Overview

The Criterion Fund is offering an opportunity to invest in three retail centers in Texas. Two properties, 31st Plaza and Coronado Shopping Center are located in Amarillo and one, Town and Country Center, is in Victoria, Texas. The portfolio is being acquired from the same seller that Criterion successfully worked with on a previous Amarillo acquisition. These assets are currently undermanaged, undercapitalized, and have below-market rents, providing significant value-add potential through capital improvements and professional leasing/management. All three centers offer a unique mix of strategies that Criterion plans to execute on to raise the revenue and income in each property. 31st Plaza - Three-building center that will go under capex renovations, we will also look to convert gross leases to NNN on renewals while simultaneously bringing rents up to market, and lease-up the one vacant space in the center. Coronado - Located in a high-income neighborhood, the 74% occupied center will undergo significant capex upgrades to be able to release the center at market rents, which are currently 50% higher than the average in-place rent in the center. Town & Country Center - The center is comprised of over 40+ tenants, maintaining over 90% occupancy since it was built without ever being marketed broadly by current ownership. With market rents 62.5% above current average rent in the center, we will bring rents to market on renewals and bring in a new leasing team to market vacant space with more strategies to increase leasing activity. The total equity raise is $5,000,000 with a 75% LTV ratio, 25-year amortization, and a 7.35% interest rate with an 18-month interest-only period to perform capex repairs and lease-up of the three properties. The purchase price capitalization rate is a blended 10%+. The forecast projects a 18.37% IRR, 2.11x equity multiple, and an average cash-on-cash return of over 10% and a stabilized cash on cash of over 13%. Sale proceeds are based on a sale of the portfolio in Year 5 with a blended exit cap rate of 8.81%.