The Village Gateway Corner Village Dr Big Bear...4. Base Rent for the Tea & Coffee Exchange, per the...

BIG BEAR LAKE, CA

The Village GatewayCorner

OFFERING MEMORANDUM

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.

BIG BEAR LAKE, CA

The Village Gateway Corner

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

Section 1 PRICING AND FINANCIAL ANALYSIS

Section 2 PROPERTY DESCRIPTION

Section 3 RECENT SALES

TABLE OF CONTENTS

The Village Gateway CornerBIG BEAR LAKE, CA


PRICING AND FINANCIAL ANALYSIS

Price $1,654,793

Down Payment 40% $661,917

Price per Square Foot (GLA) $251.99

Gross Leasable Area (GLA) 6,567

Year Built 1979

Lot Size 0.63 AC

VITAL DATA

CAP Rate - Current 6.00%

Net Operating Income - Current $99,288

Net Cash Flow After Debt Service - Current $38,919

Total Return - Current 9.48% / $62,747

1

Major Tenants


Tenant Name

The Village Pizza

The Tea & Coffee Exchange

Our Town Liquor


This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as tothe accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for anyinaccuracies. Marcus & Millichap is a trademark of Marcus & Millichap Real Estate Investment Services, Inc. © 2016 Marcus & Millichap. Allrights reserved.

OFFERING SUMMARY

2

PRICING AND FINANCIAL ANALYSISThe Village Gateway CornerBIG BEAR LAKE, CA

Existing Financing

Loan Type Free and Clear


Proposed Financing

First Trust DeedLoan Amount $992,876

Loan Type Proposed New

Interest Rate 4.5%

Amortization 30 Years

Debt Coverage Ratio 1.64

FINANCING

Our Town Liquor: 22.84%

Tea & Coffee Exchange: 28.43%

Village Pizza: 48.73%

3

Comments

*Real Estate Taxes have been adjusted to reflect estimated sale price and adjustment.


Current Per SF

Real Estate Taxes* $20,477 $3.12

Insurance $3,437 $0.52

CAM

Utilities $0 $0.00

Repairs & Maintenance $7,980 $1.22

Contract Services $1,013 $0.15

TOTAL CAM $8,993 $1.37

Management Fee $4,200 $0.64

TOTAL EXPENSES $37,107 $5.65

Tenants (% OF GLA)


EXPENSES

4

Comments*Real Estate Taxes have been adjusted to reflect estimated sale price and adjustment.


Current Per SFBase Rent

Occupied Space $99,288 $15.12

GROSS POTENTIAL RENT $99,288 $15.12

Expense Reimbursements

Real Estate Taxes* $20,477 $3.12

Insurance $3,437 $0.52

CAM $8,993 $1.37

Management Fee $4,200 $0.64

Total Expense Reimbursements $37,107 $5.65

GROSS POTENTIAL INCOME $136,395 $20.77

EFFECTIVE GROSS INCOME $136,395 $20.77

Total Expenses $37,107 $5.65

NET OPERATING INCOME $99,288 $15.12

Gross Leasable Area (GLA) 6,567 SF


INCOME & EXPENSES

5



Comments

1. GLA for the commercial space of The Village Pizza restaurant is, as stated in the Lease, 2,730 square feet. The square footage in the above rentroll is 3,200 square feet, which - per the current Owner - incorporates a one-unit, upstairs residency currently occupied by the owner of the pizzashop. The base rent as stated above is the total base rent for the tenant (currently no additional rent collected for the residence).

2. Base Rent for the Village Pizza and Our Town Liquor, per the Leases, shall be increased annually on February 1st by the cost of living for theprevious calendar year or determined by the U.S. Department of Labor, Bureau of Labor Statistics, Southern California Regional Index for all averageitems. An estimated 2% annual CPI is used for underwriting purposes.

3. Tenant NNN Reimbursement pro-rata shares/percentages are based on specific language in the Leases.

4. Base Rent for the Tea & Coffee Exchange, per the Leases, is a minimum $2,200 per month, plus an additional Percentage Rent of 8% of the grosssales in excess of $27,500 each month. Annual Rent as stated in the above rent roll is estimated based on recent sales figures and projectedgrowth.

