Visionworks, Great Clips, & Mattress Firm Shops

Transcription

1 / Powerline Rd (41,000 AADT) / Hillsboro Blvd (40,500 AADT) OFFERING MEMORANDUM OFFERING MEMORANDUM Visionworks, Great Clips, & Mattress Firm Shops Deerfield Beach, FL This property is listed in conjunction with Florida-licensed real estate broker Robert Long Realty LLC.

2 TABLE OF CONTENTS PROPERTY HIGHLIGHTS 1 PROPERTY OVERVIEW 2 FINANCIAL ANALYSIS 3 RENT ROLL 6 TENANT INFORMATION 7 SITE PLAN 8 AERIALS 9 ABOUT THE AREA 12 DEMOGRAPHICS 15 Disclaimer Michael Maffia ( Broker ) has been retained on an exclusive basis to market the property described herein ( Property ). Broker has been authorized by the Seller of the Property ( Seller ) to prepare and distribute the enclosed information ( Material ) for the purpose of soliciting offers to purchase from interested parties. More detailed financial, title and tenant lease information may be made available upon request following the mutual execution of a letter of intent or contract to purchase between the Seller and a prospective purchaser. You are invited to review this opportunity and make an offer to purchase based upon your analysis. If your offer results in the Seller choosing to open negotiations with you, you will be asked to provide financial references. The eventual purchaser will be chosen based upon an assessment of price, terms, ability to close the transaction and such other matters as the Seller deems appropriate. The Material is intended solely for the purpose of soliciting expressions of interest from qualified investors for the acquisition of the Property. The Material is not to be copied and/or used for any other purpose or made available to any other person without the express written consent of Broker or Seller. The Material does not purport to be all-inclusive or to contain all of the information that a prospective buyer may require. The information contained in the Material has been obtained from the Seller and other sources and has not been verified by the Seller or its affiliates. The pro forma is delivered only as an accommodation and neither the Seller, Broker, nor any of their respective affiliates, agents, representatives, employees, parents, subsidiaries, members, managers, partners, shareholders, directors, or officers, makes any representation or warranty regarding such pro forma. Purchaser must make its own investigation of the Property and any existing or available financing, and must independently confirm the accuracy of the projections contained in the pro forma. Seller reserves the right, for any reason, to withdraw the Property from the market. Seller has no obligation, express or implied, to accept any offer. Further, Seller has no obligation to sell the Property unless and until the Seller executes and delivers a signed agreement of purchase and sale on terms acceptable to the Seller, in its sole discretion. By submitting an offer, a purchaser will be deemed to have acknowledged the foregoing and agreed to release Seller and Broker from any liability with respect thereto. Property walk-throughs are to be conducted by appointment only. Contact Broker for additional information. Michael Maffia Managing Partner mike@preservewc.com CA RE License # Putnam Daily Partner - Brokerage Division putnam@preservewc.com CA RE License #

3 PROPERTY HIGHLIGHTS 100% Leased Retail Center to National Credit Tenants -- Scheduled Rental Increases in Majority of Leases -- Majority of Tenants on Long Term Leases Excellent Access and Visibility In Dominant Retail Corridor -- Combined AADT of 85, Ideally Situated Between Major Arterials Florida Turnpike (106,800 AADT) and I-95 (205,604 AADT) Outparcel to Super Target Anchored Center Robust Demographics within Five Miles of Site -- Total Daytime Population of 365, Average Household Income of $81,070 Half-Hour Drive to Fort Lauderdale and 1 Hour Drive to Miami Strong Retail Market with Low Vacancy and Substantial Retail Sales Neighbors Hillsboro Technology Center 75 Acre Business Park Featuring Office, Industrial, & Hotel Space No State Income Tax in Florida -- Additional Tenants Include Hobby Lobby & Petco FILE PHOTO PRESERVE WEST CAPITAL 1

4 PROPERTY OVERVIEW The Investment The Mattress Firm and Shops property in Deerfield Beach offers the unique opportunity for an investor to acquire a fully-leased retail pad outparcel to Super Target with scheduled rent increases in an established Fort Lauderdale suburb. The property is situated in a strong retail corridor between Florida Turnpike and I-95, two major arterials, and benefits from strong demographics in the surrounding area with an average household income of $81,070 within five miles of the site. With excellent exposure along West Hillsboro Boulevard near its junction with Powerline Road (Combined AADT 85,783), an investor will benefit from scheduled increases in income, a diversified income stream, and asset appreciation with this property. Location The property is located at 3317 West Hillsboro Boulevard in Deerfield Beach, Florida. Lot Size Approximately acres, or 30,231 square feet. Improvements A 8,300 square foot retail building demised into three retail suites. Mattress Firm 3,800 sq ft Great Clips 1,300 sq ft Visionworks 3,200 sq ft Parking There is ample parking available onsite and throughout the shopping center. PRESERVE WEST CAPITAL 2

