REINNO Industrial Portfolio
Portfolio Financials
| Price | $79,880,009 | Current Occupancy | 99% |
| NOI | $5,007,960 | Target yearly IRR(levered) | 10.51% |
| Cap rate | 6.27% | CoC Yield* | 6.90% |
| Interests offered | 79,880,009 | *Assumed interest rate and LTV | 6%, 70% |
| Min. investment | $35,000 | Max. investment | $79,880,009 |
| Start date | 20 Aug, 2020 | Deadline | 20 November, 2021 |
| Soft Cap | $7,000,000 | Hard Cap | $79,880,009 |
Industrial Properties included in this portfolio offer an above-average cap rate of 6.27% and an incredible opportunity to acquire a positive cash-flowing asset. They are highly diversified, thanks to multiple locations. The investments include lots in Florida, Alabama, Utah, North Carolina, Texas, California, Ohio and Colorado.
Portfolio
- Location: : Lakeland, FL
- Year built: 1980
- Buildings: 9
- Lot size (acres): 9.54
- Buildings size: 124,500 SF
- Occupancy: 100%
- Cap rate: 6.43%
- The property consists of 9 buildings on 7 tax ID parcels just north of the Lakeland International Airport and is contiguous to Publix's Headquarters. All buildings are well maintained and have a history of high occupancy and low turnover rates. The multi-tenant industrial warehousing space is in very high demand and shows no signs of slowing down anytime soon.
- Location: Birmingham, AL
- Year built: 2003
- Buildings: 1
- Lot size (acres): 6.03
- Building size: 59,891 SF
- Occupancy: 100%
- Cap rate: 7.08%
- This property has strong high-quality existing tenants, including Canon, Inc. The building is equipped with ten loading docks and fully fire-suppressed. It is in a close proximity to an expressway. The building is divided into four suites of different sizes – each used as a warehouse and/or office space.
- Location: Provo, UT
- Year renovated: 2016
- Buildings: 1
- Building size: 60,090 SF
- Lot size (acres): 4.81
- Occupancy: 100%
- Cap rate: 5%
- The facility is full of unique tenants that are employing 1000’s of skilled and technical people. The unique improvements required by the tenant mix has created buildings that provide long-term anchors for tenants to stay (high-powered printing facilities, aeronautics specialty manufacturing facility). It is located in an Opportunity Zone.
- Location: Charlotte, NC
- Year built: 2006
- Buildings: 3
- Lot size (acres): 16.67
- Buildings size : 57,433 SF
- Occupancy: 95%
- Cap rate: 5.22%
- The property is a highly desirable industrial flex space complex comprised of three separate free-standing buildings on a property that has been meticulously maintained. It is in a land-scarce environment adjacent to the Charlotte Douglas International Airport as well as Interstates 485, 77 and 85. The property has a stable and well-curated tenant mix with national, regional and local tenants. The anchor tenant, Tuff Shed, recently renewed their lease early showing a strong commitment to the site.
- Location: Sunnyvale, TX
- Year built: 1980
- Buildings: 1
- Lot size (acres): 12.00
- Buildings size: 162,500 SF
- Occupancy: 100%
- Cap rate: 6.59%
- This industrial building is located approximately 15 miles East of downtown Dallas and has easy access to multiple shipping routes and airports. The property is occupied by Adell Group & The Christman Company. This is a state of the art facility - Adell’s fully equipped tool room and environmental corrosion testing lab allows them to achieve the highest standards of quality assurance for their customers.
- Location: Colton, CA
- Year renovated: 1984
- Buildings: 2
- Lot size (acres): 4.34
- Buildings size: 60,119 SF
- Occupancy: 100%
- Cap rate: 6%
- The property’s tenant mix includes two churches, allowing the parking to be used by the churches on Sunday and the other tenants during the week. The project has enjoyed above average occupancy through the years based on it good location and functional ground floor space.
- Location: Canton, OH
- Year built: 1940
- Buildings: 1
- Lot size (acres): 40.52
- Building size: 472,895 SF
- Occupancy: 100%
- Cap rate: 7.27%
- This property is used as a mission-critical headquarters facility for century-old steel and aluminum pole manufacturer on a long-term, absolute triple net lease with annual rent increases. The building is centrally-located in the Cleveland metro area with direct highway and rail access. It has potential for redevelopment and rent increases – current rent is below the market average.There are 8,000 SF of finished office space and 200 parking sports.
- Location: Aurora, CO
- Year built: 1981
- Buildings: 1
- Lot size (acres): 3.71
- Buildings size: 63,667 SF
- Occupancy: 100%
- Cap rate: 6.55%
- This 16-unit property is leased to 14 solid tenants, most with personal guarantors. The rents are below market levels for many of the tenants, which provides an opportunity future growth. All leases have annual escalations. True NNN leases with depreciation for roof and pavement included make this facility a great passive investment.
