MVP REIT Picks Up Net-Leased Downtowm Parking for $5.8M
- Sep 06, 2013
By Eliza Theiss, Associate Editor
MVP REIT Inc., a Las Vegas-based hybrid REIT, has recently acquired two downtown Memphis parking facilities along with a facility located in downtown Kansas City, Mo. for $5.8 million. The all-cash transaction closed in late August.
One of the Memphis facilities is located on Poplar Avenue and boasts 125 parking spaces spread on a one-acre site. The property is located in the vicinity of government institutions such as Memphis City Hall, the Shelby County Justice Center and the County Election Commission. The second Memphis lot is located on Court Avenue near attractions such as AutoZone Park and numerous businesses. The half-acre car park lot holds 37 spaces. According to the Memphis Business Journal, the facilities were acquired from Covered Bridge Ventures, represented by CBRE Memphis.
The Kansas City facility occupies 1.1 acres and features 300 parking spaces near a cluster of government facilities.
“Parking facilities generate more than $20 billion in cash flow nationwide” said Mike Shustek, chairman and CEO of MVP REIT, citing International Parking Institute numbers. He added: “Their relatively low cost of capital, minimal labor expense and ability to respond quickly to inflation make them attractive investments.”
MVP REIT formed three separate limited liability companies with Vestin Realty Mortgage I Inc. (VRMI) and Vestin Realty Mortgage II Inc. (VRMII) for the transaction. The facilities’ ownership percentage is based on the respective party’s capital contribution. As such VRMII owns 51 percent, VRMI holds 44 percent, while MVP has 5 percent ownership stake.
The facilities are part of a $13.5 six-facility portfolio acquisition agreement MVP entered into in late July. MVP already closed on a 32,750-square-foot, 66-car downtown Fort Lauderdale, Fla. parking facility for $3.4 million. The REIT is expected to pick up the remaining two parking lots, located in Baltimore, Md. and St. Louis in early September.
All six facilities are leased to operators under triple net leases.
Image of Poplar lot courtesy of Google Maps