Burger King 26 Peyton Road SW Atlanta, GA OFFERING MEMORANDUM Burger King, Atlanta, GA 1
Contents 03 04 06 11 EXECUTIVE SUMMARY FINANCIAL OVERVIEW PROPERTY OVERVIEW AREA OVERVIEW exclusively listed by Gary Chou FVP & Senior Director Gary.Chou@matthews.com DIR (310) 919-5827 MOB (714) 928-8016 LIC # 01911222 (CA) Kevin Chang Associate Kevin.Chang@matthews.com DIR (310) 919-5828 MOB (951) 616-8918 LIC # 01976724 (CA) Kyle Matthews BROKER OF RECORD LIC # 67120 (GA)
investment highlights LONG-TERM, WORRY-FREE INVESTMENT Brand New Development! This store was recently built in October 2017 to match the latest Burger King prototype! Long-Term Lease Tenant to sign brand new 20-year lease with Four (4), 5-Year options to extend at close of escrow Absolute NNN Lease Tenant takes care of all landlord responsibilities including tax, insurance, maintenance, roof and structure Growing Cash Flow There are 8% increases every 5 years Excellent hedge against inflation! EXCELLENT TENANT WITH STRONG GROWTH MODEL AND BALANCE SHEET GPS Hospitality Corporate guarantee from one of the three largest Burger King operators in the country! High Growth Operator GPS Hospitality has over 430+ Burger King & Popeyes restaurants across Alabama, Arkansas, Florida, Georgia, Louisiana, Maryland, Mississippi, New Jersey, Pennsylvania and West Virginia Tenant with Long Term Outlook GPS plans to remodel 30-40 stores each year and has consistently seen year over year revenue growth Healthy Cash Flow Franchise Times reports that GPS Hospitality has revenues over $500 million and is halfway to its 10-year goal of $1 billion in annual revenue 04 07 10 IDEAL RETAIL LOCATION Main Retail Corridor Nearby national tenants include CVS, McDonald s, Wendy s, AutoZone, Chevron, and MetroPCS amongst others! Healthy Traffic Counts Over 35,000 VPD in combined traffic from Peyton Rd SW and MLK Jr. Dr. SW. Down the Street from High School Frederick Douglass High School is home to over 850 students and is less than one mile from the site Burger King, Atlanta, GA 3
Financial Overview 4 Offering Memorandum
26 Peyton Road SW Atlanta, GA 30311 List Price Annualized Operating Data Monthly Rent Annual Rent Rent/SF Cap Rate Year 1-5 $9,375.00 $112,500 $33.55 5.25% Year 6-10 $10,125.00 $121,500 $36.24 5.67% Year 11-15 $10,935.00 $131,220 $39.14 6.12% Year 16-20 $11,809.80 $141,718 $42.27 6.61% Option 1: Year 21-25 $12,754.58 $153,055 $45.65 7.14% Option 2: Year 26-30 $13,774.95 $165,299 $49.30 7.71% Option 3: Year 31-35 $14,876.95 $178,523 $53.24 8.33% Option 4: Year 36-40 $16,067.10 $192,805 $57.50 9.00% $2,143,000 Cap rate 5.25% GLA ± 3,353 SF Tenant Summary Tenant Trade Name Type of Ownership Lease Guarantor Lease Type Roof and Structure Original Lease Term Rent Commencement Date Lease Expiration Date Term Remaining on Lease Increases Options Burger King, Inc. Fee Simple GPS Hospitality NNN Tenant Responsible 20 Years COE TBD ± 20 Years 8.00% Increases in Options Four, 5-Year Options Lot Size ± 0.84 Acres Year Built 2017 Burger King, Atlanta, GA 5
Property Overview 6 Offering Memorandum
Parcel Map the offering Property Name Property Address Burger King 26 Peyton Road SW Atlanta, GA 30311 Assessor s Parcel Number 14-0205-0003-038-1 Site Description Number of Stories One Year Built 2017 Gross Leasable Area (GLA) Lot Size Type of Ownership Landscaping Topography ± 3,353 SF ± 0.84 Acres (36,590 SF) Fee Simple Professional Generally Level Burger King, Atlanta, GA 7
WEst Bound MLK Food Mart Dept. of Labor Market at MLK New Day Treatment Center Hamilton Transit Station MLK Jr Dr. ± 35,000 ADT Ralph David Abernathy Fwy ± 125,000 ADT New Horizon Baptist Church Columbia Commons Apartments ATI Insurance Hong Kong City Next Level J&J Beauty Supply T&K Package Store Dogwood Apartments Greenlight Emission Subject Property Peyton Rd ± 17,000 ADT 8 Offering Memorandum
east bound Downtown Atlanta Luther Apartments Quick Food Mart Raulph David Abernathy Fwy ± 125,000 ADT West View Food Mart Kings Glen Apartments Molly World Academy First Class Car Wash Bargain Wholesale Greenlight Emission Subject Property Burger King, Atlanta, GA 9
