Subject Property. Advance Auto Parts Kansas City, KS. Offering Memorandum THE NET LEASE AUTHORITY

Transcription

1 Subject Property Advance Auto Parts Kansas City, KS Offering Memorandum THE NET LEASE AUTHORITY Atlanta Chicago Houston Los Angeles New York Phoenix San Francisco Tulsa

2 Confidential Disclaimer This Confidential Memorandum has been prepared by Stan Johnson Company ( SJC ) and is being furnished to you solely for the purpose of your review of the commercial property located at 7622 State Avenue, Kansas City, KS (the Property ). The material contained in this Offering Memorandum shall be used for the purposes of evaluating the Property for acquisition and shall not be used for any purpose or made available to any other person without the express written consent of Stan Johnson Company ( Broker ). By accepting the Confidential Memorandum, you acknowledge and agree that: (1) all of the information contained herein and any other information you will be receiving in connection with this transaction, whether oral, written or in any other form (collectively, the Materials ), is confidential; (2) you will not reproduce the Confidential Memorandum in whole or in part; (3) if you do not wish to pursue this matter, you will return this Confidential Memorandum to SJC as soon as practicable together with all other materials relating to the Property which you may have received from SJC; and (4) any proposed actions by you which are inconsistent in any manner with the foregoing agreements will require the prior written consent of SJC. This Confidential Memorandum has been prepared by SJC, based upon certain information pertaining to the Property and any information obtained from SJC to assist interested parties in making their own evaluation of the Property is offered on a no representation or warranty provision other than customary warranties of title and is sold on an as-is, where-is basis and with all faults. The material and transaction does not purport to be all inclusive. This Confidential Memorandum contains descriptive materials, financial information and other data compiled for the convenience of parties interested in the Property. The Materials are being delivered by SJC to prospective investors with the understanding that it is not all inclusive and that it is qualified in its entirety by independent investigation by prospective investors of those matters which they deem appropriate in evaluating this offering without reliance upon SJC, the Broker or any of their respective affiliates or any of the information set out in the Materials. Neither SJC, the Broker, nor any of their respective affiliates have independently verified any of the information contained herein or in any of the Materials, and no representations or warranties as to the accuracy or completeness thereof or of any other kind whatsoever are made or intended and none should be inferred. SJC, for itself and its affiliates of the Property, expressly disclaim any and all liability for statements or representations, express or implied, contained herein or for omissions from the Materials or for any other written, oral or other format of communication transmitted to a prospective investor in the course of its evaluation of the proposed transaction. All summaries and discussions of documentation and/or financial information contained herein are qualified in their entirety by reference to the actual documents and/or financial statements, which upon request may be made available. The terms and conditions described herein are subject to change without notice. This Confidential Memorandum does not constitute an offer to accept any investment proposal but is merely a solicitation of interest with respect to the investment described herein. The Confidential Memorandum does not constitute an offer of security. The investment described herein may be financed or withdrawn from the market, without prior notice. By accepting this Confidential Memorandum you agree to release SJC and hold it harmless from any kind of claim, expense, or liability arising out of your discovery or purchase of the Property. SJC reserves the right to request the return of the Materials at any time. Ownership of the Property reserves the right to negotiate with one or more prospective investors at any time. Offered Exclusively By Andy Gatchell Associate Director agatchell@stanjohnsonco.com In Association with Les Burns KS License #BR Stan Johnson Company 303 East Wacker Drive Suite 1111 Chicago, Illinois P: F: Page 2 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

3 Table of Contents About the Investment Investment Summary & Highlights 4 Pricing & Property Overview 5 Advance Auto Parts Lease Abstract & Rent Schedule 6 Advance Auto Parts Tenant Profile 7 Location Information Location Overview 8 Shopping Center History 9 Aerial Map 10 Recent Press Site Plan 13 Surrounding Property Photos Demographics 16 Page 3 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

