LONG TERM INDUSTRIAL, OFFICE AND FLEX PORTFOLIO SALE LEASEBACK Main Buiding 2917 Latoria Street, Franklin Park STREAM Capital Partners, LLC License No.: 481.012052 Lic: 475.017525 Lic: 475.152062
TABLE OF CONTENTS Transaction Summary Tenant Summary Product Summary Building Photos Property Overview Area Overview
Disclaimer Confidentiality 3 This Offering Memorandum ( Memorandum ) is intended solely for the use of prospective investors in determining whether or not to pursue the possible acquisition of the Properties ( the Properies ) at the main campus (2912 & 2917 N Lattore, 10622 & 10628 Grand Avenue), & 10750 W. Grand Avenue, Franklin Park, IL. This Memorandum is of a proprietary and confidential nature. Prospective investors and/or their advisors are expressly forbidden from sharing this information with any individuals or organizations that are not directly connected with the analysis of this investment opportunity. STREAM Capital Partners, LLC ( SCP ) has been retained as the exclusive advisor for this investment opportunity. Any and all inquiries are to be directed to SCP. By accepting this Memorandum, the recipient agrees that it will cause its directors, officers, employees and representatives to use the Memorandum and all of the information contained therein only to evaluate this specific investment opportunity and for no other purpose and shall return this Memorandum together with any copies to SCP upon request. This Memorandum contains confidential material which is non-public information. Receipt of this Memorandum constitutes your acknowledgment that you will maintain the information contained herein in strict confidence. All information contained herein has been provided by the Organization, its affiliates or other sources that SCP deems reliable; however, SCP has not independently verified any of the information, including the financial estimates and projections and selected real estate information, contained herein. This Memorandum includes information about the Organization, including selected financial information, estimates and projections that reflect various assumptions concerning anticipated results, which may or may not prove to be correct and selected real estate information which may or may not prove to be correct. Such projections and estimates may or may not be indicative of future performance, which may be significantly more or less favorable than that as reflected herein. In furnishing this Memorandum, none of the Organization, its affiliates or SCP undertakes any obligation to provide additional information or to correct or update any of the information set forth in the Memorandum. None of the Organization, its affiliates or SCP makes any representation or warranty, expressed or implied, as to the accuracy or completeness of the information contained herein in this Memorandum, or made available in connection with any further investigation of the Organization, and nothing contained herein is, or shall be relied upon as, a promise or representation, whether as to the past or the future. The recipient should rely solely on the representations and warranties made to it by the Organization or its affiliates in any executed definitive agreement. Under no circumstances should the Organization, its affiliates or any of their management, directors, shareholders, employees, customers or vendors be contacted directly.
Transaction Summary 4 Portfolio Purchase Price: $13,027,067 Year 1 Portfolio Net Rent: $1,074,733 Year 1 Portfolio Cap Rate: 8.25% Lease Type: Absolute NNN - No Landlord Responsibilities Rent Increases: 2.00% Annual Initial Term: 15 Years Renewal Options: Four (4), Five (5) Year Options Portfolio Square Footage: 170,994 SF Portfolio Site Size: 7.91 Acres Address Building SF Land SF Rent $/SF (High) Annual Rent $ (High) Cap Rate % (Low) Value $ (High) 2917 North Latoria Street, Franklin Park, IL (Building A) 23,947 141,681 $9.25 $221,510 8.25% $2,684,967 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 46,577 incl. above $8.25 $384,260 8.25% $4,657,700 2950 Hart Drive, Franklin Park, IL (Building C) 11,232 incl. above $6.00 $67,392 8.25% $816,873 *10750 West Grand Avenue, Franklin Park, IL 89,238 202,786 $4.50 $401,571 8.25% $4,867,527 TOTALS 170,994 344,467 $6.29 $1,074,733 8.25% $13,027,067 * Does not Include Mezzanine Space
Tenant Summary 5 Founded in 1963 and still family owned and operated by Frank Defino Sr. and his three sons and daughter, Tukaiz ( the Company ), is a single-source marketing partner, providing small to large organizations nationwide marketing production services driven by innovation and technology. The Company s comprehensive suite of services provides clients with unparalleled efficiencies, cost savings and an increased ability to provide relevant, effective marketing solutions. Since 1969, the Company has operated within the Franklin Park, IL campus, which cohesively integrates creative, software development, robust marketing management technology, diverse print production, inventory management, fulfillment and distribution services. Throughout many years of robust growth, primarily driven by print production, the Company continued expanding and investing in their properties to fit their needs to maintain this fully integrated philosophy. From 2014 to 2015, the Company experienced a decrease in revenue from $42.7 million to $32.7 million due to its customers cutting back on print production; however EBITDA only declined from $2.7 million to $2.5 million as Tukaiz focused on higher margin opportunities in advertising and creative to offset the revenue decline. Accordingly, the EBITDA margins increased from 6.5% to 7.8%. Revenue for year to date 2016 is on pace with the same time last year; however, Tukaiz already recorded over $2 million in EBITDA for year to date 2016 and is on pace to achieve $4 million in EBITDA for year end 2016 based on flat-to-slightly higher year over year sales. The Company has a number of strategic initiatives for growth centered around higher margin advertising and creative solutions for customers. They also have a number of projects in the pipeline and, most importantly, they maintain excellent long-term customer relationship with major brands such as Frito Lay, State Farm, Arby s, Taco Bell, KFC, Burger King, among numerous others. Formerly, Redbox, was Tukaiz largest customer (20% of sales in 2015); however, as the Redbox business model is suffering due to shrinking demand for DVD s, Tukaiz is focusing on leveraging business from other channels and, combined with the reduced spending of Redbox, the concentration is expected to go down to around 10% of sales in 2016.
Product Examples Capabilities 6 Advertising & Creative Advertising & Creative Software Development
Product Examples Capabilities 7 Print Production Print Production Inventory & Fulfillment
Building Photos 2917 N. Latoria, Franklin Park, IL (Building A) 8
Building Photos 2917 N. Latoria, Franklin Park, IL (Building A) 9
Building Photos 2917 N. Latoria, Franklin Park, IL (Building A) 10
Building Photos 2917 N. Latoria, Franklin Park, IL (Building A) 11
Building Photos 2917 N. Latoria, Franklin Park, IL (Building A) 12
Building Photos 2917 N. Latoria, Franklin Park, IL (Building A) 13
Property Overview 2917 N. Latoria, Franklin Park, IL (Building A) 14 Address: 2917 N. Latoria, Franklin Park, IL Building Type: Office Building SF: 23,947 SF Office SF: 23,947 SF Year(s) Built: 1965,1978, and 1985 Exterior Walls: Concrete block brick HVAC: Central heat and air conditioned Power: 400 amps Sprinklers: None Site Size: 7.280 acres 317,116 SF Land-to-Building Ratio: 4.81 : 1 Misc. Property Information: Building A is can be catagorized into in thirds, with a southern, central, and northern portion. There are several entrances along the western elevation. The main entrance for customers and visitors is located along the west side of the southern portion of the improvements. Within this entrance is a reception area, a conference room, and a men s and women s restroom. The remainder of the southern portion of open office space, private offices, restrooms, and a break room. The central portion houses the second-story space. The second floor is comprised of open office space and a conference room. The remainder of this portion is open office space, private offices, and semi-finished production area. Additionally, the northern portion is comprised of open office space and several private offices.
Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 15
Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 16
Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 17
L Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 18
Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 19
Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 20
Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 21
Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 22
Building Photos 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 23
Property Overview 10622 and 10628 Grand Avenue & 2912 Latoria Street, Franklin Park, IL (Building B) 24 Address: 10622 and 10628 Grand Ave & 2912 Latoria St Franklin Park, IL Building Type: Industrial Building SF: 46,577 SF Office SF: 32,138 SF Year(s) Built: 1918, 1949, 1950, 1965, 1998(office Exterior Walls: Concrete block brick HVAC: Central heat and air conditioned Power: 200, 400, and 2,000 amp Ceiling Height: 9-14 Loading: Five (5) overhead doors Site Size: 3.25 acres 141,681SF (total for buildings A,B, & C) Land-to-Building Ratio: 1.73 : 1 Misc. Property Information: The main entrance of Building B is located along the eastern elevation within the central portion of the building. The southern portion of the entire structure is open warehouse/ production space. There is also an approximate 400 sf office along the southern elevation. The two-story section has a semifinished production area that comprises the first floor. This space has a 14 foot ceiling clearance. East of this space is several segmented rooms that house printing equipment and office space. The second floor has a training room in the center with private offices are the perimeter. There is also a reception area along the southern portion of the second floor. The elevator is located along the eastern portion of the newer two-story building.
