Actual Property EXCLUSIVE OFFERING: 2345 S Pulaski Road, Chicago, IL

Transcription

1 Actual Property EXCLUSIVE OFFERING: 2345 S Pulaski Road, Chicago, IL

2 Table of Contents I. Executive Summary 3 II. Tenant Overview 4 III. Market Overview 5 IV. Surrounding Aerial 7 V. Chicago Aerial 8 VI. Contacts 9 Actual Property

3 Executive Summary The Offering JLL is pleased to offer for sale the fee-simple interest in a single tenant Burger King (the Property or Asset ), located in urban Chicago, IL. The 2009-construction Asset is situated along Pulaski Road, in the exceptionally dense Little Village neighborhood. The Property features over 12 years of contractual term remaining and zero landlord obligations, making this a perfect property for hands-off or out-of-market investors seeking passive income. This is a rare opportunity to acquire a well-located urban asset leased long-term to one of the nation s premier Burger King franchisees. Investment Highlights Rare Chicago Investment Opportunity: The Offering presents the rare opportunity to acquire a core urban infill quick-service-restaurant. A new investor will enjoy stable, long term rental revenue and strong asset appreciation supported by the Property s premier Little Village location surrounded by a dense residential neighborhood, ongoing commercial development and close proximity to the Chicago CBD. Optimal Lease Structure: This fee-simple asset features 12+ years of remaining initial lease term providing secure bond-like returns and no landlord responsibilities, healthy five (5) percent rental increases every five (5) years, and four, five-year options to renew Excellent Visibility and Density: A testament to the exceptional surrounding density, the Asset draws from a large population of nearly 400,000 within a 3 mile radius and benefits from both local demand drivers and significant traffic counts of 45,000 VPD off the intersection of Pulaski Road and Ogden Avenue. Further, the Asset boasts strong roadside visibility with dual-signage along the major north/south retail thoroughfare of Pulaski Road. Strong In-Place Tenant: Internationally recognized restaurant brand operated by one of the nation s top franchisees, with 285+ units under the Tri-City Foods umbrella and an additional ~200 units in the Texas region under a separate entity Address Tenant Burger King Chicago, IL PROPERTY OVERVIEW AND LEASE ABSTRACT Tenant Under Lease 2345 S Pulaski Road Chicago, IL Purchase Price $3,013,040 Cap Rate 5.75% NOI $173,250 Lease Expiration 12/13/2029 Remaining Initial Lease Term Building Size Parcel Size Tri-City Foods (380+ Units) Heartland Midwest LLC (Acquired by Tri-City Foods) 12.3 Years 2,980 SF Year Built 2009 Ownership Interest Drive Through Lease Type Landlord Responsibilities 0.30 Acres Fee-Simple Yes Absolute NNN None New Prototype Store: The Property was recently constructed in 2009, featuring a new prototype building and parking lot Rent Escalations Renewal Options 5% every 5 years 4, 5-year options 3

4 Tenant Overview Burger King Burger King is the second-largest hamburger chain in the world, operating over 15,000 locations globally, with approximately half of those locations located in the United States. Since 2010 Burger King has increased net annual restaurant growth by approximately 4 times, adding 173 new units in 2010 to 631 new restaurants in A staple in the net-lease investment space, Burger King is one of the most recognizable QSR tenants and offers a convenient absolute-nnn lease structure. Cap rates on Burger King properties have compressed nationally from 2016 to 2017 by over 30 basis points, reflecting an increased demand for Burger King-Leased properties. Tri-City Foods Tri-City Foods, the tenant, is one of the nation s largest franchisees of Burger King restaurants, operating over 380 restaurants in the Chicago, Minneapolis, Omaha, and New England areas. Tri-City is a subsidiary of the Dhanani Group, which operates over 660 Burger King and Popeye s restaurants nationally and is on of the country s top-ten franchisees across all banners, as well as the second-largest Burger King franchisee. Tri-City Foods Footprint Chicago 163 New England 101 Minneapolis 65 Omaha 51 Burger King Overview Company: Burger King Parent Company: Restaurant Brands International Parent Ticker: NASDAQ: QSR Headquarters: Miami, FL Locations: 15,000+ Revenue (Parent, 2016): $4.15 billion Net Income (Parent, 2016): $615 million Total Assets (2016): $19 billion S&P Credit Rating: B+ Business Summary: Fast Food Company Website: Tri-City Foods Overview Company: Tri-City Foods Total Franchise Units: 380+ Leadership: Shoukat Dhanani Headquarters: Downers Grove, IL Focus Cities: Omaha, Chicago, Minneapolis Employees: 1,000+ 4

