Property Details
Repeat Sponsor  Below Market Rents  NOI Growth 
Asset Profile
Value Add

Shops at Hulen Recapitalization

Fort Worth, TX

Retail Property
Chestnut Real Estate Funds Chattanooga, TN
Chestnut Real Estate Funds
Targets
  • IRR 17.2%
  • Equity Multiple 1.8x
  • Hold Period 4Y
  • Minimum Investment $25K
  • Year 1 Cash on Cash 6.6%
  • Stabilized Cash on Cash 8% in Y3
  • First Distribution Feb 2019
  • Distribution Frequency Quarterly
  • Co-Investment 26%
  • Preferred Return 8%
  • Investor Profit Share 70%
  • Asset Profile Value Add
  • Loan-to-Value 69%
  • Current Occupancy 85%

About this Property

Benbrooke Realty Investment Company (“Benbrooke”) and Chestnut Real Estate Funds, LLC (“Chestnut” and collectively, “Sponsor”) are offering the opportunity to invest in the ownership of the Shops at Hulen in Fort Worth, TX, a 28,344 square foot shopping center. The shopping center is currently 95% occupied, however one of the tenants is vacating their space at the end of 2018, resulting in 85% occupancy. The investment in Shops at Hulen is a value-add investment with additional value creation through the lease-up of vacant space and increasing rents of existing tenants.

Key Points

  • The Sponsors purchased the property in 2015 when the shopping center was 58% occupied.
  • Since that time, new leases constituting roughly 12,000 feet of space have been signed with Benbrooke and Chestnut making substantial capital investments to renovate the shopping center.
  • Current tenants include DaVita, a national kidney dialysis company, US Army Career Center, Sally Beauty, a national beauty supply store, and iSmile Dental, a regional dentistry chain.
  • During the initial lease-up, earlier tenants were able to negotiate below market rents which the Sponsor agreed to due to the capital improvements being in progress rather than complete and, secondly, to generate leasing momentum in the center.
  • As the end of theses leases approach for the early tenants, an opportunity exists to renegotiate the lease terms with the in-place tenants or new tenants to market-rate rents.
  • Market rental rates are above $20 per square foot and with the capital improvements complete and sustained high occupancy, Shops at Hulen has leverage to increase rates.

Offered By

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Assets Under
Management

Currently
$647.94K 30+ assets
Exited
$171.48MM No asset count reported
Portfolio LTV
48%  
Historical
Realized Returns

Total IRR
47.2%  
Equity Multiple
2.23x  
Annual Cash
7.3%  
Years Of
Experience

As Principals
30+ years  
In Business
6 years  
Size
6 Staff * Dedicated investor relations
* All information is reported by Chestnut Real Estate Funds as of 4/17/2018.
Assets Under
Management

Currently
$647.94K 30+ assets
Exited
$171.48MM No asset count reported
Portfolio LTV
48%  
Historical
Returns

Total IRR
47.2%  
Equity Multiple
2.23x  
Annual Cash
7.3%  
Years Of
Experience

As Principals
30+ years  
In Business
6 years  
Size
6 Staff * Dedicated investor relations
* All information is reported by Chestnut Real Estate Funds as of 4/17/2018.

Financials

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Offering Financial

Location Details

Fort Worth, TX

Shops at Hulen is located in the core of the Hulen retail submarket, which is anchored by the Hulen Mall. It is one of the most vibrant and successful retail trade areas in Tarrant County and includes many national and regional retail stores. The $300 million master-planned Shops at Clearfork development sits on 270 acres less than 10 minutes north of the Shops at Hulen. The property is shadow-anchored by a Walmart Supercenter. Traffic counts on South Hulen Street are over 42,000 vehicles per day. The submarket includes dozens of national retailers including Walmart, Kroger, Costco, Super Target, Hobby Lobby, 24-Hour Fitness, Starbucks, Dollar Tree and many more. The property is situated near a new limited access toll-road known as the Chisholm Trail Parkway from which there is an exit leading to Oakmont Boulevard and the Walmart that is adjacent to Shops at Hulen. The Parkway connects the suburban areas of southwest Fort Worth to Interstate 30 and eventually to downtown Fort Worth continuing to spur growth in the area.

Documents

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Offering Agreement Documents

Frequently Asked Questions

Below are some of the most frequently asked questions about this offering.

The Sponsors first acquired the Property in 2015 at an acquisition price of $3.95M, when it was 58% occupied. Sponsors provided the entirety of the original required equity investment totaling $1.73M. Since that time, Sponsors have stabilized the asset, and it is now 95% occupied (one tenant’s lease will expire shortly, which will bring occupancy to 85%). A recent appraisal and several offers support a FMV in excess of the stipulated $4.9M acquisition price. During a recent refinance, Sponsors received approximately $800k from their initial investment. In this present transaction, a portion of the recapitalization proceeds will be distributed to the Sponsors, and a portion ($611k) representing 38% of the required equity is anticipated to be reinvested at close.

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