MIDTOWN 7.27-ACRE CASH-FLOWING RE-DEVELOPMENT OPPORTUNITY IN THE HEART OF RALEIGH WEGMAN S ADJACENT

Transcription

1 MIDTOWN 7.27-ACRE CASH-FLOWING RE-DEVELOPMENT OPPORTUNITY IN THE HEART OF RALEIGH WEGMAN S ADJACENT

2 EXECUTIVE SUMMARY THE INVESTMENT OPPORTUNITY 7.27-Acre Cash-Flowing Re-Development Opportunity in the Heart of Raleigh Wegman s Adjacent HFF is pleased to offer for sale 601Midtown, a rare 7.27-acre cash-flowing asset within the acclaimed Midtown area of Raleigh. With 57,804SF of retail space currently fully leased on site, the in-place NOI of $181,289 is attractive from a long-term investment standpoint, or a faster redevelopment scenario. A re-tenanting of the space for retail or office use is certainly a potential, as is a complete demolition and redevelopment of the site for mixed-use or residential. Entitled for dense multifamily, office, retail and more, 601Midtown is well-positioned for high-end development in a luxurious submarket known for long term sustainability, excellent access to employers, and walkability to desirable lifestyle amenities. RESEARCH TRIANGLE PARK 40 Morrisville UMSTEAD PARK 40 CARY 540 RALEIGH-DURHAM INTERNATIONAL AIRPORT NORTH HILLS K Ideally situated between Downtown Raleigh and North Hills, 601Midtown comes with invaluable proximity to major employment and retail destinations. Additionally, 601Midtown sits immediately adjacent to Midtown East, an iconic 173,000SF, Wegman s-anchored development with a curated mix of shops, restaurants, and service users. 601Midtown is also a mere 3 minutes from the expansive walkable retail establishments and ancillary office within North Hills. Apex Garner PROPERTY DETAILS Address 601 E Six Forks Rd Raleigh, NC, Wake County PINs , Municipality Total Acreage (approx.) 7.27 Zoning Max Height By-Right Uses Current Use City of Raleigh CX-3-PL (Commercial Mixed Use - 3-Story Height Maximum - Parking Limited) 3 Stories In-Place NOI $181,289 Total Square Footage Current Tenants Multifamily, Retail, Office, Medical Office, Hotel PIN ,852SF Lifetime Fitness PIN ,952SF Enterprise Office 57,804SF Occupancy 100% Lifetime Fitness - 54,852SF Enterprise - 2,952SF State Employees Credit Union - ATM SURROUNDING DEMOGRAPHICS RADIUS 1-MILE 3-MILE 5-MILE 2018 Population 7,543 92, ,822 Census Population (2000) 5,230 80, ,183 Historical Population Growth as % ( ) 5.50% 1.90% 2.00% Avg Household Income $89,480 $94,578 $85,674 Median Household Income $69,494 $73,551 $67,346 Per Capita Income $39,446 $41,663 $35,244 Median Age % Bachelors Degree or Higher 54.8% 51.6% 47.9% % HH Incomes over $100,000 32% 31% 28% Source: Regis EXECUTIVE SUMMARY

3 RDU INTERNATIONAL AIRPORT 18 minutes west ST. DAVID S SCHOOL CRABTREE VALLEY MALL 1,400,000 SF DREWRY HILLS NEIGHBORHOOD $400,000 - $3,000,000 NORTH HILLS NEIGHBORHOOD $350,000 - $1,500,000 NORTH HILLS OFFICE PARK NORTH HILLS MIXED-USE DEVELOPMENT 1,400,000+ SF Office 1,800+ Multifamily Units 170+ Upscale Retail Shops, Services & Restaurants NORTH HILLS EAST EXPANSION Under Construction/Proposed 2,089 multifamily units 1,000,000+ SF Office 300 Hotel Keys CRABTREE CREEK GREENWAY TRAIL ANDERSON FLATS 182 units TOWNS AT CHESWICK $350,000 - $450, ,000 VPD DUKE RALEIGH HOSPITAL 138 beds 13,000 employees CREEKSIDE CROSSING 145,500 SF WAKE FOREST RD 66,000 VPD THOMPSON BUICK/GMC/CADILLAC SIX FORKS RD 33,000 VPD MIDTOWN EAST Under Construction 173,000 SF Wegman s Anchored Retail Development HOLLY PARK SHOPPING CENTER 160,000 SF DOWNTOWN RALEIGH 5 minutes south 150,000 SF 3

