Offering Memorandum NEW CONSTRUCTION Texas Roadhouse 33090 South Dixie Highway, Florida City, FL 33034 REPRESENTATIVE PHOTO
CONFIDENTIALITY AND DISCLAIMER The information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCB s or asbestos, the compliance with State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant s plans or intentions to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein. NON-ENDORSEMENT NOTICE Marcus & Millichap Real Estate Investment Services, Inc. ( M&M ) is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of M&M, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of M&M, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers. Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers. ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.
NET LEASE DISCLAIMER Marcus & Millichap hereby advises all prospective purchasers of Net Leased property as follows: The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any information provided. As the Buyer of a net leased property, it is the Buyer s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any obligation to conduct a due diligence examination of this Property for Buyer. Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors. Buyer and Buyer s tax, financial, legal, and construction advisors should conduct a careful, independent investigation of any net leased property to determine to your satisfaction with the suitability of the property for your needs. Like all real estate investments, this investment carries significant risks. Buyer and Buyer s legal and financial advisors must request and carefully review all legal and financial documents related to the property and tenant. While the tenant s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including newly-constructed facilities or newly-acquired locations, may be set based on a tenant s projected sales with little or no record of actual performance, or comparable rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or may fail to comply with other material terms of the lease; cash flow may be interrupted in part or in whole due to market, economic, environmental or other conditions. Regardless of tenant history and lease guarantees, Buyer is responsible for conducting his/her own investigation of all matters affecting the intrinsic value of the property and the value of any long-term lease, including the likelihood of locating a replacement tenant if the current tenant should default or abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer s legal ability to make alternate use of the property.abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer s legal ability to make alternate use of the property. By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment Services and hold it harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this net leased property. By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment Services and hold it harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this net leased property.
exclusively listed Exclusively listed by: GABRIEL BRITTI Vice President Investments Senior Director, National Retail Group Miami OFfice Office: (786) 522-7017 Gbritti@marcusmillichap.com RONALD ISSENBERG Vice President Investments Senior Director, National Retail Group Miami OFfice Office: (786) 522-7013 Rissenberg@marcusmillichap.com
Table of Contents Executive summary...7 Financial analysis... 9-10 Property description...11-14 Demographic analysis...15-16
Executive summary
EXECUTIVE SUMMARY Investment Overview Marcus & Millichap is pleased to present a rare opportunity to acquire a 15- Year Corporately Guaranteed NNN Ground Lease with Texas Roadhouse. There are 10 Percent scheduled increases in rent every Five Years in the initial term, as well as the option periods. This site is located on US1/South Dixie Highway just 42 Miles south of Downtown Miami in Florida City. With accessibility from US-1 and the Florida Turnpike to the east, the immediate area is home to national retailers Home Depot, BJ s Wholesale Club, Best Buy, Mattress Firm, Panda Express, AutoZone, Bank of America, Chase, Payless Shoe Source, and Krispy Kreme, among others. Texas Roadhouse, Inc. (Texas Roadhouse), incorporated in 2004, is a fullservice, casual dining restaurant chain. The Company offers an assortment of specially seasoned and aged steaks hand-cut daily on the premises, and cooked to order over open gas-fired grills. In addition to steaks, it also offers its guests a selection of ribs, fish, seafood, chicken, pork chops, pulled pork, and vegetable plates, and an assortment of hamburgers, salads and sandwiches. Its entrees include two made-from-scratch side items, and it offers all its guests a free unlimited supply of roasted in-shell peanuts and made-from-scratch yeast rolls. As of December 27, 2011, it leased 173 properties and owned 121 properties. As of 2015 the chain operates 450 restaurants in 49 states. Investment Highlights New 15-Year Absolute Triple-Net (NNN) Corporate Ground Lease Brand New Construction Rare Corporate Guarantee (Texas Roadhouse, Inc.) 2014 Corporate Sales Exceeded $1.58 Billion Florida - No State Income Tax Traffic Counts Exceed 38,000 Plus Vehicles Per Day REPRESENTATIVE PHOTO 7