Property Name Parent Company Trade Name Ownership Burger King Restaurant Brands International, Inc. (NYSE: QSR) Public Credit Rating (Standard & Poor s) B+ Revenue Net Income $1.15 B $233.70 M No. of Locations ± 15,000 No. of Employees ± 34,248 Headquartered Miami, FL Website www.bk.com Year Founded 1953 TENANT OVERVIEW Burger King Worldwide operates the world s #3 hamburger chain by sales with almost 15,000 restaurants in the US and more than 100 other countries. In addition to its popular Whopper sandwich, the chain offers a selection of burgers, chicken sandwiches, salads, and breakfast items, along with beverages, desserts, and sides. Many of the eateries are stand-alone locations offering dine-in seating and drive-through services; the chain also includes units in high-traffic locations such as airports and shopping malls. Burger King Worldwide is owned and operated by Restaurant Brands International. GEOGRAPHIC OUTREACH Burger King has restaurant locations throughout the US and more than 100 other countries. The US and Canada are responsible for about 65% of revenues. Like most other giants of the fast-food industry, Burger King has expanded its nationwide and international presence primarily through franchising. But the company has reduced its domestic expansion efforts recently. Burger King has used joint ventures to expand in countries like China, Mexico, Russia, and Singapore. STRATEGY Burger King has been remodeling outdated restaurant interiors and modernizing obsolete technology, thus positioning the company for future growth. Its goal is to have 40% of Burger King restaurants in the US and Canada on a modern image by the end of 2015. The company has also been steadily refranchising locations with the goal of getting to a 100% franchised business model eventually. 10 Offering Memorandum
area Area overview Overview Atlanta is Georgia s capital and most populous city, as well as the economic and cultural hub of the Atlanta metropolitan area. Atlanta is a rapidly growing city, and its metropolitan area exceeded 5.5 million for the first time in 2013. While the area s growth is not as high as it was in the 1990 s and early 2000s, it s higher than the previous year and this growth is expected to continue as Atlanta attracts new people. It s projected that metro Atlanta s population will reach about 5.7 million by 2020. 440,641 Population 33.3 Median Age $46,439 Median Household Income Burger King, Atlanta, GA 11
Economy Atlanta s economy is considered diverse, with dominant sectors including logistics, professional and business services, media operations, and information technology. Corporate operations comprise a large portion of Atlanta s economy, with the city serving as the regional, national, or global headquarters for many corporations. Top Employers Atlanta contains the country s third largest concentration of Fortune 500 companies and the city is the global headquarters of corporations such as The Coca-Cola Company, The Home Depot, Delta Air Lines, AT&T Mobility, Chick-fil-A, UPS, and Newell-Rubbermaid. Over 75 percent of Fortune 1000 companies conduct business operations in the Atlanta metropolitan area, and the region hosts offices of about 1,250 multinational corporations. Many corporations are drawn to Atlanta on account of the city s educated workforce; as of 2010, nearly 43% of adults in the city of Atlanta have college degrees, compared to 27% in the nation as a whole. demographics POPULATION 1 Mile 3 Mile 5 Mile 2022 Projection 7,868 79,879 232,231 2017 Estimate 7,510 77,919 221,793 2010 Census 7,037 76,122 204,274 Growth 2017-2022 4.77% 2.52% 4.71% HOUSEHOLDS 1 Mile 3 Mile 5 Mile 2022 Projection 3,440 31,982 93,232 2017 Estimate 3,250 30,866 87,478 Growth 2017-2022 5.85% 3.62% 6.58% INCOME 1 Mile 3 Mile 5 Mile 2017 Est. Average Household Income $34,779 $40,991 $53,739 12 Offering Memorandum