4 PARK CENTRAL NORTH HILLS ATTRACTIVE IN-PLACE RENT WITH QUICK TERMINATION RIGHTS 601Midtown has the luxury of in place rent today, which will serve a new owner well post-closing. Currently, there are three tenants on site paying rent, with the potential for quick termination of the largest tenant, Lifetime Fitness. This would immediately unlock considerable value for a developer, if the desire is to re-tenant the space, or completely redevelop the site. Further, a buyer has the ability to keep the current tenancy if that is the short term desire. ACCRETIVE IN-PLACE ZONING: CX PL The current zoning of CX 3 PL (Commercial Mixed-Use 3-Story Maximum Parking Limited) adds significant value for developers as it allows for several accretive by-right development avenues today. By-right development types include multifamily, office, retail, medical office, and hotel. While the current height maximum is 3 stories, the myriad of development options gives a buyer ultimate flexibility on the site, and without the need to rezone. BANK OF AMERICA TOWER NEARBY VALUE DRIVERS Located just inside Raleigh s beltline, 601Midtown finds itself in the center of a business hub with abundant amenities and nearby resources. With the $2.5B+ North Hills spanning 130 acres just 1.2 miles and a 3-minute drive from 601Midtown s front door, there are endless amenities at the fingertips of a 601Midtown resident, or employee. Additionally, just.5 miles and 2 minutes from 601Midtown lies Duke Raleigh Hospital. Duke Raleigh has 138 inpatient beds, as well as 1,300 employees on site. In fiscal year 2017, Duke Raleigh Hospital admitted 9,588 patients and 230,957 outpatient visits. Finally, the immediately adjacent Midtown East development, anchored by Raleigh s first Wegman s, is a true testament to the positive development in the area. VILLAGE GREEN - NORTH HILLS MAIN 4 EXECUTIVE SUMMARY

5 MIDTOWN/NORTH HILLS DEVELOPMENT PIPELINE NORTH HILLS N INCREASINGLY URBAN INFILL LOCATION SIX FORKS RD WAKE FOREST RD The Midtown/North Hills submarket is experiencing unprecedented economic growth resulting in increased urbanization of the area. With the sprawling development of North Hills to the northwest, the Midtown submarket boasts a development pipeline largely made up of multifamily, office, retail and mixed-use projects that will further amenitize the area and position the submarket as a true urban infill location. With this, 601Midtown offers close proximity to not only vast retail and restaurant options, but over 1.5MSF of Class-A office space within a 3-minute drive. Given the additional future development in the area, this site is poised for long-term success ,894 TOTAL NUMBER OF MULTIFAMILY UNITS PROPOSED/ UNDER CONSTRUCTION 685 TOTAL NUMBER OF HOTEL ROOMS PROPOSED/UN- DER CONSTRUCTION 1,415,000 TOTAL NUMBER OF OFFICE SF PROPOSED/UNDER CONSTRUCTION 204,400 TOTAL NUMBER OF RETAIL SF PROPOSED/UNDER CONSTRUCTION OFFICE RESIDENTIAL HOTEL RETAIL MEDICAL No. Project Name Developer Product Type Development Size Status 1 North Hills Tower IV Kane Realty Office 325,000SF Under Construction 2 Walter Tower Kane Realty Multifamily 294 Units Under Construction 3 Walter Hotel Kane Realty Hotel 193 Keys Under Construction 4 Vine Apartments Kane Realty Multifamily 325 Units Under Construction 5 North Hills Tower V Kane Realty Office 300,000SF Proposed 6 Dewitt Office Dewitt Carolinas Office 790,000SF Proposed 7 Dewitt Multifamily Dewitt Carolinas Multifamily 1,275 Units Proposed 8 Dewitt Hotel Dewitt Carolinas Hotel 300 Keys Proposed 9 Dewitt Senior Living Dewitt Carolinas Senior Multifamily 300 Units Proposed 10 Reserve at North Hills NorthView Partners Senior Multifamily 189 Units Proposed 11 Towns at Cheswick Ashton Woods Townhomes 89 Towns Under Construction 12 Midtown East Regency Centers Retail 173,000SF Under Construction 13 McNeill Pointe Bobby Lewis Retail 31,400SF Under Construction 14 Duke Raleigh Expansion Duke University Medical 210,000SF Under Construction 15 Hampton Inn Private Investor Hotel Proposed Midtown TBD TBD TBD n/a 5

