REGAL CINEMAS LINCOLNSHIRE, IL OFFERING MEMORANDUM

Transcription

1 REGAL CINEMAS LINCOLNSHIRE, IL OFFERING MEMORANDUM

2 2 TABLE OF CONTENT INVESTMENT OVERVIEW FINANCIAL OVERVIEW TENANT OVERVIEW 11 AERIALS 17 DEMOGRAPHICS CLICK TO WATCH Regal Cinemas - Lincolnshire, IL 19 MARKET OVERVIEW PLAY

3 3 INVESTMENT OVERVIEW 4 INVESTMENT OVERVIEW INVESTMENT OVERVIEW Marcus & Millichap is pleased to present this trophy, Regal Cinemas in Lincolnshire, Illinois. This affluent Lake County suburb is less than 25 miles northwest of Chicago. Regal Cinemas has been operating at this location since The tenant demonstrated their commitment by exercising a 12-year extension option early, and investing $3.8 million of their own capital to perform a $5.7 million renovation. The work included: replacing the auditorium seating with luxury recliners, expanding and upgrading concession facilities, remodeling the box office, upgrading and replacing lighting, replacing interior/exterior signage, and much more. There are more than 11 years remaining on an absolute-net lease with zero landlord responsibilities. The lease is backed by a corporate guaranty from Regal Cinemas, Incorporated. In 2016, Regal Cinemas registered more than $3.6 billion in revenue across 7,315 screens in 561 theatres worldwide. The subject property features 15 screens and one IMAX theatre with luxury-reclining-stadium seating. The subject property is the entertainment anchor in the CityPark Live-Work-Play Life Style Center, which is situated at the signalized, hard corner intersection of Milwaukee Avenue and Aptakisic Road. More than 60,000 vehicles pass through this intersection daily. Milwaukee Avenue runs direct into Chicago s West Town neighborhood. CityPark represents a dramatic departure from the traditional suburban shopping center. This mixed-use center offers specialty shopping, dining, and entertainment with an exciting, urban atmosphere. With more than 70,000 square feet of class A office space, the CityPark Corporate Center is anchored by Camping World s (NYSE: CMA) corporate headquarters. The center has more than 75,000 square feet of restaurant and retail space; notable tenants include: Wildfire, Viper Alley (boutique concert venue, restaurant, and private event space), Red Robin, Liquid Fusion Café, and many more. In terms of hospitality, there is a 117-room Hampton Inn and Suites. While CityPark as a center has been around since the 1990s, significant capital is being invested to expand its residential capacity. 444 Social, which is situated directly adjacent to the Regal Cinemas, is a 300-unit class A multifamily development project. Leasing is expected to begin in the fall of 2018 with completion expected by spring of This asset also benefits from affluent demographics. There are more than 178,000 residents with an average household income (AHHI) of $126,000 within five miles. Adlai E Stevenson High School received a U.S. News Best High Schools Gold Rating, making it 6th best high in Illinois. Nationally, the school is ranked among the top 200 high schools. More than 3,800 students are enrolled. Trophy Regal Lincolnshire Stadium 15 and IMAX Affluent Lake County Suburb of Lincolnshire, Illinois 25 Miles Northwest of Chicago Tenant Exercised 12-Year Extension After 19 Years of Operation and Completed $5.7 Million in Capital Improvements in 2016 (More Than 65 Percent Was Tenant s Capital) More Than 11 Years Remaining on Absolute-Net (NNN) Lease Zero Landlord Responsibilities Corporate Guaranty Regal Cinemas, Incorporated $3.2 Billion Revenue Company (2016) Across 7,315 Screens in 561 Theatres Entertainment Anchor in CityPark Mixed- Use Live-Work-Play Live Style Center 70,000-Square-Foot, Three-Story Office Complex (Camping World Corporate Headquarters) 77,000 Square Feet of Restaurant-Retail Space (Wildfire and Viper Alley) 117-Room Hampton Inn & Suites Asset is Directly Adjacent to 444 Social 300- Unit Class A Multifamily Luxury Development Received $67 Million Construction Loan in October 2017 CityPark At Lincolnshire is Situated at the Signalized, Hard Corner Intersection of Milwaukee Avenue and Aptakisic Road More than 60,400 Vehicles Per Day (VPD) Affluent Demographics The Average Household Income (AHHI) is more than $128,500 Within Three Miles of This Asset Adlai E Stevenson High School Ranked Number Six in Illinois by U.S. News

