WALGREENS OFFERING MEMORANDUM 15250 MONTANUS DRIVE CULPEPER, VA 22701
AFFILIATED BUSINESS DISCLOSURE & CONFIDENTIALITY AGREEMENT This Offering Memorandum has been prepared by NKF Capital Markets for use by a limited number of parties and has been obtained from sources believed reliable. While we do not doubt its accuracy, we have not verified it, and make no guarantee, warranty or representation about it. It is your responsibility to confirm, independently, its accuracy and completeness. All projections have been developed by NKF, Owner and designated sources, are based upon assumptions relating to the general economy, competition, and other factors beyond the control of Owner, and therefore are subject to variation. No representation is made by NKF or Owner as to the accuracy or completeness of the information contained herein, and nothing contained herein is or shall be relied on as a promise or representation as to the future performance of the property. Although the information contained herein is believed to be correct, Owner and its employees disclaim any responsibility for inaccuracies and expect prospective purchasers to exercise independent due diligence in verifying all such information. Further, NKF, Owner and their employees disclaim any and all liability for representations and warranties, expressed and implied, contained in, or for omissions from, the Offering Memorandum or any other written or oral communication transmitted or made available to the recipient. The Offering Memorandum does not constitute a representation that there has been no change in the business or affairs of the property or Owner since the date of preparation of the Offering Memorandum. Analysis and verification of the information contained in the Offering Memorandum is solely the responsibility of the prospective purchaser. Additional information and an opportunity to inspect the property will be made available upon written request to interested and qualified prospective investors. Owner and NKF each expressly reserve the right, at their sole discretion, to reject any or all expressions of interest or offers regarding the property and/or terminate discussions with any entity at any time with or without notice. Owner shall have no legal commitment or obligations to any entity reviewing this Offering Memorandum or making an offer to purchase the property unless and until such offer is approved by Owner, a written agreement for the purchase of the property has been fully executed, delivered and approved by Owner and its legal counsel, and any obligations set by Owner thereunder have been satisfied or waived. This Offering Memorandum and the contents, except such information, which is a matter of public record or is provided in sources available to the public, are of a confidential nature. By accepting this Offering Memorandum, you agree that you will hold and treat it in the strictest confidence, that you will not photocopy or duplicate it, that you will not disclose this Offering Memorandum or any of the contents to any other entity (except to outside advisors retained by you, if necessary, for your determination of whether or not to make a proposal and from whom you have obtained an agreement of confidentiality) without the prior written authorization of Owner or NKF and that you will use the information in this Offering Memorandum for the sole purpose of evaluating your interest in the property and you will not use the Offering Memorandum or any of the contents in any fashion or manner detrimental to the interest of Owner or NKF. If you have no interest in the property, please return the Offering Memorandum forthwith. OFFERED EXCLUSIVELY BY Newmark Knight Frank NATIONAL NET LEASE PRACTICE GROUP D. Andrew Ragsdale J.D. Senior Managing Director 918.878.9535 Andrew.Ragsdale@ngkf.com Jerry Hopkins Senior Managing Director 918.878.9536 Jerry.Hopkins@ngkf.com Ken Hedrick Executive Managing Director 918.878.9540 Ken.Hedrick@ngkf.com Mat Adler Managing Director 202.664.5912 Mat.adler@ngkf.com Virginia License #0225051130 2 WALGREENS CORPORATION 15250 MONTANUS DRIVE