4 Subject Property Subject Property Investment Summary Stan Johnson Company is pleased to offer for sale to qualified investors, the opportunity to purchase the fee simple interest in a brand new 8,075 square foot Advance Auto Parts store, located at 7622 State Avenue in Kansas City, KS ( The Property ). Tenant has operated in the center for over 50 years and relocated to their new building in November, The Property is located at the intersection 78th & State Avenue near the I-70 Interchange, at the recently redeveloped Wyandotte Plaza Shopping Center, a 198,937 square foot grocery anchored shopping center. The shopping center benefits from the nearby Village West trade area which includes the 1.1 million square foot Legends Outlets & restaurants, Kansas Speedway, Sporting KC Park (home to MLS Team Sporting Kansas City), the 650,000 square foot Cerner Continuum Campus with 4,000 employees, Hollywood Casino, Community America Ballpark, Cabela s, Nebraska Furniture Mart, Great Wolf Lodge and Schlitterbahn Water Park. There are Years remaining on the 17 Year initial term and Three (3), Five (5) Year options with a 5% rental increase in Year Three and 5% rental increases every Five (5) Years thereafter through the initial term. Tenant Reimburses Pro Rata Share of Shopping Center Operating Expenses, Real Estate Taxes & Insurance. Tenant Responsible for Repairs & Replacement of HVAC and roof. Landlord responsible for Repair & Replacement of slab, foundation and structure only. Purchase Price: $881,356 Cap Rate: 5.90% Investment Highlights Brand New Construction - Advance Auto Parts occupies a brand new 8,075 square foot building Long Lease Term Remaining - Over 15 years of term remaining and three (3), five (5) year options Investment Grade Corporate Lease - Tenant is rated BBB- (investment grade) with total 2013 Revenue of $6.4 billion and $391 million in Net Income Rent Escalations - Favorable 5% rental increase in Year 3 and 5% rental increases every five (5) years thereafter through initial term Minimal Landlord Responsibilities - Tenant is responsible for all expenses, including the roof. Landlord is only responsible for structure, slab and foundation, which is rare for this type of lease Largest Auto Part Dealer in North America - Advance recently acquired CarQuest (General Parts International) for $2 billion, making it the LARGEST auto parts dealer in the country with a combined 5,289 stores Page 4 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

5 Pricing Overview 7622 State Avenue Kansas City, KS Offering Price: $881,356 Offering Cap Rate: 5.90% Current Annual Rent: $52,000 Tenant Trade Name: Advance Auto Parts Property Overview Building Size: Land Area: +/- 8,075 SF +/ Acres Year Built: 2013 Ownership Interest: Fee Simple (Land & Building) N Page 5 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

6 Lease Abstract Rent Schedule Tenant: Guarantor: Address: Building Size: Land: 7622 State Avenue Kansas City, KS Advance Auto Parts Advance Stores Company, Inc State Avenue 8,075 SF 0.89 AC Built: 2013 Rent Commencement: November 1, 2013 Lease Expiration: October 31, 2030 Initial Term: Term Remaining: Renewal Options: 17 Years Years NOI: $52,000 Three (3) Five (5) Year Options In addition to Basic Rent, if TT s Gross Sales Percentage Rent: during any calendar year exceed $1.9mm, TT shall pay LL 3% of such excess Increases: 5% in Year 3 Expenses: NN Tenant Reimburses Landlord for Pro Rata Share of CAM, Taxes & Insurance Landlord Responsibilities: Repair & Replacement of Slab, Structure and Foundation ROFR: None Interest: Fee Simple (Land & Building) Lease Year Annual Rent Rent PSF Escalation 1-2 $52,000 $6.44 n/a 3-7 $54,600 $ % 8-12 $57,330 $ % $60,197 $ % Option $72,236 $ % Option $86,803 $ % Option $104,020 $ % Subject Property Page 6 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

