Marcus & Millichap is pleased to present the opportunity to acquire the property located at 15060 West Drive in Houston, Texas, occupied by the owners, MRAMCO and sister company Kor-Lok. The subject property consists of approximately 14,400 square feet of warehouse space and is situated on 1.01 acres of land. The asset features steel construction, metal roofing, and four grade-level doors. Upon the sale of the property, MRAMCO and Kor-Lok plan to execute a two-year triple-net leaseback. As a short-term sale-leaseback, this deal may offer a future lease-up opportunity with a pro-forma cap rate north of 10 percent based on current rent growth projections. Established in 1980, MRAMCO is an industrial distributor of a variety of tube fittings and valves. Kor-Lok was founded in 2004 and is a supplier of fluid control products including instrumentation tube fittings, pipe fittings, and valves. Both companies service multiple industries such as oil and gas, petrochemical, and power generation.
With close proximity to Beltway 8 (Sam Houston Tollway) and State Highway 288, the subject property sits within the Southwest Far submarket. While characterized as mostly low-density and rural, Southwest Far contains a sizeable 24 million square feet of industrial space. Unlike the overall Houston market where vacancies have been trending up, availability has been tightening significantly in the submarket with the vacancy rate down 4.8 percentage points annually to 6.1 percent in the second quarter of 2023. During this time, market rents were up 4.2 percent year-over-year. Although 2.2 million square feet of industrial space was under construction going into the back half of the year (representing 9 percent of inventory), 93 percent of the pipeline was concentrated in properties of at least 100,000 square feet. This means that rent growth and vacancies among small industrial properties will not be directly impacted by new supply for the foreseeable future (CoStar).
As the fifth most populous metro area in the U.S., Houston houses over seven 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.
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: ZAE0040269)
