CS1031 Tampa Pharma, DST
From inception in 2006, original tenant Xcelience grew from one facility with 45 employees to an international contract development and manufacturing organization (CMDO), with 7 facilities and over 200 employees. Strong growth attracted Capsugel, which acquired Xcelience in 2015, with more than 4,000 customers in 100 countries. In July 2017, Capsugel’s continued upward momentum led to its acquisition by Lonza Group, a Swiss pharmaceutical firm with sales of approximately $4.13 billion1.
Corporate Guaranty: Lonza’s American subsidiary, Lonza America, Inc., guarantees full payment and performance of the lease. Lonza is a leading pharmaceutical firm with a market capitalization of approximately $19 billion2. This new guaranty demonstrates the corporate-parent’s Lonza’s long-term commitment to the facility. There are 10 years remaining on the lease with 2.5% annual increases in the base rental rate, and two 5-year extension options.
Tenant’s representative estimates that Capsugel has spent approximately $6 million in build-out and equipment at the facility. The site is an FDA approved location, which is required to provide CDMO services to clients. The purchase price of $7,065,000 represents a $435,000 discount to the $7,500,000 appraised market value3. Tax-Free State: Florida does not have an income tax. Investors will not pay Florida income taxes.
Securities offered through WealthForge Securities, LLC, the managing broker-dealer for the CS1031Tampa Pharma, DST offering and member FINRA/SIPC. Capital Square and WealthForge are not affiliated.
Consider the Risks An investment in the Interests involves substantial investment and tax risks, including, without limitation, the following risks:
- Past performance is not a guarantee of future results.
- The economic success of the Interests will depend upon the results of operations of the Property. Fluctuations in vacancy rates, rent schedules, and operating expenses can adversely affect operating results or render the sale or refinancing of the Property difficult or unattractive.
- The Master Tenant’s capitalization is supported solely by the cash flow from the underlying tenant lease. The Sponsor is not under any obligation to contribute capital to the Master Tenant.
- No assurance can be given that future cash flow will be sufficient to make the debt service payments on any borrowed funds and also cover capital expenditures or operating expenses.
- No assurance can be given that Beneficial Owners of Interests will realize a substantial return (if any) on their investment or that they will not lose their entire investment in the Trust.
- The Interests are not freely transferable by the Beneficial Owners.
- There are various risks associated with owning, financing, operating, and leasing commercial properties in California.
- The Interests do not represent a diversified investment.
- Beneficial Owners must completely rely on the Master Tenant to collect the rent and operate, manage, lease, and maintain the Property.
- The Beneficial Owners have no voting rights with respect to the management or operations of the Trust or in connection with the sale of the property.
- There are various conflicts of interest among the Trust, the Sponsor, the Signatory Trustee, and their Affiliates.
- The Interests are illiquid.
- There are tax risks associated with an investment in the Interests.
- There are risks related to competition from properties similar to and near the property.
- There may be environmental risks related to the property.
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LocationTampa, FL
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Overview
Recently renovated 71,150-square-foot office and R&D lab used to design, develop and manufacture innovative new drugs for the biopharmaceutical, consumer health and nutrition industries
