with Partial Sale-Leaseback and Massive Value-Add Opportunity
- Premium Roofing Actively Employs Around 90 Contract Workers for Work Across Texas, Oklahoma, and Louisiana
- 5.3% Current Market Vacancy Means Tough Barrier-to-Entry Market with Quick On-Market Vacancies
- Below-Market Rates for Both Tenants Meaning Extreme Value-Add Opportunity
- Rental Rates Have Increased Within Submarket Steadily Since 2010 (Costar)
- Property Contains Stabilized Outside Storage
Marcus & Millichap is pleased to present the opportunity to acquire the property located at 13434 and 13436 McGrath Road in Houston, Texas. The subject property consists of approximately 25,800 square feet of space and is situated on 2.03 acres of land. The multi-tenant asset features stabilized outside storage space. With below market rental rates for both tenants, one of which is the owner-user planning a partial sale leaseback, acquisition of this property is a massive value-add opportunity. The owner-user, Premium Roofing, actively employs around 90 contract workers across Texas, Oklahoma, and Louisiana. Entrance to the newly built out State Highway 288 sits just a block away from the property.
The subject property is situated within South Highway 35, a large submarket containing 42.5 million square feet of industrial space. As suburban south Houston continues to grow, so is industrial demand for e-commerce and distribution uses. Despite recent volatility, the vacancy rate remains at a relatively low rate of 5.0 percent as the third quarter concludes. As a tough barrier to entry market with quick on-market vacancies, market rents have steadily increased since 2010. The 32 percent rent growth over the last decade has slightly outperformed the metro average. South Hwy 35 has experienced rapid growth since 2010 with more than 5 million square feet delivered during that time, putting the submarket in the top 10 for deliveries during that stretch of time. With absorption forecast to top 443,000 square feet this year and continue to keep pace into 2022 (CoStar), today’s market conditions present investors a sound opportunity.
As the fifth most populous metro area in the U.S., Houston houses nearly 6.9 million people in southeastern Texas. The market is composed of nine counties: Harris, Galveston, Brazoria, Fort Bend, Chambers, Montgomery, Austin, Liberty and Waller. The Gulf of Mexico, which borders the metro to the southeast, provides access to markets around the world via the Port of Houston, making it a prime location for import/export. Houston’s economy has diversified in recent years, with the healthcare and technology sectors showing strong growth. As Houston’s population continues to grow, primarily to the northwest, many companies are expanding to the region to provide goods and services to the increasing population.