Texas Government Office: DFPS & TWC

New Braunfels, TX

Price $1,520,000
Cap Rate 8.86%
TYPE Single-Tenant
Tenant The State of Texas: DFPS & TWC
LISTING AGENT Jessica Zahn Gibson
Paul Blackburn, Blackburn Properties
Texas Local Broker #376821

Property Description

This government office is 100% leased and guaranteed by The State of Texas, a best-in-class tenant rated S&P AA+.  The government office has 6 years remaining on an initial 10 year Gross Net Lease with annual increases at 25% of the Consumer Price Index. This lease has a high yield, leveraging 28% down and annual return. High yield is only possible with loan assumption, buyer can obtain new loan.

The tenant, the Department of Family & Protective Services, just renewed their lease early with a substantial rental increase. The mission of the DFPS is to protect children, the elderly, and people with disabilities from abuse, neglect, and exploitation by involving clients, families and communities. The other tenant, the Texas Workforce Commission, is expected to renew in 2018. The mission of the TWC is to support a workforce system that creates value and helps employers, individuals and communities achieve sustainable economic prosperity.

The subject property is located in New Braunfels, Texas, the principal city of the San Antonio-New Braunfels Metropolitan Statistical Area. San Antonio-New Braunfels is the 3rd largest metro area in Texas and is also the 2nd fastest growing large metropolitan area in the state – the population is over 1MM. Companies like Walmart Distribution Center, The Coleman Company and Vanguard Health Systems have relocated to the area due to the pro-business leadership attitude, competitive incentives and low tax burden.

Property Highlights

  • 100% Leased and Guaranteed by the State of Texas with Annual Rental Increases at 25% of CPI
  • Buyer can Obtain a New Loan, High Yield is Only Possible with a Loan Assumption | High Yield: Leverage with Only 28% Down & Annual Return)
  • Gross Net Lease - Landlord: Roof, Structure, Parking, Taxes, Insurance & CAM | Tenant: Interior Utilities, Janitorial Services & Supplies
  • Best-In-Class Tenant: (S&P: AA+)
  • Early Lease Renewal: Tenant Just Renewed Early with a Substantial Rental Increase
  • 2018 Demographics (10 MI) - Total Population: 134,652 | Average Household Income: $90,442 | Pop Growth 2010-2017: 33.33%