STORM LAKE RETAIL CENTER · 2020. 2. 25. · Decades worth of experience Highly-focused...

STORM LAKE, IA1515 LAKE AVENUE NORTH

OFFERING

MEMORANDUM

STORM LAKE RETAIL CENTER

FINANCIAL

OVERVIEWPAGES 03-08

INVESTMENT

OVERVIEWPAGES 09-13

MARKET

OVERVIEWPAGES 14-16

01 02 03

ACT ID: ZAB0260097

STORMLAKERETAILCENTER

TABLE OF

CONTENTS

SECTION 1

FINANCIAL

OVERVIEW

01

FINANCIAL

OVERVIEW

Repeat clients

Decades worth of experience

Highly-focused specialization

STORM LAKE RETAIL CENTER1515 Lake Ave N, Storm Lake, IA 50588

DEMOGRAPHICS

1-Mile 3-Mile 5-Mile

Population 3,523 11,139 12,643

Average HH Income

$51,770 $66,445 $69,685

PRICE:$2,538,000

CAP RATE:8.00%

NOI: $203,060

SQUARE FEET:20,939

LEASE TYPES:Mostly NNN

ACREAGE:2.99 Acres

4

Price: $2,538,000

Cap Rate: 8.00%

Gross Leasable Area: 20,939

Price Per Square Foot: $121.21

Year Built: 2016

Lot Size: 2.99 Acres

PRICING

20,939 Square Foot Multi-Tenant Retail Center |Anchored by Dollar Tree, Cricket Wireless, ShoeSensation & HR Block

Zero Lease Rollover in 2020 | Only 1 Lease Expires in2021

NNN Leases for 5 of the 6 Tenants | Very MinimalLandlord Responsibility

100% Occupied & Fully Stabilized

Positioned down the Street from a WalmartSupercenter

INVESTMENT HIGHLIGHTS

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EXECUTIVE

SUMMARY

5

SUMMARY

Price: $2,538,000

Down Payment (30%): $761,400

Current CAP: 8.00%

Cash on Cash: 10.95%

Square Feet 20,939

Cost per Square Feet: $121.21

Debt Coverage Ratio: 1.76

Year Built: 2016

OPERATING DATA

Scheduled Gross Income: $235,184

CTI Reimbursements: $64,578

Admin Reimbursements: $2,777

Total Income: $302,539

Vacancy Factor: $7,563 2.50%

Gross Operating Income: $294,975

Less Expenses: $91,916

Net Operating Income: $203,060 8.00%

Capital Reserves: $4,188 ($.20)

Loan Payments: $115,494

Pre Tax Cash Flow: $83,378 10.95%

Plus Principal Reduction: $40,777

Total Return Before Taxes: $124,155 16.31%

PROPOSED NEW FINANCING

Loan Amount: $1,776,600

Terms 4.25% Interest Rate

25 Year Amortization

5 Year Term

Monthly Payment: $9,624.52

Annual Payment: $115,494.23

EXPENSES

Taxes: $3.09 $64,710

Insurance: $0.30 $6,186

CAM: $0.67 $13,940

Management: 2.40% $7,079

TOTAL EXPENSES: $91,916

Per RSF: $4.39

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OPERATING

SUMMARY

6

Suite TenantSq.

Ft.

% of

Total

Lease

Start

Lease

End

Monthl

y Rent

Annual

Rent

Annual

PSF

Bump

Date

New

Rent

PSF

Annual

Reimb.

Lease

Type

Option

Terms

A Dollar Tree 8,600 41.07% 11/17/2016 1/31/2027* $7,525.00 $90,300.00 $10.50 12/1/2021 $11.00 $35,147.28 NNN (2) 5-yr

Option I 2/1/2027 $11.50

Option II 2/1/2032 $12.00

B Cricket Wireless 1,850 8.84% 6/30/2017 6/30/2022 $2,081.25 $24,975.00 $13.50 $8,118.85 NNN (1) 5-yr

Option I 7/1/2022 $14.50

C Shoe Sensation 5,000 23.88% 8/1/2016 7/31/2021 $5,000.00 $60,000.00 $12.00 Gross (2) 5-yr

Option I 8/1/2021 $13.00

Option II 8/1/2026 $14.00

D HR Block 1,500 7.16% 7/1/2017 6/30/2022 $1,500.00 $18,000.00 $12.00 $6,582.85 NNN (1) 5-yr

