actual location 7-eleven - matthews.com...the city’s ability to attract businesses, create jobs,...

7-ElevenSilver Spring, MD

OFFERING MEMORANDUM

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Actual Location

Asset Overv iew

Area Overv iew

Property Features

Tenant Report

Content

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EXCLUSIVE LISTING AGENTS

MATT COATES

Associate

matt [email protected] (949) 432-4505MOB (714) 366-1236LIC # 01980718

ARON CLINE

SVP & Senior Director

aron.c l [email protected] (949) 432-4509MOB (818) 632-0233LIC # 01904371

JOHN P. LIN

BROKER OF RECORD

LIC # 318697

Actual Location

ASSET OVERVIEW

INVESTMENT HIGHLIGHTS

Matthews Real Estate Investment Services4

THE TENANT

• Corporately guaranteed lease with 7-Eleven, Inc. backed by AA- Investment-Grade Credit (Standard & Poor’s)

• Leased to globally recognized 7-Eleven, Inc., which has over 8,500 stores nationwide and over 60,000 worldwide with annual revenue in excess of $10.3 billion

THE LEASE

• 7-Eleven has operated under its lease for over fifty (50) years at the location which speaks to its stability within the community

• Absolute NNN Lease – Zero landlord responsibilities

• 7-Eleven recently extended the lease by seven (7) years and added a five (5) year option period upon expiration of the extension, showing a long-term commitment to the location

• Scheduled rent increases in both initial term and option period

THE LOCATION

• The site is located approximately 10 miles north of Washington DC, just off of State Hwy 650 & New Hampshire Ave which boasts average daily traffic counts over 39,200

• The property contains over 142,500 people within a 3-mile radius and over 441,817 within a 5-mile radius; the immediate area (1-mile radius) is also expected to grow in population by over 5.50% by 2022

• Extremely wealthy area: average household income of ±$83,300 within a 1-mile radius, ±$99,300 within a 3-mile radius, and ±$103,514 within a 5-mile radius

• Surrounded by numerous apartment communities including: the Enclave Apartments (directly across the street from the site with ±1,120 units throughout 19 stories), Oak Hill Apartments, Vista at White Oak Apartments, Yorkshire Apartment Homes, Birches Apartments, Montgomery Paint Branch Apartments, and White Oak Tower Apartments, all of which are located within one mile of the site

• Directly across the street from the White Oak Shopping Center, which includes a number of national tenants including: Sears, Walgreens, Giant Food, Subway, Sprint, Mattress Firm, T-Mobile, Avis, and Payless ShoeSource; other national tenants in the immediate vicinity include: McDonald’s, Einstein Bros. Bagels, Popeye’s, Planet Fitness, Boston Market, T-Mobile, Public Storage, Shell, Mid-Atlantic Federal Credit Union, and State Farm Insurance, among others

• Just north of the Food and Drug Administration’s White Oak Campus, which is currently undergoing a $1.5 billion reconstruction project and employs approximately 10,500 people with another 5,900 scheduled to be added to the workforce by 2020

• Approximately two miles west of the White Oak Life Sciences Center development, which is currently in Phase 1; The project’s plan includes 300 acres of land which should encompass over 7,000,000 square feet of commercial space, 5,300 residential units, and an elementary school

7-Eleven | Silver Spring | MD 5

7-Eleven11303 Lockwood DriveSilver Spring, MD 20904

List Price .............................................................................................$2,191,300

CAP Rate - Current ................................................................................... 5.75%

Gross Leasable Area ......................................................................± 2,200 SF

Lot Size ..........................................................................................± 0.34 Acres

Year Built / Renovated ................................................................................1967

Annualized Operating DataMonthly Rent Annual Rent Rent/SF Cap Rate

Current - 10/30/2020 $10,500.00 $126,000 $57.27 5.75%

11/1/2020 - 4/30/2024 $10,833.33 $130,000 $59.09 5.93%

Option 1 $11,916.67 $143,000 $65.00 6.53%

Tenant Summary

Tenant Trade Name 7-Eleven, Inc.

