Wendy s Pendleton, OR [ REPRESENTATIVE PHOTO ] Pendleton, or ABSOLUTE NNN ASSET ON BRAND NEW 25-YEAR LEASE 824 Southgate, Pendleton, OR 97801 [ www.capitalpacific.com ]
Wendy s PRICE: $1,415,000 CAP: 5.00% WENDY S IS AN ABSOLUTE NNN QUICK- SERVICE RESTAURANT WITH A NEW 25- YEAR LEASE IN PENDLETON, OREGON. Wendy s has a 17-year historical tenancy at the Premises and was recently assigned to the largest Pacific Northwest Wendy s franchisee, with a total of 82 locations throughout the U.S. and Canada. The Operator will execute a brand new 25-year lease within 60 days of assignment of the lease, scheduled for May 1, 2017. A remodel featuring significant upgrades costing in excess of $300,000 is scheduled for 2017-2018 to comply with Wendy s corporate Image Activation Plan. LEASABLE SF...±3,000 SF PRICE PER SF...$472 LAND AREA...±27,442 SF LEASE TYPE...Absolute NNN LEASE EXPIRATION...4/30/2042* YEAR BUILT/REMODELED...1979/2017** CURRENT RENT...$26.51/SF PARKING...±34 Spaces or 11.3/1,000 SF * Expiration date estimated. **Full interior/exterior remodel upgrading to new store format slated for 2017-2018. ADDRESS: 824 Southgate, Pendleton, OR 97801 [ REPRESENTATIVE PHOTO ] WENDY S - PENDLETON 2
Core Characteristics New 25-year lease with rent bumps of 5% every 5 years. Absolute NNN lease structure provides zero Landlord responsibilities. Preeminent franchise operator with 80-plus locations throughout seven western states and Canada. Major $300,000+ interior and exterior remodel slated for 2017, featuring image updates and structural and parking lot improvements. Ideal access provided to Interstate-84 on-off ramps directly north of the Subject. Frontage on Southgate exposes the Subject to 25,500 vehicles per day. Strong daily needs draw to nearby Walmart Supercenter and Safeway. Landlord s Interest is further protected through co-guaranty clause requiring Tenant to operate a total of 10 units under the subject LLC. [ REPRESENTATIVE PHOTO ] WENDY S - PENDLETON 3
Quick Stats About the Franchisee 6,490 WENDY S LOCATIONS (80% ARE FRANCHISES) NASDAQ: WEN PUBLIC SINCE 1976 $1.44 BILLION IN 2016 REVENUE Wenspok Resources, LLC is one of six regional franchise entities founded and managed by Peter Nisbet, with a combined total of 82 franchise units throughout seven Western States and Canada. Peter grew up locally in the Pacific Northwest and is a well-recognized Wendy s franchisee, with a 15-year involvement with Wendy s International, LLC. Peter formed Wenspok Resources, LLC in December 2012 with a total of 13 stores throughout Spokane, WA and Northern Idaho, and added an additional built-to-suit location in 2016 in Yakima, WA. This entity employs 506 people and each restaurant has average annual sales above $1.8 million. In 2013, Peter formed Wenoregon, LLC, and Wenshasta, LLC, incorporating 12 Wendy s restaurants in the Central Oregon and Northern California region and the addition of a completely remodeled location in Eugene, OR in 2016. This entity has average annual sales of $1.6 million each and a combined total of 400 employees. Peter and Wenspok Companies partnered in 2014 to form Wentana, LLC, which consists of 18 Wendy s restaurants in Montana, North Dakota, and Wyoming. Wentana has average annual sales per restaurant greater than $2.1 million and employs 575 people. Most recently, Peter and investment partners purchased Wendberta, Inc., a 37-Wendy s conglomerate in the affluent Alberta, Canada province with over 1,200 employees and combined sales of $84,500,000 annually. 82 UNITS OPERATED $1.8 MILLION AVERAGE ANNUAL SALES OF EACH LOCATION [ REPRESENTATIVE PHOTO ] WENDY S - PENDLETON 4
Aerial SURROUNDING RETAIL Bi-Mart Burger King Dairy Queen D&B Supply Denny s Dollar Tree Domino s Jack in the Box JCPenny KFC Little Caesars Pizza Mazatlan Mexican Papa Murphy s Quiznos Rite Aid Safeway Starbucks Taco Bell Walgreens Walmart Supercenter Westgate SE Emigrant Ave 84 WENDY S 28,600 DAILY ST. ANTHONY S HOSPITA L 1 MILE SOUTH 25,500 DAILY Southgate WENDY S - PENDLETON 5
westbound Highway Access The Property is strategically located within one block from access to a major Interstate. Wendy s benefits from excellent accessibility to the region s most trafficked interstate highways. Highway 84 Access To Highway From Highway 84 Eastbound 84 WENDY S WENDY S - PENDLETON 6
Site Plan SITE PLAN KEY LAND AREA ±27,442 SF LEASABLE SF PARCEL OUTLINE SUBJECT TRASH/RECYCLE INGRESS/EGRESS ±3,000 SF SOUTHGATE 25,500 DAILY DRIVE-THRU PYLON SIGN *Site Plan Not To Scale WENDY S - PENDLETON 7
