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Lexington, MS

Emerald Transformer

Address:
896 Bowling Green Road, Lexington, MS 39095
Property Type:
Single Tenant
Price:
$3,195,000
Cap Rate:
11.04% cap
NOI:
$352,827
Square Feet:
115,681 sqft
Lot Size:
20.76 Acres
Price Per Square Foot:
$27.62
Year Built:
1997
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* By downloading the Marketing Package (Offering Memorandum) you hereby agree to the CONFIDENTIALITY AND BUYER REGISTRATION AGREEMENT.

Investment Highlights

Investment Highlights

Investment Highlights

  • 115,681-Square-Foot Industrial Asset Situated on 20.76 Acres
  • Features 28’-37’ Clear Heights, Five One-Ton Cranes, 19 Grade-Level Doors, and Two Dock-High Doors
  • New Roof Membrane Overlay with 15-Year Transferable Warranty and Concrete Repairs Underway
  • Value-Add Opportunity for Investor Backfill Space at Lease Expiration for Above Market Return
  • Opportunity for Acquisition Well Below Replacement Cost ($27.62/Sq.Ft)
  • Excess Land for Additional Outside Storage Space for Tenant or User

Investment Overview

Marcus & Millichap is pleased to present the opportunity to acquire the property located at 896 Bowling Green Road in Lexington, Mississippi leased to Transformer Gaskets & Components LLC (TGC). The subject property consists of approximately 115,681 square feet of warehouse space and is situated on 20.76 acres of land. The single-tenant asset features clear heights ranging from 28’ to 37’, five one-ton cranes, 19 grade-level doors, and two dock-high doors. With a coverage ratio of just 12.8 percent, the property has ample excess land which can be used for outside storage for tenant or owner use. During September 2023, the property was under renovation with the installation of a new roof membrane overlay including a 15-year warranty, and $50,000 in concrete repairs.

The triple-net lease in place runs through May 2027 and can be renewed twice for five years each time. At about $3.00 per square foot, the rent is nearly 57 percent under the average market rate, providing investors a significant value-add opportunity. In business since 2001, TGC has quickly grown into the largest independent transformer parts distributor in the United States. TGC sells parts and components to over 200 customers that repair or remanufacture electrical equipment. By forming cooperative buying agreements with manufacturers, TGC transformed the industry by reducing shipment times to just 24 hours (TGCparts.com).

Located about an hour’s drive north of Jackson, Mississippi, the property has proximate access to State Highway 12 in the Vicksburg/Central Area submarket. In addition, the property is only seven miles from Interstate 55, the main corridor connecting Chicago, St. Louis, Memphis, Jackson and New Orleans. This geographically large submarket contains 24.9 million square feet of industrial space. After reaching an all-time high of 15.4 percent in early 2021, the vacancy rate has significantly declined, settling at 5.4 percent by the midway point of 2023. Market rents rose quickly during this time and were up about 12.0 percent annually at the end of Q2, pushing the average rent to around $7.10 per square foot. Going into the back half of 2023, there were no industrial properties under construction in the Vicksburg/Central Area submarket. This will allow vacancies and rents to go unimpeded by new supply for the foreseeable future (CoStar).

Jackson, Mississippi, is the state capital and largest urban center, strategically situated equidistant between New Orleans and Memphis. The metro area encompasses six counties, with Hinds County being the most populous at about 232,000 residents. Jackson’s economy benefits from a strong public sector, providing nearly 40,000 jobs, and robust education and healthcare sectors. The presence of the Nissan Canton Vehicle Assembly Plant, employing over 5,000 people, boosts the local automotive industry and supports other suppliers like Delphi Technologies and Johnson Controls. Although the median income is below the national average, a 67 percent homeownership rate and low cost-of-living are notable economic features.

BROKER OF RECORD
William M. Davis
Mississippi Broker of Record
5100 Poplar Ave., Ste. 2505
Memphis, TN 38137
Tel: (901) 620-3626
Mickey.Davis@MarcusMillichap.com
License #: B-15586
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: ZAE0060649)