Option I 7/1/2022 $14.00

E Total Concept Salon 2,257 10.78% 9/30/2017 9/30/2022 $2,000.00 $24,000.00 $10.63 $9,904.99 NNN (1) 5-yr

Option I 10/1/2022 $11.96

F Lavish Nails 1,732 8.27% 4/15/2018 4/30/2025 $1,492.42 $17,909.00 $10.34 5/1/2022 $11.43 $7,601.00 NNN

Current Totals 20,939 100% $19,599 $235,184 $11.23 $67,354

Occupied 20,939 100% $19,599 $235,184 $11.23 $67,354

Vacant

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RENT

ROLL

*Dollar Tree can terminate their lease if sales do not exceed $1,000,000 between 12/1/2020-11/30/2021

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Dollar Tree, Inc. is an American chain of discount varietystores that sells items for $1 or less. Headquartered inChesapeake, Virginia, it is a member company of Fortune500 and operates 15,155 stores throughout the 48 contiguousU.S. states and Canada. Its stores are supported by anationwide logistics network of eleven distribution centers.The company operates one-dollar stores under the names ofDollar Tree and Dollar Bills. The company also operates multi-price-point variety chains under the names Deals and FamilyDollar.

Headquarters: Chesapeake, Virginia

No. of Locations: 15,155+

Symbol: NASDAQ: “DTR”

Website: www.dollartree.com

Square Footage: 8,600

Lease Start: November 17, 2016

Lease Expiration: January 31, 2027

Cricket Wireless is a prepaid wireless service provider in theUnited States. Cricket Wireless offers voice, text, and data and isa wholly owned subsidiary of AT&T Inc. As of 2011, it providedprepaid wireless services to approximately 5 million subscribersin the United States. Cricket Wireless was founded in 1999 byLeap Wireless International, Inc. On July 12, 2013, AT&T Inc.agreed to acquire Cricket's parent company Leap WirelessInternational for $1.2 billion. The merger was approved by theFederal Communications Commission on March 13, 2014, andlater that same day, Leap Wireless announced the completionof its acquisition by AT&T.

Headquarters: Atlanta, Georgia

No. of Locations: 4,300+

Symbol: NYSE: “T” (Parent Company)

Website: www.cricketwireless.com


Lease Start: June 30, 2017

Lease Expiration: June 30, 2022

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TENANT

PROFILES

http://www.dollartree.com/

http://www.cricketwireless.com/

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Shoe Sensation’s mission is to provide quality and brandname footwear for the entire family, from toddlers to seniors,their large selection of shoes has something for everyone asthe typical Shoe Sensation will showcase over 10,000 pairs ofthe latest styles. In addition to their sensational productoffering, they strive to be good stewards in their communitiesand to help whenever possible. In 2017, their quantity ofstores increased by 25%, there are now 149 stores across 18states, as well as 15,000 square feet of offices and a 150,000square foot distribution center and over 1,000 employees..

Headquarters: Jeffersonville, Indiana

No. of Locations: 149

Symbol: Private

Website: www.shoesensation.com


Lease Start: August 1, 2016

Lease Expiration: July 31, 2021

H&R Block is an American tax preparation company in NorthAmerica, Australia, and India based in Kansas City, Missouri.Founded in 1955, by brothers Henry Bloch and Richard Bloch,H&R Block currently operates approximately 12,000 retail taxoffices worldwide. They offer consumer tax software, formerlycalled TaxCut, as well as online tax preparation and electronicfiling from their website. Now, they have prepared more than720 million tax returns and have grown to have company-owned and franchise retail locations in all 50 states.

Headquarters: Kansas City, Missouri

No. of Employees: 87,500

Symbol: NYSE: “HRB”

Website: www.hrblock.com


Lease Start: July 1, 2017

Lease Expiration: June 30, 2022

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TENANT

PROFILES

http://www.shoesensation.com/

http://www.hrblock.com/

SECTION 2

INVESTMENT

OVERVIEW

02

INVESTMENT

OVERVIEW

Repeat clients



INVESTMENT HIGHLIGHTS 20,939 Square Foot Multi-Tenant Retail

Center | Comprised of 6 Suites

Fully Stabilized Retail Center Offered at

100% Occupancy

Mostly NNN Leases | 5 of the 6 Tenants

have a NNN Lease

Potential Upside Opportunity in Converting

Cricket Wireless Lease (23% of GLA) to NNN

Long-Term Leases | Zero Lease Rollover in

2020 & Only 1 Lease Expires in 2021

Strong Tenant Mix of National Retailers |

Anchors Include Dollar Tree (NASDAQ:

