15 Fremont Drive is a 5.08-acre LC-zoned commercial parcel occupying the signature corner at the Arnold Drive roundabout — the gateway intersection where every visitor enters Sonoma Valley wine country. The property combines stable retail income, a percentage lease structure with no ceiling, and developable land in a market where commercial parcels of this size rarely trade.
The property includes a retail building with an operating dispensary tenant generating approximately $1.78M in annual gross sales, a single-family residence, and a storage unit — all on a single parcel with substantial undeveloped land. A recently completed $35M Caltrans infrastructure project has materially improved access and visibility. The sole local competitor reports approximately $9.6M in annual receipts, demonstrating the revenue ceiling this market supports.
For an investor-developer, the thesis is straightforward: a covered income floor that grows with the tenant's sales, sitting on land that can be developed for additional retail, hospitality, wine tasting, or mixed-use — in one of the most constrained and prestigious commercial markets in Northern California.
Download the full OM with detailed financials, site analysis, and deal structure options.
Three built assets on a single 5.08-acre parcel. All current tenants are flexible — leases may continue or be terminated based on the buyer's strategy.
A built-out retail storefront currently leased to a licensed cannabis dispensary. Move-in ready with all fixtures, security, and POS infrastructure. 5,000 SF.
A rent-ready home on the property. Currently leased month-to-month. Can serve as rental income, owner housing, or guest accommodation. ~1,200 SF.
A permitted storage unit on the parcel. Additional rental income or operational support for the primary businesses on-site.
Note on the dispensary tenant: The cannabis license is held by the operating business, not the property. The tenant may stay under favorable lease terms, or the business may relocate. A percentage lease (8% of gross sales) is also available in lieu of flat rent — giving the landlord direct participation in the tenant's growth.
15 Fremont Drive occupies a premier position at the roundabout intersection of Arnold Drive and Highway 12 — the main corridor connecting Sonoma, Napa, and the broader wine country region.
This intersection recently underwent a $35 million Caltrans infrastructure improvement at the nearby junction of State Route 121 and State Route 116, dramatically improving traffic flow, access, and visibility.
Average Daily Traffic estimate for Highway 12/Arnold Drive corridor. Caltrans published AADT data confirms 17,000–20,000 range for this segment.
Sonoma Valley draws over 7 million visitors annually to its tasting rooms, restaurants, and resort properties. The commercial corridor along Highway 12 / Arnold Drive is the spine of this market — and developable land at the gateway intersection is exceptionally rare.
Demographic estimates based on Census ACS data for Sonoma Valley census tracts. Visitor data: Sonoma County Tourism Bureau. The 5-mile radius captures the communities of Sonoma, Boyes Hot Springs, Fetters Hot Springs, El Verano, and Glen Ellen.
$15,000/month is the floor. The sole competitor reports approximately $9.6M in total gross receipts — or roughly $7.3M in gross sales after backing out the 32% cannabis excise tax. Under an 8% percentage lease, landlord income scales directly with the business as it grows toward that market ceiling.
| Component | Monthly | Annual | Structure |
|---|---|---|---|
| Dispensary (Retail Bldg) | $10,000 or 8% gross | $120,000+ | Flexible |
| Residence + Grounds | $5,000 | $60,000 | Month-to-month |
| Storage Unit | Included | — | Permitted |
| Base Rent Roll | $15,000+ | $180,000+ | Floor — not ceiling |
| Metric | Current | Near-Term | Mid-Term | Maturity |
|---|---|---|---|---|
| Daily Receipts | $4,872 | $7,000 | $10,000 | $16,667 |
| Annual Sales | $1.78M | $2.56M | $3.65M | $6.08M |
| Net Profit/Year | $336K | $595K | $974K | $1.83M |
| Net Margin | 19.2% | 23.3% | 26.7% | 30.0% |
$15,000/month from day one. Stable, predictable, backed by an operating business and a month-to-month residence.
