HOUSTON, TX – Reaffirming its commitment to the dynamic Houston market, Kumo Capital is pleased to announce the acquisition of Spring Cypress Multiplex, a 171,379 SF mixed-use property in the high-demand submarket of Tomball, TX. This acquisition was driven by a core investment thesis centered on a bulletproof basis, securing a quality, high-demand asset at a significant discount to market value.
#1: A Basis Play for Intrinsic Value
The foundation of this investment is its exceptional cost basis. Spring Cypress Multiplex was acquired for $16.83M, which translates to $98.24 per square foot. This represents a purchase price approximately 24% below the submarket average of ~$129/SF, providing a substantial margin of safety and intrinsic value from day one. This low-cost basis is the cornerstone of our strategy, creating a defensive position while unlocking significant upside potential for our investors.
High-Quality Asset in a High-Demand Location
Beyond the compelling entry point, the property itself is a high-performing asset in a thriving location. Situated in a dense, affluent area of Tomball, the property fronts Spring Cypress Road, which sees 22,600 vehicles daily. The strong demographics, combined with the property’s diverse mix of retail, flex industrial, and self-storage space, have resulted in a stabilized occupancy of over 96%. This demonstrates the asset’s good vintage and its proven appeal to a wide range of local and regional businesses.
Diversification and Immediate Returns
The property’s unique composition—19% Retail, 54% Flex Industrial, and 26% Self-Storage—provides multiple, strong revenue streams. This diversification, coupled with the high occupancy, delivers stable and immediate cash flow with an 8.9% cap rate in year one. Our strategy will further enhance this performance by converting leases to NNN and aligning rents with market rates, projected to boost NOI by 17% in the first three years.
This acquisition perfectly aligns with Kumo Capital’s strategy of identifying well-located, quality assets where we can secure a compelling cost basis. The Spring Cypress Multiplex is poised to deliver strong, risk-adjusted returns.