PRICING AND Financial Analysis Tenant Research The Company s wholly owned subsidiaries include Texas Roadhouse Holdings LLC (Holdings), Texas Roadhouse Development Corporation (TRDC), Texas Roadhouse Management Corp (Management Corp.) and Aspen Creek, LLC (Aspen Creek). The Company and its wholly owned subsidiaries operate restaurants under the names Texas Roadhouse and Aspen Creek. Holdings also provides supervisory and administrative services for certain other license and franchise restaurants. TRDC sells franchise rights and collects the franchise royalties and fees. Management Corp. provides management services to Holdings, TRDC and certain other license and franchise restaurants. Texas Roadhouse restaurants offer a variety of menu items that are designed to appeal to a range of consumer tastes. It offers an assortment of specially seasoned and aged steaks, including 6, 8, 11 and 16 ounce Sirloins; 10, 12, 16 and 20 ounce Rib-eyes; 6 and 8 ounce Filets; Prime Rib, and T-Bones. The Company also offers its guests a selection of fish, seafood, chicken, pork chops, ribs, pulled pork and vegetable plates, and an assortment of hamburgers, salads and sandwiches. Entree prices include made-from-scratch yeast rolls and include the choice of two of the made-from-scratch sides: baked potato, sweet potato, steak fries, mashed potatoes, house or Caesar salad, green beans, chili, seasoned rice, baked beans, corn, and steamed vegetables. Its menu allows guests to customize their meals by ordering steaks that are smothered either in cheese, onions, gravy or mushrooms and baked potatoes loaded with sour cream, cheese, bacon, and butter. Other menu items include specialty appetizers, such as the Cactus Blossom and Chicken Critters (chicken tenders). The Company also provide a 12 & Under menu for children that includes sirloin steak, rib basket, Lil Dillo Sirloin Bites, Jr. Chicken Critters, mini-cheeseburgers, hot dog and macaroni & cheese, all served with one side item and a beverage. Most of its restaurants feature a full bar that offers a selection of draft and bottled beer. It serves a selection of brands of liquor and wine, as well as margaritas. Texas Roadhouse restaurants are focused to appeal to segments of the population, children, families, couples, adults, and business persons. 8
PRICING AND Financial Analysis Texas Roadhouse 33090 South Dixie Highway, Florida City, FL 33034 PROPERTY RENT DATA Rent Increases Monthly Rent Annual Rent Years 1-5 $10,000.00 $120,000.00 Years 6-10 $11,000.00 $132,000.00 ANNUALIZED OPERATING DATA List Price $2,400,000 Cap Rate 5.00% Lot Size 1.813 Acres Rentable Square Feet 7,163 SF Price/SF (GLA) $335.06 Year Built 2016 Type of Ownership Leased Fee / Ground Lease Years 11-15 $12,100.00 $145,200.00 Option 1 $13,310.00 $159,720.00 Option 2 $14,641.00 $175,692.00 Base Rent ($33.75/SF) $120,000 Net Operating Income $120,000 Total Anual Return $120,000 9
PRICING AND Financial Analysis TENANT LEASE ABSTRACT Tenant Trade Name Texas Roadhouse Tenant overview Tenant Ownership Guarantor Corporate Store Public Corporate Guarantee Stock Symbol Board TXRH NASDAQ Lease Type Absolute Net Lease Term 15 Years Lease Commencement Date 2016 HQ Louisville, KY Number of Locations 455 Rent Commencement Date On or Before August 17, 2016 Expiration Date of Base Term 2031 Roof & Structure Maintenance Increases Options Term Remaining on Lease Property Type Tenant Responsible 10% Every Five Years Two (Five Year) Options 15 Years Net Leased Restaurant - Other 10
Property description Regional Map 11
Property description Aerial 12
Property description Parcel Map 13
Property description Site Plan 14
Property description Parcel Survey 15
Demographic analysis Demographic Details Population 2-Mile 4-Miles 6-Miles 2000 Population 35,156 68,169 87,057 2010 Population 51,621 99,244 128,196 2014 Population 55,402 107,311 139,265 2019 Population 62,106 120,685 156,870 Households 2-Mile 4-Miles 6-Miles 2000 Households 10,606 20,375 25,494 2010 Households 15,884 30,125 38,396 2014 Households 17,126 32,723 41,879 2019 Households 19,263 36,894 47,247 2014 Average HH Size 3.17 3.24 3.27 2014 Daytime Population 11,896 21,286 27,558 2000 Owner Occupied Housing Units 32.38% 46.16% 47.46% 2000 Renter Occupied Housing Units 56.54% 45.28% 42.65% 2000 Vacant 11.08% 8.56% 9.88% 2014 Owner Occupied Housing Units 34.05% 46.40% 49.19% 2014 Renter Occupied Housing Units 65.95% 53.60% 