Medical Office Building - Cash Flowing Asset with Capital Growth Potential

• Consistent Cash Flow: Long-term cash flows average over 8% annualized.
• Stable Tenancy: Strong financial tenant base.
• Lease Extension: Recently signed leases extended the terms, with the shortest lease expiring in May 2028.
• Prime Location: Near hospitals and Class A office centers.
• Growing Metro: Located in a growing metropolitan area.
• Recession Resilience: Healthcare tenant concentration provides a recession hedge.
• Tenant Improvement Reserves: Significant tenant improvement reserves accrue annually.
• Solid Core Investment: Represents a solid "Core Investment" with consistent and growing cash flows over a 5-7 year holding period.
• Attractive Financing: Project financed with a $3.65mm CMBS loan at <55% loan-to-cost.
• Favorable Loan Terms: CMBS Loan is a 10-year Interest Only at 5.85% with final term date of December 2033.
• Rents built in escalations: Averaging over 3% annually.

This proposition remains an excellent opportunity as a result of its superb location in a vibrant medical district in Richmond's exclusive West End - Glen Forest.

Property Description

• Address: 7110 Forest Ave, Richmond, VA 23226 (Henrico County)
• Parking: Parking lot redone in 2020. 133 on-site parking spaces, 5 of which are handicapped.
• Roof: Flat with a rubber membrane cover. 45 mil EPDM. Roof replacement cost is a reimbursable expense by the tenants.
• Lobby: Carpet, cosmetic renovations in 2019 and 2024. Interior common area stairwell in the lobby and two fire stairwells each located at each end of the building.
• Floor Loads: The floors can support live loads of 90 pounds per square foot.
• Ceiling Height: Slab-to-slab heights are approximately 14 feet with a finished ceiling height of approximately 8'6"- 10'.
• Restrooms: Two restrooms per floor with ceramic tile and paint finish. ADA accessible stall in each 1st-floor restroom. First-floor restrooms include a shower and changing room.

Building Features

• Year Built: 1986
• Exterior: Steel frame with brick and glass exterior
• Renovations: Lobbies and common areas fully renovated in 2019 and 2024. All tenant spaces renovated since 2019.
• Elevator: One hydraulic elevator
• Lighting: LED lighting
• Operating Expense Reimbursement: Over 90% tenant reimbursement of Operating Expenses.

Clinical Research Partners at 7110 Forest Ave features a desirable mix of medical and commercial tenants, with a significant presence of medical-related businesses.

First Floor Tenants

• Clinical Research Partners (CRP)
• VitaPure (a CRP Company)
• NAI Dominion Commercial R.E.
• Commonwealth Construction Mgt.

Second Floor Tenants

• Clinical Research Partners CRP - Clinical Infusion Solutions (CRP)
• Silvercore Consultants

* Shared Conference Room available. Reviewing purposeful re-use of the conference room to provide additional revenue.

The property is strategically located near Henrico Doctors Hospital and St Mary's Emergency Department, benefiting from the robust medical community in the area. Henrico Doctors' Hospital is part of the HCA Virginia Health System, which includes over 14 hospitals, 27 outpatient centers, and is affiliated with over 3,000 physicians, further highlighting the strong medical ecosystem surrounding 7110 Forest Ave.

Richmond, Virginia, presents a compelling location for real estate investment, boasting strong demographics, a pro-business environment, and a growing healthcare sector.

Key Location Advantages

• Strong Demographics: Richmond MSA demonstrates robust demographics with consistent annual growth of 2% per year for the past 10 years.
• Significant Population: The Richmond MSA is a leading center in the Southeast, with approximately 1.3 million people. It serves as a political, financial, and cultural hub and is the capital of Virginia.
• Educational Hub: Home to leading universities including The University of Richmond, Virginia Commonwealth University (a major research university with a comprehensive health center), Virginia State University, Virginia Union University, and Randolph Macon University.
• Pro-Business Environment: Virginia is at the heart of the busy I-95 business corridor and maintains a pro-business attitude. Richmond has received repeated national recognition as an excellent place to do business.
• Affordable Cost of Living: The area offers an affordable cost of living, which is 4% lower than the national average.
• Tax Benefits: Richmond benefits from a long-standing affordable 6% corporate tax rate.
• Accessibility: Premier access to 45% of the U.S. population within a one-day drive.
• Growing Healthcare District: The expanding healthcare district supporting Clinical Research Medical Center is expected to attract future investment and economic growth.
• Consistent Population Growth: Virginia consistently reflects solid demographic trends and population growth, making it an attractive MSA for investment.

Richmond's combination of economic strengths and demographic trends positions it favorably for continued growth and successful real estate investments.

Capital Stack & Loan Structure

The total capitalization for Clinical Research Partners is approximately $7.7 million, encompassing acquisition, closing and financing expenses, fees, and tenant improvement reserves.

• Acquisition Price: $7,050,000 ($227 psf) in December 2022
• Debt Financing: $3.65mm CMBS loan (<55% loan-to-cost)
• Loan Type: 10-year Interest Only
• Interest Rate: 5.85%
• Maturity Date: December 2033

Lease Summary Highlights

77% of the building is occupied by a core medical office tenant with long-term leases, incorporating multiple verticals. Lease discounts are set to roll off in Q3, which is expected to improve income for investors.

Pro Forma Highlights (Year 1 - 2025)

Note: Pro forma information is based on preliminary projections and is subject to revision.