We have a master lease that cashflows $13,000 a month. This is a fully licensed and built out location for distribution and manufacturing in a 16,000 sq foot building in Northern California.
The cashflow is the delta in rents between what we receive from sub tenants and what we pay the property owner. It's fully tenanted with two strong tenants that are well capitalized with both corporate and personal guaranties.
Currently, there’s 2 years left on the lease with a 5 year option. However we believe the owner would give a new 5 year lease, with a 5 year option to an incoming party.
This deal would make sense for someone that wants to allocate funds to the cannabis industry and receive a long term cashflow.
We’re valuing it at $399,000 negotiable for someone that wants to take over our position. Based on the cashflow and our asking price the buyer would receive a 31% yield on capital invested.
We’re looking to sell so we can inject the capital into another business.