OUTPARCEL TO SINGLE TENANT ABSOLUTE NNN GROUND LEASE Low downside Risk - Potential to Increase Rent - Significant Upside Opportunity 1602 State Highway 37, Massena, NY 13662 COLLIERS INTERNATIONAL 3 PARK PLAZA, SUITE 1200 IRVINE, CA 92814 SNYDER/CARLTON TEAM
Table Of Contents Property Summary Lease Abstract Investment Highlights Aerial Overview Tenant Overview Massena, NY Regional Map Demographics Daytime Population Map Household Income Map Confidentiality Agreement Pg. 3 Pg. 4 Pg. 5 Pg. 8 Pg. 10 Pg. 11 Pg. 13 Pg. 14 Pg. 15 Pg. 16 Pg. 17 Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. This publication is the copyrighted property of Colliers International and /or its licensor(s) 2015. All rights reserved
Property Summary We are pleased to offer to qualified investors an absolute NNN investment fully leased to Taco Bell in the city of Massena, NY. The property is located on approximately 1.00 acres of land and is positioned as an outparcel to the St. Lawrence Centre, which is a shopping mall managed by Carlyle Development Group. There are approximately 44 stores with 4 anchor tenants, totaling over 550,000 SF of GLA. Taco Bell has operated at this location since 1993. There are approximately 3.5 years remaining with 3-5 Year option periods. There are 10% rental increases each option. The current rent is $44,450 per annum, which is significantly below market rent. Moreover, annualized sales at this location average over $900,000 per year, representing a very healthy 4.9% rent-to-sales ratio. The Taco Bell brand is the world s largest fast food mexican chain and is owned by YUM Brands (NYSE: YUM). Headquarted in Irvine, CA, Taco Bell surpassed $9 Billion in system sales in 2015 across approximately 6,400 stores. YUM brands currently has a market value of approximately $34 Billion and employs over 303,000 people. In 2014, YUM was listed #216 on the Fortune 500 list as well as being ranked #3 on the World s most admired companies in the food services industry. This is a unique opportunity to acquire an established, proven Taco Bell investment at a low price with an absolute NNN lease structure (zero landlord obligations), below market rent and attractive 10% increases. Pricing List Price $745,000 NOI $44,450 CAP Rate 5.95% Operating Expense Data Annual Rent $44,450 Operating Expense Taxes NNN Insurance NNN CAM NNN Net Operating Income $44,450 TACO BELL P. 3
Lease Summary Lease Abstract Tenant Trade Name: Taco Bell Restaurant Lease Commencement November 01, 1993 Lease Expiration October 31, 2018 Lease Term Term Remaining On Lease 25 Years 3.5 Years Base Rent $44,450 Rent PSF $22.35 Rental Adjustments Option Periods Right of First Refusal 10% Rent Bumps Every 5 Yrs. 3-5 Year Options 10% Increases Every Option 11/01/2018 $48,895.00 11/01/2023 $53,784.50 11/01/2028 $59,162.95 No Property Details Parcel 405889-010-031-0003-002 Lease Type Absolute NNN Ground Lease Building Area 1,989 SF Roof And Structure Tenant Responsible Land Area 43,560 SF (1 Acre) Land Use Fast Food Franchise TACO BELL P. 4
Global Brand Taco Bell Corporation - Subsidiary of YUM Brands (NYSE: YUM) World s Largest Fast Food Mexican Chain - Over 6,400 Locations YUM Brands Market Value Apprx $34 Billion - Ranked #216 on Fortune 500 List Ranked #3 on World s Most Admired Companies in Food Service Industry Surpassed $9 Billion in Top Line Revenues - Employs over 300,000 People TACO WENDY S BELL P. 5
Absolute NNN Lease Absolute NNN Ground Lease - Zero Landlord Obligations Approximately 3.5 Years Remaining with 3-5 YR Options - 10% Increases Each Option Generates Average Sales Over $900,000 / YR - Approximate 4.9% RTS Currently Paying $22.35 PSF / YR - Significantly Below Market - Low Downside Risk Low downside Risk - Potential to Increase Rent - Significant Upside Opportunity 1,989 Square Feet on Approximately 1.00 Acres of Land TACO BELL P. 6
Ideal 1031 Exchange Opportunity Absolute NNN Lease Structure - Zero Landlord Obligations - Coupon Clipper Investment Grade Tenant - Taco Bell Corp - Subsidiary of YUM Brands (NYSE: YUM) Significantly Below Market Rent - 10% Rental Increase At Next Option Established, Proven Taco Bell Location - Outparcel to Shopping Mall Excellent Rent to Sales Coverage - Approximately 4.9% - Big Upside Free and Clear of Existing Debt - Take Advantage of Low Interest Rates TACO BELL P. 7
Aerial Overview SMITH RD. MAIL RD. NY-37 37 MAIL RD. Outparcel to Shopping Mall Outparcel to St. Lawrence Centre - Over 550,000 SF of GLA Tenants include JCP, Bon-Ton, Ollie s, BJ s and Taco Bell Located Directly Along Route 37, Near Intersection of Route 37 & Route 131 Situated Along Primary Ingress/Egress To Shopping Mall - Excellent Access Directly Adjacent to Massena International Airport Massena, NY - Near Canadian Border - North New York Massena, NY Home of America s Seaway Locks TACO BELL P. 8
Aerial Overview NY-37 INDUSTRIAL 37 MAIN ST. 37 MASSENA INTERNATIONAL AIRPORT N. RAQUETTE RIVER RD. Massena, NY Home of America s Seaway Locks TACO BELL P. 9
