Prime Commercial Property with Mixed-Use Potential

[Mitchell Coles]

Investment Info:

Retail commercial investment investment.

A prime commercial property located in the heart of Downtown Morganton, near the courthouse and surrounded by thriving businesses. The building features three long-term tenants on the upper level, each occupying spaces for over five years, with opportunities for upgrades and rent increases. The lower level is undergoing a significant build-out to house the third location of Arbol Eatery, a grab-and-go restaurant renowned for its fresh, flavorful offerings. The build-out also includes plans for a wellness and fitness center and an event space, creating a dynamic, multi-use property in a high-traffic area. With Morganton’s growing population, influx of major corporations like Tyson Foods, and frequent visitors traveling to and from the mountains, this property is perfectly positioned for long-term growth and profitability.

What made you interested in investing in this type of deal?

I was drawn to this deal because of its prime location in Downtown, near the courthouse and surrounded by thriving businesses. The property’s existing long-term tenants provided immediate cash flow, while the potential to build out the lower level for my restaurant, Arbol Eatery, and additional amenities like a wellness center and event space aligned with my vision for creating value. Morganton’s growing population and its appeal to both residents and visitors made this a strategic investment.

How did you find this deal and how did you negotiate it?

I found this deal through my local real estate network, which identified it as a high-potential commercial property in Downtown Morganton. Recognizing the opportunity to combine steady income from existing tenants with the ability to develop the lower level for Arbol Eatery and other amenities, I pursued direct negotiations with the seller. By presenting my vision for the property and emphasizing my ability to close quickly, I was able to secure favorable terms that aligned with my investment st

How did you finance this deal?

I financed this deal through a private lender, which allowed for a quick acquisition and the flexibility needed to fund the planned build-out for Arbol Eatery, the wellness center, and the event space. This financing strategy also provided the capital to make necessary upgrades to the existing tenant spaces, ensuring the property’s long-term profitability and alignment with my broader investment goals.

How did you add value to the deal?

I added value to the deal by retaining the 3 long-term tenants on the upper level, providing immediate cash flow, while planning upgrades to their units to justify future rent increases. Additionally, I initiated a transformative build-out of the lower level to include the third location of Arbol Eatery, a wellness and fitness center, and an event space. These enhancements significantly increase the property’s functionality, appeal, and income potential, making it a cornerstone of my portfolio.

What was the outcome?

The outcome is still in progress. The property is generating steady income from the three upper-level tenants, while the build-out for the lower level, including Arbol Eatery, a wellness center, and an event space, is underway. Once completed, these additions will significantly enhance the property’s value and income potential. The investment is on track to become a dynamic, mixed-use destination in Downtown Morganton, benefiting both my portfolio and the local community.

Lessons learned? Challenges?

Maintaining clear communication with existing tenants is essential during redevelopment projects. Reassuring long-standing tenants that they are valued and included in the long-term vision helps build trust and ensures stability. Strategic planning and phased upgrades are critical to balancing renovations with ongoing operations.