4 5 FINANCIAL OVERVIEW 6 LEASE SUMMARY FINANCIAL OVERVIEW LEASE SUMMARY PRICE $27,357,244 LEASE COMMENCEMENT DATE 10/1/1998 CAP RATE 6.75% LEASE EXPIRATION DATE 2/19/2029 NOI $1,846,614 PRICE PER SQUARE FOOT $ RENT PER SQUARE FOOT $24.50 YEAR BUILT 1996/2016 APPROXIMATE LOT SIZE Acres LEASE TERM TERM REMAINING INCREASES OPTIONS TO RENEW 25 Years 11 Years 11-12% in Options 2, 5-Year GROSS LEASEABLE AREA 75,372 ANNUALIZED OPERATING DATA TYPE OF OWNERSHIP Fee Simple BASE RENT ANNUAL RENT MONTHLY RENT INCREASES PSF LEASE GUARANTOR LEASE TYPE ROOF AND STRUCTURE Regal Cinemas, Incorporated Absolute NNN Tenant Responsible Current 2/19/2029 $1,846,614 $153,885 $24.50 OPTIONS 2/20/2029 2/19/2034 $2,072,730 $172,728 12% $ /20/2034 2/19/2039 $2,298,846 $191,571 11% $30.50

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6 9 TENANT OVERVIEW 10 ADJACENT DEVELOPMENT OVERVIEW TENANT OVERVIEW - REGAL CINEMAS DEVELOPMENT OVERVIEW SOCIAL Regal Entertainment Group operates one of the largest and most geographically diverse theatre circuits in the United States, consisting of 7,315 screens in 561 theatres in 43 states along with Guam, Saipan, American Samoa and the District of Columbia (DC) as of September 30, Regal Entertainment Group, a Delaware corporation organized on March 6, 2002 is the parent company of Regal Entertainment Holdings, Incorporated, which is the parent company of Regal Cinemas Corporation and its subsidiaries. Regal Cinemas Corporation s subsidiaries include Regal Cinemas, Incorporated and its subsidiaries, which include Edwards Theatres, Incorporated and United Artists Theatre Company. The company operates theatres in 48 of the top 50 United States designated market areas. Regal believes that the size, reach and quality of the company s theatre circuit not only provides its patrons with a convenient and an enjoyable movie-going experience, but is also an exceptional platform to realize economies of scale in theatre operations. TENANT PROFILE TENANT TRADE NAME Regal Lincolnshire Stadium 15 & IMAX OWNERSHIP Public TENANT Regal Cinemas, Incorporated (Inc.) LEASE GUARANTOR Regal Cinemas, Incorporated (Inc.) NUMBER OF LOCATIONS 561 Units HEADQUARTERED Knoxville, Tennessee WEB SITE SALES VOLUME $3.2 Billion (2016) STOCK SYMBOL RGC BOARD New York Stock Exchange (NYSE) RANK #2 in Largest Movie Theatre Operator in United States (June 2016) Adjacent to Regal Cinemas, 444 Social features a mid-century modern design. Thoughtfullydesigned communal spaces create a vibrant and engaging atmosphere. Amenities include: outdoor dining, fire lounges, sun decks, bocce courts, a kayak launch, and a pool. Situated within Lincolnshire s CityPark Center, 444 Social will consist of over 300 luxury apartments divided between two buildings. The property will have 127 one-bedroom, 126 two-bedroom and 15 threebedroom units. 444 Social features distinctively designed homes that offer residents a new level of luxury. Functional floor plans are complemented by private balconies in each unit, to provide fresh, outdoor living space. Residents will enjoy the best of everything, with unparalleled amenities, designer interiors, unobstructed views and pet friendly accessibility. Leasing is expected to begin in the fall of 2018 with completion expected by spring of As of November 2017, underground plumbing and electrical piping has been installed in much of the north wing of the east residential building. Excellent progress has been made at forming and pouring the concrete foundations and stems walls in the south two wings of the east residential building. Half of the precast panels have been set for the west deck parking garage. If the weather holds, the precast subcontractor hopes to be finished by Thanksgiving, which is ahead of schedule.

7 11 AERIAL 12 DIRECT ACCESS TO CHICAGO Lincolnshire, Illinois is located less than 20 miles away from Chicago City Center.

8 13 AERIAL 14 CITY PARK COMPLEX OVERVIEW CITY PARK COMPLEX OVERVIEW The City Park Complex, Comprises of Four Parcels that Embodies the Eat, Live, Work, Play Lifestyle. Regal Cinemas (Offering) is a Major Driver within City Park.

9 15 AERIAL 16 NOTABLE CORPORATE TENANTS NOTABLE CORPORATE TENANTS Regal Cinemas (Offering) is Located Within a Prominent & Established Corporate Corridor

10 17 DEMOGRAPHICS 18 DEMOGRAPHICS $ POPULATION 5 MILES 2000 Population 181, Population 176, Population 178, Population 179,693 HOUSEHOLDS 5 MILES 2000 Households 65, Households 67, Households 67, Households 68,168 HOUSEHOLD (HH) INCOME 5 MILES 2017 Average HH Income $125, Median HH Income $97, Per Capita Income $47, CONSUMER SPENDING 5 MILES Food Away From Home $1,831,129,928 $1,193,284,041 Apparel & Services $839,691,685 $308,552,248 *As of 8/1/2017 per US Census Bureau Entertainment/ Recreation Personal Care Products & Services 176 e Zurich 12 Deer Park rness 14 Ivanhoe Sylvan Lake Hawthorn Woods Forest Lake Kildeer Palatine Mundelein Long Grove 53 Rolling Meadows 21 Vernon Hills 83 5 MILE RADIUS 3 MILE RADIUS 1 MILE Lincolnshire Buffalo Grove Mettawa Wheeling 22 Prospect Heights Arlington Heights 94 SITE Riverwoods Lake Bluff Bannockburn Lake Forest Deerfield 68 Fort Sheridan Northbrook Highwood Highland Park Northfield AERIAL Glencoe Winnet Ke

