Let’s go to Alexandria, LA, where Austin Johnson and D. Parker Moring, Jr., appraised a ±45,000 square foot, repurposed Toys-R-Us that was thoroughly updated and reconfigured into a Multitenant Medical Office, some of whose tenants are quite specialized and serve much of Central Louisiana. Repurposed/Second Generation buildings are always an adventure in depreciation quantification as there are multiple moving parts to consider with this calculation, and the final figure is usually both objective and subjective. Medical Office has special considerations, especially currently because the cost of construction has gone up tremendously due to the specialized buildout which includes extensive plumbing and electrical requirements. There are fewer medical offices being built for this reason and the presence or absence of a characteristic in an existing building carries more weight. Above all, this assignment was an excellent case study on how to create value after losing a credit tenant in a struggling market.
