GREAT CLIPS, POPEYES & US CELLULAR 3921 38th Street Moline, … · 2018-12-21 · break the billion-dollar mark, according to trade publication Franchise Times. The group also runs

GREAT CLIPS, POPEYES & US CELLULAR3921 38th StreetMoline, IL 61265 (Quad Cities MSA)

NET LEASE INVESTMENT OFFERING

TABLE OF CONTENTS

TABLE OF CONTENTS


I. Executive Profile Executive Summary

Investment Highlights

Property Overview

III. Location Overview Photographs

Site Plan

Aerials

Map

IV. Market & Tenant Overview Demographic Report

Market Overviews

Tenant Overview

II. Financial Overview Rent Roll

Proforma Analysis

DISCLAIMERSTATEMENT:

DISCLAIMER STATEMENT

The information contained in the following Offering Memorandum is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from The Boulder Group and should not be made available to any other person or entity without the written consent of The Boulder Group.

This Offering Memorandum 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. The Boulder Group has not made any investigation, and makes no warranty or representation.

The information contained in this Offering Memorandum has been obtained from sources we believe to be reliable; however, The Boulder Group has not verified, and will not verify, any of the information contained herein, nor has The Boulder Group 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.


EXECUTIVESUMMARY:

EXECUTIVE SUMMARY

The Boulder Group is pleased to exclusively market for sale a fully leased three-tenant property located within the Quad Cities MSA in Moline, Illinois. The property was constructed in 2017 and each tenant has a new ten year lease with rental escalations in the primary term. There are over 55,000 people living within three miles of the property and have an average household income of $73,031. The property features a drive-thru for the Popeye’s store.

The 7,763 square foot building is ideally located at the corner of a signalized intersection just off of John Deere Road (45,700 VPD). The property is a shadow strip center to Walmart Supercenter and Lowe’s. Other retailers in the immediate area include Menards, Sam’s Club, Target, Kohl’s, Hy-Vee, Regal Cinemas and SouthPark Mall, which is anchored by Dick’s Sporting Goods, Dillard’s, JCPenney, and Von Maur. The property is also located in close proximity to the John Deere World Headquarters and The Trinity Medical Center (236 Beds). Additionally, the property is located just off of Interstate 74 (45,700 VPD) and is near the Quad City International Airport.

The Popeye’s lease is guaranteed by HZ Ops Holdings Inc. which is a subsidiary of The Dhanani Group. HZ Ops Holdings Inc. contains approximately 250 units. Dhanani Group which is 100% family owned and operated. The group is one of the largest Burger King franchisees, with more than 500 locations nationwide and is also a large franchisee of Popeyes. Its restaurant revenues were $1.1 billion in 2016, one of only three franchisee groups to break the billion-dollar mark, according to trade publication Franchise Times. The group also runs close to 200 convenience stores, pushing its total revenues above $2 billion. The US Cellular store is operated by a subsidiary of corporate and the Great Clips store is operated by an 11-unit operator.


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INVESTMENT HIGHLIGHTS:

INVESTMENT HIGHLIGHTS

• Located within the Quad Cities MSA

• Brand new construction (2017)

• New ten year leases

• Rental escalations in the primary term

• Ideally located at the corner of a signalized intersection just off of John Deere Road (45,700 VPD)

• Shadow anchored by Walmart Supercenter and Lowe’s

• Retailers in the immediate area include Regal Cinemas, Menards, Sam’s Club, Target, Kohl’s, Hy-Vee and

SouthPark Mall which is anchored by Dick’s Sporting Goods, Dillard’s, JCPenney, and Von Maur

• Located in close proximity to the John Deere World Headquarters and The Trinity Medical Center (236

Beds)

• Positioned just off of Interstate 74 (45,700 VPD) and is near the Quad City International Airport

• Popeye’s features a drive-thru

• There are over 55,000 people living within three miles of the property and have an average household

income of $73,031


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PROPERTY OVERVIEW:

PROPERTY OVERVIEW


Price: $3,294,453

Cap Rate: 6.40%

Net Operating Income: $210,845*

Year Built: 2017

Lease Types: NNN* (Roof, Structure, Parking Lot & Utility Systems)