Taco Bell Yum! Brands, Inc., (NYSE: YUM) Taco Bell Corporation is a California-based fast service restaurant chain that specializes in Mexican-style fast food. Taco Bell, with 2004 combined company and franchisee sales reaching $5.7 billion dollars, holds the largest share of the Mexican-style restaurant market in the United States. More than 35 million consumers visit a Taco Bell each week and over 80 percent of its 6,500 locations are franchised. The company, with restaurants in Canada, Guam, Aruba, Dominican Republic, Chile, Costa Rica, Guatemala, Puerto Rico, Ecuador, Hawaii, Asia, and Europe, operates as a subsidiary of YUM! Brands Inc., the largest restaurant company in the world. Yum! Brands, Inc. Yum! Brands, Inc., (NYSE: YUM), based in Louisville, Kentucky, is one of the world s largest restaurant companies with nearly 43,000 restaurants in more than 130 countries and territories. Yum! Brands is ranked #228 on the FORTUNE 500 list with revenues of more than $13 billion in 2015 and is named one of the Aon Hewitt Top Companies for Leaders in North America. Our restaurant brands KFC, Pizza Hut and Taco Bell are the global leaders of the chicken, pizza and Mexican-style food categories. Since their spin-off from PepsiCo in 1997, Yum! Brands has become a truly global company going from approximately 20 percent of profits coming from outside the U.S. to almost 65 percent in 2015. Yum! Brands, Inc. is the worldwide leader in emerging markets with more than 16,500 restaurants, nearly twice as many as the nearest competition. With about 2.5 restaurants per million people in the top 10 emerging markets, compared to 57 restaurants per million in the U.S., we are on the ground floor of global growth. NYSE: YUM Exchange: NYSE (US Dollar) Price: $79.98 Volume 3,497,506 Market Cap 32.59B 05/23/2016-1:48PM TACO BELL P. 10
Massena, NY Overlooking the great St. Lawrence River in northernmost New York State, Massena was the fastest-growing commercial and industrial center in St. Lawrence County during the 20th century. From the development of Alcoa operations in 1902, to the arrival of the St. Lawrence Centre Mall and the wide spread of nearby shopping facilities in the 1980 s and 1990 s, Massena firmly established itself as St. Lawrence County s center for commercial, industrial and manufacturing progress throughout the past century, and thus attracting folks to the community from throughout northern New York and southeastern Canada. In addition to a large base of employment opportunities, Massena offers several tourist attractions such as the St. Lawrence Seaway, St. Lawrence-Franklin D. Roosevelt Power Project, the Robert Moses State Park and other recreational facilities. Now into the 21st century and the new millennium, Massena stands ready to assist in improving its current commercial base while welcoming new and compatible business and industry. Economy The economy of early Massena was partly based on health spas, but the modern town is involved in power production, aluminum production at ALCOA, and the commerce of the St. Lawrence Seaway. Massena is home to an Alcoa Aluminum plant, the longest continually operating aluminum facility in the world, and a former Reynolds Metals Company plant, now called Alcoa East (temporarily idled in July 2009). Alcoa currently employs over 1100 people at its facilities in Massena, making it one of the largest private employers in New York north of Syracuse, contributing over $340 million annually to the area s economy. The New York Power Authority also operates a hydroelectric power generating dam, the St. Lawrence-FDR Power Project, on the St. Lawrence River adjacent to Massena. Curran Renewable Energy manufactures wood pellet fuel and mulch in the town. TACO BELL P. 11
St. Lawrence Centre The St. Lawrence Centre is a shopping mall in Massena, New York managed by Carlyle Development Group. There are approximately 44 stores with 4 anchor tenants, totaling over 550,000 SF of GLA. Anchor stores include The Bon-Ton, and J.C. Penney. TACO BELL P. 12
Regional Map TACO BELL P. 13
Demographics Population 3-MILE 5-MILE 7-MILE Estimated Population (2015) 7,184 14,580 17,353 Projected Population (2020) 7,186 14,528 17,339 Households 3-MILE 5-MILE 7-MILE Estimated Households (2015) 3,065 6,254 7,350 Projected Households (2020) 3,089 6,272 7,390 $$ $ Income 3-MILE 5-MILE 7-MILE Avg. Household Income (2015) $47,237 $52,567 $52,516 Median Household Income (2015) $38,681 $40,958 $41,011 Business Facts 3-MILE 5-MILE 7-MILE Total # of Businesses (2015) 319 763 841 Total # of Employees (2015) 3,205 6,933 7,632 TACO BELL P. 14
Approximately 14,528 Residents Within a 5-Mile Radius Population Density TACO WENDY S BELL P. 15
Average Household Income of $52,567 Within a 5-Mile Radius Median Household Income TACO BELL P. 16
This Offering Memorandum contains select information pertaining to the business and affairs of Taco Bell, Massena, NY It has been prepared by Colliers International. 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 Colliers International. 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 or 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 from Colliers, 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 Colliers International 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 Taco Bell, Massena, NY 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 Colliers International 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. Colliers International 3 Park Plaza, Suite 1200 Irvine, CA 92814 Snyder/Carlton Team Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. This publication is the copyrighted property of Colliers International and /or its licensor(s) 2015. All rights reserved TACO BELL P. 17
For More Information Contact: Eric Carlton Senior Vice President License No. 01809955 949.724.5561 eric.carlton@colliers.com Jereme Snyder Executive Vice President License No. 01360233 949.724.5552 jereme.snyder@colliers.com John Sharpe Senior Associate License No. 01800769 949.724.5546 john.sharpe@colliers.com THE SNYDERCARLTON TEAM WWW.THENNNETWORK.COM