“DLTR”), Cricket Wireless (NYSE: “T”), HR

Block (NYSE: “HRB”) & Shoe Sensation

Positioned just down the Street from a

Walmart Supercenter | Major Draw to this

Corridor

Strong Location | Close Proximity to Buena

Vista University & the Buena Vista Medical

Center Hospital

Marcus & Millichap is proud to present the opportunity to

acquire the fee simple interest in the Storm Lake Retail

Center located in Storm Lake, Iowa.

The 20,939 square foot building is positioned on 2.99 acres

with excellent exposure along Highway M44. Storm Lake

Retail Center is perfectly positioned just down the street from

a Walmart Supercenter which is a major draw to this corridor

contributing to the healthy traffic counts nearby. The

subject property is also in close proximity to Buena Vista

University, the Buena Vista Regional Medical Center and the

large industrial warehouses home to Tyson Foods. There is

minimal competition nearby for a majority of the tenants at

Storm Lake providing additional security in the deal. Hy-Vee

and Bomgaars occupy a large shopping center down the

street to the south, with other tenants nearby including Ace

Hardware, Anytime Fitness, O’Reilly Auto Parts, Napa Auto

Parts, Burger King and Subway.

Storm Lake Retail Center is currently 100 percent occupied,

and is fully stabilized with upside in capturing the future rent

increases scheduled. There are triple net leases in 77

percent of the gross leaseable area of the deal, with Cricket

Wireless being the only tenant with a gross lease, providing

more upside in converting the lease to triple net. The center

has a healthy mix of national tenants including Dollar Tree

(NASDAQ: “DTR”), Cricket Wireless (NYSE: “T”) and HR Block

(NYSE: “HRB”) among others.

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INVESTMENT WRITE-UP

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INVESTMENT

OVERVIEW

Repeat clients



1930

MARKET

AERIAL

11

SE

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Repeat clients



1930

LOCAL

MAP

12

SE

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2.1 MILESBuena Vista Medical

Center

1.4 MILESStorm

Lake

1.3 MILESBuena Vista

University

Repeat clients



1930

REGIONAL

MAP

13

SE

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133 MILESSioux Falls,

South Dakota

122 MILESOmaha,

Nebraska

70 MILESSioux City,

Iowa

SECTION 3

MARKET

OVERVIEW

03

MARKET

OVERVIEW

Repeat clients



15

2018HOUSEHOLDS:

6.0%

Growth2018-2023*:

The current year racial makeup of your selected area is as

follows: 60.87% White, 4.56% Black, 2.23% Native

American and 14.81% Asian/Pacific Islander. Compare

these to US averages which are: 70.20% White, 12.89%

Black, 0.19% Native American and 5.59% Asian/Pacific

Islander. People of Hispanic origin are counted

independently of race.

People of Hispanic origin make up 36.22% of the current

year population in your selected area. Compare this to the

US average of 18.01%.

Race and Ethnicity

Employment

In 2019, there are 8,579 employees in your selected area,

this is also known as the daytime population. The 2000

Census revealed that 50.14% of employees are employed

in white-collar occupations in this geography, and 49.70%

are employed in blue-collar occupations. In 2019,

unemployment in this area is 3.43%. In 2000, the average

time traveled to work was 13.00 minutes.

Population

In 2019, the population in your selected geography is 12,643.

The population has changed by 5.20% since 2000. It is

estimated that the population in your area will be 12,643.00 five

years from now, which represents a change of 0.00% from the

current year. The current population is 50.54% male and

49.46% female. The median age of the population in your area

is 31.19, compare this to the US average which is 37.95. The

population density in your area is 160.63 people per square

mile.

Households

There are currently 4,318 households in your selected

geography. The number of households has changed by 3.05%

since 2000. It is estimated that the number of households in

your area will be 4,363 five years from now, which represents a

change of 1.04% from the current year. The average household

size in your area is 2.72 persons.