- Location: Sanford, FL
- Year built: 2015
- Buildings: 3
- Lot size (acres): 10.21
- Building size: 42,427 SF
- Occupancy: 100%
- Cap rate: 6.36%
- This facility features warehouse, office and manufacturing space. It is located less than 4 miles away from the Orlando-Sanford International Airport. There is a single national tenant on a ten-year NNN lease with two additional five-year renewal options. The complex also includes 2 pavilions and secured yard storage.
Statistics Summary
| Occupancy | Year Built | |
| Property 1 | 100% | 1980 |
| Property 2 | 100% | 2003 |
| Property 3 | 100% | 2016 |
| Property 4 | 95% | 2006 |
| Property 5 | 100% | 1980 |
| Property 6 | 100% | 1984 |
| Property 7 | 100% | 1940 |
| Property 8 | 100% | 1981 |
| Property 9 | 100% | 2015 |
| Average (portfolio) | 99% | 1989 |
Financial Summary
| Price | NOI | Cap Rate | |
| Property 1 | $7,920,000 | $508,916 | 6.43% |
| Property 2 | $11,000,000 | $779,161 | 7.08% |
| Property 3 | $9,823,759 | $491,187 | 5.00% |
| Property 4 | $9,845,000 | $514,267 | 5.22% |
| Property 5 | $10,450,000 | $689,115 | 6.59% |
| Property 6 | $6,820,000 | $409,500 | 6.00% |
| Property 7 | $7,713,750 | $561,000 | 7.27% |
| Property 8 | $9,047,500 | $592,814 | 6.55% |
| Property 9 | $7,260,000 | $462,000 | 6.36% |
| Total (portfolio) | $79,880,009 | $5,007,960 | 6.27% |
Financial Projections
RIPP is an all-equity deal. The properties are purchased with the capital raised from investors. These financial projections estimate the returns investors can expect, if they hold their tokens for five years from the initial sale/security token offering (STO). However, it is important to note that digital shares can be sold at any point after the holding period (one year). Moreover,investors can use digital shares as collateral for a loan –this scenario is illustrated on page 16. Property management fees are accounted for in the NOI calculations and vary from property to property.
Note: Past performance is not indicative of future results.
Investors can choose to increase their return on investment by using tokenized real estate as loan collateral.The calculations below represent a scenario where all the digital shares (tokens) are used as collateral at an LTV equal to 70%. It is assumed that the loan is taken on the same day the digital shares (tokens) are purchased and the balloon payment is due at the same time as the property is sold.
Important note: RIPP will purchase the properties with 100% equity and no debt. This scenario is only to illustrate how investors can use the tokens they bought for a loan.
Market Overview
According to a JLL Research Report,industrial vacancy for the U.S. had as light uptick by 10 basis points quarter-over-quarter reporting at 5.2%. While this quarter exhibited a slight elevation in vacancy, it continues to remain near historic lows.
Despite a potential slowdown in leasing activity as the market adjusts to the global pandemic, top logistics markets continue to operate at a sub 3.0 percent vacancy rate. Moreover, the rise of e-commerce increases the need for warehouses, keeping occupancy rates high.
In Q1 2020 U.S. average rent increased for another quarter reporting at $6.30 per square foot with 8.8 percent annualized growth from the prior year.Continued competition for quality space is expected to add pressure on rents through 2020. As COVID-19 spread across the U.S.,several factors will affect rent prices. Some speculative development projects are put on hold, there is a rise in rent relief requests, decrease in port volumes, an increase in trucking prices, and growth in e-commerce adoption by consumers.
Industrial sector continues to attract investors. According to the CBRE Q4 2019 report, soaring values led to sustained cap rate compression in the second half of 2019.Moderate tightening should continue in 2020 but cap rates largely should remain stable.
Cap rates for acquisitions of stabilized assets averaged 6.13% for all tires and classes,falling by 13 bps in H2. This portfolio offers a 6.27% cap rate – above the U.S. average.
According to the Bureau of Economic Analysis’ estimate released in March 2020, the U.S. economy grew at an annual rate of 2.1% during the fourth quarter of 2019. The unemployment rate increased 60 basis points from one year ago, reaching 4.4% in March 2020, due to the coronavirus pandemic.
