Case Study: Valley Medical Building – Renton, WA

In 2017, we acquired the Valley Medical Building, a 34,243 SF medical office asset located on a multi-acre site directly adjacent to Valley Medical Center in Renton, WA. Over a three-year period, we stabilized operations and captured significant appreciation, ultimately realizing strong returns and executing a successful 1031 exchange into a 50,000 SF Class A office building along the SR-520 corridor.

INVESTMENT SNAPSHOT

Phase: Realized

Location: Renton

Property Type: Medical

Size: 34,243

Acquisition Date: 2017

Purchase Price: 5,050,000

Equity Raised:  $3,500,000

Sale Price:  $8,800,000

Sale Date: 2017

Strategy: Core

IRR: 29.64%

Multiple: 1.64

Cash on Cash: 6.06%

INVESTMENT THESIS

Strategic Location: The property’s adjacency to Valley Medical Center—the largest nonprofit healthcare provider between Seattle and Tacoma—offered strong tenant demand fundamentals and long-term value insulation.

Stable Cash Flow with Upside: The asset provided immediate cash flow with a diversified medical tenant base, while the underlying land value and strategic location offered medium-term appreciation potential.

Long-Term Redevelopment Potential: The size and positioning of the site created multiple strategic exit options, including redevelopment for higher-density medical or mixed-use purposes.

RESULTS

Successful Exit: Sold for $8,800,000 within three years of acquisition, delivering a 29.64% IRR and a 1.64x equity multiple.

Strategic Reinvestment: Proceeds were 1031 exchanged into a 50,000 SF Class A office building located along the SR-520 corridor, compounding investor capital into a larger, higher-profile asset.

Operational Performance: During the hold period, the property delivered consistent cash distributions while maintaining a strong occupancy profile.