TENANT SUMMARY

Tenant GLA % ofGLA

LeaseCommence

LeaseExpire

AnnualRent

Rent/SF

ChangesOn

ChangesTo

Options LeaseType

% of NNNReimb.

Village Pizza 3,200 48.73% 07/01/2002 06/30/2022 $39,048.00 $12.20 02/01/2017 $39,828.96 NNN 40%

Our Town Liquor 1,500 22.84% 01/28/2016 01/31/2026 $27,030.00 $18.02 02/01/2017 $27,570.60 (1) 5-Year NNN 25%

Tea & Coffee 1,867 28.43% 01/01/2012 01/01/2022 $32,659.00 $17.49 (3) 5-Year NNN 35%

TOTAL VACANT

TOTAL 6,567 100.00% $98,737.00 $67,399.56

TOTAL 6,567 100.00% $98,737.00 $67,399.56

6


For The Year Beginning Year 1Jan 2016

Year 2Jan 2017

Year 3Jan 2018

Year 4Jan 2019

Year 5Jan 2020

Year 6Jan 2021

Year 7Jan 2022

Year 8Jan 2023

Year 9Jan 2024

Year 10Jan 2025

Tenant(s) Name VillagePizzaTea &Coffee

Exchange

Total Number of Tenants 2

Total Square Feet 5,067

Total Percentage 77.2%

Cumulative Percentage 77.2%


Percentage of SF Expiring Number of Tenants Expiring Cumulative % of SF Expiring

0%

10%

20%

30%

40%

50%

60%

70%

80%

Tota

l P

roje

ct

Squa

re F

oota

ge

0

1

2

Num

ber

of Tenants

Jan 20160%

Jan 20170%

Jan 20180%

Jan 20190%

Jan 20200%

Jan 20210%

Jan 202277%

Jan 20230%

Jan 20240%

Jan 20250%

LEASE EXPIRATION SUMMARY

Any projections, opinions, assumptions or estimates used here within are for example purposes only and do not represent the current or future performance of the property.

40568 Village Drive

Big Bear Lake, CA 92315

Price $1,654,793

Down Payment 40% $661,917

Gross Leasable Area (GLA) 6,567

Price/SF $251.99

CAP Rate - Current 6.00%

Lot Size 0.63 AC

Year Built 1979

FIRST TRUST DEED

Loan Amount $992,876

Loan Type Proposed New

Interest Rate 4.5%

Amortization 30 Years

Annualized Operating Data

Income CurrentBase Rent

Occupied Space $99,288

Gross Potential Rent $99,288

Expense Reimbursements $37,107

Gross Potential Income $136,395

Effective Gross Income $136,395

Total Expenses $37,107

Net Operating Income $99,288

Debt Service $60,369

Debt Coverage Ratio 1.64

Net Cash Flow After Debt Service 5.88% / $38,919

Principal Reduction $23,828

Total Return 9.48% / $62,747

7

Location


Financing


ExpensesReal Estate Taxes* $20,477

Insurance $3,437

CAM

Utilities $0

Repairs & Maintenance $7,980

Contract Services $1,013

TOTAL CAM $8,993

Management Fee (% of EGI) 3.1% / $4,200

TOTAL EXPENSES $37,107

EXPENSES/SF $5.65


Loan information is time sensitive and subject tochange. Contact your local Marcus & Millichap CapitalCorporation representative.

