620 Roseville Parkway is a two-story building totaling 193,573 SF located in Sacramento, CA and was originally constructed in 1996 and renovated in 2017. At acquisition, the Property was 75% leased to two tenants. During the GCREIT ownership period, the business plan will be to convert flex/office space to lab use, given the growing life-science market fundamentals and current tenant’s demands resulting in a 50% lab space in the property. The opportunity is attractive given the relative value of a going-in basis of $175 PSF and Year 5 stabilized basis of $246 PSF compared to the replacement cost estimated at $300 PSF.
"Thanks to its comparatively low cost of living among other major cities in California, Sacramento is projected to continue to benefit from strong population growth."
Sacramento is an emerging life science market with venture capital funding sharply increasing in 2021, with over 100 biotechnology and medical device companies located in the region and a local talent base coming out of UC Davis.
Roseville benefits from its proximity to Sacramento’s life science and medical community, which is anchored by Kaiser Permanente, Sutter Health and UC Davis. Kaiser Permanente, whose newly constructed, 210,000 SF Roseville campus lies just over five miles from the Property, and Sutter Health are the largest private sector employers in Sacramento.
Despite the broader population decline throughout California, Sacramento saw population growth of 0.5% throughout 2020, largely due to in-migration from the San Francisco, San Jose and Los Angeles MSAs increasing 33.8%, 19.6% and 21.4% year- over-year, respectively, through 2020. Roseville’s net growth of 2.4% placed it among the top 10 fastest growing cities in California.
The property benefits from favorable population demographics, with Roseville’s median household income of $100,000 exceeding both that of the state ($75,000) and the nation ($67,000). The property benefits from strong local and regional connectivity via I-80, which is a major artery connecting Roseville to both Sacramento and the Bay Area.
Additionally, the property lies adjacent to the master planned Campus Oaks mixed-use development, which already features a market leading grocer, Nugget Markets (opened in March 2021), and will feature nearly 950 multifamily units and 500,000 SF of retail/commercial uses upon completion in 2022.