OFFERING MEMORANDUM HARBOR POINTE PLACE WEST SACRAMENTO, CA

Transcription

1 OFFERING MEMORANDUM WEST SACRAMENTO, CA

2 Executive Summary Property Highlights 100% leased 3 tenant retail investment with long term remaining on all three leases. Anchored by a very high volume Starbucks on an end cap with a rare drive through and patio, with Int. 80 freeway traffic of over 90,000 cars per day. As an original build to suit tenant, Starbucks has been operating at this location since 2003 and generates 60% of center net income and has six years left on a ten year renewal. Harbor Pointe Place shares an extremely busy Int. 80 exchange with RiverPointe Marketplace; an 800,000 square foot super regional center that enjoys a large expanded trade area, and includes IKEA, Walmart Super Center, Home Depot, Ross, Petco, Lazy Boy, and restaurants. High traffic, highway commercial site that shares ingress/egress & parking with Panda Express with drive through, and includes a Jack in the Box, Chevron/ Subway. A 104 room Extended Stay America, 110 room Hampton Inn & Suites, a planned 96 room Marriott Springfield that should be under construction soon, and another proposed 82 room hotel adds to the site s dinner traffic. Exceptional daytime population with over 91,000 employees within a ten minute drive of the site providing excellent lunch traffic to this three restaurant offering. The California Highway Patrol Academy, Bayer Crop Science, Cummins Engine, Tony s Fine Foods & dozens of other quality employers are a short walk away. Nearby West Sacramento major employers include United States Postal Service (regional), State of California (General Services Agency), California State Teachers Retirement System (CALSTRS), United Parcel Service (UPS Regional), Raley s/bel-air Headquarters, Tony s Fine Foods/United National Foods, Nor- Cal Beverage, Clark Pacific, and Aetna Healthcare. PRICE $2,690,000 / 4.95% Actual Cap Rate FIRST YEAR ESTIMATED NOI $133,109 TENANTS Starbucks - over 24,000 locations worldwide - 5 years remaining on a 10 year extension Manaao Thai Cuisine - Open since years remaining on a 5 year extension Taco Tuesday - Family run years remaining on a 5 year lease PERCENTAGE LEASED 100% RENTABLE SQUARE FEET 4,631 SF /2

3 Property Overview Property Overview Address: 715 Harbor Pointe Place West Sacramento, California Year of Construction: 2003 Building Size: 1-story retail building with an approximate 4,631 square feet Site Size: Approx. 0.6 acres (approximately 26,136 square feet) Parcel Numbers: Land Use: Stores, Retail Outlet Access: Private vehicles can access through driveway access on Harbor Pointe Utilities: Water: City of West Sacramento Electricity: Pacific Gas & Electric Gas: Pacific Gas & Electric Flood Hazard: Subject property is located in Zone X: Area of minimal flood hazard, usually depicted of FIRMS as above the 500-year flood level (per FEMA) Seismic Hazard: Parking: This site is not located in a Special Study Zone as established by the Alquist-Priolo Geological Hazards Act Shared non-exclusive common area parking for all parcels, with additional street parking /3

4 Property Overview Site Plan ±1,247 SF ±1,835 SF ±1,549 SF /4

5 Tenant Summary This Starbucks is reported to be one of their highest grossing locations in Northern California. Its strategic location and drive-through have powered revenue since Day 1, as evidenced by long lines at the drive-through and hours of operation being expanded numerous times. Starbucks Corporation is the leading roaster, retailer, and marketer of specialty coffee in the world. Its operations include upwards of 7,300 coffee shops and kiosks in the United States, and nearly 3,000 in 34 other countries, with the largest numbers located in Japan, Canada, the United Kingdom, China, Taiwan, South Korea, the Philippines, Thailand, Malaysia, Mexico, Australia, Germany, and New Zealand. In addition to a variety of coffees and coffee drinks, Starbucks shops also feature Tazo teas; pastries and other food items; espresso machines, coffee brewers, and other coffee- and tea-related items; and music CDs. The company also sells many of these products via mail-order and online at starbucks.com. It also wholesales its coffee to restaurants, businesses, education and healthcare institutions, hotels, and airlines. Through a joint venture with Pepsi-Cola Company, Starbucks bottles Frappuccino beverages and the Starbucks DoubleShot espresso drink and sells them through supermarkets and convenience and drugstores. Through a partnership with Kraft Foods, Inc., the company sells Starbucks whole bean and ground coffee into grocery, warehouse club, and mass merchandise stores. From a single small store that opened in 1971 to its status as a 21st-century gourmet coffee giant, Starbucks has led a coffee revolution in the United States and beyond. General Tenant Information Rent Details Recovery Starbucks #6724 (Option 1) 1,549 $52.68 Jul-2017 $54.00 $4.50 Starbucks Suite: A 33.45% $81,600 Jul-2018 $55.35 $4.61 6/20/2003-6/30/2023 $4.39 Jul-2019 $56.74 $4.73 5% annual cap 20 Years 11 Days $6,800 Jul-2020 $58.67 $4.89 on increases Jul-2021 $59.60 $4.97 Jul-2022 $61.09 $5.09 Starbucks #6724 (Option 2) 1,549 $72.51 Suite: A 33.45% $112,320 7/1/2023-6/30/2028 $ Years $9,360 Starbucks #6724 (Option 3) 1,549 $83.43 Suite: A 33.45% $129,240 7/1/2028-6/30/2033 $ Years $10,770 /5

