Wendy s 1770 University Ave W, Saint Paul, MN 55104 Offering Memorandum R E T A I L A D V I S O R S
CONFIDENTIALITY & DISCLAIMER STATEMENT This Offering Memorandum contains select information pertaining to the business and affairs of Wendy s located at 1770 University Ave W, Saint Paul, MN 55104 ( Property ). It has been prepared by Matthews Retail Advisors. 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 Retail Advisors. 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 Retail Advisors 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 Retail Advisors 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. Matthews Retail Advisors
Table of Contents Pricing and Financial Analysis Investment Overview... 2 Investments Highlights... 2 Executive Summary...3 Company Overview...4 Property Description Physical Description...7 Bird s Eye... 8 Regional Map... 9 Tenant Map...10 Demographics City Overview Saint Paul, MN...12 Demographics Report...13 EXCLUSIVELY LISTED BY: Wesley Connolly National QSR Specialist direct +1.310.919.5809 MOBILE +1.707.477.7185 wesley.connolly@matthews.com License No. 01962332 Mark Hulsey Broker of Record License No. 40169559
Matthews Retail Advisors
Pricing and Financial Analysis
Investment Highlights Strong operating history having been at the site over 35 years Located less than 3 miles from the University of Minnesota and TCF Bank Stadium Dense demographics with over 430,000 in a 5-mile radius Positioned along the major retail corridor directly on University Avenue Seasoned QSR Franchisee Four Crown, Inc. operates over 55 Wendy s locations in the Twin Cities area Strong commitment to the brand through significant remodel plans at most locations Consistently awarded numerous accolades within the Wendy s franchisee system P. 2 Matthews Retail Advisors OFFERING MEMORANDUM Wendy s
Executive Summary Wendy s 1770 University Ave W Saint Paul, MN 55104 List Price... $1,100,000 CAP Rate - Current...6.81% Gross Leasable Area... 2,664 SF Lot Size... 0.46 Acres (20,038 SF) Year Built... 1977 Annualized Operating Data Monthly Rent Annual Rent* Rent/SF CAP Rate Current - 1/31/18 $6,250 $75,000 $28.15 6.81% Option 1-2/1/18-1/31/23 $6,666 $80,000 $30.03 7.27% Option 2-2/1/23-1/31/28 $7,333 $88,000 $33.03 8.00% Option 3-2/1/28-1/31/33 $7,916 $95,000 $35.66 8.63% *Additional percentage rent of 5% in excess sales of $1,500,000 Tenant Summary Tenant Trade Name Wendy s - Four Crown, Inc. Type of Ownership Fee Simple Lease Guarantor Franchisee Lease Type NNN Roof and Structure Tenant Responsible Original Lease Term 10 Years Lease Commencement Date 12/1/1979 Lease Expiration Date 1/31/2018 Term Remaining on Lease 2+ Years Increases $5,000 at option Options Three (3) Five (5) Year Options Wendy s OFFERING MEMORANDUM Matthews Retail Advisors P. 3
Company Overview Property Name Wendy s Property Type Net Leased Fast Food Restaurant Parent Company Trade Name Wendy s Ownership Public Credit Rating B+ (Non-Investment Grade) Stock Symbol WEN Headquartered Dublin, OH Web Site www.wendys.com Year Founded 1969 As one of the largest fast-food companies in the world, Wendy s recently fell to the third ranked hamburger chain behind McDonald s and Burger King. Wendy s (NYSE: WEN) at one point oversaw over 6,500 stores, but consistent store closings have brought the total number of units to 5,780 by 2014. Wendy s Corporate is on plans to divest of direct operations to approximately 95% of their stores by 2016, making it one of the largest franchisee systems in the country. Although the chain is requiring it s buildings to be updated, the improvement costs have been fiercly resisted by many franchisee operators. Wendy s Chief Executive Officer, Emil Brolick, recently explained that franchisees margins have continued to shrink due to rising wage, health care and food input costs, putting added pressure on the chain s franchisee operations. Sources: QSR Magazine, WSJ P. 4 Matthews Retail Advisors OFFERING MEMORANDUM Wendy s
Property Description
P. 6 Matthews Retail Advisors OFFERING MEMORANDUM Wendy s
