56 New Driftway
Why Is This a Fulcrum Property?
- Attractive Risk Adjusted Return
- Core-plus Investment with “Sticky” Tenants and Room to Grow
- Purchase Price Below Replacement Cost
- Target Rich Environment
- Local, Convenient Medical and Dental Care
Medical office properties are coveted investment targets. Among the reasons are because medical professionals as tenants generally are stable and credit-worthy, are likely to invest in capital improvements in their spaces, and once they have established their practices in a location, are not likely to move. This is exemplified at 56 New Driftway with several tenants having signed 10- and 15–year leases, practices dating back to 1997 being sold and leases assigned to the new generation of practices, and original leases being extended for the fourth time!
Address: 56 New Driftway, Scituate, MA
Size: 23,969 SF (3 floors)
Year Built: 1974
Property Use: Medical, Dental, Physical Therapy
Tenancy: 90% leased, all in the medical and dental fields
Attractive Risk Adjusted Return
Fulcrum Real Estate Partners is offering an annualized 7.0% Preferred Return to limited partner equity investors
Core-plus Investment with “Sticky” Tenants and Room to Grow
- 90% Leased – Purchase price of $3,825,000 targets double-digit returns over proposed hold period
- Stable Rent Roll – Average remaining lease term of 7+ years; several tenants have long-term lease renewal history at the building
- Organic Growth – Current tenant interest in expansion into available space bodes well for adding value in the near term
- Quality Medical Tenants – All 9 tenants are either medical doctors or dentists with thriving, established practices, many with considerable capital investments in their spaces…”sticky” meaning they are not likely to move
Purchase Price Below Replacement Cost
Purchase price at $3,825,000 ($160 per square foot) is significantly below replacement cost for fully-plumbed medical office buildings (estimated at $300 per square foot including land); low comparative basis enhances our competitive position for tenants in the future.
Target Rich Environment
The South Shore location in Scituate, MA has terrific demographics for healthcare service providers; growing school-age enrollment, and a median resident age of 47.5 years (8 years older than the State’s average of 39.4 years) hit both ends of the target healthcare customer base which can also claim a median family income of $131,230 with 31.7% of families earning over $200,000*.
*(Source: based on 2015 statistics, www.city-data.com)
Convenient care
Medical office properties thrive in two situations – either adjacent to a hospital complex or far enough away from a hospital to be advantageous to the local medical and dental providers who can deliver basic clinical care to the busy families and elderly patients in an underserved market. The Harbor Medical Building at 56 New Driftway is a prime example of the latter. Being 15 miles from the nearest hospital complex – South Shore Hospital and its surrounding medical environment in South Weymouth, MA, – 56 New Driftway’s Scituate location delivers basic medical and dental care to those in the South Shore communities who would much rather stay local and avoid the traffic and inconvenience of traveling on congested roads.
