1150 Northbrook Corporate Center
Northbrook Corporate Center, delivered in 2007, is one of the newest office buildings in the submarket. The four-story building, constructed to institutional and energy-efficient design standards, includes a two-level atrium lobby, brick and glass curtain wall, lower-level covered parking, and is situated in a picturesque office park. The Property is currently leased to five companies and 85.2% occupied. The tenancy profile is diverse with industry sectors including alternative energy, biotechnology, and government. Approximately 50% of the rental revenue is derived from credit tenants.
The Property is situated at the epicenter of commercial amenities in one of Pennsylvania’s major transportation crossroads and offers immediate access to restaurants, shopping, fitness centers, daycare facilities, hotels, banks and more. Within minutes, tenants have access to a 1 million sf regional mall, countless national retailers and convenient fast casual restaurants. The amenity-rich location, superior access to highway networks, and efficient public transportation system make the Property an appealing work environment for modern office users.
Advalurem is able invest at a low basis because it represents the last asset in a 2006 vintage fund that is under pressure to unwind prior to achieving the optimal value of the Property. This dynamic, coupled with valuations being much higher when the Property was constructed, has enabled Advalurem to acquire the Property at a significant discount to both replacement cost and the competitive set. The business plan is to upgrade the physical infrastructure and provide existing and future tenants with an exceptional office product at competitive lease rates.
Advalurem intends to hold the investment for 4 years. Based on our conservative financial analyses, the investment is projected to return an estimated 15.7% compound annual return, net of fees and expenses, and 1.7x multiple on invested capital.