Building Size: 7,763 SF

Land Size: 1.24 AC

*Refer to Proforma on page 5

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RENTROLL:

RENT ROLL


Tenant Square Feet Term Period Annual Rent Rent PSF Increase

Great Clips 1,260 SF 10 Years Current - June 30, 2022 $30,240 $24.00July 1, 2022 - June 30, 2027 $33,264 $26.40 10.00%

Option 1 July 1, 2027 - June 30, 2032 $36,540 $29.00 9.85%Option 2 July 1, 2032 - June 30, 2037 $40,194 $31.90 10.00%

Popeyes Chicken 3,500 SF 10 Years Current - August 31, 2022 $98,000 $28.00(The Springfest Company) September 1, 2022 - August 31, 2027 $104,860 $29.96 7.00%

Option 1 September 1, 2027 - August 31, 2032 $112,200 $32.06 7.00%Option 2 September 1, 2032 - August 31, 2037 $120,054 $34.30 7.00%Option 3 September 1, 2037 - August 31, 2042 $128,458 $36.70 7.00%Option 4 September 1, 2042 - August 31, 2047 $137,450 $39.27 7.00%Option 5 September 1, 2047 - August 31, 2052 $147,072 $42.02 7.00%Option 6 September 1, 2052 - August 31, 2057 $157,367 $44.96 7.00%Option 7 September 1, 2057 - August 31, 2062 $168,382 $48.11 7.00%Option 8 September 1, 2062 - August 31, 2067 $180,169 $51.48 7.00%

US Cellular 3,003 SF 10 Years Current - July 31, 2022 $85,500 $28.47(USCOC of Greater Iowa, LLC) August 1, 2022 - July 31, 2027 $90,000 $29.97 5.26%

Option 1 August 1, 2027 - July 31, 2032 $94,500 $31.47 5.00%Option 2 August 1, 2032 - July 31, 2037 $99,000 $32.97 4.76%

Total 7,763 SF $213,740

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PROFORMAANALYSIS:

PROFORMA ANALYSIS


Income

Rental Income

Base Rent $213,740

CAM 5,227

Insurance 6,129

Real Estate Taxes 19,272

Management Fee 955

Total Reimbursements $31,582

Total Rental Income $245,322

Expenses

CAM $(5,227)

Insurance (6,129)

Management Fee (3,850)

Real Estate Taxes (19,272)

Total Expense $(34,477)

Net Operating Income $210,845

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Notes: Owners collects mangagment fee of 5% of CAM + Insurance from Popeye›s Owners collects mangagment fee of 10% of CAM, Insurance + Real Estate Taxes from Great Clips Owners collects mangagment fee of 10% of CAM from US Cellular


PHOTOGRAPHS

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AERIAL

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SITE PLAN

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MAP


MAP

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WORLDHEADQUARTERS

3.5 MILES

MAPMAP

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WORLDHEADQUARTERS

DEMOGRAPHICREPORT:

DEMOGRAPHIC REPORT

Population 1-Mile 3-Mile 5-Mile

Total Population 5,839 55,638 115,425

Total Households 2,650 24,240 49,185

Income 1-Mile 3-Mile 5-Mile

Average Household Income $76,389 $73,031 $70,358


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MARKET OVERVIEW

MARKETOVERVIEW:

Moline, IllinoisMoline is a city in Rock Island County, Illinois with a population of 43,977 people. Moline is one of the Quad Cities, along with neighboring East Moline and Rock Island in Illinois and the cities of Davenport and Bettendorf in Iowa. The Quad Cities have an estimated population of 381,342. The city is the ninth-most populated city in Illinois outside the Chicago Metropolitan Area.

The corporate headquarters of Deere & Company is located in Moline (6,300 employees), as was Montgomery Elevator, which was founded and headquartered in Moline until 1997, when it was acquired by Kone Elevator, which has its U.S. Division headquartered in Moline. Other highlights of Moline include the Quad City International Airport, Niabi Zoo, Black Hawk College, and the Quad Cities campus of Western Illinois University-Quad Cities. Moline is a retail hub for the Illinois Quad Cities, as South Park Mall and numerous big-box shopping plazas are located in the city.

www.moline.il.us

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MARKET OVERVIEW

MARKETOVERVIEW:

The Quad CitiesThe Quad Cities is a region of four counties in northwest Illinois and Southeastern Iowa. The urban core consists of five principal cities: Davenport and Bettendorf in Iowa, and Rock Island, Moline and East Moline in Illinois. These cities are the center of the Quad Cities Metropolitan Area, which has a population of more than 383,780 people and a Combined Statistical Area (CSA) population of roughly 475,000 people, making it the 90th largest CSA in the nation.

