Popeyes at Rainier Square New construction absolute-net lease with 20-Year initial term 2406 W Nob Hill Blvd, Yakima, WA 98902
PRICE: $2,414,000 CAP: 5.50% Popeyes is an opportunity to acquire a firstclass new construction asset with a 20-year initial term in Yakima, Washington. The Property is located along a heavily-trafficked commercial corridor in a newly redeveloped shopping center, Rainier Square at Nob Hill. Some of Rainier Square is still in the leasing and development stages, but currently includes major national retailers, Red Robin, Starbuck s, Jimmy John s, MOD Pizza, Costa Vida, Wendy s and a 107-Room Home2 Suites by Hilton that are currently being developed. Popeyes is operated and guaranteed by an experienced restaurant franchisee with an expansive portfolio of restaurant operations. The Property is leased on an absolute net basis with zero landlord responsibilities. Additionally, Popeye s recognizes 10% increases in year 11 and every 5 years following. LEASABLE SF...±3,008 SF LAND AREA...±38,278 SF LEASE TYPE................ Absolute Net YEAR BUILT...2017 PARKING...±43 Spaces or 14.3/1,000 SF* *Rainier Square provides significant reciprocal parking for overflow ADDRESS: 2406 W Nob Hill Blvd, Yakima, WA 98902 POPEYE S AT RAINIER SQUARE 2
Core Characteristics > PART OF LARGER REDEVELOPED FIRST CLASS NEIGHBORHOOD CENTER, RAINiER SQUARE AT NOB HILL. > RAINIER SQUARE PROVIDES a strong retail draw with several new NATIONAL CREDIT RETAILERS WITHIN THE DEVELOPMENT. > 20-YEAR INITIAL LEASE TERM PROVIDES EXCELLENt STABILITY. > ABSOLUTE NET EXPENSE STRUCTURE WITH ZERO LANDLORD REQUIREMENTS. > SCHEDULED RENT GROWTH THROUGHOUT INITIAL TERM AND OPTION PERIODS. > LARGE SCALE FRANCHISEE operates more than 70 restaurant locations. > HEAVILY-TRAFFICKED COMMERCIAL CORRIDOR ALONG NOB HILL BOULEVARD. > DENSE RESIDENTIAL POPULATION BASE OF MORE THAN 115,000 WITHIN A 5-MILE RADIUS. POPEYE S AT RAINIER SQUARE 3
About the franchisee ABOUT THE FRANCHISEE: Franchisee operator exhibits extensive experience in restaurant operations including ownership of the Johnny s Carino s brand. In all, the franchisee operates more than 70 restaurant locations. 35 RESTAURANT FRANCHISE OPERATIONS 35 JOHNNY CARINO S OPERATIONS (CORPORATE OWNER) 2,800 EMPLOYEES UNDER OPERATIONAL CONTROL POPEYE S AT RAINIER SQUARE 4
Aerial RAINIER SQUARE 82 Dickey s BBQ Pit Jimmy John s Kumon MOD Pizza MEMORIAL HOSPITAL Red Robin Starbucks U-Haul Wendy s 27,000 DAILY VALLEY MALL Bed Bath & Beyond Rite Aid POPEYE S AT RAINIER SQUARE YAKIMA VALLEY COMMUNITY COLLEGE Gap Kohl s Ross Dress for Less Sears W NOB HILL BLVD Macy s Michaels Old Navy Pier 1 Imports Shari s Restaurant Starbucks T.J. Maxx Value Village WASHINGTON STATE COLLEGE OF NURSING 24,690 DAILY S 1 ST ST as Quiznos RETAIL CORRIDOR Albertsons Arby s Burger King Costco Denny s Dollar Tree Home Depot Jiffy Lube Kmart Lowe s Office Depot Olive Garden PetSmart Quiznos Rite Aid Safeway Shari s Restaurant Shopko Sonic Subway T.J. Maxx Taco Bell Taco Del Mar Target Value Village Walgreens Walmart Wendy s WinCo POPEYE S AT RAINIER SQUARE 5
Rainier Square Development POPEYE S AT RAINIER SQUARE << W NOB HILL BLVD >> The Subject is part of the larger core neighborhood shopping center, Rainier Square at Nob Hill. The development is anchored by a new Home 2 by Hilton Suites under construction as well as several national retailers, including Red Robin, Starbuck s, Wendy s, MOD Pizza, Jimmy John s among others. Popeyes is part of phase 3 at Rainier Square which includes a new strip center anchored by Costa Vida as well as the new hotel. The shopping center has been completely redeveloped by Hogback development from obsolete buildings and vacant land to first class construction with several national credit tenants, creating a true destination shopping center. POPEYE S AT RAINIER SQUARE 6
Hotel breaks ground Hogback Development has broken ground on the Home 2 Suites by Hilton hotel and is expecting to be open in the Spring of 2019. The opening of the hotel in 2019 will add to the already high traffic counts at Rainier Square. To learn more about the development, click here for the article. POPEYE S AT RAINIER SQUARE 7
