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Total Rentable SF
106,177 SF
Credit Rated
AAA (S&P)
Total Occupancy
100%
Annual Rent Escalations
2.00%
INVESTMENT HIGHLIGHTS
LONG-TERM LEASES WITH ANNUAL RENT INCREASES - Each of the 15 properties feature a modified gross lease with 19 years remaining and 2.00% annual escalations to the base rent.
AAA RATED CREDIT - The State of Georgia carries a AAA credit rating. The credit is perceived so strongly that prominent lenders have provided non-recourse fully amortizing debt on State of Georgia leased assets, despite the existence of appropriations language in all State of Georgia leases.
LONG HISTORY OF OCCUPANCY - DFCS has operated out of the subject properties since the build-to-suit work was completed. In return for a considerable landlord investment, the tenant renewed the entire portfolio of leases for a fresh twenty (20) year term with two (2) percent annual increases. Additionally, the tenant took on the two of the most cost intensive responsibilities in the form of utilities and janitorial services.
SITE IMPROVEMENTS – As part of the lease restructure, the existing landlord spent $3.22 million on improvements (average of $223k per location), See page 10 for a detailed summary of the work performed.
MIDTERM TI ALLOWANCE – Each of the 15 properties has a midterm TI allowance of $15/SF totaling $1,592,655 for the entire portfolio. The Seller will credit the purchaser at close for the present value of the this future expense. This allowance will ensure the properties maintain the standard required by DFCS to best serve their clientele.
STRATEGIC LOCATIONS – By state mandate (§ 49-3-1), Georgia has a DFCS location in every county to ensure ease of accessibility. Each of the 15 properties was a build-to-suit for DFCS, is located in the county seat of its respective county, and is the only location in each county. DFCS is committed to continuing to provide these services, which is evidenced by their fresh 20-year lease term.
CONSISTENT DEMAND – DFCS is a division of the Georgia Department of Human Services (DHS) which serves more than 2 million Georgians and employs approximately 8,506 people. With an annual funding budget of $2.06 billion, DHS delivers a wide range of services that protect and enhance the lives of Georgia’s most vulnerable residents. DFCS, a division of DHS, is one of the largest agencies in state government with an annual funding budget of $1.5 billion.
