FOR SALE - $3,069,900 (7.2% cap rate) –
Opportunity for Owner-User to Share Space with Existing Tenants
Built in 1966, the property is built out as a health department certified, commercial kitchen with over $1M in improvements including a new HVAC system and upgraded water, gas, and electrical service to accommodate existing and future equipment. The TasteLab has approximately 8,000 SF of usable cook and prep space complete with a double-sided hot line with gas ranges, stock pot burners, double stack ovens, grills, and broilers. The space has 2 walk-in refrigerators and a walk-in freezer (comprising approximately 800 SF), a full scullery room with a commercial dishwasher, and approximately 500 SF of individually locked dry storage rooms. All furniture, fixtures, and equipment, including commercial stand mixers, immersion blenders, robot coupe, deli slicers, and common kitchen equipment, i.e. pots and pans, are the property of the seller and shall convey with the sale. The receiving refrigerator is conveniently located by the loading dock, and the property’s wide hallways are able to accommodate pallets, making loading and unloading easy, as well as additional storage. The property also has approximately 800 SF of office space on 2 levels with attractive murals painted by local artists.
The entire property is leased, jointly and severally, to two, venture-backed tenants with approximately 3 years remaining on the initial lease term with one 3-year renewal option. Tenant A is a meal delivery company that provides healthy meals directly to customers. Tenant B is a catering company with large institutional contracts, specializing in breakfast and lunch foods available in coffee shops and grab-n-go spots in the DC metro area.
Designed by a kitchen consultant to optimize operations for large food businesses, the TasteLab was originally operated as a “food business incubator,” similar to Union Kitchen. Short-term license agreements provided local food entrepreneurs, including caterers, personal chefs, bakers, chocolatiers, beverage makers, snack makers, etc., with access to its full, commercial kitchen; lowering barriers to entry with lower price structures and not requiring equity in the businesses operating in its space. At its peak, the TasteLab hosted over 100 food-related businesses with revenues of over $60k/month. With its mix of world-renowned chefs and adventurous eaters, the District is well known for its thriving food scene. This fact should contribute to strong, increased demand, which combined with the property’s valuable, existing infrastructure, makes this a solid investment opportunity with significant upside potential and a high likelihood of value appreciation.
Click here to watch the property video!