6 Tenant Summary Following many successful years in the restaurant business, this experienced family operator opened Manaao Thai cuisine in 2009, where they continue to serve highly rated homestyle Thai cuisine. A major expansion and remodel was completed last year and includes new restrooms, an open ceiling dining room with craft beer and wine bar, and custom high end imported wallpapers, lighting, and decor throughout. Manaao Thai s significant investment in their business was part of a five year lease extension that runs through November of 2020, adding significant value to the center. General Tenant Information Rent Details Recovery 4. Starbucks # Manaao Thai Cuisine 1,549 1,835 $52.68 $18.00 Jul-2017 Dec-2017 $54.00 $18.60 $4.50 $1.55 Starbucks Net Suite: B 39.62% $33,030 Dec-2018 $19.20 $1.60 4/12/ /30/2020 $1.50 Dec-2019 $19.80 $ Years 7 Months 19 Days $2,753 Taco Tuesday is a fresh, new taqueria concept that is perfect for this high traffic, employment center location. Taco Tuesday s focus is on a quick service menu of tasty Mexican food, beverages; including specialty drinks, tap mexican beers, and wine, and delicious desserts. Tenant has extensive previous experience in the food business as a plant manager for two wholesale bakeries. General Tenant Information Rent Details Recovery 2. Taco Tuesday 1,247 $16.84 Jul-2017 $17.44 $1.45 Net Suite: C 26.93% $21,000 Jul-2018 $18.04 $1.50 4/12/2016-6/30/2021 $1.40 Jul-2019 $18.64 $ Years 2 Months 19 Days $1,750 Jul-2020 $19.25 $ Taco Tuesday (Option 1) 1,247 $19.85 Jul-2022 $20.45 $1.70 Net Suite: C 26.93% $24,750 Jul-2023 $21.05 $1.75 7/1/2021-6/30/2026 $1.65 Jul-2024 $21.65 $ Years $2,063 Jul-2025 $22.25 $1.85 General Tenant Information Rent Details Recovery /6

7 REED AVE - 16,200 ADT N Property Overview Location Aerial RiverPointe Marketplace 80 90,000 ADT 80 SUBJECT FUTURE 82-ROOM HOTEL (PROPOSED) 96-ROOM HOTEL (PLANNED) STILLWATER RD - 26,216 ADT /7

8 Property Overview Location Aerial ACADEMY FUTURE 82-ROOM HOTEL (PROPOSED) 96-ROOM HOTEL (PLANNED) 80 /8

9 N Property Overview Location Aerial SACRAMENTO STATE ARDEN FAIR MALL CAL EXPO SACRAMENTO CITY COLLEGE SACRAMENTO EXECUTIVE AIRPORT CALIFORNIA STATE CAPITOL CALSTRS BUILDING THE ZIGGURAT THE BARN RIVERBEND SHOPPING PLAZA ±15,000 SF GLA RIVERPOINT MARKETPLACE ±133,992 SF GLA /9

10 Property Overview Retail Aerial - City of West Sacramento RIVERBEND SHOPPING PLAZA KMAX PACIFIC COAST BANKER S BANK WESTERN TRUCK PARTS & EQUIPMENT VALLEY POWER SYSTEM SUPER IMPORT BAVAN FOOD CALIFORNIA HIGHWAY PATROL ACADEMY FUTURE 82-ROOM HOTEL (PROPOSED) 96-ROOM HOTEL (PLANNED) TONY S FINE FOODS TOMRA SORTING SOLUTIONS BAYER CORP US SOCIAL SECURITY ADMINISTRATION CUMMINS SALES & SERVICE /10