PURCHASE PRICE $8,545,000 CAP RATE 5.50% THE OFFERING Newmark Knight Frank ( NKF ) has been retained to exclusively offer the opportunity to purchase the Walgreens Co. leased retail property located at 15250 MONTANUS DRIVE CULPEPER, VA 22701. The Subject Property is located in the heart of the Culpeper market, and amongst many other national credit tenant retailers, including Lowes, Wal-Mart, Target, Kohls, Aldi, Chick-fil-A, Starbucks, and Panera. The property is 100% Leased and Guaranteed by Walgreens Co., under a long term Absolute NNN Lease, with zero landlord responsibilities. There are 15+ years remaining of primary lease term, which is accompanied by fifty (50), one (1) year option periods. INVESTMENT HIGHLIGHTS Long Term Lease 15+ Years of Remaining Primary Lease Term. 100% Absolute NNN Lease The Subject Property Boasts a True Absolute NNN Lease, with Zero Landlord Responsibilities. Metro/Amtrak Serviced Market Culpeper is served by DC Metro/Amtrak, increasing crucial accessibility to the Washington D.C. Metropolitan area, as well as the Amtrak Northeast Corridor route. High Growth Area & Demographics the Culpeper market provides for a dense suburban demographic, with an expected population growth of 8% between now and 2020. Premier Retail Location Walgreens benefits from a Premier Market Location, within the heart of the Culpeper primary retail corridor. Institutional Quality Construction the subject property was Built to Suit Walgreens, including their prototypical masonry construction. Performing Unit, with Drive Thru The Subject Property has strong sales, and provides consumers with convenient drive thru service. 3 WALGREENS CORPORATION 15250 MONTANUS DRIVE
LEASE ABSTRACT Property Address 15250 Montanus Drive, Culpeper, VA 22701 Tenant Walgreen Corporation (S&P: BBB) Effective Date October 18, 2007 Rent Commencement Date April 1, 2008 Annual Rent $470,000 Expiration Date March 31, 2033 Option Periods 50, 1 year options Lease Type Absolute NNN Lease, with zero LL responsibilities Right of First Refusal 10 day response period Estoppel Yes, 30 day response period Rentable Building Area 14,673 SF Acreage 2.0215 Acres Construction Type Masonry Year Built 2008 RENT SCHEDULE Current March 31, 2018 $470,000 April 1, 2018 March 31, 2019 $470,000 April 1, 2019 March 31, 2020 $470,000 April 1, 2020 March 31, 2021 $470,000 April 1, 2021 March 31, 2022 $470,000 April 1, 2022 March 31, 2023 $470,000 April 1, 2023 March 31, 2024 $470,000 April 1, 2024 March 31, 2025 $470,000 April 1, 2025 March 31, 2026 $470,000 April 1, 2026 March 31, 2027 $470,000 April 1, 2027 March 31, 2028 $470,000 April 1, 2028 March 31, 2029 $470,000 April 1, 2029 March 31, 2030 $470,000 April 1, 2030 March 31, 2031 $470,000 April 1, 2031 March 31, 2032 $470,000 April 1, 2032 March 31, 2033 $470,000 Option Periods 50, 1 year options $470,000 4 WALGREENS CORPORATION 15250 MONTANUS DRIVE
TENANT/CREDIT OVERVIEW Walgreens Boots Alliance, Inc. is an American holding company headquartered in Deerfield, Illinois that owns Walgreens, Boots and a number of pharmaceutical manufacturing, wholesale and distribution companies. The company was formed on December 31, 2014 after Walgreens purchased the 55% stake in Switzerland-based Alliance Boots that it did not already own. Walgreens had previously purchased 45% of the company in 2012 with an option to purchase the remaining shares within three years. The combined business has operations in over 25 countries. Walgreens had formerly operated solely within the United States and its territories, while Alliance Boots operated a more international business. The Walgreen Company (simply Walgreens) is an American company which operates as the second-largest pharmacy store chain in the United States behind CVS Health. It specializes in filling prescriptions, health and wellness products, health information, and photo services. As of August 31, 2016, the company operated 8,175 stores in all 50 states, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands. It was founded in Chicago, Illinois, in 1901. The Walgreens headquarters office is in the Chicago suburb of Deerfield, Illinois. Credit Summary Trade Name Walgreens Industry Drug Store/Retail Founded 1901 Headquarters Deerfield, IL 2017 Revenues $117 Billion 2017 Net Income $4.17 Billion 2017 Net Worth $22.88 Billion 5 WALGREENS CORPORATION 15250 MONTANUS DRIVE