Dividends and Ownership
REINNO Industrial Property Portfolio is a Real Estate disruptor. RIPP is offering fractional ownership of commercial real estate in the U.S. in the form of digital shares (tokens). 100% of NOI is distributed to token holders as dividends every quarter. The default currency is USD but investors can also choose to receive dividends in stable coins. The company offers a pure equity portfolio of stabilized income-producing real estate in the USA. This way investors can individually decide if they want to leverage their tokens for debt and higher ROI or keep it as is for lower risk.
The properties included in this portfolio represent the assets that RIPP intends to buy upon successful capital raise. In case one or more of the properties become unavailable during the raise, RIPP is responsible for finding an asset with comparable parameters (size, income,location, return, etc).
The Purchase and Sale Agreements are expected to be executed one month after the soft cap(the minimum amount that has to be raised to buy the first property) is reached.
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Team and Partners
The RIPP team is comprised of seasoned professionals who have comprehensive real-world experience in the commercial real estate, financial markets and law. RIPP has an Investment Committee responsible for making decisions related to the acquisition, investment, asset management and disposition of properties. The RIPP team was assembled to continue the historically successful real estate investment activities of its members, targeting a broad range of real estate assets, portfolios, and companies.
RIPP’s strategy includes sourcing opportunistic investments through its proprietary network of owners and agents, as well as financial, accounting, and legal professionals. These include generally inaccessible bilateral deals and off-market transactions. These types of investments typically require significant experience in commercial real estate deals. RIPP will always favor income-producing properties with stable tenants and growth potential.
RIPP equity offering is backed by REINNO. REINNO is the first company in the world to accept tokenized reale state as loan collateral. RIPP is using the legal framework approved by REINNO for this offering, which allows investors to use their tokens as collateral for instant, paperless and flexible loans up to $50M. In order to provide the greatest liquidity for its investors, REINNO secured secondary market listing opportunities for RIPP at ADAX. ADAX is a registered security token exchange. The tokens will be available for trading after the holding period of 1 year. RIPP is using a trusted escrow provider; for more details please refer to the Purchase Agreement.
RIPP is managed by a professional team with more than 60+ years of combined experience. Bravo Capital Advisors is an asset management company responsible for assigning appropriate property management providers to the real estate assets included in this portfolio. The properties are managed by local or on-site service providers to decrease the risks and optimize performance.
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DISCLAIMER
This offering has been prepared by Industrial Series, a designated series of Reinno Series, LLC. All materials and information received or derived from Industrial Series, a series of Reinno Series, LLC its directors, officers, agents, advisors, affiliates and/or any third party sources are provided without representation or warranty as to completeness, veracity,or accuracy, condition of the property, compliance or lack of compliance with applicable governmental requirements, develop ability or suitability, financial performance of the property, projected financial performance of the property for any party’s intended use or any and all other matters.
Neither Industrial Series, a series of Reinno Series, LLC, its directors, officers, agents, advisors, or affiliates makes any representation or warranty, express or implied, as to accuracy or completeness of the any materials or information provided, derived, or received. Materials and information from any source, whether written or verbal, that may be furnished for review are not a substitute for a party’s active conduct of its own due diligence to determine these and other matters of significance to such party. Industrial Series, a series of Reinno Series, LLC will not investigate or verify any such matters or conduct due diligence for a party unless otherwise agreed in writing. Any party contemplating or under contract or in escrow for a transaction is urged to verify all information and to conduct their own inspections and investigations including through appropriate third party independent professionals selected by such party. All financial data should be verified by the party including by obtaining and reading applicable documents and reports and consulting appropriate independent professionals.Industrial Series, a series of Reinno Series, LLC makes no warranties and/or representations regarding the veracity, completeness, or relevance of any financial data or assumptions. Industrial Series, a series of Reinno Series, LLC does not serve as a financial advisor to any party regarding any proposed transaction. All data and assumptions regarding financial performance, including that used for financial modelling purposes, may differ from actual data or performance. Any estimates of market rents and/or projected rents that may be provided to a party do not necessarily mean that rents can be established at or increased to that level. Parties must evaluate any applicable contractual and governmental limitations as well as market conditions, vacancy factors and other issues in order to determine rents from or for the property. Legal questions should be discussed by the party with an attorney. Tax questions should be discussed by the party with a certified public accountant or tax attorney. Title questions should be discussed by the party with a title officer or attorney. Questions regarding the condition of the property and whether the property complies with applicable governmental requirements should be discussed by the party with appropriate engineers, architects, contractors, other consultants and governmental agencies. The buildings presented in this offering are subjects to change and can be replaced with similar buildings of comparable financials, characteristics and parameters. All properties and services are marketed by Industrial Series, a series of Reinno Series, LLC in compliance with all applicable fair housing and equal opportunity laws.
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* Some equity offerings might not provide dividend payments and offer higher capital gains instead. Please check the offerings to understand their respective terms.