7 ADVANCE AUTO PARTS No. of Locations: 5,276 Credit Rating: Stock Symbol: Total Revenue: Net Income: Net Worth: Headquarters: Website: S&P: BBB-/Stable AAP (NYSE) $6.50 billion (as of 12/28/13) $ billion (as of 12/28/13) $1.51 billion (as of 12/28/2013) Roanoke, VA Advance Auto Parts, Inc. (NYSE: AAP), through its subsidiaries, operates as a retailer of automotive parts, accessories, and maintenance items to do-it-yourself and do-it-for-me customers in the automotive aftermarket industry. The company operates in two segments, Advance Auto Parts (AAP), and Autoparts International (AI). Advance Auto Parts recently acquired CarQuest (General Parts International) for $2 billion, making it the largest auto part dealer in the country. The acquisition increased the company s access to commercial/wholesale part sales and expanded their footprint in the northeast. As of April 19, 2014, Advance Auto Parts operated 5,276 AAP stores and 1,400 independently owned CarQuest branded stores throughout 49 states, Puerto Rico, the Virgin Islands, and Canada. Advance Auto Parts is currently headquartered in Roanoke, Virginia and was founded in As of December 28, 2013, the company employed approximately 74,000 employees. Advance Auto Parts is now the largest automotive aftermarket retailer in the United States based on sales and store count. The company premiered on the Fortune 500 list of companies in 2003, and has remained on the list ever since. Advance Auto Parts stores carry a product offering of approximately 20,000 stock keeping units, or SKUs, generally consisting of a custom mix of product based on each store s respective market. Advance Auto Parts operates 374 large-format stores, known as HUB stores, which stock an additional 15,000 SKUs which are available to their stores within the HUB store s service areas on a same-day or next-day basis. As of December 28, 2013, Advance Auto Parts, Inc. had total revenues of $6.50 billion, a net income of $ million, a net worth in excess of $1.51 billion and an S&P credit rating of BBB-/stable. Subject Property Page 7 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

8 Location Overview Kansas City, Kansas is the third-largest city in the state of Kansas and is the county seat of Wyandotte County. It is a suburb of Kansas City, Missouri, and is the third largest city in the Kansas City Metropolitan Area (MSA: 2,035,334). The city is part of a consolidated citycounty government known as the Unified Government which also includes the cities of Bonner Springs and Edwardsville. It is situated at Kaw Point, which is the junction of the Missouri and Kansas rivers. Sporting Park CommunityAmerica Ballpark Kansas City is home to the Kansas Speedway Sporting Kansas City MLS soccer team and the Kansas City T-Bones minor league baseball team. The city is also home to The Legends at Village West, a 1,200,000 SF lifestyle center surrounded by the Kansas Speedway, Hollywood Casino, Livestrong Sporting Park, Nebraska Furniture Mart, Great Wolf Lodge, Phoenix Theatres at the Legends 14, Cabela s and Community America Ballpark. Greater Kansas City is headquarters to several Fortune 500 companies (Sprint Nextel Corporation, H&R Block, YRC Worldwide Inc., and International Assets Holding Corporation) and additional Fortune 1000 corporations Great Plains Energy, Aquila, AMC Theatres, Applebee s, DST Systems, Garmin International, Cerner, Seaboard Corporation, and Russell Stover Candies). Kansas Speedway Legends Outlets Kansas City Page 8 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

9 Shopping Center History Set in the heart of an underserved trade area, the shopping Center at 78th Street and State Avenue in Wyandotte County has been developed as a prime infill retail location with grocery and power tenants. Operating since 1961, this long-term grocery store location is positioned at the busiest intersection in Kansas City, Kansas, with a traffic count of 40,000 vehicles daily. The refreshed 198,937-square-foot, retail center serves the highest volume in the trade area, the retail center represents a key convenience and offers a number of featured improvements and benefits: Receipt of an updated building façade and newly configured parking lot Implementation of upgraded lighting and signage Installation of a new, signalized intersection at entrance on State Avenue Inclusion in Kansas City s Complete Streets initiative that supports designing, constructing, and maintaining infrastructure to encourage active living and make pedestrian spaces safer, attractive, more livable and accessible. Wyandotte Plaza Shopping Center Page 9 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

10 I-435 (47,002 VDP) PARALLEL PKWY (13,753 VPD) STATE AVE (18,848 VPD) CERNER CORPORATE CAMPUS I-70/KANSAS TPKE (58,154 VPD) N Page 10 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

11 Plans for large, new shopping center in KCK BY: Amy Hawley KSHB NBC 41 Action News POSTED: Jan 16, 2014 KANSAS CITY, Kan. - Wyandotte County has landed another big, new development project and developers say it s mostly due to the success of Village West. The Wyandotte Plaza will be the site of the $28 million reconstruction of the shops at 78th and State Avenue about four miles east of Kansas Speedway and Legends shops. It is the first time in years a developer has poured that kind of money into old Kansas City, Kan., instead of Village West. Up until the Speedway, 78th and State Avenue was the epicenter of Wyandotte County s sales tax base. If you live here, that s where you shop at, President of Wyandotte County Economic Development Greg Kindle said. But the old shops gave way to the past and neglect. Developers attention focused on the corn fields that quickly put Kansas City, Kan., on the fast track to success. Village West is now home to Kansas biggest tourist attraction. But today, residents see that success spilling over, for the first time, into their old KCK neighborhoods. The grocery store at Wyandotte Plaza will be KCK s biggest. Developers, with the help of major tax incentives, are bringing in $28 million and 230,000 squarefeet of renovations, new shops, national chains, landscaping and a new future. I don t think it will be the last, I think there are a number of other things happening, Wes Grammer with Red Legacy said. Kindle, believes success begets success. I think it d be difficult to make the case that we d have that investment but for the success we have seen at Village West. This is just the beginning, he said. Source: KSHB NBC 41 Action News (Click for link to video) (Source: Yaeger Architecture) Page 11 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