50.81% 2014 Vacant 11.16% 10.53% 10.35% 2019 Owner Occupied Housing Units 33.53% 45.90% 48.78% 2019 Renter Occupied Housing Units 66.47% 54.10% 51.22% 2019 Vacant 12.20% 11.63% 11.31% Income 2-Mile 4-Miles 6-Miles $0 - $ 14,999 26.6% 22.1% 21.5% $15,000 - $24,999 17.0% 14.4% 14.5% $25,000 - $34,999 16.0% 13.7% 13.3% $35,000 - $49,999 14.8% 15.1% 14.3% $50,000 - $74,999 13.6% 15.8% 16.6% $75,000 - $99,999 5.8% 8.2% 8.6% $100,000 - $124,999 3.2% 4.7% 5.1% $125,000 - $149,999 1.2% 2.4% 2.7% $150,000 - $200,000 1.1% 2.1% 2.1% $200,000 to $249,999 0.3% 0.5% 0.6% $250,000 + 0.6% 0.9% 0.9% 2014 Median HH Income $28,512 $34,875 $35,700 2014 Per Capita Income $12,729 $15,586 $15,624 2014 Average HH Income $40,691 $50,459 $51,402 Demographic data 2012 by Experian. 16
Demographic analysis Demographic Summary Geography: 6 Miles Population In 2014, the population in your selected geography is 139,264. The population has changed by 59.96% since 2000. It is estimated that the population in your area will be 156,869 five years from now, which represents a change of 12.64% from the current year. The current population is 50.04% male and 49.95% female. The median age of the population in your area is 30.4, compare this to the Entire US average which is 37.3. The population density in your area is 1,233.31 people per square mile. Households There are currently 41,878 households in your selected geography. The number of households has changed by 64.26% since 2000. It is estimated that the number of households in your area will be 47,246 five years from now, which represents a change of 12.81% from the current year. The average household size in your area is 3.27 persons. Income In 2014, the median household income for your selected geography is $35,700, compare this to the Entire US average which is currently $51,972. The median household income for your area has changed by 21.51% since 2000. It is estimated that the median household income in your area will be $41,753 five years from now, which represents a change of 16.95% from the current year. The current year per capita income in your area is $15,624, compare this to the Entire US average, which is $28,599. The current year average household income in your area is $51,401, compare this to the Entire US average which is $74,533. Race and Ethnicity The current year racial makeup of your selected area is as follows: 66.88% White, 21.44% Black, 0.12% Native American and 1.25% Asian/Pacific Islander. Compare these to Entire US averages which are: 71.60% White, 12.70% Black, 0.18% Native American and 5.02% Asian/Pacific Islander. People of Hispanic origin are counted independently of race. People of Hispanic origin make up 59.47% of the current year population in your selected area. Compare this to the Entire US average of 17.13%. Housing In 2000, there were 13,428 owner occupied housing units in your area and there were 12,066 renter occupied housing units in your area. The median rent at the time was $451. Employment In 2014, there are 27,558 employees in your selected area, this is also known as the daytime population. The 2000 Census revealed that 44.24% of employees are employed in white-collar occupations in this geography, and 55.25% are employed in blue-collar occupations. In 2014, unemployment in this area is 8.90%. In 2000, the average time traveled to work was 35.5 minutes. 17
Market Overview About Florida City, Florida The Florida Keys are a string of tropical islands stretching about 120 miles off the state s southern tip, between the Atlantic Ocean and Gulf of Mexico. A major tourist destination, visitors are drawn to keys leisure lifestyle, Florida City is locatedi 42 miles South of Downtown Miami along the gate way to the Florida Keys, The Everglades National Park and Biscayne National Park. Each Year, several million tourists travel along US 1 to reach these destinations. Traffic counts exceed 38,000 Plus vehicles per day or approximately 14 million per year. Commerce in Florida city is integrated for daily traffic of tourists, locals and commercial vehicles. Immediate surrounding retail includes Best Buy, Super Walmart, BJ Wholesale Club, Home Depot and the Florida Keys Outlet Mall. This mall features tenants such as Calvin Klein, Nike, Tommy Hilfiger, Crocs and Guess which all serve the local residents and the entire Florida Keys chain of islands residents. sources: http://www2.dot.state.fl.us/floridatrafficonline/viewer.html 18
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exclusively listed Exclusively listed by: GABRIEL BRITTI Vice President Investments Senior Director, National Retail Group Miami OFfice Office: (786) 522-7017 Gbritti@marcusmillichap.com RONALD ISSENBERG Vice President Investments Senior Director, National Retail Group Miami OFfice Office: (786) 522-7013 Rissenberg@marcusmillichap.com