LOCATION OVERVIEW Culpeper, Virginia is located in the Central Virginia region and is an hour south of Washington D.C. and 40 minutes north of Charlottesville. Rapid population growth in Culpeper is fueled by the proximity to Washington D.C. and Charlottesville and the beauty of the Blue Ridge Mountains. The County of Culpeper was one of the fastest growing counties in the state experiencing over 36% population growth from 2000 to 2010 and is projected to grow an additional 18% by 2020. Among its many attributes, Culpeper boasts a skilled and educated workforce, exceptional real estate values, abundant and reliable power, robust fiber optics and an outstanding quality of life. These advantages attract innovative corporations and government entities to the Culpeper area. Washington, D.C., formally the District of Columbia and commonly referred to as Washington, the District, or simply D.C., is the capital of the United States. Washington had an estimated population of 681,170 as of July 2016. Commuters from the surrounding Maryland and Virginia suburbs raise the city s population to more than one million during the workweek. The Washington metropolitan area, of which the District is the principal city, has a population of over 6 million, the sixth-largest metropolitan statistical area in the country. Washington has a growing, diversified economy with an increasing percentage of professional and business service jobs.[the gross product of the Washington Metropolitan Area was $435 billion in 2014, making it the sixth-largest metropolitan economy in the United States. The Packard Campus of the National Audio-Visual Conservation Center is located on 45-acres near Culpeper, Virginia, and 75 miles southwest of Washington, DC near the foothills of the Blue Ridge Mountains. The campus is built into the side of Mount Pony, the highest slope in Culpeper County, and features an adaptive reuse and expansion of a previously existing underground Federal Reserve Bank facility. It was created through a unique partnership between the Packard Humanities Institute, the United States Congress, the Library of Congress and the Architect of the Capitol. 6 WALGREENS CORPORATION 15250 MONTANUS DRIVE
SITE SURVEY 0.62' CLR 0.47' CLR 5.00' 10.00' 75' BRL 7 WALGREENS CORPORATION 15250 MONTANUS DRIVE
BRAD N TA CK S YK DR NO LL RD NU RO F OR D N MO LOCATION AERIAL IRA HO FFM AN LN ) /29 E UT Y ON 15 O (R HW S DI ES M JA 8 WALGREENS CORPORATION 1 5 2 5 0 M O NTA NU S D RIVE R SD MA U NN A NT MO N
DEMOGRAPHICS 1 Mile Ring 5 Mile Ring 10 Mile Ring POPULATION 2000 Total Population 2,135 16,884 30,970 2010 Total Population 3,640 25,434 42,047 2016 Total Population 3,972 27,331 44,825 2021 Total Population 4,288 28,933 47,179 HOUSEHOLDS 2000 Total Households 755 6,531 11,062 2010 Total Households 1,158 9,133 14,652 2016 Total Households 1,215 9,407 15,127 2021 Total Households 1,324 10,049 16,088 POPULATION 2000 to 2010 Population Change 70.5% 50.6% 35.8% 2000 to 2016 Population Change 86.0% 61.9% 44.7% 2010 to 2021 Population Change 17.8% 13.8% 12.2% 2016 to 2021 Population Change 8.0% 5.9% 5.3% HOUSEHOLD 2000 to 2010 Household Change 53.4% 39.8% 32.5% 2000 to 2016 Household Change 60.9% 44.0% 36.7% 2010 to 2021 Household Change 14.3% 10.0% 9.8% 2016 to 2021 Household Change 9.0% 6.8% 6.4% 2016 RACE White alone 54.3% 67.2% 72.4% Black or African American alone 22.5% 18.4% 16.4% American Indian and Alaska Native alone 1.3%.5%.5% Asian alone 3.3% 1.9% 1.4% Native Hawaiian and OPI alone.0%.1%.1% Some Other Race alone 13.2% 7.5% 5.5% Two or More Races 5.4% 4.3% 3.7% 2016 INCOME Per Capita Income $24,010 $25,764 $27,299 Household Income: Median $63,220 $59,216 $63,894 Household Income: Average $77,049 $74,210 $78,623 AVERAGE HOUSEHOLD SIZE 3.2 2.9 2.9 Old Executive Eisenhower Office Building The White House 9 WALGREENS CORPORATION 15250 MONTANUS DRIVE
NATIONAL NET LEASE PRACTICE GROUP D. Andrew Ragsdale J.D. Senior Managing Director 918.878.9535 Andrew.Ragsdale@ngkf.com Jerry Hopkins Senior Managing Director 918.878.9536 Jerry.Hopkins@ngkf.com Ken Hedrick Executive Managing Director 918.878.9540 Ken.Hedrick@ngkf.com Mat Adler Managing Director 202.664.5912 Mat.adler@ngkf.com