Executive summary
The region of Northern Virginia and the Tyson’s corner submarket has a huge potential for the property. The Tyson’s center offers a huge market for the real estate property due to the population composition in the region. Tyson’s corner is the largest shopping mall in the Baltimore-Washington region. The mall forms a center of attraction to shoppers from the working class within the city and outside the city. These are the main potential persons looking to acquire property within DC. The recently opened Silver Metro line is likely to have the largest economic impact on the area. The line will increase the number of people visiting the area since there will be an ease in commuting thus creating a potential for further development. The fact that the Silver Metro line acts an important attraction center, the real estate property is likely to have an easy market (Tyson, 2011).
The economy of Northern Virginia is high as compared to other regions with unemployment rates standing at 6%. This is an indication of the dynamic labor market in the region that will consequently create a high demand for real estate office property. The region is also highly populated thus providing a ready market for developmental real estate property. All these factors with a combination of the location of the property which is Tyson’s corner provide a good opportunity for development of the property and increasing the property need in the region. The major industries in Northern Virginia that support real estate include agriculture, mining, technology, and aerospace. The industries are key in investing in real estate property within the region due to the high revenues that they generate. The DC location creates an easy investment into the hospitality industry due to the high level of intellectuals located around.
Property market in Tyson’s corner
Office real estate property market in Tyson’s corner is attractive based on the fact that the area receives numerous visitors on a daily basis due to the availability of resources in the region. Tyson corner can thus attract very interesting returns for a well marketed venture within the property. Currently, the presence of the newly built Metro line has created a huge impact on the property market within the region. Resultantly, the demand has increased with a huge margin which can be seen through repeated purchases of property within the region (Lang, 2010).
Currently, Tyson’s corner is experiencing new constructions which indicate that the property market is attractive and more people are investing their money. There are very few vacant buildings within the center due to the huge demand for property especially class A and class B office property. In Tyson’s corner, the current rent rates average at $48.96 per square feet which is an indication of the adjustment to the high demand for offices in the prime location. The presence of the metro line has increased the demand for office real estate property and resultantly created a shortage in supply of the commodity which has caused the prices to inflate highly.
According to the market behavior, the prediction of the next few years, the property market will be flooded with investors. However, the demand will keep increasing due to the changes in the economic situations of the region and the need for prime property within the city. The property market thus still has a potential for attractive investments and there is a need for investors to take care of the available opportunities since the returns will be high enough for sustainability. The location of the building provides a competitive advantage over other buildings serving the same purpose. The building is easy to access through the road thus creating an attraction to the investors who would love to have their customers easily access their property without any problem. The property thus has the best available options for any buyer through its promising returns even as the years move (Tyson, 2011).
Description of the building
The property is a class B office block thus providing state of the art facilities for any buyer looking to ensure that the client needs are met without any hindrances. The property is housed in 6.75 acres of land which provide sufficient compound for other developments within the needs of the buyers. Even though the property is old since it was built in 1999, the renovation that took place in 2005 transformed the outlook at the interior. The building has a total of three floors with 48,249 square feet of space that is available for renting. Additionally, the building has an advantage of 233 parking spaces that are available and could be used by users of the building and visitors. The building is well built with reinforced concrete footings, foundation and slab with steel frame and brick exterior walls. The windows are high-efficiency double thermoplane tinted glass in aluminum frames. With such an environment, the property offers an advantage over the competitors since a well ventilated building is important to ensure that there is increased work productivity (Lang, 2010).
The roof of the building was placed in 2000 with a rubber membrane system over steel deck with a 15-year warranty which shows the quality of the property. The floor height is 12 foot from one slab to another creating a room enough for persons to feel comfortable. Within the building, there are two Montgomery hydraulic elevators servicing the building proving the high class attraction. The property also is equipped with a full wet fire sprinkler system and a card-activated security system for exterior doors providing good security that any person would require before occupation. Lastly, the building is serviced with a six gas-fired Trane rooftop heating and cooling units and a boiler for perimeter heating which were placed in 2010 (Mason, 2005).
Customer description and their credit worthiness
A high end property requires a credit worthy client who will be able to sustain the rents for a longer period. Some clients end up failing to sustain their rents thus causing a loss to the property owners. Verizon wireless is a huge customer based on the history of the company in the United States. The company has revenues that averaged at $131.62 billion for the year 2015. This provides a good ground for knowledge of their credit worthiness. The company revenues indicate that they are able to afford the property and pay more for the property in the long run. It is important for the property rent to be increased to ensure that there is maximum utility of revenues during the period which the company shall have rent the property (Tyson, 2011).
Additionally, the company has the ability to make a purchase of the entire building due to its revenues. However, other customers will require high revenues to be able to lease out the property due to the high rates that the property goes for. As a result, the property will only attract high end clients who is credit worthy. All the customers that will have the desire to rent out the property need to be companies since they have more credit worthiness and easy to follow up in cases of defaults where the company is unable to pay the rent due to one reason or another (Mason, 2005).
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References;
Mason, J. B. (2005). Power and Channel Conflicts in Shopping Center Development. The Journal of Marketing, 28-35.
Tyson, J. M. (2011). Drafting, Interpreting, and Enforcing Commercial and Shopping Center Leases. Campbell L. Rev., 14, 275.
Lang, R. E. (2010). Office sprawl: The evolving geography of business. Washington, DC: Brookings Institution, Center on Urban and Metropolitan Policy.