Income

In 2019, the median household income for your selected

geography is $53,505, compare this to the US average which is

currently $58,754. The median household income for your area

has changed by 46.47% since 2000. It is estimated that the

median household income in your area will be $62,702 five

years from now, which represents a change of 17.19% from

the current year.

The current year per capita income in your area is $24,624,

compare this to the US average, which is $32,356. The current

year average household income in your area is $69,685,

compare this to the US average which is $84,609.

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MARKET

OVERVIEW

16

2018HOUSEHOLDS:

6.0%

Growth2018-2023*:

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POPULATION 1 Miles 3 Miles 5 Miles

2023 Projection

Total Population 3,539 11,148 12,643

2018 Estimate


2010 Census


2000 Census


Current Daytime Population

2018 Estimate 4,863 15,224 16,399

HOUSEHOLDS 1 Miles 3 Miles 5 Miles

2023 Projection

Total Households 1,210 3,777 4,363

2018 Estimate


Average (Mean) Household Size 2.97 2.73 2.72

2010 Census


2000 Census


Occupied Units

2023 Projection 1,210 3,777 4,363

2018 Estimate 1,280 3,995 4,621

HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles

2018 Estimate

$150,000 or More 1.30% 4.81% 5.56%

$100,000 - $149,000 8.04% 10.31% 10.80%

$75,000 - $99,999 11.22% 13.42% 13.69%

$50,000 - $74,999 22.63% 23.84% 23.83%

$35,000 - $49,999 14.47% 14.79% 14.73%

Average Household Income $51,770 $66,445 $69,685

Median Household Income $43,050 $52,172 $53,505

Per Capita Income $17,784 $23,142 $24,624

HOUSEHOLDS BY EXPENDITURE 1 Miles 3 Miles 5 Miles

Total Average Household Retail Expenditure

$55,023 $62,824 $64,159

Consumer Expenditure Top 10 Categories

Housing $13,827 $15,784 $16,112

Transportation $9,520 $10,900 $11,166

Shelter $7,859 $8,945 $9,127

Food $5,571 $6,382 $6,525

Personal Insurance and Pensions $4,451 $5,648 $5,878

Health Care $3,881 $4,703 $4,827

Utilities $3,299 $3,652 $3,711

Entertainment $2,121 $2,563 $2,640

Cash Contributions $1,397 $1,728 $1,768

Apparel $1,294 $1,450 $1,480

POPULATION PROFILE 1 Miles 3 Miles 5 Miles

Population By Age

2018 Estimate Total Population 3,523 11,139 12,643

Under 20 34.23% 31.14% 30.84%

20 to 34 Years 23.38% 24.17% 23.76%

35 to 39 Years 6.35% 5.57% 5.57%

40 to 49 Years 11.90% 10.53% 10.43%

50 to 64 Years 14.38% 15.77% 16.27%

Age 65+ 9.75% 12.83% 13.10%

Median Age 29.63 30.63 31.19

Population 25+ by Education Level

2018 Estimate Population Age 25+ 2,022 6,415 7,366

Elementary (0-8) 17.11% 13.27% 12.97%

Some High School (9-11) 11.10% 9.67% 9.63%

High School Graduate (12) 32.04% 28.66% 28.48%

Some College (13-15) 17.00% 16.60% 16.70%

Associate Degree Only 6.67% 7.16% 7.26%

Bachelors Degree Only 8.36% 13.70% 14.19%

Graduate Degree 4.37% 7.40% 7.45%

MARKET

OVERVIEW

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.

NET LEASED DISCLAIMER

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.

NON-ENDORSEMENT NOTICE

CONFIDENTIALITY & 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 prepare 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, not 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.

S T O R M L A K E R E T A I L C E N T E R | S T O R M L A K E , I A

EXCLUSIVE OFFERING

www.marcusmillichap.com

P R E S E N T E D B Y :O F F I C E S

N A T I O N W I D E

I O W A B O R

J o n R u z i c k a

R e g i o n a l M a n a g e r , M i n n e a p o l i s

L i c : B 6 3 3 7 9 0 0 0

ACT ID: ZAB0260097

ACT ID: ZAB0260097

STORM LAKE RETAIL CENTER · 2020. 2. 25. · Decades worth of experience Highly-focused...

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Transcript of STORM LAKE RETAIL CENTER · 2020. 2. 25. · Decades worth of experience Highly-focused...