Four interstate highways serve the Quad Cities: Interstate 80, Interstate 280, Interstate 74 serve both states while Interstate 88 serves just Illinois. United States highways include U.S. Route 6 and U.S. Route 67, which run through both Iowa and Illinois, while U.S. Route 61 serves just Iowa and U.S. Route 150 serves just Illinois. The Quad Cities are served by the Quad City International Airport, Illinois’ third-busiest airport, located in Moline. The airport is marketed as a regional alternative to the larger airports in Chicago, nearly 200 miles away. The smaller Davenport Municipal Airport is the home of the Quad City Air Show.

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Great ClipsGreat Clips is a 100% franchised company with more than 4,200 salons across North America—each one offering a great haircut at a great location at a great price. They pride themselves on making it easy for customers to get a great haircut at a time and place that’s convenient for them. That’s why they are open evenings and weekends, no appointments necessary.

The store is operated by PB5, LLC. They operate 11 locations in the quad cities and their sister company operates 9 lo-cations in Chicago.

Website: www.greatclips.comFounded: 1982Number of Locations: 4,200+Headquarters: Bloomington, Minnesota

US CellularU.S. Cellular is the fifth-largest full-service wireless carrier in the United States, providing national network coverage and industry-leading innovations designed to elevate the customer experience. The Chicago-based carrier offers coverage where the other carriers don’t and a wide range of communication services that enhance consumers’ lives, increase the competitiveness of local businesses and improve the efficiency of government operations. U.S. Cellular has the Highest Wireless Network Quality Performance in the North Central Region, according to J.D. Power, and 99 percent of custom-ers have access to 4G LTE speeds.

Website: www.uscellular.comFounded: 1983Customers: 5.1 MillionRevenue (2017): $3.89 billionHeadquarters: Chicago, Illinois

TENANT OVERVIEW

TENANT OVERVIEW:

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PopeyesPopeyes is an American multinational chain of fried chicken fast food restaurants founded in 1972 in New Orleans, Louisiana. Since 2008, its full brand name is Popeyes Louisiana Kitchen, Inc. and it was formerly named Popeyes Chicken & Biscuits and Popeyes Famous Fried Chicken & Biscuits. On February 21, 2017, Restaurant Brands International announced a deal to buy Popeyes for US$1.8 billion. On March 27, 2017, the deal closed with RBI purchasing Popeyes at $79 per share via Orange, Inc, an indirect subsidiary of RBI.

According to a company press release dated June 29, 2007, Popeyes is the second largest “quick-service chicken restaurant group, measured by number of units”, after KFC. More than 2,600 Popeyes restaurants are in more than 40 states and the District of Columbia, Puerto Rico, and 30 countries worldwide. About thirty locations are company-owned, the rest franchised.

Website: www.popeyes.comFounded: 1972Number of Locations: 2,600+Headquarters: Miami, Florida

Dhanani Group which is 100% family owned and operated. The group is one of the largest Burger King franchisees, with more than 500 locations nationwide and is also a large franchisee of Popeyes. Its restaurant revenues were $1.1 billion in 2016, one of only three franchisee groups to break the billion-dollar mark, according to trade publication Franchise Times. The group also runs close to 200 convenience stores, pushing its total revenues above $2 billion.

The lease is guaranteed by HZ Ops Holdings Inc., which is a subsidiary of The Dhanani Group. HZ Ops Holdings Inc. contains approximately 250 units.

TENANT OVERVIEW

TENANT OVERVIEW:

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Randy [email protected]

Jimmy [email protected]

3520 Lake Avenue, Suite 203Wilmette, IL 60091

www.bouldergroup.com

Documents

GREAT CLIPS, POPEYES & US CELLULAR 3921 38th Street Moline, … · 2018-12-21 · break the billion-dollar mark, according to trade publication Franchise Times. The group also runs