11 Key West Sacramento Assets Global Food Industry Hub: 35 food producers & distributors 500 acres of City and Port-owned land Sacramento River Cats, AAA team and Raley Field, stadium and event center Close Proximity to State Capitol /Downtown Sacramento Close Proximity to UC Davis Center of intersection of all interstate highways: I-5, I-80, US50 Sacramento City College Downtown Center U.S.P.S. Regional Processing Center & UPS Regional Center Port of West Sacramento & Foreign Trade Zone #143 Port Area is Craft Beer District West Sacramento Overview West Sacramento is a vibrant riverfront community located across the Sacramento River and minutes from the State Capitol and downtown Sacramento. It is recognized as an innovation leader in the region and a growing center of commerce, with an expanding cluster of food industry companies. Urban farms dot the landscape, providing fresh produce to residents and restaurateurs. Incorporated in 1987, West Sacramento encompasses approximately 23 square miles, with a population approaching 50,000 people. West Sacramento is home to Raley Field, the 14,500 seat stadium for the Sacramento River Cats, the #1 minor league in the AAA, and affiliate of the San Francisco Giants. A regional entertainment center, Raley Field offers scenic views of the Sacramento skyline during games, concerts and festivals. Raley Field anchors the developing Bridge District, a 180-acre, development area between the Tower Bridge and the Pioneer Memorial Bridge. Over 1,000 new homes have been occupied along this one-mile stretch of Sacramento riverfront, near Garden Park and riverfront bicycle trails. Area Overview The Bridge District is the region s first LEED neighborhood, planned for 4,000 high-rise homes, offices, retail and entertainment venues. Plans are underway for a streetcar line that will connect the Bridge District with the State Capitol. The City offers new and established neighborhoods for all ages and incomes, including town homes, lofts and master planned new home communities. Regional amenities abound including the West Sacramento River Walk and 11 miles of riverfront for boating, sailing, fishing and paddle boarding. The River City Rowing Club and the U.C. Davis Rowing Club hosts NCAA championship races at the Port of West Sacramento. Well-maintained parks and bicycle trails are located throughout West Sacramento. The southern Southport area features new, master-planned home communities, parks and schools, near the City s Recreation Center, which offers tennis courts, rock climbing wall, pools for adults and children, and a large water slide. West Sacramento s City Hall and Civic Center, Community Center, Yolo County Public Library and Sacramento City College anchor West Sacramento s downtown revitalization. The Community Center houses the City s award-winning, universal preschool programs, an art gallery, and black box theater and community rooms for leisure classes, meetings and performances. Educational choices include public, private and charter schools, the UC Davis Early College Prep High School, Career Tech Academy and Culinary Arts and Farm-to-Fork Education program. West Sacramento offers ample business space and land, high-quality water and a full suite of business services. Home to global companies Bayer Crop Science, Siemens Healthcare, McKesson, Xerox and Miyamoto International, West Sacramento is also proud to host locally-grown companies including Raley s/bel Air Markets, Nor-Cal Beverage, and Tony s Fine Foods. Public agencies include the California Fuel Cell Partnership, the California Department of General Services, and headquarters offices of the California State Teachers Retirement System. /11