Hogback Development Company CHECK OUT THEIR WEBSITE: CLICK HERE ABOUT HOGBACK DEVELOPMENT COMPANY The developer of Rainier Square at Nobhill is Hogback Development Company. Hogback Development Company specializes in value-add projects in the Northwest and has a history of first class development in Yakima. Recent projects in addition to Rainier Square include Tahoma Square, a Harbor Freight Tools and Goodwill anchored shopping center in Yakima with major national tenant pad sites and Pasco Road 68 and Sandifur, another thirteen-acre retail site in Pasco breaking ground in late 2017. POPEYE S AT RAINIER SQUARE 8
Site Plan W NOB HILL BLVD 24,690 DAILY SITE PLAN KEY DRIVE-THRU PARCEL OUTLINE: LAND AREA: BUILDING AREA: ±38,278 SF ±3,008 SF POPEYE S: NOT A PART: INGRESS/EGRESS: Site Plan not to scale POPEYE S AT RAINIER SQUARE 9
Financial Analysis PRICE $2,414,000 Capitalization Rate: 5.50% NET OPERATING INCOME SUMMARY SCHEDULED INCOME Per SF Scheduled Rent: 10/1/2017 $44.13 $132,750 Equals: Effective Gross Income $44.13 $132,750 Less: OPERATING EXPENSES Per SF CAMS NNN Property Taxes NNN Insurance NNN Total Operating Expenses NNN - Equals: NET OPERATING INCOME $132,750 This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies. POPEYE S AT RAINIER SQUARE 10
Rent Roll TENANT INFO TERM Tenant Name Size Date Monthly Rent Percent Increase Annual Rent PSF Cap Rate Popeyes - Yakima 3,008 8/5/2017 $11,063 $132,750 $44.13 5.50% 10/1/2027 $12,169 10.0% $146,025 $48.55 6.05% Lease Notes Occupancy Date : 8/5/2017 10/1/2032 $13,386 10.0% $160,628 $53.40 6.65% Lease Expiration : 9/30/2037 RENT SUMMARY Option 1 10/1/2037 $14,724 10.0% $176,690 $58.74 7.32% Option 2 10/1/2042 $16,197 10.0% $194,359 $64.61 8.05% Option 3 10/1/2047 $17,816 10.0% $213,795 $71.08 8.86% Option 4 10/1/2052 $19,598 10.0% $235,175 $78.18 9.74% Option 5 10/1/2057 $21,558 10.0% $258,692 $86.00 10.72% Option 6 10/1/2062 $23,713 10.0% $284,561 $94.60 11.79% Comments: Tenant is on an absolute-net lease with a 20-year initial term. Tenant is responsible for all maintenance on their parcel and reimbursement for all property taxes. Expenses related to maintenance of the shopping center common areas will require the tenant to reimburse up to $250 per month in year one with a 5% cap on annual increases. Option periods require six months notice. Current Totals: 3,008 $11,063 $132,750 $44.13 5.50% This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies. POPEYE S AT RAINIER SQUARE 11
Lease Abstract TAXES Tenant is responsible to pay 100% of the taxes on the building, land or improvement on the Property. INSURANCE Tenant is responsible for maintaining insurance policies for general liability, property, automobile liability and workers compensation. PREMISES/TERM TENANT Popeyes SQUARE FEET 3,008 SF LEASE TYPE Absolute NNN GUARANTOR Allen Gantes; Franchisee RENT COMMENCEMENT 8/05/2017 LEASE EXPIRATION 9/30/2037 OPTIONS Six, five-year Options; 180 Days Notice RENT/EXPENSES 10% increases in year 11 and every 5 years following. BASE RENT Date Range Monthly Annually 8/05/2017-9/30/2027 $11,063 $132,750 10/01/2027-9/30/2032 $12,169 $146,025 10/01/2032-9/30/2037 $13,386 $160,628 UTILITIES Tenant is responsible for payment of all utilities on site as well as the repair, maintenance and replacement of all HVAC systems. TENANT S OBLIGATIONS Tenant is responsible for all maintenance and repair on the building and premises. LANDLORD S OBLIGATIONS Landlord shall have no repair and maintenance obligations with respect to the Premises. LEASE PROVISIONS EXCLUSIVE USE Landlord will not lease space to any restaurant specializing in the sale of chicken. RIGHT OF FIRST REFUSAL Tenant shall have fifteen (15) days to exercise a first right to purchase the Property following a bona fide LOI received by the Landlord. OPTIONS Date Range Monthly Annually 1) 10/1/2037 9/30/2042 $14,724 $176,690 2) 10/1/2042 9/30/2047 $16,197 $194,359 3) 10/1/2047 9/30/2052 $17,816 $213,795 4) 10/1/2052 9/30/2057 $19,598 $235,175 5) 10/1/2057 9/30/2062 $21,558 $258,692 6) 10/1/2062 9/30/2067 $23,713 $284,561 POPEYE S AT RAINIER SQUARE 12