Financial Analysis Target Price Range PRICE $1,415,000 Capitalization Rate: 5.00% Price Per Foot: 3,000 Square Feet $472 NET OPERATING INCOME SUMMARY SCHEDULED INCOME Per SF Scheduled Rent: 5/1/2017 $23.57 $70,704 Equals: Effective Gross Income $23.57 $70,704 Less: OPERATING EXPENSES Per SF CAMS NNN Property Taxes NNN Insurance NNN Total Operating Expenses NNN - [ REPRESENTATIVE PHOTOS ] Equals: NET OPERATING INCOME $70,704 This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies. WENDY S - PENDLETON 8
Rent Roll TENANT INFO TERM RENT SUMMARY Tenant Name Size Date Monthly Rent Percent Increase Annual Rent PSF Cap Rate Wendy's 3,000 5/1/2017 $5,892 $70,704 $23.57 5.00% 5/1/2022 $6,187 5.0% $74,239 $24.75 5.25% Lease Notes Occupancy Date : 7/17/1999 5/1/2027 $6,496 5.0% $77,951 $25.98 5.51% Lease Expiration : 4/30/2042* 5/1/2032 $6,821 5.0% $81,849 $27.28 5.78% Option 1 5/1/2042 $7,162 5.0% $85,941 $28.65 6.07% Option 2 5/1/2047 $7,520 5.0% $90,238 $30.08 6.38% Option 3 5/1/2052 $7,896 5.0% $94,750 $31.58 6.70% Option 4 5/1/2057 $8,291 5.0% $99,488 $33.16 7.03% *New 25-year lease to commence within 60 days of February 2017 assignment to Wenspok Resources LLC. Commencement date expected to occur in April 2017, assumed as 5/1/2017 for purpose of Analysis. Comments: Absolute NNN lease. Lease has a Co-Guaranty clause requiring Tenant to operate a total of 10 Wendy's restaurants under Wenspok Resources, LLC, and if at anytime Tenant operates less than 10 Wendy's restaurants for a period of 12-plus months, Tenant must co-guaranty the lease with another entity operated by Lessee, bringing the total operated restaurants to 10 or more. Tenant has a Right of First Refusal to purchase the Property effective after Year 2. Landlord may request Tenant financials once annually. Landlord is required to reimburse $250k of total $300k+ cost of remodel; this may be handled by 1) TI allowance held back in escrow from Seller funds, or 2) purchase price is reduced and Buyer assumes responsibility for paying out T.I. allowance. Current Totals: 3,000 $5,892 $70,704 $23.57 5.00% This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies. WENDY S - PENDLETON 9
Area Intel & Demos PENDLETON OVERVIEW Pendleton was strategically built on both sides of the Umatilla River as a vital transportation and trading route for settlers, as well as a water and power source. The Umatilla River connected the city to the Columbia River to the West. Pendleton has since continued with a diverse economic base with deep roots in agriculture. The rural part of Oregon has an agriculturally-based economy and works hard to keep the multi-million dollar grain and cattle industries strong. Additionally, the commodities are converted to value added products at establishments such as Pendleton Flour Mills, Continental Mills, Haus Barhyte mustards and Hill Meat Company. Umatilla County is the leading wheat producing county in the state and energy production is a growing sector within the county as wind farms are expanding in the area. The county seat of Umatilla County, Pendleton s population of 17,515 makes it the largest city in Eastern Oregon, and the business, political, commercial, tourism and entertainment center for the region. Pendleton is famous for its annual rodeo, the Pendleton Round-Up. First held in 1910, it is part of the Professional Rodeo Cowboys Association (PRCA)-sanctioned rodeo circuit. POPULATION 5 Mins 10 Mins 15 Mins 2010 9,100 17,058 20,042 2016 9,150 17,262 20,240 2021 9,171 17,332 20,367 2016 HOUSEHOLD INCOMES 5 Mins 10 Mins 15 Mins Average $55,190 $59,923 $60,806 Median $42,198 $46,281 $47,413 Wendy s PENDLETON TOP 10 EMPLOYERS COMPANY ± EMPLOYEES State of Oregon 1,009 Confederated Tribes 701 Wildhorse Resort & Casino 590 Keystone RV Company 443 Eastern Oregon Correctional Institution 440 St. Anthony Hospital 325 Pendleton School District 310 Umatilla-Morrow ESD 300 Walmart 230 5 MINS 10 MINS 15 MINS
THE CAPITAL PACIFIC EXPERIENCE - OUR DAILY COMMITMENT TO OUR CLIENTS [ www.capitalpacific.com ] [ REPRESENTATIVE PHOTO ] SEAN MACK smack@capitalpacific.com (503) 675-8378 MICHAEL HORWITZ mhorwitz@capitalpacific.com (503) 675-8381 DAVID GELLNER dgellner@capitalpacific.com (206) 693-3349 KEVIN ADATTO kadatto@capitalpacific.com (503) 675-7726 PETER DUNN pdunn@capitalpacific.com (503) 607-0197 [ Copyright 2017 Capital Pacific LLC ] SCOTT FRANK sfrank@capitalpacific.com (503) 675-8383 SEAN TUFTS stufts@capitalpacific.com (206) 693-3352