5 FINANCIAL ANALYSIS PRICING PRICE $4,586, % Return Projected Gross Revenue YEAR 1 YEAR 10 YEAR 1 YEAR 10 Base Rental Revenue $295,500 $357,555 Scheduled Base Rental Revenue $295,500 $357,555 Expense Reimbursement Revenue $137,904 $170,220 Total Potential Gross Revenue $433,404 $527,775 Effective Gross Revenue $433,404 $527,775 Net Operating Income $286,606 $347,082 CAP Rate 6.25% 7.57% Annual Expenses Property Taxes $88,561 $105,839 Property Insurance $7,138 $9,313 Common Area Maintenance $38,097 $49,708 Management 3% of EGR $13,002 $15,833 Total Operating Expenses $146,798 $180,693 Financing The property will be delivered free and clear of permant financing. Note The net income is an estimate and does not provide for all potential costs and expenses (i.e. maintenance, repair, etc.) that may be required of the owner. Any reserves set forth herein are merely estimates and not based on any experience, physical inspection, or prior knowledge. All prospective purchasers are strongly advised to make an independent investigation to determine their estimate of costs and expenses prior to entering into an agreement to purchase. PRESERVE WEST CAPITAL 3

6 FINANCIAL ANALYSIS GENERAL ASSUMPTIONS General Assumptions Analysis Date August 1, 2018 Total Rentable Area 8,300 SF Total Area for CAM Reimbursement Calculations 8,300 SF General Inflation per Annum 3.00% General Expense Growth per Annum Real Estate Tax Growth per Annum 3.00% 2.00% Management Fee 3% of EGR PRESERVE WEST CAPITAL 4

7 FINANCIAL ANALYSIS CASH FLOW PROJECTION Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Aug-2018 Aug-2019 Aug-2020 Aug-2021 Aug-2022 Aug-2023 Aug-2024 Aug-2025 Aug-2026 Aug-2027 Jul-2019 Jul-2020 Jul-2021 Jul-2022 Jul-2023 Jul-2024 Jul-2025 Jul-2026 Jul-2027 Jul-2028 Projection Statistics Net Rentable Area in SF 8,300 Base Rental Revenue PSF/mo. $2.97 $2.99 $3.25 $3.26 $3.26 $3.26 $3.29 $3.58 $3.59 $3.59 Total Operating Expenses PSF/yr. $17.69 $18.08 $18.58 $18.99 $19.41 $19.83 $20.28 $20.83 $21.30 $21.77 Absorption & Turnover Vacancy % General Vacancy % Potential Gross Revenue Base Rental Revenue 295, , , , , , , , , , Scheduled Base Rental Revenue 295, , , , , , , , , ,555 Expense Reimbursement Revenue 137, , , , , , , , , , Total Potential Gross Revenue 433, , , , , , , , , ,775 General Vacancy Effective Gross Revenue 433, , , , , , , , , ,775 Operating Expenses Taxes - $ ,561 90,332 92,139 93,982 95,861 97,779 99, , , ,839 Insurance - $0.86 7,138 7,352 7,573 7,800 8,034 8,275 8,523 8,779 9,042 9,313 CAM - $ ,097 39,240 40,417 41,630 42,879 44,165 45,490 46,855 48,260 49,708 3% 13,002 13,162 14,052 14,188 14,293 14,401 14,580 15,562 15,715 15,833 Total Operating Expenses 146, , , , , , , , , ,693 NET OPERATING INCOME 286, , , , , , , , , ,082 Cash flow information is based on initial estimated expenses with annual expense increases determined using the assumptions listed on page 4. PRESERVE WEST CAPITAL 5

8 RENT ROLL Tenant Sq. Ft. Monthly Rent PSF Annual Rent PSF Annual Rent Lease Term Lease Start Date Lease Expire Date Rental Increase Date(s) Rental Increase Amount(s) Options Lease Structure Mattress Firm 3,800 $3.17 $38.00 $144, yrs. 6/22/2015 6/30/2025 7/1/2020 $158,840 5 yrs. Option 1: $174,724 Option 2: $192,196 Option 3: $211,416 NN inclusive of taxes, insurance, utilities, and proportionate share of common area maintenance, excluding roof and structure. Tenant is responsible for management fee of up to 10% of CAM costs. Controllable CAM costs are not to increase by more than 5% annually on a non-cumulative basis, however, Tenant's share of controllable CAM costs will reset to the lower of either Tenant's share of actual expenses incurred by Landlord or the amount Tenant's share would be if expenses for the five previous years had been subject to a 5% annual cumulative cap. Great Clips 1,300 $2.92 $35.00 $45,500 5 yrs. 10/12/ /31/2020 n/a n/a 5 yrs. Option 1: $50,050 Option 2: $55,055 NN inclusive of taxes, insurance, utilities, and proportionate share of common area maintenance, excluding roof and structure. Tenant is responsible for management/ administrative fee of up to 15% of CAM costs. Visionworks 3,200 $2.75 $33.00 $105, yrs. 6/22/2015 6/30/2025 7/1/2020 $116,160 5 yrs. Option 1: $127,776 Option 2: $140,544 NN inclusive of taxes, insurance, utilities, and proportionate share of common area maintenance, excluding roof and structure. Tenant is responsible for management fee of up to 10% of CAM costs. Increases in controllable CAM costs are capped at 5% annually on a noncumulative basis. Leased 8, % Vacant 0 0% TOTAL 8, % PRESERVE WEST CAPITAL 6