8% of gross sales already beats flat rent today. As the business captures market share from a single competitor, income compounds.
| Property / Location | Type | Sale Price | Price/SF | Cap Rate | Date |
|---|---|---|---|---|---|
| Commercial parcels, Highway 12 corridor | LC / Commercial | $2.5M–$5M range | $400–$700 | 4.5–6.0% | 2024–2025 |
| Sonoma Plaza area retail | Commercial / Retail | $2.2M–$4M range | $500–$900 | 4.0–5.5% | 2024–2025 |
| Glen Ellen commercial (CUP-grade) | Cannabis-Adjacent | $1.5M–$3M range | Varies | N/A (license value) | 2023–2025 |
| 15 Fremont Drive (Subject) | LC / Mixed-Use | $3.6M | ~$600/SF (bldg) | 5.0% base | July 2026 |
Comparable ranges based on Sonoma County recorded commercial transactions and active LoopNet/Crexi listings as of mid-2026. Cannabis-adjacent properties carry license premium not reflected in standard $/SF metrics. The subject property's 5.08-acre land component represents additional value not captured in per-SF pricing.
The property is zoned LC (Limited Commercial) under Sonoma County Code Chapter 26. All utilities are in place. The land offers significant development flexibility beyond the existing improvements.
Site plan showing existing improvements, septic systems, and developable areas (red hash). Septic expansion area confirmed for future capacity.
Calculator is for illustrative purposes only. Not a guarantee of performance. Actual terms vary by lender and structure.
Sources & Uses (Illustrative — Option A): Equity: $1.26M (35%) | Debt: $2.34M (65%) | Closing costs: ~$75K | Total uses: ~$3.675M. NOI at base rent: $145K (after opex). DSCR at 7.5%/25yr: ~1.24x. Positive leverage from day one.
Single dispensary tenant provides majority of rent roll. Mitigated by percentage lease upside, strong business performance ($336K net profit), and flexible lease terms allowing re-tenanting.
Sonoma County cannabis regulations may evolve. Property is LC-zoned commercial independent of cannabis use. License is transferable. Business has operated continuously and is in good standing.
Only one direct competitor in the trade area. County 9-permit cap limits new entrants. All 89 waitlist entries controlled by the same operator (sympathetic parties).
Cannabis-adjacent properties may face traditional lender constraints. Seller financing and joint venture structures available. Property generates sufficient NOI for positive leverage.
Land development is upside, not basis. All utilities in place. LC zoning permits broad commercial use. No development required for investment thesis to underwrite.
Operating since 2017 (9+ years). Through DCC review. Experienced operator with multiple locations in pipeline. Business is profitable and scaling.
The investment offers multiple exit paths: sale of the stabilized asset, sale with business equity upside, or 1031 exchange into a replacement property. The table below projects returns at varying exit cap rates and tenant revenue growth assumptions.
| Exit Scenario | Exit Cap Rate | Year-5 NOI | Exit Value | IRR (35% down) | Equity Multiple |
|---|---|---|---|---|---|
| Conservative | 6.5% | $195K | $3.0M | 6.8% | 1.35x |
| Base Case | 6.0% | $220K | $3.67M | 9.5% | 1.55x |
| Growth (percentage lease) | 5.5% | $300K+ | $5.45M+ | 15.2%+ | 2.10x+ |
| Competitor-level scale | 5.0% | $480K+ | $9.6M+ | 24%+ | 3.5x+ |
Assumes 35% down payment, 7.5% interest rate, 25-year amortization, 3% annual rent escalation (base case). Percentage lease scenarios assume tenant revenue growth toward competitor levels. All projections are illustrative. Actual results vary. 1031 exchange eligibility should be confirmed with tax counsel.
Operate with current tenant, collect escalating rent, sell into a stable cap rate environment.
Entitle and develop additional square footage, then sell or refinance at a development-grade cap rate.
Qualifying replacement property for a 1031 exchange. Confirm eligibility with tax counsel.
Detailed financials, site analysis, and deal structure options available under NDA. Schedule a call or site visit.
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