FINANCIAL OVERVIEW

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PROPERTY DESCRIPTION

Investment Highlights

■ First Intersection Greeting Visitors to Big Bear; GreatExposure to Inbound Traffic

■ Net Leased Tenants With Annual Increases

■ Year-Over-Year Store Sales Growth

■ Long Term Tenants: 2/3 of Businesses In Place for 20+ Years

9

PROPERTY DESCRIPTIONThe Village Gateway CornerBIG BEAR LAKE, CA


INVESTMENT OVERVIEW

Marcus & Millichap is pleased to exclusively market for sale The Village Gateway Corner, a three-tenant retail strip located on the hard corner of a heavily trafficked intersection in Big Bear Lake, CA. The property contains a synergistic mix of net-leased tenants, including Village Pizza, Our Town Liquor Store, and the newly remodeled Tea & Coffee Exchange. This opportunity includes annual rent increases, long term tenancy by two of the tenants, and a personal guarantee on the lease for the third tenant. The property controls one of the most strategic corners in the area, where Highway 18 abruptly splits into Big Bear Boulevard and Village Drive and travelers have the option of either staying on the highway (the faster route to the mountain resort) or continuing into the main village of Big Bear Lake. As the first stop for weekend supplies coming into town, and the last chance for food and coffee before the drive down to lower elevations, the Village Gateway Corner offers investors the opportunity to acquire irreplaceable real estate in a highly sought after destination.

Big Bear Lake is a unique mountain resort community, nestled in the mountains of the San Bernardino National Forest, about 100 miles northeast of Los Angeles. About 21,000 residents make their home in Big Bear Lake full time, with hundreds of thousands of tourists visiting annually during the town’s two peak tourism seasons – winter and summer. The Big Bear community is a destination for countless recreational opportunities, including fishing, water sports, hiking, mountain biking, horseback riding, tours, and winter sports. Big Bear also features a public zoo, a nine-hole golf course, seven public campgrounds, great restaurants, entertainment, abundant shopping, and one of the nation’s only alpine solar observatories.

The Offering

Property The Village Gateway Corner

Property Address 40568 Village Drive


Assessor's Parcel Number 0308-144-17

Zoning SP, Big Bear Lake

Site Description

Number of Stories One

Year Built 1979

Gross Leasable Area (GLA) 6,567 SF

Lot Size 0.63 AC

Type of Ownership Fee Simple

Parking Ratio 4.55/1,000 SF

10



PROPERTY SUMMARY

11



PROPERTY PHOTOS

12



Local Map Regional Map

AREA MAPS

13



AERIAL PHOTO


RECENT SALES

1)2)3)4)

The Village Gateway CornerVillage Drive RetailCiti BankVillage MallBig 5 Sporting Goods

15

RECENT SALESThe Village Gateway CornerBIG BEAR LAKE, CA


RECENT SALES MAP

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160.00

200.00

240.00

280.00

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360.00

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Subject VillageDriveRetail

CitiBank

VillageMall

Big5

SportingGoods

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2.00

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6.00

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Subject CitiBank

Big5

SportingGoods

Average Price per Square Foot

16


Average Cap Rate


CAP RATE AND PRICE PER SF

1

2


40568 Village Drive


Village Drive Retail

40764 Village Drive

Big Bear Lake, CA, CA 92314

Citi Bank

41969 Big Bear Boulevard


Close of Escrow: 06/26/2015

Year Built: 1940

Gross Leasable Area (GLA): 9,000 SF

Sale Price: $1,737,500

Percent Down: 28%

CAP Rate:

Price/SF (GLA): $193.06

Lot Size: 0.5 AC

Subject Property

Year Built: 1979


Offering Price: $1,654,793

Percent Down 40%

CAP Rate: 6.00%


Lot Size: 0.63 AC

17


Year Built:



Percent Down: 100%

CAP Rate: 4.70%


Lot Size: 0.91 AC



RECENT SALES

4

3 Village Mall40729 Village Drive


Big 5 Sporting Goods

41383 Big Bear Boulevard


Close of Escrow: 1/30/2013Year Built: 2012



Percent Down:

CAP Rate: 6.60%


Lot Size: 0.92 AC

18


Year Built: 1980



Percent Down:

CAP Rate:


Lot Size: 1.28 AC



RECENT SALES

BIG BEAR LAKE, CA

OFFERING MEMORANDUM


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The Village Gateway Corner Village Dr Big Bear...4. Base Rent for the Tea & Coffee Exchange, per the...

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