9 TENANT PROFILES Mattress Firm Lessee: Mattress Firm, Inc. Since its founding in 1986, Mattress Firm has grown to become the largest and most Website: successful specialty bedding company in the No. of Locations: 3,400+ United States. The company operates and franchises more than 3,400 stores through its brands including Mattress Firm, Sleepy s, and Sleep Train across 49 states with 80 distribution centers. Mattress Firm, Inc. is an operating subsidiary of the parent company Mattress Firm Holding Corporation, which was acquired by Steinhoff International Holdings N.V. for $3.8 billion as of September 16, This acquisition will now give Steinhoff International a strong foothold in the U.S. furniture market. Steinhoff International Holdings is an integrated retailer that manufactures, sources and retails furniture, household goods and general merchandise in Europe, Africa and Australasia. Steinhoff s vertically integrated business model is based upon a strategy of sourcing and manufacturing products at low cost and distributing them to its value-conscious customer base through its extensive retail footprint. Steinhoff has a primary listing on the Frankfurt Stock Exchange and a secondary listing on the Johannesburg Stock Exchange. In the fourth quarter of 2017, Steinhoff reported revenue of $5.9 billion. Great Clips Salon Lessee: Totalee Holdings, LLC Great Clips is the world s largest salon brand, employing more than 40,000 stylists across Guarantor: Great Clips, Inc. & more than 4000 franchised salons throughout Andrew Nesbitt the U.S. and Canada. The Company has a wide Website: advertising footprint, with partnerships with No. of Locations: 4,000+ brands like NASCAR, EA Sports, the NFL. Since the depths of the recession in 2009, Great Clips has opened nearly 160 salons a year and seen 22 consecutive quarters of same-store sales growth. In 2013, the privately held company reported revenues of $1.3 billion. Lessee: Website: No. of Locations: 700+ Visionary Properties, Inc. Visionworks Visionworks (formerly Eye Care Centers of America, Inc.) is the third largest retail optical chain in the U.S., with more than 700 locations in 40 states and the District of Columbia as well as retail services online. Their stores offer eye exams, exclusive brand frames, lenses, sunglasses, and accessories, as well as contact lenses and leading technology in vision correction. Many locations also feature on-site labs, allowing customers to pick up their prescriptions within one hour or less. The stores accept hundreds of insurance plans, allowing a large number of customers to access affordable, high-quality vision care. Visionworks is a subsidiary of Highmark, a non-profit healthcare company that operates health, vision, and dental insurance providers, hospital services, and more. The company and its subsidiaries insure more than 5.2 million people across Pennsylvania, Delaware, and West Virginia, and is one of the top 10 largest health insurers in the U.S. The company is an independent licensee of the Blue Cross and Blue Shield Association and is the fourth largest Blue Cross and Blue Shield affiliated company. The company s subsidiaries include the third largest vision managed care organization by revenue and the fifth largest dental insurance carrier in the U.S.. For the 2016 fiscal year, the company reported revenue of $18.2 billion, net income of $58.5 million, and total assets of $13.3 billion. The company has reported preliminary 2017 revenue of $18.3 billion. Visionary Properties, Inc., the lease entity, is a subsidiary of Visionworks. PRESERVE WEST CAPITAL 7

10 SITE PLAN 3,200 SF 1,300 SF 3,800 SF / HILLSBORO BOULEVARD

11 AERIAL NORTHWEST VIEW DEERFIELD MALL ADIOS GOLF CLUB THE CLUB AT BOCA POINTE DEERCREEK PLAZA / Powerline Rd (41,000 AADT) / Hillsboro Blvd (40,500 AADT)

12 AERIAL TOWN CENTER AT BOCA RATON NORTH VIEW VIA MIZNER GOLF & COUNTRY CLUB THE CLUB AT BOCA POINTE DEER CREEK GOLF CLUB /P ow er lin er d( 41,00 0A AD T) DEERCREEK PLAZA / Hillsboro Blvd (40,500 AADT)

