Marcus & Millichap is pleased to present the opportunity to acquire the property located at 3028 Wilson Road, in Harlingen, Texas, anchored by Central Air & Heating Service (CAHS). The subject property consists of three buildings containing a total of approximately 81,660 square feet of industrial space and is situated on 17.51 acres of land. The single-tenant asset features rail access, a total of two docks, 12 grade-level doors, clear heights of 20’ to 24’, and approximately 16,681 square feet of office space. The seller reports recent renovations to the property include the installation of a new metal roof, as well as a new HVAC system consisting of two chilled water units and seven DX cooling units. With ample land, this sale offers an attractive value-add opportunity to further develop the property.
CAHS currently has a triple-net lease in place expiring in 2028, with 2.0 percent annual rent escalations and two three-year renewal options. With minimal landlord responsibilities, the property offers a long-term investment opportunity given the specialty features that increase the probability of lease renewal. Since 1972, CAHS is a leading provider of HVAC, mechanical, and plumbing services throughout Southern Texas. In 2021, CAHS was acquired by Modigent, a comprehensive infrastructure, technology, and energy solutions corporation.
With direct access to Interstate 69 East, the property is primely situated within Greater Harlingen, a relatively small submarket containing 3.5 million square feet of industrial space. At the close of Q3 2023, the vacancy rate stood at 15.1 percent. Although considerably high, when looking at comparable properties under 100,000 square feet, the vacancy rate falls to only 6.4 percent. Rent growth at the end of Q3 for comparable properties sits above the five-year average at 5.2 percent year-over-year. As of a result of no industrial construction in this market, rent growth and vacancies should be unaffected by new supply for the foreseeable future (CoStar).
Located at the southernmost tip of Texas, the Brownsville-Harlingen metro area is home to about 434,000 residents. Its strategic position along the Gulf Coast and the Texas-Mexico border fosters a thriving trade sector. Manufacturing firms, including Keppel AmFELS and ESCO Marine, contribute to the area’s diverse economy. The region also boasts a growing aerospace industry, supported by SpaceX’s Boca Chica launch site. Education and healthcare are strong sectors, with institutions like the University of Texas Rio Grande Valley and major medical centers providing employment opportunities. The Port of Brownsville serves as a vital deep-water seaport and Foreign Trade Zone, employing more than 8,500 individuals. With a mix of cultures, outdoor activities, and affordability, Brownsville-Harlingen offers unique experiences to residents and visitors alike.
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. © 2023 Marcus & Millichap. All rights reserved. (Activity ID: ZAE0490015)
