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Bristlecone

Case Studies

Project Objective

Bristlecone was a unique Old Florida-style commercial-industrial mix property with an eclectic mix of existing businesses, including a leatherworking shop, a pizza restaurant, a winery, and a blacksmithing studio. Originally built in 1958, the building had undergone decades of haphazard expansions, resulting in a maze-like layout with multiple elevations and a disjointed structural design. Despite its unconventional configuration, the property was fundamentally sound, on large acreage, on a main road, with durable concrete block construction.

This acquisition posed significant challenges for most buyers. User/operator buyers struggled to make sense of the building’s layout, and for investors, the property was highly unattractive due to the extensive architectural and construction efforts required to bring it up to market standards for a new tenant. Recognizing the opportunity, Rich Global’s objective was clear: acquire the asset below market value, secure a high-quality long-term tenant, and optimize investment returns with minimal capital expenditure.

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Project Details

Project Solution

Leveraging our ability to execute creative deal structuring, Rich Global acquired Bristlecone for $1,537,500—securing a $170,000 discount from its true market potential had the building not been so cluttered with structural inefficiencies.

Prior to closing, Rich Global negotiated and secured a fully executed lease with a thriving, multi-location tenant expanding across Florida and the western U.S. The tenant’s strong financial standing and aggressive expansion strategy made this an ideal partnership for long-term stability.

A key success factor in this investment was that Rich Global structured the deal so that the tenant assumed all renovation and improvement costs—eliminating the need for a tenant improvement budget. The tenant invested over $1 million in upgrades, which included:

  • Full Interior Renovation: Complete gut and rebuild, refinished floors, new walls, custom-built cabinetry and countertops.
  • Business Expansion & Enhancement: Buildout of a Cigar Bar and retail space, securing a 4COP full liquor license, and creating expanded seating areas.
  • Exterior & Structural Improvements: Addition of a new patio space, installation of new doors and exterior siding, fresh paint, upgraded signage, and restroom renovations.
  • Specialty Food Sub-Tenant: The tenant introduced a complementary sub-tenant, further strengthening the financials of the primary tenant. Rich Global approved this sub-lease to enhance long-term success, reinforcing the tenant’s profitability and lease security.

Lease Structure & Flexibility

Rich Global structured a flexible and creative lease to allow the tenant time to renovate and establish operations while ensuring full rental payments over time:

  • 4-month rent abatement to support renovations.
  • 6 months of 50% deferred rent, helping tenant ease into operations.
  • 6 months of base rent plus deferred rent catch-up, ensuring Rich Global received full rental value while accommodating the tenant’s financial success.

This structured approach showcases Rich Global’s ability to identify and capitalize on unconventional opportunities by remaining flexible, creative, and strategically aligned with long-term value creation.

Project Results

  • Immediate 10% capitalization rate from the day of closing, ensuring strong investor returns with no additional capital expenditure.
  • Lease Structure:
    • 3% annual rent increases or CPI (whichever is greater).
    • 7-year initial term with (2) 5-year extension options, securing long-term stability and predictable cash flow.
  • Tenant-funded $1M property improvement, significantly increasing asset value without requiring any direct investment from Rich Global.
  • Projected Exit Strategies:
    • At an 8.0% cap rate, the projected sale price is $2,037,500, yielding a $500,000 exit profit.
    • At a 6.5% cap rate, the projected sale price is $2,507,692.31, yielding a $970,192.31 exit profit.
    • Minimum acceptable sale price at a 7.0% cap: $2,328,572, yielding a $791,072 exit profit.
    • Long-Term Strategy: Given the stability and strong performance of the tenant, there is no urgent need to sell. Rich Global will hold the asset for continuous cash flow and appreciation, ensuring long-term wealth creation.
    • If tenant were ever to vacate the lease, we have both corporate and personal guarantees, but the property would also attract a much higher lease now with the $1m+ in renovations which stays with the property. This investment can’t lose. 

Bristlecone is a testament to Rich Global’s ability to unlock value in complex, unconventional assets. By structuring a zero-cost tenant improvement plan, securing a high-growth tenant with a strong operational model, and implementing a strategic lease structure, this investment exemplifies Rich Global’s expertise in maximizing returns while minimizing capital risk. Through creative deal structuring, market foresight, and operational efficiency, Rich Global continues to set the industry standard for high-performance real estate investments.

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