13 AERIAL CLOSE-UP VIEW / Powerline Rd (41,000 AADT) / Hillsboro Blvd (40,500 AADT)

14 ABOUT THE AREA General Overview Deerfield Beach (population 79,764) is a city in Broward County, located just south of the Palm Beach county line. The city is part of the Miami-Fort Lauderdale-West Palm Beach metropolitan statistical area, with a total population of 6,723,472. The city neighbors Boca Raton to the North, Coral Springs to the West, and Fort Lauderdale to the South. SITE Deerfield Beach benefits from its central location in the greater Miami area, ease of access via numerous major arterials, including the Florida Turnpike and Interstate 95, and more. The city is home to some of the only remaining undeveloped land in Broward County, making it ideally positioned for future growth. The city boasts annual retail sales exceeding $5 trillion with a strong retail market throughout the city. Rental rates and development demand continue to grow, and vacancy rates in the city have dropped over the last eight years. The city benefits from a relatively diverse economic base made up of manufacturing, life sciences, professional services, international trade, finance, tourism, logistics, architectural and engineering services, specialized design, computer systems design, and motion picture and video industries. The city also benefits from close proximity to several of Florida s major cities, located less than half an hour s drive from Fort Lauderdale, and approximately 1 hour s drive from Miami. Both Fort Lauderdale and Miami are major tourist hubs with significant passenger and commercial traffic; they are home to the third busiest and busiest cruise ship ports in the U.S., respectively. Major development activity in Deerfield Beach includes the Hillsboro Technology Center, a 75 acre business park featuring industrial, office, and hotel space. Major tenants currently located at the site include The Learning Experience, UPS, Shipmonk, Empire Flooring, and the Marriott Springfield Suites. Other major developments include Pioneer Grove, a recently approved mixeduse development in the city s historic downtown. The development will feature 2,150 multi-family residential units, 215,000 feet of municipal space, 169,000 square feet of city offices and other municipal space, and 14.2 acres of parks.

15 ABOUT THE AREA Site Information The subject property is ideally situated with excellent access and visibility outparcel to Super Target within a thriving retail corridor near the signalized intersection of West Hillsboro Blvd/State Route 180 (42,933 AADT) and Powerline Road/State Route 845 (42,850 AADT). The site is centrally located between Hillsboro Boulevard s junctions with State Route 91/Florida Turnpike (106,800 AADT) and Interstate 95 (205,604 AADT), both major regional arterials, further improving access to the site. The property benefits from strong demographics with a population of 325,655 and a total daytime population of 365,165 within five miles of the site. Average household income within five miles of the site exceeds $81,070. SITE The property benefits from a prominent retail location outparcel to Super Target, Hobby Lobby, and Petco. Other tenants in the center include TD Bank, Starbucks, Bank of America, Boca Care Urgent Care, and more. The site neighbors Deerfield Mall, with tenants including Publix, T.J. Maxx, PetSmart, Cinepolis, Dollar Tree, Ulta, Sally Beauty, AT&T, Wells Fargo, Citibank, Chick-Fil-A, Wingstop, Panera Bread, and more. Other shopping centers neighboring the site include the Marketplace at Hillsboro, with tenants including Planet Fitness, Sherwin Williams, Chevron, and more. Additional major retail tenants neighboring the site include Walgreens, CVS, ALDI, 7-Eleven, Ross, Michael s, The Home Depot, Advance Auto Parts, Dunkin Donuts, McDonald s, and more. In addition, Quiet Waters Elementary School is located just one mile from the site, drawing additional traffic from parents, students, and teachers. The property is located just two miles from the Hillsboro Technology Center, a 75 acre business park featuring industrial, office, and hotel space, drawing significant additional traffic from employees near the site. The site will additionally benefit from the planned expansion of Hillsboro Boulevard, which will occur east of the site and include increased road capacity and more, driving increased traffic to the site.

16 DEMOGRAPHICS 3317 W Hillsboro Blvd Deerfield Beach, FL Top Employers in Broward County Publix Corporation 1, POPULATION 326,655 Median Home Value $230,250 AVG. HOUSEHOLD INCOME $81,071 JM Family Enterprises 1,274 Broward Health North 1,162 UPS 511 City of Deerfield Beach 461 Population Summary 1 Mile 1 3 Miles 5 Miles 2010 Total Population 14, , , Total Population 15, , , Total Population 15, , , Annual Rate 0.78% 0.87% 0.96% Average Household Income Sun-Sentinel 397 Target 356 Republic National Distribution 342 Peoples Trust 325 Broward County Sheriff Office $65,009 $73,973 $81, $74,747 $83,963 $91,360 Median Home Value 2017 $107,178 $214,265 $230, $152,216 $274,309 $293,174 PRESERVE WEST CAPITAL 14

17 Michael Maffia Managing Partner CA RE License # Putnam Daily Partner - Brokerage Division putnam@preservewc.com CA RE License # Borel Avenue, Suite 650 San Mateo, CA D F