6 NORTH HILLS MIXED-USE DEVELOPMENT 1,400,000+ SF Office 1,800+ Multifamily Units 170+ Upscale Retail Shops, Services & Restaurants DREWRY HILLS NEIGHBORHOOD $400,000 - $3,000,000 NORTH HILLS EAST EXPANSION Under Construction/Proposed 2,089 multifamily units 1,000,000+ SF Office 300 Hotel Keys M I DTOWN R A LE I G H a flourishing urban-suburban node As Raleigh continues to grow and evolve, Midtown has become a leader in attracting residents, companies, retailers, and overall density in masses. With proximity to density at nearby North Hills, easy commutes to high-income affluent neighborhoods, and lack of traffic compared to the more dense areas such as Downtown Raleigh, many large office users have relocated from Downtown to Midtown to achieve a true live-work-play environment. 6 EXECUTIVE SUMMARY

7 $2.5B+ IN ESTIMATED DEVELOPMENT SINCE 2004 MIDTOWN RALEIGH ANCHORED BY NORTH HILLS THE TRIANGLE S QUINTESSENTIAL MIXED-USE DISTRICT $37+ PER SQUARE FOOT OFFICE RENTS RALEIGH S UNIQUE, WALKABLE LIVE-WORK-PLAY DESTINATION The North Hills area has undergone a remarkable $2.5 billion transformation in the past 15 years since visionary Kane Realty Corporation began redeveloping the former North Hills Mall. Today, North Hills is one of the Southeast s most successful and vibrant mixed-use destinations that has attracted sought-after boutique and big box retailers, notable national and international employers, and numerous high-end residential options. 5,000+ EMPLOYMENT (ESTIMATED) MIDTOWN S CACHET AND APPEAL BOLSTERED BY NORTH HILLS INSTITUTIONAL SUCCESS With institutional capital approval and over $1B in investment since 2012, North Hills has raised the profile of North Raleigh with global capital sources as a desirable residential enclave with top-tier employment and retail. $40+ PER SQUARE FOOT RETAIL RENTS NORTH HILLS DEVELOPMENT SURGE LIFTS ACHIEVABLE RENTS ACROSS NORTH RALEIGH Underpinned by the best capital in the world, Midtown Raleigh and North Hills are in growth mode with robust, diverse development pipelines to meet the area s wellheeled residents and employees. With top-of-market multifamily rents - of $2,000+ multifamily rent and $37 PSF office rent North Hills success has lifted demand and rents throughout North Raleigh and Midtown. +3M ANNUAL VISITORS 7

8 ADJACENT WALKABLE RETAIL DRIVES VALUE RENDERING SOURCE: COSTAR An undoubtedly strong attribute of 601Midtown its immediate walkability to the area s desirable retail. Specifically, the under-construction 173,000SF Midtown East, anchored by Raleigh s first Wegman s. Current shop tenants include: Midtown East has 38,615SF of additional restaurant and retail space remaining, all of which is less than 100 yards from the front door of a 601Midtown development. BURGERFI - HOLLY PARK Adjacent to Midtown East (1/5th mile from 601Midtown) lies Holly Park Shopping Center, a 160,000SF shopping center anchored by Trader Joe s, and Ross. Similar to Midtown East, Holly Park is a walkable retail destination that has all of the retail options a consumer would desire. From restaurants, to grocer, to service users, to auto parts, Holly Park can serve almost all weekly needs in one stop. RESTAURANT OPTIONS WITHIN HOLLY PARK: TRADER JOE S - HOLLY PARK 8 EXECUTIVE SUMMARY

