WIENERSCHNITZEL OFFERING MEMORANDUM ACTUAL PROPERTY Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a trademark of 2016 Marcus & Millichap. Activity ID: Y0332007 1
Financial Overview OFFERING SUMMARY PRICE $1,551,835 CAP RATE 4.85% NOI $75,264 PRICE PER SQUARE FOOT $888.79 RENT PER SQUARE FOOT $43.11 YEAR BUILT 2002 APPROXIMATE LOT SIZE 0.70 Acres GROSS LEASEABLE AREA 1,746 TYPE OF OWNERSHIP Fee Simple LEASE GUARANTOR Galardi Group Realty Corp LEASE TYPE NNN Ground Lease ROOF AND STRUCTURE Tenant Responsible LEASE SUMMARY LEASE COMMENCEMENT DATE 8/22/2012 LEASE EXPIRATION DATE 8/31/2027 LEASE TERM 15 Years TERM REMAINING 10 Years INCREASES 12 Percent Every 5 OPTIONS TO RENEW 2, 5-Year OPTIONS TO TERMINATE None OPTIONS TO PURCHASE None FIRST RIGHT OF REFUSAL None ANNUALIZED OPERATING DATA Base Rent Annual Rent Monthly Rent 9/1/2017 8/31/2022 $75,264 $6,272 9/1/2022 8/31/2027 $84,296 $7,025 12.00% OPTIONS 9/1/2027 8/31/2032 FMV FMV/12 9/1/2032 8/31/2037 FMV FMV/12 ACTUAL PROPERTY Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a trademark of 2016 Marcus & Millichap. Activity ID: Y0332007 2
Investment Overview Marcus & Millichap is pleased to present this 1,746-square foot Wienerschnitzel in Fontana, California, which is 12 miles west of San Bernardino and 50 miles east of Los Angeles. Wienerschnitzel is operating under an absolute net ground lease, with zero landlord responsibilities. There are 10 years of base term remaining with 12 percent rent bumps every five years. This asset is guaranteed by Galardi Group Realty Corp. Wienerschnitzel is the largest hot dog chain in the world and serves more than 120 million hot dogs per year. This asset is a pad site within the Morningside Marketplace shopping center. Wienerschnitzel benefits from having great visibility along Cherry Avenue and Baseline Avenue, which combined, see more than 46,000 vehicles per day (VPD). Wienerschnitzel benefits from being in a strong demographic area as well. There are more than 287,000 residents with an average household income greater than $89,000 within the five-mile radius. Additional retailers in the immediate vicinity include: Panda Express, Chase Bank, KFC, and Baskin Robbins, AutoZone, Wendy s, 7-Eleven, Starbucks, Logan s Roadhouse, Jack in the Box, Subway, Wells Fargo, and many more. Wienerschnitzel in Fontana, California 12 Miles West of San Bernardino Lease is Guaranteed by Galardi Group Realty Corp Absolute Net Ground Lease With 10 Years Remaining Zero Landlord Responsibilities Subject to 12 Percent Rent Bumps Every Five Years Two, Five-Year Options to Extend Strong Demographics More Than 287,000 Residents with an Average Household Income Greater Than $89,000 8 Percent Population Growth from 2010 to 2017 Highly Visible Along Cherry Avenue More than 16,600 Vehicles Per Day (VPD) Dense Retail Corridor More Than 330,000 Square Feet of Retail within Two Miles Additional Retailers in the Immediate Vicinity Include: Panda Express, AutoZone, Wendy s, 7-Eleven, Starbucks, Logan s Roadhouse, Jack in the Box, Subway, Wells Fargo, and Many More ACTUAL PROPERTY Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a trademark of 2016 Marcus & Millichap. Activity ID: Y0332007 3
Tenant Overview - Wienerschnitzel Wienerschnitzel is an American fast food chain founded in 1961 (as Der Wienerschnitzel ) that specializes in hot dogs, also known as the World s Largest Hot Dog Chain. Wienerschnitzel locations are found predominantly in California and Texas, but also in Arizona, Colorado, Illinois, Louisiana, New Mexico, Nevada, Utah, and Washington. Outside the 50 states, there is a store located in Guam and one in Panama. The chain is recognizable by the A-frame style roofs of its older restaurants. The chain s advertising mascot is an anthropomorphized hot dog known as The Delicious One, who runs from people who want to eat him. The first Wienerschnitzel was founded by former Taco Bell employee John Galardi in 1961. This location is still operating today at 900 West Pacific Coast Highway, east of Figueroa Street, in the Los Angeles community of Wilmington. After the death of John Galardi in 2013, the brand remains family owned. Today, the company operates and franchises 350 Wienerschnitzel quickservice restaurants. One of the largest hot dog chains, the restaurants offer a variety of toppings for its wieners, such as chili, cheese, and bacon, as well as alternative menu items including chicken sandwiches, corn dogs, and hamburgers. About 90 percent of Wienerschnitzel locations are operated by franchisees, and 10 percent are corporately operated. Galardi Group also owns Tastee Freez, a chain of ice cream stands, and The Original Hamburger Stand. TENANT PROFILE TENANT TRADE NAME Wienerschnitzel OWNERSHIP Private TENANT Wienerschnitzel LEASE GUARANTOR Galardi Group Realty Corp NUMBER OF LOCATIONS 350 HEADQUARTERED Newport Beach, CA WEB SITE www.wienerschnitzel.com ACTUAL PROPERTY Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a trademark of 2016 Marcus & Millichap. Activity ID: Y0332007 4
Aerial Overview Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a trademark of 2016 Marcus & Millichap. Activity ID: Y0332007 5
Area Overview & Demographics 1-Mile 3-Mile 5-Mile Population 2000 Population 8,432 49,375 157,685 2010 Population 11,805 124,177 267,665 2017 Population 12,691 135,349 287,755 2022 Population 13,185 140,953 298,908 1-Mile 3-Mile 5-Mile Households 2000 Households 3,866 20,608 64,794 2010 Households 3,100 31,892 70,640 2017 Households 3,371 35,040 76,591 2022 Households 3,510 36,544 79,702 1-Mile 3-Mile 5-Mile Household (HH) Incomes 2017 Average HH Income $109,558 $98,136 $89,701 2017 Median HH Income $96,537 $83,582 $74,459 2017 Per Capita Income $29,101 $25,406 $23,875 Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a trademark of 2016 Marcus & Millichap. Activity ID: Y0332007 6
Market Overview - Fontana, California Today, more than 210,000 people call the City of Fontana home. Fontana s low crime rate, affordable housing, diversity, and below average unemployment rate has made the city one of the fastest growing in California and a trendsetter in San Bernardino County. Temperate southern California weather allows the City to host festivals, parades and walks/races throughout the year (including the Fontana Days Half Marathon, considered the fastest half-marathon course in the world). Fontana s current economy is driven largely by industrial uses, particularly trucking-based industries. The city is home to several truck dealerships, and other industrial equipment sales centers, and, like its neighbors Ontario and Rancho Cucamonga, many product distribution centers for such companies as Toyota, Target, Sears, Mercedes-Benz, Southern California Edison, Home Shopping Network, and Avery Dennison. Fontana is also home to numerous small manufacturers of building materials and other locally used products, and many small auto dealerships and salvage yards. The city also has numerous local shopping centers, such as the Summit Heights Gateway/ Falcon Ridge Town Center at the north end of the city, and Palm Court in the southern section. Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a trademark of 2016 Marcus & Millichap. Activity ID: Y0332007 7
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. 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.
WIENERSCHNITZEL Broker of Record Kent Williams OAKLAND, CA Tel: (858) 373-3100 License: 00823860