NEW, 10 YEAR LEASE EXTENSION #9 OUT OF 115 LOCATIONS ACTUAL PROPERTY UNDER RENOVATION (AS OF SEPT. 2019) CONN'S HOMEPLUS OFFERING 30445 Northwestern Highway, Suite 275 Farmington Hills, MI 48334 248.254.3410 fortisnetlease.com ZEF LUCA INVESTMENT ADVISOR D: 248.419.3629 ZLUCA@FORTISNETLEASE.COM ROBERT BENDER MANAGING PARTNER D: 248.254.3406 RBENDER@FORTISNETLEASE.COM
DISCLOSURE : All materials and information received or derived from Fortis Net Lease (hereinafter collectively referred to as FNL ), its directors, officers, agents, advisors, affiliates and/or any third party sources are provided without representation or warranty by FNL its directors, officers, agents, advisors, or affiliates as to com- pleteness, veracity, or accuracy, condition of the property, compliance or lack of compliance with applicable governmental requirements, suitability, financial performance of the property, projected financial performance of the property for any party s intended use or any and all other matters. Neither FNL its directors, officers, agents, advisors, or affiliates makes any representation or warranty, express or implied, as to accuracy or completeness of the any materials or information provided, derived, or received. Materials and information from any source, whether written or verbal, that may be furnished for review are not a substitute for a party s active conduct of its own due diligence to determine these and other matters of significance to such party. FNL will not investigate or verify any such matters or conduct due diligence for a party unless otherwise agreed in writing. ALL PARTIES SHALL CONDUCT THEIR OWN INDEPENDENT INVESTIGATION AND DUE DILIGENCE: Any party contemplating or under contract or in escrow for a transaction is urged to verify all information and to conduct their own inspections and investigations including through appropriate third party independent professionals selected by such party. All financial data should be verified by the party including by obtaining and reading applicable documents and reports and consulting appropriate independent professionals. FNL makes no warranties and/or representations regarding the veracity, completeness, or relevance of any financial data or assumptions. FNL does not serve as a financial advisor to any party regarding any proposed transaction. All data and assumptions regarding financial performance, including that used for financial modeling purposes, may differ from actual data or performance. Any estimates of market rents and/or projected rents that may be provided to a party do not necessarily mean that rents can be established at or increased to that level. Parties must evaluate any applicable contractual and governmental limitations as well as market conditions, vacancy factors and other issues in order to determine rents from or for the property. Legal questions should be discussed by the party with an attorney. Tax questions should be discussed by the party with a certified public accountant or tax attorney. Title questions should be discussed by the party with a title officer or attorney. Questions regarding the condition of the property and whether the property complies with applicable governmental requirements should be discussed by the party with appropriate engineers, architects, contractors, other consultants and governmental agencies. All properties and services are marketed by FNL in compliance with all applicable fair housing and equal opportunity laws. PRESENTED BY: ZEF LUCA ROBERT BENDER INVESTMENT ADVISOR MANAGING PARTNER D: 248.419.3629 D: 248.254.3406 ZLUCA@FORTISNETLEASE.COM RBENDER@FORTISNETLEASE.COM ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM DISCLAIMER // 2
INVESTMENT SUMMARY List Price: $5,497,000 Current NOI: $426,000 Initial Cap Rate: 7.75% CLICK HERE TO VIEW VIDEO PRICE $5,497,000 Land Acreage: 3.0 Year Built 1999 CAP RATE 7.75% Building Size: 53,414 SF Price PSF: $102.90 Lease Type: NNN LEASE TYPE NN Lease Term: 10 INVESTMENT OFFERING Fortis Net Lease is pleased to present this 53,414 SF. Conn's Home Plus store located in Baton Rouge, LA. The tenant has occupied the building for approximately 20 years and just executed a new 10 year lease term. The lease contains four, five year options to renew each with a 12.63% rental rate increase. The lease is corporately guaranteed by Conn's HomePlus which owns 115 stores. This is location is reportedly #9 in the chain. In return for a new 10 year lease term the landlord recently invested approximately $1.5M in a complete remodel and 4,000 SF expansion. This Conn's Home Plus is highly visible as it is strategically positioned just south of Interstate 12, (51,214+ VPD). Traffic Counts on Airline Hwy exceed 66,400 VPD. The Subject offering represents an ideal opportunity for any 1031 exchange location on a tremendous retail corridor. Click HERE for a Conn's Homeplus Informational Video: https://youtu.be/zfyib4v-n_s EXTENDED TERM 10 Years INVESTMENT HIGHLIGHTS Brand New 10 Year Lease Extension Commencing October 2018 Store Recently Received Corporate Remodel New Parking Lot & Major Roof Replacements Occurred In 2018 Close Proximity To Interstate 190 and the Cortana Mall Flag Ship Store #9 of 119 Corporate Locations 66,419 Vehicles Per Day On Airline Hwy 12.63% Rent Bumps At Next Option Renewal 208,784 People Live Within A 5 Mile Radius ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM INVESTMENT OFFERING // 3