11 19 LINCOLNSHIRE, ILLINOIS 20 LINCOLNSHIRE OVERVIEW ABOUT LINCOLNSHIRE LINCOLNSHIRE TOP EMPLOYERS Lincolnshire is a village in Vernon Township, situated in Lake County. The village is seven miles northeast of Arlington Heights and 26 miles northwest of Chicago. Lake County is the third most populated county in the state, and the 31st wealthiest county in the United States. The Des Plaines River meanders through the eastern part of the village, dividing the town in half vertically at the village hall, while Half Day Road/Illinois Route 22 splits the village in half in an east west direction. Milwaukee Avenue/United States (US) Route 45 runs in a north south direction through Lincolnshire, into the village of Buffalo Grove to the south and Vernon Hills to the north. Lincolnshire has a robust economy representing a number of employers in professional services, retail, hospitality, educational services, real estate, and industrial sectors. Lincolnshire serves as the headquarters of Van Vlissingen & Company, a commercial real estate developer, the global outsourcing Aon Hewitt company, and the stationery products manufacturers Quill and ACCO Brands. Newman/Haas Racing, an auto racing team in the Indy Racing League, is based in the village. The Marriott Theatre, on the premises of the Marriott Lincolnshire Resort, sells approximately 400,000 tickets each year. The Marriot Lincolnshire Resort is also undergoing a $25 million renovation. The first two phases of the project have been completed, which include significant capital improvements to the resort s 390-room hotel and elegant pavilion. The third phase also is nearing completion. The project is transforming nearly every aspect of the resort, from introducing two new restaurants, adding a full-service Starbucks Cafe, new spa, as well as renovating all guest rooms. The Bricton Group manages the property known for its 18-hole championship golf course and the Marriott Theatre, which has the largest subscription base of any live musical theater in the country. No. Business Name Number of Employees 1 Aon Hewitt 3,864 2 Zebra Technologies 1,743 Line of Business Global human resources; outsourcing and consulting Marking, tracking and computer printing technologies 3 CDW 1,250 Technology products and services 4 School District 125 1,108 Public education 5 HydraForce 670 Hydraulic cartridge valves and control systems 6 Quill 425 Office products and supplies 7 Sedgebrook Lincolnshire-Prairie View School District 103 Senior living and care retirement community 373 Public education 9 Marriott Resort 312 Resort/entertainment 10 Sysmex 281 Medical equipment and devices The village of Lincolnshire holds an annual summer festival; The Taste of Lincolnshire features and advertises tastesize samples of local restaurants and provides local entertainment, including musicians, a raffle, and a local pet show. Since 1993, Lincolnshire has also held the Lincolnshire Art Festival. The event encourages Lake County artists to display their work to the community. As incentives for publicity, entertainment and parking are provided free of charge. Lincolnshire hosts a Fourth of July celebration annually, known as Red, White, and BOOM!, a collection of activities centered on the celebration of the American Independence Day. It incorporates live music, a raffle, and a fireworks show at local Spring Lake Park.

12 MARCUS & MILLICHAP HEREBY ADVISES ALL PROSPECTIVE PURCHASERS OF NET LEASED PROPERTY AS FOLLOWS: The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any information provided. As the Buyer of a net leased property, it is the Buyer s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any obligation to conduct a due diligence examination of this Property for Buyer. Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors. Buyer and Buyer s tax, financial, legal, and construction advisors should conduct a careful, independent investigation of any net leased property to determine to your satisfaction with the suitability of the property for your needs. Like all real estate investments, this investment carries significant risks. Buyer and Buyer s legal and financial advisors must request and carefully review all legal and financial documents related to the property and tenant. While the tenant s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including newly-constructed facilities or newly-acquired locations, may be set based on a tenant s projected sales with little or no record of actual performance, or comparable rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or may fail to comply with other material terms of the lease; cash flow may be interrupted in part or in whole due to market, economic, environmental or other conditions. Regardless of tenant history and lease guarantees, Buyer is responsible for conducting his/her own investigation of all matters affecting the intrinsic value of the property and the value of any long-term lease, including the likelihood of locating a replacement tenant if the current tenant should default or abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer s legal ability to make alternate use of the property. By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment Services and hold it harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this net leased property.

13 REGAL CINEMAS LINCOLNSHIRE, IL 300 PARKWAY DR, LINCOLNSHIRE, IL BROKER OF RECORD: STEVEN WEINSTOCK MARCUS & MILLICHAP OAK BROOK TERRACE, IL LICENSE: