NORTHSTAR RETAIL GROUP OFFERING MEMORANDUM REPRESENTATIVE PHOTO EDINA, MINNESOTA Presented By NORTHSTAR of
AERIAL NORMANDALE LAKE OFFICE PARK US FISH & WILDLIFE SERVICE 176,000 VEHICLES 58,00 VEHICLES BILL MACK SCULPTOR SUBJECT PROPERTY
INVESTMENT SUMMARY PRICE $5,533,000 7.50% CAP Rate ADDRESS 7711 Computer Avenue Edina, MN 55435 APN 31-028-24-33-0016 NET OPERATING INCOME $415,800 ($22.00/SF) LEASE TERM 15 Years LEASE TYPE Absolute Net BUILDING/LOT SIZE 18,900 SF / 2.01 Acres YEAR BUILT/RENOVATED 1964/2018 Marcus & Millichap is pleased to offer the opportunity to acquire this absolute NNN property leased to Kiddie Academy in Edina, Minnesota. The property consists of an 18,900 square foot building on two acres. The facility consists of 13 classrooms, a 5,000 square foot indoor play area, two play grounds, a basketball court, and a soccer field. The property is ideally situated on the border of Bloomington and Edina, with easy access to the intersection of Interstate 494 and Highway 100, with collective traffic counts of 234,000 vehicles per day. The property also benefits from its close proximity to many sources of employment, including the 1 million square foot Seagate campus, the 1.7 million square foot Normandale Office Park, and sits across the street from the Pentagon Park redevelopment (The Link). Kiddie Academy has signed a 15-year lease at the property with scheduled rent increases throughout the initial lease term. The franchisee is a high net worth individual that has the development rights to four more locations throughout the Twin Cities. The brand has over 175 locations across the country and a nearly 40 year operating history. Edina is one of the most sought after suburbs in the Twin Cities, having made the Best Places to Live list on multiple occasions. The area surrounding the property has ideal demographics for the tenant s target market. Average household income is significantly above the national average and there are a large number of employers in the area, providing jobs for families with children in the age range that Kiddie Academy caters to. Highlights: New 15 Year Absolute NNN Lease Over 9,000,000 SF of Office Space Within 1-Mile Radius High Traffic Location Just off I-494 & Hwy 100 Proven Brand 175 Locations Nationwide Great Demographics Average Household Income Over $100K 5,000 Square Feet of Indoor Play Area Outdoor Soccer Field
LEASE SUMMARY LEASE SUMMARY Tenant Tenant Trade Name Franchisee Kiddie Academy Lease Commencement October 31st, 2017 Occupancy Date (Estimated) July 1st, 2018 Rent Commencement (Estimated) April 1st, 2019* Lease Expiration (Estimated) December 31st, 2033 Options Lease Term Remaining Real Estate Tax Repair and Maintenance of Improvements Property Insurance Utilities Roof & Structure Right of First Refusal Three 5-Year Options 15 Years Tenant Responsible Tenant Responsible Tenant Responsible Tenant Responsible Tenant Responsible 20 Days RENT SCHEDULE DATE RANGE ANNUAL RENT MONTHLY RENT PER SF Lease Years 1-7 [Current] $415,800.00 $34,650.00 $22.00 Lease Years 8-9 $434,700.00 $36,225.00 $23.00 Lease Years 10-12 $453,600.00 $37,800.00 $24.00 Lease Year 13 $472,500.00 $39,375.00 $25.00 Lease Years 14-15 $477,225.00 $39,768.75 $25.25 OPTION PERIODS * Kiddie Academy will take occupancy and open for business Summer 2018. There is a 9-month free rent period, with rent commencing Spring 2019. Seller will credit the rent for this period. 1st Option: Lease Years 16-20 $465,885.00 $38,823.75 $24.65 2nd Option: Lease Years 21-25 $512,473.50 $42,706.13 $27.12 3rd Option: Lease Years 26-30 $563,720.85 $46,976.74 $29.83
TENANT SUMMARY A franchise child care system founded in 1981, today Kiddie Academy operates over 175 locations with headquarters in Abingdon, Maryland. The company was ranked among the top 25 percent of the Franchise 500, and was also ranked eighth on the Franchise Gator s fourth annual Top 100 ranking franchise systems. The company s real estate team has years of experience with selecting locations across the nation. The real estate team uses a variety of software and market analysis to make the right site selection. The franchisee for the Edina location is a high net worth individual that has the franchise rights to four more locations in the Twin Cities. Although this will be the first Twin Cities location, the brand has a proven curriculum through its nearly 40-year operating history. TENANT SUMMARY Ownership Private Tenant Kiddie Academy Parent Essential Brands No. of Locations 175+ Headquartered Abingdon, MD Years in the Business 36 Website www.kiddieacademy.com In the News Congressman Jody Hice visits Kiddie Academy of Dacula Kiddie Academy of Abingdon Earns National Accreditation Kiddie Academy Bolster Corporate Team with a Total of 16 New Hires & Promotions
AERIAL DOWNTOWN MINNEAPOLIS SOUTHDALE MALL WEST 77TH STREET CAMPUS 11,500 VEHICLES SUBJECT PROPERTY
AERIAL HEADQUARTERS HEADQUARTERS 58,000 VEHICLES CAMPUS 176,000 VEHICLES
PROPERTY PHOTOS
FLOOR PLAN
BUILDING PLAN SOCCER FIELD
MARKET SUMMARY A first-ring suburb of Minneapolis, Minnesota, Edina was founded as a farming and milling community in the late 1800 s. Today, the city is connected to the metropolitan area via Minnesota State Highways 62 and 100, as well as Interstate 494. Edina is considered one of Minneapolis most affluent suburbs and is also home to headquarters for several companies: Jerry s Foods, Lund Food Holdings, Edina Realty, Dairy Queen, and Orange Julius. The city boasts more than 1,550 acres of park and open space, with 44 parks and 8 miles of scenic pathways. Edina County Club and Interlachen Country Club are also located within city limits. MAJOR EMPLOYERS [2015] Fairview Southdale Hospital Edina Public Schools The City of Edina BI Worldwide Regis Barr Engineering Lund Food Holdings International Dairy Queen, Inc.
DEMOGRAPHICS 1 Mile 3 Miles 5 Miles 2010 Population 6,367 76,077 241,355 2017 Estimated Population 6,699 80,363 254,043 2022 Projected Population 6,753 80,363 254,645 % Change in Population, Projected 2017-2022 0.8% 0.0% 0.2% 2017 Estimated Total Households 3,240 35,611 110,040 2017 Estimated Average Household Income $101,247 $107,719 $108,915 2022 Projected Average Household Income $116,573 $122,141 $122,737 2017 Estimated Median Household Income $68,858 $73,641 $74,681 2017 Estimated Per Capita Income $48,992 $47,802 $47,293 9 MILLION SQUARE FEET OF OFFICE SPACE 1 Mile Radius from Subject Property 2017 Estimated % Total Labor Force 65.2% 65.0% 69.2% Of Total Labor Force, % Employed 97.5% 97.2% 96.9% Of Total Labor Force, % Unemployed 2.5% 2.8% 3.0% % Total Not in Labor Force 34.8% 35.0% 30.8% 2017 Estimated % Attained Some College, No Degree 17.0% 18.6% 18.9% 2017 Estimated % Bachelor s Degree 33.8% 33.3% 32.1% 2017 Estimated % Graduate Degree 21.0% 20.2% 19.3% 2017 Estimated Median Age (Years) 39.6 44.5 41.1 DAYTIME POPULATION 19,000+ 1 Mile Radius from Subject Property 2017 Average Household Income 5 Mile Radius from Subject Property Total Population 5 Mile Radius from Subject Property Unemployment 5 Mile Radius from Subject Property
CONTACT Presented By SEAN DOYLE First Vice President Investments Sean.Doyle@MarcusMillichap.com (952) 852-9719 MATT HAZELTON First Vice President Investments Matt.Hazelton@MarcusMillichap.com (952) 852-9729 ADAM AJ PRINS First Vice President Investments Adam.Prins@MarcusMillichap.com (952) 852-9743 CORY VILLAUME First Vice President Investments Cory.Villaume@MarcusMillichap.com (952) 852-9728 NORTHSTAR of 1350 Lagoon Avenue Suite 840 Minneapolis, MN 55408 www.northstarretailgroup.com