FINANCIAL SUMMARY LEASE SUMMARY INCOME PER SF Tenant: Conn's Home Plus Gross Income $426,000 $7.98 EXPENSE PER SF Expenses $0 $0.00 Gross Expenses $0 $0.00 Lease Type: NN Primary Lease Term: 10 Yrs. Annual Rent: $426,000 Rent PSF: $7.97 Landlord Responsibilities: Capital Replacements to Roof, Structure, Lot NET OPERATING INCOME $426,000 $7.98 Taxes, Insurance & CAM: Tenant PROPERTY SUMMARY Year Built: 1999 Year Renovated: 2018 Lot Size: 3 Acres Building Size: 53,414 SF Traffic Count: 66,419 Roof Type: Robber Membrane \ Steel Zoning: Commercial Construction Style: Concrete Roof, Structure & Parking: LL (New Lot & Major Roof Work in 2018) Original Start Date: 1999 Extended Expiration Date: 10-01-2028 Lease Term Remaining: 10 Years Rent Bumps: 12.6% at Next Option Renewal Options: 4, Five Year Options Lease Guarantor: Conn's Corporation Lease Guarantor Strength: Corporate Guaranteed Tenant Website: https://www.conns.com Parking Lot: HVAC Asphalt / Ample Ground Mounted GROSS SALES: STORE COUNT: GUARANTOR: S&P: $1.5 B 115 CONN'S, INC B ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM PROPERTY & LEASE // 4
RENT SCHEDULE LEASE YEARS ANNUAL RENT MONTHLY RENT BUMP 1-10 $426,000 $35,500-11-15 Option 1 $479,835 $39,986.25 12.63% 16-20 Option 2 $506,492 $42,207.71 5.5% 21-25 Option 3 $533,148 $44,429.17 5.3% 26-30 Option 4 Fair Market Value ---- ---- OVERVIEW Company: Conn's HomePlus Founded: 1890 Total Revenue: $1,516,000.00 Net Income: 796,000 Market Cap: 1.12 Billion Headquarters: The Woodlands, Texas Website: www.conns.com TENANT HIGHLIGHTS 115 Stores and expanding, currently in 14 States. Improving same store sales trend, best performance in eight quarters. $1.5 billion in revenue 128 years in business. TENANT PROFILE Conn s Home Plus is a specialty retailer currently operating 119 retail locations in Alabama, Arizona, Colorado, Georgie, Louisiana, Mississippi, Nevada, New Mexico, North Carolina, Oklahoma, South Carolina, Tennessee, Texas and Virginia. Conn s sells furniture and related accessories for the living room, dining room and bedroom, as well as traditional and specialty mattresses; home appliances, including refrigerators, freezers, washers, dryers, dishwashers and ranges; a variety of consumer electronics, including LED, OLED, Ultra HD and internet-ready televisions, Blu-ray players, home theater and portable audio equipment; and home office products, including computers, printers and accessories. They also offer a variety of products on a seasonal basis. Unlike many of their competitors, Conn s provides flexible in-house credit options for their customers in addition to third-party financing programs and third-party lease-to-own payment plans. Publicly Traded (Nasdaq: CONN) Improving same store sales trend, best performance in eight quarters. Corporate interest expense of $16.8 million compared to $20.4 million in previous year ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM TENANT PROFILE // 5
ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM PROPERTY PHOTOS // 6
ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM PROPERTY PHOTOS // 7
ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM ADDITIONAL PHOTOS // 8
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ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM PROPERTY PHOTOS // 12
ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM PROPERTY PHOTOS // 13
ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM PROPERTY PHOTOS // 14
ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM LOCATION MAPS // 15
Conn's Home Plus ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM AERIAL MAP // 16
POPULATION 1 MILE 3 MILES 5 MILES Total Population 2018 5,415 75,480 208,034 Total Population 2023 5,378 75,640 208,784 Median Age 39.9 35.9 34.8 # Of Persons Per HH 2.4 2.4 2.5 HOUSEHOLDS & INCOME 1 MILE 3 MILES 5 MILES Total Households 2,785 30,822 84,974 Average HH Income $72,854 $62,010 $63,259 Average House Value $152,370 $229,581 $220,040 Consumer Spending (Thousands) 53,952 689,589 1,861,741 Baton Rouge is in the midst of an urban renaissance as a result of downtown initiatives focused on attracting new residents and businesses. As of late August, vacancies in Baton Rouge retail market are more than 100 basis points below the metro s historical average. Despite 2018, year-over-year demand has outpaced supply additions since early in the cycle, strengthening fundamentals. Investment has increased in 2018, already surpassing last year s totals. Trades typically occur between local players, but and increased presence of institutional investors this year has anchored sales volume. Since 1998, over $2.9 billion has been invested in the downtown area, including the renovation and development of the Shaw Center for the Arts, restaurants, nightclubs, cutting-edge green spaces, and new office buildings. These initiatives are attempting to attract business and residents to Baton Rouge. ZEF LUCA 248.419.3629 ZLUCA@FORTISNETLEASE.COM // ROBERT BENDER 248.254.3406 RBENDER@FORTISNETLEASE.COM AREA & DEMOGRAPHICS // 17
TOTAL SALES VOLUME PROPERTIES SOLD BROKER & BUYER REACH STATES SOLD IN $5.0B 2,200 250K 40 The FNL Team 30445 Northwestern Highway, Suite 275 Farmington Hills, MI 48334 248.254.3410 fortisnetlease.com ZEF LUCA INVESTMENT ADVISOR D: 248.419.3629 ZLUCA@FORTISNETLEASE.COM PRESENTED BY: ROBERT BENDER MANAGING PARTNER D: 248.254.3406 RBENDER@FORTISNETLEASE.COM