Key West Office & Retail Portfolio

Highlights:

• Six-building, 37-unit office and retail condominium portfolio consisting of 22 strap numbers, with ownership controlling a majority interest in the condominium association
• Buildings F and K, along with the adjacent ±1 acre parcel, are non-association assets, providing enhanced operational and development flexibility
• Currently approximately 51% occupied, offering a clearly defined two-year lease-up path to stabilization
• Lease-up underwriting based on $22.50 PSF modified gross rents, conservative relative to prevailing market all-in occupancy costs
• Year 1 Stabilized Potential Gross Income: $970,915
• Year 1 Stabilized Net Operating Income: approximately $691,777
• Approximately $600,000 in roof replacement escrow to be transferred to the buyer at closing, materially reducing near-term capital expenditure risk and effective net basis
• Additional optional upside through executive suite conversion of Building F, supported by existing performance in Building K
• ±1 acre of excess land providing future development or parcel split potential, subject to survey, approvals, and market conditions

Description:

This 40,684 SF office and retail portfolio generates in-place income today while offering a clearly defined, two-year lease-up path to stabilization. Current gross income of approximately $240,000 annually provides carry and downside protection during the lease-up period, while final underwriting supports a stabilized Year 1 Net Operating Income of approximately $691,777.

Lease-up assumptions are based on $22.50 PSF modified gross rents, which remain conservative relative to prevailing market conditions when viewed on an all-in occupancy cost basis. Upon stabilization, the property supports a projected Potential Gross Income of $970,915 and an implied stabilized value of approximately $9.9 million at a 7.0% exit cap rate, excluding any additional upside strategies.

When discounted for lease-up timing and execution risk, the lease-up alone supports a present value range of approximately $7.6 million to $7.9 million. The contract price of $7,999,999, combined with approximately $600,000 in roof replacement escrow transferring to the buyer at closing, results in a reduced effective net capital basis while removing near-term capital expenditure risk during stabilization.

Additional upside opportunities are optional and include the potential conversion of Building F into executive suites, as well as future development or partial disposition of the ±1 acre excess land, subject to survey, municipal approvals, and market conditions.

Located along one of the fastest-growing commercial corridors in Lee County, this property offers exceptional connectivity to both Cape Coral and the greater Fort Myers area. Its central position provides convenient access to major arterials, making it ideal for businesses seeking strong regional reach. The site also benefits from its proximity to significant new development activity along Colonial Boulevard, including the redevelopment area surrounding the Broadway Palm Theatre, which continues to drive growth, traffic, and long-term demand in this submarket.

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