5 Market Overview Chicago Highlights An Economy That Rivals Nations: If Chicago were its own country, its economy would be ranked 22 nd in the world World Business Chicago #1 metro for corporate investment in the U.S. Site Selection Magazine Top Metro in 2013 and 2014 for new and expanding companies World Business Chicago #1 in Top 10 Cities for Recent Grads Gradspot.com #2 nationally and #9 Globally, Most Economically Competitive Cities of 2025 Economist Magazine, Special Report #1 U.S. City for Foreign Direct Investment Projects, three consecutive years IBM s Global Location Trends Report #4 in Most Economically Powerful City in the World Richard Florida/Martin Prosperity Institute Global Economic Power Index #7 in Global Cities Index in 2014 A.T. Kearney #7 in Top 10 Cities for Startups Nation Venture Capital Association #6 in Global Financial Centres Index (GFCI) in the Americas in 2015 City of London #8 in 2014 Top 10 World s Best Travel Cities, the only U.S. City on the list Lonely Planet Chicago Freestanding Retail Market Overview Market Submarket As of 1Q2017 Chicago South Chicago Total Inventory (SF) 297,477,816 10,940,329 Top tier in intellectual capital, innovation and entrepreneurism, digital economy, airport to CBD access, transportation and infrastructure, health, safety and security, sustainability and natural environment, demographics and livability, economic clout, ease of doing business and cost, and quality of living PriceWaterHouseCooper City of Opportunities 2015 report, an assessment of 30 global cities. Total Vacancy 5.1% 3.0% 12-month Net Absorption (SF) 696, ,077 5

6 Market Overview (Continued) Little Village Neighborhood The Asset is located in Chicago s Little Village neighborhood, just north of the Chicago River s South Branch. A bustling and vibrant neighborhood, Little Village s 26 th Street (just 0.3 miles south of the Asset) is the secondhighest grossing shopping district in Chicago behind only Michigan Avenue, grossing $900 million in sales in Little Village boasts numerous amenities beyond it s shopping district, including green spaces like Piotrowski Park, Washtenaw Park, and La Villita Park. The Paul Simon Chicago Job Corps Center is located just south of the neighborhood along the Chicago River, a no-cost career training center administered by the U.S. Department of Labor. The neighborhood also hosts Villapalooza, an annual music and arts festival that has become one of Chicago s most popular and diverse grassroots festivals. Little Village is well-served by public transportation. The CTA Pink Line runs through the north side of the neighborhood, providing easy access west to Cicero and northeast to the Loop and the other CTA lines. Additionally, the Metra has stops just east and west of the neighborhood, with access to downtown and the western suburbs as far as Aurora. POPULATION Demographic Information 3-mile radius 5-mile radius 2021 Projection 372,952 1,061, Estimate 364,944 1,035, Number of Households 104, ,298 ESTIMATED HH INCOME Less than $35, % 45.5% $35,000 - $49, % 9.1% $50,000 - $74, % 15.6% $75,000 - $99, % 10.3% More than $100, % 19.9% Average HH Income $47,411 $67,396 Median HH Income $34,369 $42,608 6

7 Surrounding Aerial Pink Line 7

8 Chicago Aerial Chicago CBD 5 Miles 8

9 JLL Contacts Alex Sharrin Eric Suffoletto Dwight Stephenson Quinn McCarthy Jones Lang LaSalle IP, Inc. All rights reserved. The information contained in this document is proprietary to JLL and shall be used solely for the purposes of evaluating this proposal. All such documentation and information remains the property of JLL and shall be kept confidential. Reproduction of any part of this document is authorized only to the extent necessary for its evaluation. It is not to be shown to any third party without the prior written authorization of JLL. All information contained herein is from sources deemed reliable; however, no representation or warranty is made as to the accuracy thereof.