12 4,000 Cerner employees move into new KCK offices BY: Austin Alonzo Kansas City Business Journal POSTED: Jun 17, 2013 KANSAS CITY, Kan. The first of 4,000 employees began moving into the Cerner Corp. campus Monday at the Village West development in Kansas City, Kan. Matt Tidwell, a spokesman for the North Kansas City health care software provider, said thefirst employees will move into the first of two new highrisetowers at Cerner s Continuous Campus during the next few weeks. The nine-story towers are part of a $190 million investment by Cerner at the site near the The Legends Outlet Mall and the Kansas Speedway. When complete, the offices will provide more than 650,000 square feet of new space. The incentives deal with the state yielded $147 million in Kansas sales tax revenue (STAR)bonds and $85 million in state tax credits and cash incentives. The deal also requires Cerner to create 4,000 new jobs with an average annual salary of $54,000 by The first of the two towers was finished earlier this year, and the second one is scheduled to be finished in early Both towers are expected to be fully staffed soon afterward. When fully operational, staff at the campus will work 24 hours a day maintaining technology networks for 30 percent of the nation s health care systems, the Kansas City Business Journal reported late last year. Big changes expected in area Those businesses near the new offices at the junction of Interstates 70 and 435 are expecting big things from the new offices, which will house white-collar workers. The new buildings and the resulting employees are expected to boost residential and commercial development in western Wyandotte County, economic development officials said. Greg Kindle, president of the Wyandotte County Economic Development Council, said the new offices should boost daytime sales at the Legends and other retailers, drive the development of residential building near the offices and attract other developers to build new office space near Village West. Source: Kansas City Business Journal first-of-4000-cerner-employees-move.html Cerner Campus Cerner Campus Page 12 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

13 Site Plan Opening Q Opening Q Opening Aug Opening Feb N Page 13 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

14 Wyandotte Plaza Shopping Center Wyandotte Plaza Shopping Center Wyandotte Plaza Shopping Center Page 14 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

15 Wyandotte Plaza Shopping Center Wyandotte Plaza Shopping Center Marshall s & Petsmart Coming Soon Page 15 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

16 Demographics 7622 State Ave, Kansas City, Kansas, mi. 0-3 mi. 0-5 mi. Population 2014 Population 7,944 37,370 67, Population 8,051 38,493 69, Annual Rate -0.04% 0.40% 0.38% Annual Rate 0.27% 0.59% 0.57% Households 2014 Population 3,338 14,706 25, Population 3,374 15,100 26, Annual Rate -0.10% 0.33% 0.28% Annual Rate 0.21% 0.53% 0.50% Annual Rate Race and Ethnicity 2014 White Alone 40.7% 50.9% 52.6% 2014 Black Alone 45.6% 34.8% 30.3% 2014 American Indian/Alaska Native Alone 0.5% 0.7% 0.8% 2014 Asian Alone 1.7% 2.5% 3.2% 2014 Pacific Islander Alone 0.2% 0.2% 0.2% 2014 Other Race 6.7% 6.4% 8.8% 2014 Two or More Races 4.6% 4.5% 4.2% 2014 Hispanic Origin (Any Race) 13.4% 14.1% 17.7% 2014 Median Household Income $37,000 $40,458 $42, Average Household Income $44,882 $49,492 $51,963 Page 16 Advance Auto Parts - Wyandotte Plaza Shopping Center THE NET LEASE AUTHORITY

17 Andy Gatchell Associate Director (312) In Association with Les Burns KS License #BR Stan Johnson Company 303 East Wacker Drive Suite 1111 Chicago, Illinois P: F: