KGC Commercial Real Estate is pleased to present a rare Davita Dialysis anchored value-add investment opportunity at 1314-1324 S. Euclid Street in Anaheim, California. The property consists of two well located medical buildings totaling approximately 23,218 square-feet, situated on two parcels totaling 1.47 acres of land.
1324 S. Euclid Street consists of an 8,854-sf building situated on 25,962 sf of land. It is 100% leased to DaVita Dialysis (NYSE: DVA) and has 4 1/2 years remaining in the current lease term with 3.5% annual rent increases. Davita completely renovated this building in 2012 prior to moving into the property. It remains committed to this location by recently exercising its first of two 5-year renewal options which extended the lease to July 31, 2030. The lease is a modified double net lease that requires Davita to pay all operating expenses, except for costs related to structural damage to the property.
1314 S. Euclid Street consists of a 14,160-sf building situated on 37,680 sf of land which offers a compelling value-add opportunity with substantial upside. The property is currently vacant due to roof damage, which is estimated to cost approximately 400k-500k to repair. The owners were considering converting this property to low-income housing, which has delayed any repair work. The new owner of this property can either repair/rehab the existing building with a new roof and refurbish the existing medical offices (if needed) or redevelop the entire property. If the new owner decides to repair the existing facility, then it has a potential to achieve a stabilized conservative return on cost of 8% +. The property is priced at land value due.
The property is positioned along S. Euclid Street, a major thoroughfare, with excellent visibility and strong daily traffic counts, serving the dense residential population of central Anaheim. The property is close to major medical centers including UCI Medical Center and Kaiser Permanente as well as major retailers/events including Food for Less, Target, Walgreens, CVS, Sprouts, Ralphs, Angel Stadium, Honda Center (Ducks Stadium), Anaheim Convention Center and Disneyland theme park. The area is home to over 500,000 residents within a five-mile radius, with household income exceeding $100,000 +. Orange County is regarded as one of the strongest rent growth markets in the country due to its unparalleled access to major freeways, a large population base, John Wayne and LAX airports.