12 Area Overview Sacramento Regional Overview A recent Wall Street Journal states that Sacramento is California s newest real estate hot spot and leads with Price cuts have been replaced by bidding wars. A once-sleepy downtown is flush with urban-renewal projects. A luxury condo tower with penthouses priced over $4 million is under construction. Sacramento, CA, long seen as a fairly bland government town, is in the midst of a real estate boom. Highlights include a 3.2 billion dollar investment in an urban renaissance including the new Golden 1 Center and Downtown Commons. At 8% year over year, rent growth for apartments is the fastest growing among major U.S. metro areas. The office sector is considered a top 5 market for investments due to strong job growth, low vacancy rates, and healthy rent growth. Retail absorption continues to reduce vacancy across the region. The West Sacramento submarket contains over 1.8M square feet of retail with no space listed for sublease. The submarket has one of the lowest retail vacancy rates of any submarket in the region with overall vacancy at 3.1%. The market should continue its pattern of falling vacancy throughout The Sacramento region is experiencing a profound shift in its competitive position, thanks in large part to an influx of entrepreneurs, businesses, creative professionals, and a highly-educated, STEM-driven talent base. The City of Sacramento s Innovation Zone is a set of initiatives that concentrates resources and amenities to help provide the infrastructure and support fresh companies need to grow. The City of Sacramento s limited partnership with 500 Startups, the world s foremost seed investor group, is part of its ongoing commitment to the region s tech future. Greater Sacramento is hosting more international business activity than ever before. Roughly one in every four companies that is showing interest in investing and creating jobs in the Sacramento Region has a parent company in another country. This is also reflected in recent successes of the last 17 companies the organization assisted with expansions or new locations, nine were based outside of the U.S. For four of them, this was their first location in the U.S. Over 400 separate food crops are grown in California. Food production is a $54 billion industry in California, with over $21 billion coming from foreign exports. Agri-business leaders like H.M. Clause, Bayer Crop Science, and Monsanto know the value of the Central Valley. Revolutionary technology is developed and implemented here every day. And these industry innovators have a significant presence in Greater Sacramento, the heart of the Central Valley region. The Greater Sacramento region is a national hub for renewable energy research and development. The area hosts over 200 green firms and organizations, many with headquarters in the region. Anchored by Northern California s best healthcare system, Greater Sacramento is a life science and health service destination. Dignity Healthcare, Kaiser Permanente, Sutter Health, and the UC Davis Health System are primary drivers of discovery. UC Davis Medical Center is on the cutting edge of treatments and cures. Greater Sacramento s healthcare system ranks among the top in the nation for cancer treatment, cardiovascular care, and treatment of strokes. UC Davis School of Veterinary Medicine is ranked #1 in the world. Greater Sacramento is a leader in genomic and biomedical research, and life sciences industries. /12

13 BUSINESS BUSINESS Area Overview LOOP 80 N CHP ACADEMY PROPERTY Area Overview, continued The major league sports teams that call the Sacramento region home include the Sacramento Kings, who play in the new innovative Golden 1 Center just 3 miles away from subject property. West Sacramento is the home of the AAA baseball team, the River Cats, and a state-ofthe-art, multi-use baseball complex, Raley Field. The River Cats are the minor league affiliate of Major League Baseball s San Francisco Giants. LOOP 80 DEEP WATER CHANNEL PORT OF SACRAMENTO SOUTHPORT SACRAMENTO RIVER DOWNTOWN SACRAMENTO RIVER CITY HIGH SCHOOL /13

14 Confidential Offering Memorandum, WEST SACRAMENTO, CA Shaun Morrow, CCIM Senior Director LIC # Erik Neese Director LIC # CONFIDENTIALITY & DISCLAIMER The information contained in this marketing brochure ( Materials ) is proprietary and confidential. It is intended to be reviewed only by the person or entity receiving it from Cushman & Wakefield ( Agent ). The Materials are intended to be used for the sole purpose of preliminary evaluation of the subject property ( Property ) for potential purchase. The Materials have been prepared to provide unverified summary financial, physical, and market information to prospective buyers to enable them to establish a preliminary level of interest in potential purchase of the Property. The Materials are not to be considered fact. The information contained in the Materials is not a substitute for thorough investigation of the financial, physical, and market conditions relating to the Property. 400 Capitol Mall,Suite 1800 Sacramento, CA ph: fx: The information contained in the Materials has been obtained by Agent from sources believed to be reliable, however, no representation or warranty is made regarding the accuracy or completeness of the Materials. Agent makes no representation or warranty regarding the Property, including but not limited to income, expenses, or financial performance (past, present, or future); size, square footage, condition, or quality of the land and improvements; presence or absence of contaminating substances (PCB s, asbestos, mold, etc.); Compliance with laws and regulations (local, state, and federal); or, financial condition or business prospects of any tenant (tenant s intentions regarding continued occupancy, payment of rent, etc). Any prospective buyer must independently investigate and verify all of the information set forth in the Materials. Any prospective buyer is solely responsible for any and all costs and expenses incurred in reviewing the Materials and/or investigating and evaluating the Property. By receiving the Materials you are agreeing to the Confidentiality and Disclaimer set forth herein. All Property showings are by appointment only and must be coordinated through the Agent.

15 Addendum Sale Procedures All investors should base their offers and pricing on the As-Is, Where-Is condition of the property. Qualified prospective investors will have the opportunity to inspect the property. Each prospective investor is to rely upon its own investigation, evaluation and judgment as to the condition of the property. Inquiries regarding Harbor Pointe should be directed to either of the following: Shaun Morrow, CCIM Senior Director Retail Investments LIC # Erik Neese Director Capital Markets Investments LIC # Capitol Mall, Suite 1800 Sacramento, California ph: fx: Cushman & Wakefield /15