Physical Description THE OFFERING Property Name...Wendy s Property Address...1770 University Ave W Saint Paul, MN 55104 Assessor s Parcel Number... 33-29-23-42-0016 SITE DESCRIPTION Number of Stories...One Year Built... 1977 Gross Leasable Area (GLA)...2,664 SF Lot Size... 0.46 Acres (20,038 SF) Type of Ownership...Fee Simple Parking...±22 Surface Spaces Parking Ratio...8.26 : 1,000 SF Landscaping...Professional Topography... Generally Level CONSTRUCTION Foundation...Concrete Slab Framing...Wood Exterior... Painted Stucco Parking Surface...Asphalt Roof...Flat Wendy s OFFERING MEMORANDUM Matthews Retail Advisors P. 7
Bird s Eye P. 8 Matthews Retail Advisors OFFERING MEMORANDUM Wendy s
Regional Map Wendy s OFFERING MEMORANDUM Matthews Retail Advisors P. 9
Tenant Map P. 10 Matthews Retail Advisors OFFERING MEMORANDUM Wendy s
Demographics
City Overview Saint Paul, MN Saint Paul is the capital and second-most populous city of the U.S. state of Minnesota. As of 2014, the city s estimated population was 297,640. Saint Paul is the county seat of Ramsey County, the smallest and most densely populated county in Minnesota. The city lies mostly on the east bank of the Mississippi River in the area surrounding its point of confluence with the Minnesota River, and adjoins Minneapolis, the state s largest city. Known as the Twin Cities, the two form the core of Minneapolis Saint Paul, the 16th-largest metropolitan area in the United States, with about 3.5 million residents. Founded near historic Native American settlements as a trading and transportation center, the city rose to prominence when it was named the capital of the Minnesota Territory in 1849. Though Minneapolis is better-known nationally, Saint Paul contains the state government and other important institutions. Regionally, the city is known for the Xcel Energy Center, home of the Minnesota Wild, and for the Science Museum of Minnesota. As a business hub of the Upper Midwest, it is the headquarters of companies such as Ecolab. Saint Paul, along with its Twin City, Minneapolis, is known for its high literacy rate. It was the only city in the United States with a population of 250,000 or more to see an increase in circulation of Sunday newspapers in 2007. Saint Paul is home to a number of colleges, most notably the University of Minnesota. The University of Minnesota is a public research university, located both in Minneapolis and Saint Paul. It is the oldest and largest campus within the University of Minnesota system and it also has the sixth largest student body in the United States, with well over 50,000 students. P. 12 Matthews Retail Advisors OFFERING MEMORANDUM Wendy s
Demographics Report Population 1-Mile 3-Mile 5-Mile 2020 Projection 18,857 177,575 452,502 2015 Estimate 18,360 170,927 432,054 2010 Census 17,883 164,353 410,521 2000 Census 17,475 165,958 405,626 Growth 2015-2020 2.71% 3.89% 4.73% Growth 2010-2015 2.67% 4.00% 5.25% Growth 2000-2010 2.34% -0.97% 1.21% Households 1-Mile 3-Mile 5-Mile 2020 Projection 3,431 36,282 88,825 2015 Estimate 3,320 34,773 84,644 2010 Census 3,219 33,250 80,303 2000 Census 3,235 34,169 81,268 Growth 2015-2020 3.36% 4.34% 4.94% Growth 2010-2015 3.13% 4.58% 5.41% Growth 2000-2010 -0.50% -2.69% -1.19% Income 1-Mile 3-Mile 5-Mile $0 - $15,000 16.91% 14.51% 17.48% $15,000 - $24,999 14.70% 9.78% 11.30% $25,000 - $34,999 11.27% 9.61% 10.26% $35,000 - $49,999 13.59% 13.73% 13.60% $50,000 - $74,999 15.38% 16.75% 16.13% $75,000 - $99,999 10.16% 11.85% 11.19% $100,000 - $124,999 6.13% 8.07% 7.28% $125,000 - $149,999 3.34% 5.06% 4.33% $150,000 - $199,999 5.22% 5.24% 4.17% $200,000 - $249,999 1.67% 2.02% 1.59% $250,000 - $499,999 1.33% 2.51% 1.95% $500,000+ 0.28% 0.87% 0.71% 2015 Est. Average Household Income $62,266 $75,077 $67,343 2015 Est. Median Household Income $42,842 $53,542 $47,093 Wendy s OFFERING MEMORANDUM Matthews Retail Advisors P. 13
Wendy s 1770 University Ave W Saint Paul, MN 55104 OFFERING MEMORANDUM Wesley Connolly National QSR Specialist direct +1.310.919.5809 MOBILE +1.707.477.7185 wesley.connolly@matthews.com License No. 01962332 Mark Hulsey Broker of Record License No. 40169559 Matthews Retail Advisors 841 Apollo Street, Suite 150 El Segundo, CA 90245 www.matthews.com