TOURISM Atlanta is one of the most visited cities in America, with over 37 million visitors per year. In 2015 alone, the tourism industry generated $58.9 billion in business sales. Although the most popular attraction among visitors to Atlanta is the Georgia Aquarium, the world s largest indoor aquarium, Atlanta s tourism industry mostly driven by the city s history museums and outdoor attractions. SPORTS It is home to three professional sports franchises: the Atlanta Braves (Major League Baseball), the Atlanta Hawks (National Basketball Association), and the Atlanta Falcons (National Football League). All teams have made their city proud and have become national champions. The residents of Atlanta and surrounding cities have become a devoted fan base to their teams and have some of the best crowd atmospheres. ACTIVITIES Atlanta also contains various outdoor attractions. The Atlanta Botanical Garden, adjacent to Piedmont Park, is home to the 600-foot-long Kendeda Canopy Walk, a skywalk that allows visitors to tour one of the city s last remaining urban forests from 40-foot-high. The Canopy Walk is considered the only canopy-level pathway of its kind in the United States. Zoo Atlanta, located in Grant Park, accommodates over 1,300 animals representing more than 220 species. Home to the nation s largest collections of gorillas and orangutans, the Zoo is also one of only four zoos in Burger the U.S. to King, house giant Atlanta, pandas. GA 13
CONFIDENTIALITY & DISCLAIMER STATEMENT This Offering Memorandum contains select information pertaining to the business and affairs of Burger King located at 26 Peyton Road SW, Atlanta, GA 30311 ( Property ). It has been prepared by Matthews Real Estate Investment Services. This Offering Memorandum may not be all-inclusive or contain all of the information a prospective purchaser may desire. The information contained in this Offering Memorandum is confidential and furnished solely for the purpose of a review by a prospective purchaser of the Property. It is not to be used for any other purpose or made available to any other person without the written consent of Seller or Matthews Real Estate Investment Services. The material is based in part upon information supplied by the Seller and in part upon financial information obtained from sources it deems reliable. Owner, nor their officers, employees, or agents makes any representation or warranty, express or implied, as to the accuracy or completeness of this Offering Memorandum or any of its contents and no legal liability is assumed or shall be implied with respect thereto. Prospective purchasers should make their own projections and form their own conclusions without reliance upon the material contained herein and conduct their own due diligence. By acknowledging your receipt of this Offering Memorandum for the Property, you agree: 1. The Offering Memorandum and its contents are confidential; 2. You will hold it and treat it in the strictest of confidence; and 3. You will not, directly or indirectly, disclose or permit anyone else to disclose this Offering Memorandum or its contents in any fashion or manner detrimental to the interest of the Seller. Owner and Matthews Real Estate Investment Services expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers to purchase the Property and to terminate discussions with any person or entity reviewing this Offering Memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase and sale of the Property has been fully executed and delivered. If you wish not to pursue negotiations leading to the acquisition of the Property or in the future you discontinue such negotiations, then you agree to purge all materials relating to this Property including this Offering Memorandum. A prospective purchaser s sole and exclusive rights with respect to this prospective transaction, the Property, or information provided herein or in connection with the sale of the Property shall be limited to those expressly provided in an executed Purchase Agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims against Seller or Matthews Real Estate Investment Services or any of their affiliates or any of their respective officers, Directors, shareholders, owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property. This Offering Memorandum shall not be deemed to represent the state of affairs of the Property or constitute an indication that there has been no change in the state of affairs of the Property since the date this Offering Memorandum.
Burger King 26 Peyton Road SW Atlanta, GA 30311 exclusively listed by Gary Chou FVP & Senior Director Gary.Chou@matthews.com DIR (310) 919-5827 MOB (714) 928-8016 LIC # 01911222 (CA) Kevin Chang Associate Kevin.Chang@matthews.com DIR (310) 919-5828 MOB (951) 616-8918 LIC # 01976724 (CA) Kyle Matthews BROKER OF RECORD LIC # 67120 (GA) Burger King, Atlanta, GA 15