400 Tesconi Circle — Industrial Lease-Up & Long-Term NNN Tenant
An owner who had outgrown a small industrial building with a large yard wanted to keep it as an investment rather than sell — which meant landing a quality tenant on a long lease in a slowing market, while still moving out. We marketed early, found the one tenant whose unusual requirement matched the site, and structured a 10-year NNN lease that started above market.
The Challenge
The owner had acquired 400 Tesconi Circle through a 1031 exchange because its yard space and flexibility let the business expand and pursue larger contracts. As the company kept growing, it secured a much larger facility — which raised the question of whether to sell Tesconi Circle or keep it as an investment.
The owner preferred to hold, but holding meant establishing stable rental income at an awkward moment.
Three factors complicated the timing:
- The owner was still transitioning operations into the new facility
- The industrial leasing market was slowing, reducing tenant activity
- The layout — a smaller industrial building on a large parking and yard area — limited the pool of tenants
The Action
We advised starting the leasing campaign early, before the business had fully vacated, so the property was in front of tenants while the move was still under way.
Targeted outreach surfaced a company searching for exactly this configuration: a smaller industrial building with a large parking and staging area. The catch was timing — the tenant was roughly twelve months early, with a lease that had not yet expired.
With a slow market and a pending vacancy, we structured a deal that aligned both timelines:
- Significant free rent to bridge the tenant's overlap with its existing lease
- A limited tenant-improvement allowance for operational needs
- A 10-year triple-net lease
Because the improvements customized the building to the tenant's operation, the owner could justify a rental rate above prevailing comparables — so the lease started from a higher base while keeping annual escalations.
The Result
The outcome was a 10-year NNN lease with a rapidly growing national company, turning the property into a stabilized, income-producing asset.
Key outcomes:
- A 10-year triple-net lease executed
- Above-market rent supported by tenant improvements
- Annual escalations compounding from a higher base
- Immediate stabilization as a cash-flowing asset
The lease increased the property's valuation by approximately $1,000,000. Shortly after execution, the tenant was acquired by BlackRock, strengthening the credit behind the lease and improving the property's cap-rate and refinancing position. The owner now holds a long-term, passive income asset — the outcome the 1031 purchase was meant to deliver.
The property
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