Area Demographics ABOUT YAKIMA Yakima, Washington has been the cultural, business, educational, health services, and governmental focal point of the Central Washington region since it was founded more than 125 years ago. Originally built along the new Northern Pacific Railway company line, Yakima has grown from its agricultural roots to become a vibrant, diverse metropolitan city. With a rich history and a bright future, Yakima is the Heart of Central Washington. Yakima is the largest city in Yakima County with a population of about 92,000. That makes it the 9th largest city in Washington State. The Yakima community enjoys a rich mixture of people from many cultural and ethnic backgrounds. 1, 3, & 5 MILE RADIUS DEMOGRAPHICS POPULATION 1-Mile 3-Mile 5-Mile 2010 15,946 84,497 112,210 2017 15,731 86,452 115,787 2022 15,666 87,735 117,988 2017 HOUSEHOLD INCOMES 1-Mile 3-Mile 5-Mile Median $52,545 $41,225 $46,259 Average $68,209 $58,652 $64,986 SEATTLE 5-Mile radius 146 miles 2h 11min YAKIMA POPEYE S AT RAINIER SQUARE 3-Mile radius 182 miles 3h 6min 1-Mile radius PORTLAND POPEYE S AT RAINIER SQUARE 13
About Yakima YAKIMA ECONOMY Yakima s economy has always revolved around agriculture. A wide variety of crops are grown in the Yakima Valley. Yakima County is Washington State s leader in terms of the value of the fruits, vegetables, grains, and other agricultural products produced by the county s farmers. The region has long been known as one of the world s leading producers of apples. While Yakima still relies on agriculture to drive its economy, over 250 manufacturing firms are also located here producing a variety of products including aircraft parts, wood products, plastic products, recreational vehicles, and communications technology. Tourism is the fastest growing segment of the Yakima economy. More than 70 wineries are located in the Yakima Valley and regularly draw visitors to sample and buy the Valley s internationally-renowned varietals. Outdoor recreation, including water and snow skiing, fishing, boating, hiking, horseback riding, and white water rafting, also makes Yakima a favorite destination for people from throughout the Northwest and around the world. TOP EMPLOYERS IN YAKIMA VALLEY EMPLOYER # OF FULL-TIME EMPLOYEES Yakima Valley Memorial Hospital 2,500 Yakima School District, No. 7 1,756 Walmart 1,700 Zirkle Fruit +1,500 Washington Fruit +1,500 JOBS BY INDUSTRY 103,585 TOTAL JOBS Local Government - 12.4% Health Services - 12.4% Retail Trade - 9.8% Manufacturing - 7.9% Other than Top 5-31.4% Agriculture, Forestry & Fishing - 26.1% LABOR FORCE 124,360 UNEMPLOYMENT 8.1% AVERAGE WAGE $33,767 POPEYE S AT RAINIER SQUARE 14
Contact Information FOR MORE INFORMATION ON POPEYE S PLEASE CONTACT: SEAN MACK smack@capitalpacific.com (503) 675-8378 DAVID GELLNER dgellner@capitalpacific.com (206) 913-2842 KEVIN ADATTO kadatto@capitalpacific.com (503) 675-7726 PETER DUNN pdunn@capitalpacific.com (503) 607-0197 SEAN TUFTS stufts@capitalpacific.com (206) 693-3352 NATE FLIFLET nfliflet@capitalpacific.com (206) 457.8613 MICHAEL HORWITZ mhorwitz@capitalpacific.com (503) 675-8381 SCOTT FRANK sfrank@capitalpacific.com (503) 675-8383 WE SELL COMMERCIAL REAL ESTATE BUT WE VALUE PEOPLE Capital Pacific is a Commercial Real Estate Brokerage Firm specializing in Retail Investment Sales in the Pacific Northwest as well as Nationally. Our goal is to deliver results for our clients while providing a level of service that will earn repeat business. We have a very human approach that we call the Capital Pacific Experience - CPx. Our team works together on every single assignment, which ultimately benefits our clients. Today Capital Pacific has offices in Seattle, Portland & San Francisco. [ www.capitalpacific.com ]
[ Copyright 2017 Capital Pacific LLC ] The information contained in this document has been obtained from sources Capital Pacific believes to be reliable. Capital Pacific makes no representation or warranty in respect to its accuracy. It is your responsibility to confirm its accuracy and completeness. www.capitalpacific.com