Description​

INVESTMENT OVERVIEW

10-Year Hands-Off Investment | $250K+ in Recent Upgrades | Steps from the Federal Courthouse.

 

COMPASS is proud to offer 107 N. 3rd Street, a rare opportunity to own a fully renovated, long-term leased property in the heart of Rockford's civic center. Occupied for 12 years by the Youth Services Network (YSN), this building serves as an essential hub for the community’s social infrastructure.

 

Why This is a "Smart Money" Buy:

The "Fortress" Location: While some neighboring blocks are in transition, this property is located in the "Civic Core." Being steps away from the Federal Courthouse, City Hall, and County Courts provides long-term land value that "one-off" retail locations simply cannot match. You are buying into the permanent heart of the city.

 

Zero Near-Term Maintenance: The current owner has already done the heavy lifting for you. With a brand-new $145,000 roof, new 2025 HVAC units, and energy-efficient LED upgrades, your "net" income is protected from expensive surprise repairs.

 

A "Tenant for Life": Youth Services Network isn't just a tenant; they are a community pillar. They relocated here specifically to be near the courts and the families they serve. With a new 10-year lease extension, they have signaled their intent to remain here for the long haul.

 

Immediate High Yield: At an 8.68% return (Cap Rate), this property pays significantly more than a savings account or a typical NNN franchise, while offering the security of a tenant backed by nearly $8.5M in annual funding.

 

Walkable Amenities: Your investment is located in a vibrant "work-and-play" district, just blocks from the BMO Center, Prairie Street Brewing, and the riverfront.

 

INVESTMENT HIGHLIGHTS

Extensive Recent Capital Improvements: Over $250,000 has been reinvested into the property recently, significantly de-risking the asset for the next owner:

Roof: Full replacement completed ($145,000)

HVAC: Proactive mechanical lifecycle management; 2 units replaced in May 2025

Energy Efficiency: Full LED lighting conversion with motion sensors (2021)

Accessibility & Cosmetics: New wheelchair ramp ($8k+), fresh foyer flooring (Feb 2026), and parking lot seal/stripe (May 2025)

 

10-Year Lease Commitment: A new 126-month lease through June 2035 reinforces the tenant’s 12-year history at this site. The lease features a programmed rent bump in 2030, ensuring predictable long-term cash flow.

 

Essential "Recession-Proof" Tenant: YSN is a state-licensed child welfare agency (est. 1982) serving 8,000+ families annually. Their $8.5M+ revenue stream is largely grant-funded, making them highly resistant to market volatility.

 

Strategic Civic Location: Positioned in the downtown core, at the crossroads of five levels of government, ensuring constant professional traffic and mission-critical relevance for the tenant: The Stanley J. Roszkowski U.S. Federal Courthouse,

The Winnebago County Courthouse, Rockford City Hall, Winnebago County Justice Center, and Rockford Social Security Office. The facility is geographically essential for the tenant’s state-mandated social service delivery.

 

Exceptional Basis & Yield: At an 8.68% cap rate and $62.54/SF, this property is priced below replacement cost while offering a yield significantly higher than comparable NNN assets in primary Illinois markets.

 

OCCUPANCY AND TENANCY HISTORY

Youth Services Network (YSN) has established a long and stable operating presence at the property. Youth Services Network provides youth and family services throughout the Rockford region, supporting a range of community-based programs.

 

The organization relocated to this location approximately 12 years ago following a local roadway expansion and has since expanded its operations to occupy the entire building, utilizing the property as its primary service hub in Rockford.

 

Throughout its tenancy, YSN has maintained a positive relationship with ownership, demonstrated by consistent on-time rent payments and responsible occupancy. The organization’s long-term presence and full-building utilization underscore the property's importance to its ongoing operations.

 

The property itself has supported public-service and government-related uses since 1998, reinforcing the site’s long-standing role in serving community-focused organizations and its continued suitability for similar uses.

 

To support a smooth ownership transition, a local professional familiar with the property and its operational history is available to remain with the asset, providing continuity and reliable local oversight for the benefit of the tenant and future ownership.

 

YSN is a pillar of the Northern Illinois social safety net, providing 24-hour trauma response and foster care services. Their relocation to this site 12 years ago was a strategic move to ensure proximity to the population they serve, making this location mission-critical to their charter.