9 DIRECT ADJACENCY AND WALKABILITY TO INCREDIBLE RETAIL NORTH HILLS 3 minute drive HOLLY PARK SHOPPING CENTER 160,000 SF 137,000 VPD DUKE RALEIGH HOSPITAL 138 beds 13,000 employees CREEKSIDE CROSSING 145,500 SF MIDTOWN EAST Under Construction 173,000 SF Wegman s Anchored Retail Development SIX FORKS RD 33,000 VPD WAKE FOREST RD 66,000 VPD 150,000 SF 601 MIDTOWN 9

10 DOWNTOWN RALEIGH 50,000+ Employees 3.2M annual visitors 144% population increase since 2000 RDU INTERNATIONAL AIRPORT 18 minutes west via I-40 DOCK 1053 Retail/Creative Office 127,000 SF 1 MCNEILL POINTE 31,400SF Retail Center Under Construction RESEARCH TRIANGLE PARK 20 minutes west via I-40 7,000 acres 22.5MSF commercial space 1 RALEIGH IRONWORKS Planned 200,000+SF office 50,000+sf retail +/-230 multifamily units CRABTREE CREEK GREENWAY TRAIL NORTH HILLS MIXED-USE DEVELOPMENT 1,400,000+ SF Office 1,800+ Multifamily Units 170+ Upscale Retail Shops, Services & Restaurants MIDTOWN EAST Under Construction 173,000 SF Wegman s Anchored Retail Development 150,000 SF SIX FORKS RD 33,000 VPD WAKE FOREST RD 66,000 VPD CREEKSIDE CROSSING 145,500 SF investment advisors analyst structured finance JUSTIN GOOD Managing Director jgood@hfflp.com SARAH GODWIN Director sgodwin@hfflp.com JEFF GLENN Managing Director jglenn@hfflp.com ALLAN LYNCH Senior Director alynch@hfflp.com CAYLOR MARK Director cmark@hfflp.com TOM KOLARCZYK Director tkolarczyk@hfflp.com JOHN MIKELS Real Estate Analyst jmikels@hfflp.com ROGER EDWARDS Senior Director redwards@hfflp.com TRAVIS ANDERSON Senior Managing Director tanderson@hfflp.com Holliday Fenoglio Fowler, L.P. acting by and through Holliday GP Corp a North Carolina licensed real estate broker ( HFF ). Seller will be selling the Property on an as-is, where is basis and will not be making any representations or warranties regarding the condition or suitability of the property. 201 NORTH TRYON STREET SUITE 1400 CHARLOTTE, NORTH CAROLINA SIX FORKS ROAD SUITE 876 RALEIGH, NORTH CAROLINA HFF has been engaged by the owner of the property to market it for sale. Information concerning the property described herein has been obtained from sources other than HFF, and neither Owner nor HFF, nor their respective equity holders, officers, employees and agents makes any representations or warranties, express or implied, as to the accuracy or completeness of such information. Any and all reference to age, square footage, income, expenses and any other property specific information are approximate. Any opinions, assumptions, or estimates contained herein are projections only and used for illustrative purposes and may be based on assumptions or due diligence criteria different from that used by a purchaser, and HFF, its partners, officers, employees and agents disclaim any liability that may be based upon or related to the information contained herein. Prospective purchasers should conduct their own independent investigation and rely on those results. The information contained herein is subject to change. Holliday Fenoglio Fowler, L.P., HFF Real Estate Limited (collectively, HFF ), HFF Securities L.P. and HFF Securities Limited (collectively, HFFS ) are owned by HFF, Inc. (NYSE: HF). HFF and its affiliates operate out of 26 offices and are a leading provider of commercial real estate and capital markets services to the global commercial real estate industry. HFF, together with its affiliates, offers clients a fully integrated capital markets platform including debt placement, investment advisory, equity placement, funds marketing, M&A and corporate advisory, loan sales and loan servicing. For more information please visit hfflp.com or follow HFF on