Building Photos 2950 Hart Drive, Franklin Park, IL (Building C) 25
Building Photos 2950 Hart Drive, Franklin Park, IL (Building C) 26
Building Photos 2950 Hart Drive, Franklin Park, IL (Building C) 27
Property Overview 2950 Hart Drive, Franklin Park, IL (Building C) 28 Address: 2950 Hart Drive, Franklin Park, IL Building Type: Industrial Building SF: 11,232 SF Office SF: 2,000 SF Year(s) Built: 1965 Exterior Walls: Concrete block brick HVAC: Central heat and air conditioned Power: 400 amps Clear Height: 20 Sprinklers: 100% Wet Loading: One (1) exterior dock w/ levelator, Two (2) overhead doors Site Size: 3.25 acres 141,681SF (total for buildings A,B, & C) Land-to-Building Ratio: 1.73 : 1 Misc. Property Information: The main entrance to the office is located along the northern elevation. Additionally, there are several entrances to the warehouse section along the eastern, western, and southern elevations. The office is comprised of several private offices, a reception area, a break room, and restrooms. The remainder of the building is open warehouse space. There is a 480 sf aluminum constructed storage building located to the northwest of Building C. This building has a concrete footing, a garage door, and electrical installed.
Building Photos 10750 West Grand Avenue, Franklin Park, IL 29
Building Photos 10750 West Grand Avenue, Franklin Park, IL 30
Building Photos 10750 West Grand Avenue, Franklin Park, IL 31
Building Photos 10750 West Grand Avenue, Franklin Park, IL 32
Building Photos 10750 West Grand Avenue, Franklin Park, IL 33
Building Photos 10750 West Grand Avenue, Franklin Park, IL 34
Building Photos 10750 West Grand Avenue, Franklin Park, IL 35
Building Photos 10750 West Grand Avenue, Franklin Park, IL - Vacant Office Space 36
Building Photos 10750 West Grand Avenue, Franklin Park, IL - Vacant Office Space 37
Property Overview 10750 West Grand Avenue, Franklin Park, IL 38 Address: 10750 West Grand Avenue, Franklin Park, IL Building Type: Industrial Building SF: 89,238 SF (Does not include mezzanine space) Office SF: 12,007 SF Zoning: Zoned I-1, Restricted Industrial Year(s) Built: 1964, with substantial renovation in 2014 Lighting: LED with motion sensors Exterior Walls: Brick HVAC: Central heat and air conditioned in office and employee break room, Warehouse is heated only with GFA Eight (8) new industrial sized fans in Warehouse Power: 3,000 amps 277/480 volts, 3 phase Clear Height: 18 Sprinklers: 100% Wet Loading: Three (3) interior docks w/ levelator, Two (2) depressed exterior docks, Three (3) truck high exterior & One (1) overhead door Column Spacing: 40 x 25 Parking: 92 spaces Site Size: 4,66 acres 202,990 SF Land-to-Building Ratio: 2.28 : 1 Misc. Property Information: Significant renovations were recently made including new tear off bitumen roof, new mansard roof panels and tuck pointing of brick columns near office.
Aera Overview Franklin Park, Illinois 39 Franklin Park, Illinois is a suburb of Chicago and located within Cook County, the second largest county in the United States with 5,250,000 people. The Village of Franklin Park is located 17 miles from downtown Chicago and less than five miles from O Hare International Airport. Because of the proximity to downtown Chicago, O Hare, Interstates I-90, I-294 and I-290 and the Canadian Pacific Intermodal facility, the the O Hare industrial sub-market, the industrial sub-market within which Franklin Park is located, is the second largest industrial sub-market in Chicago with over 109,000,000 square feet of industrial space. It also maintains the second lowest vacancy rate of all of the 20 industrial sub-markets with a vacancy rate of just 2.5%, which is lower than the overall Chicagoland industrial vacancy rate of 3.9%. Land is extremely scarce in and around O Hare and this is leading to land values to skyrocket. 20 years ago land in and around O Hare was around $3 - $4 / SF and today that is up to around $20 / SF and higher. Due to the central location in the United States, many freight forwarding companies need to be as close to the Airport as possible and this continues to drive prices significantly higher for land in and around the Airport, which is extremely scarce and grew more scarce with the recent expansion of the Airport.
40 Property Overview Franklin Park, IL O Hare Iternational Airport 4.9 miles Gordon Food Service DC Former AM Castle Building New 27 Acre Industrial Spec. Development Sonoco Packaging Nestle National Lift Truck Multi-Group Logistics Norkol Canadian Pacific Intermodal Terminal Midwest Can Magellan Pipelin Lifefitness ODW HD Supplies FedEx Freight
Area Overview Metropolitan Map - Kenosha, Wisconsin 41 O Hare International Airport 4.9 miles Chicago, IL 17 miles