Type of Ownership Fee Simple

Lease Guarantor Corporate

Lease Type NNN

Roof and Structure Tenant Responsible

Original Lease Term 20 Years

Lease Commencement Date 5/1/1966

Rent Commencement Date 5/1/1966

Lease Expiration Date 4/30/2024

Term Remaining on Lease ± 7 Years

Increases 3.17% on 11/1/2020; 10% at Option

Options One (1), Five (5) Year OptionActual Location

AREA OVERVIEW

THE DISTRICT OF COLUMBIA


A place unlike any other, Washington, D.C. is the capital city of the United States located on the north bank of the Potomac River, 35 miles from Chesapeake Bay at the western edge of the Mid-Atlantic Coastal Plain. It is formally known as the District of Columbia and commonly referred to as D.C. As a world-class city, Washington, D.C. possesses notable assets and opportunities for residents, visitors and businesses alike. There is plenty to do in the capital city with its countless restaurants, entertainment venues, public parks, museums and other cultural sites.

Taking advantage of the metro area’s extensive public transit system, commuters from the city’s surrounding suburbs in Maryland and Virginia raise D.C.’s population during the workweek to more than one million. The entire Washington metropolitan area has a population of over six million, making it the sixth-largest metropolitan area in the country.


To p E m p l o y e r s

B u s i n e s s C l i m a t eD.C. has a growing, diversified economy that has come to include an increasing percentage of professional and business service jobs, especially in the areas of education, finance, public policy and scientific research. With a highly-educated workforce, a business-friendly environment and a hub for the world’s most influential leaders and innovators, D.C. offers unparalleled opportunities for economic growth, commerce and industry.

The federal government continues to be a major industry in D.C. and has significant impact on the local economy and culture. Tourism is the capital city’s second largest industry, contributing an estimated $4.8 billion in 2011 thanks to its 18.9 million visitors that year. It is home to the headquarters of international organizations such as the World Bank, the International Monetary Fund, and the Pan American Health Organization as well as other institutions such as national trade unions, lobbying groups,

professional associations and 176 foreign embassies.

D e v e l o p m e n tA primary goal for the capital city is to sustain its economic viability to promote a prosperous business climate. There are several development initiative and incentive programs tailored to businesses looking to locate to or expand in D.C. and improving the local economy and workforce. Business development is key to the city’s ability to attract businesses, create jobs, and stimulate economic growth.

Several movements towards revitalizing distressed areas of the city have also been implemented. One of these development projects is the New Communities Initiative (NCI), a program designed to redevelop neighborhoods into vibrant, mixed-income communities that provide quality affordable housing options, economic opportunities and access to D.C.’s amenities.

S i l v e r S p r u n g

SILVER SPRING, MARYLAND


Just north of Washington, D.C., Silver Spring is a suburban city in Montgomery County, Maryland. The southernmost, urbanized part of the city is a major business hub at the north apex of Washington, D.C. Silver Spring’s extensive ethnic diversity is represented in the assortment of family-owned restaurants amidst well-known national chains.

Both established and newly developed neighborhoods provide many housing options, ranging from single family homes and town houses to luxury apartments and condominiums. These residential communities are all, much to the convenience of residents, located within close proximity to the Metro and a variety of shopping areas.

Throughout the last decade, public involvement and private investment have begun to turn Silver Spring into an arts and entertainment center. This renaissance has brought the city attention as it has undergone considerable renovations to its downtown area with the addition of restaurants, entertainment, major retail, residential and office developments. Downtown redevelopment was marketed as “silver sprung” to indicate that the city was ready for business. Thanks to this recent revitalization and development, Silver Spring has one of the strong real estate markets in the Washington, D.C. metropolitan area.

In 2015, a new $91 million transit center, the Paul S. Sarbanes Transit Center, opened to the public. Facilitating the growing demand for public transportation in the Silver Spring area, the new center is a multimodal facility that brings the region’s transit systems together under one roof.

City development continues as new office buildings, condominiums, stores and restaurants open upon the culmination of their respective construction projects. 2016 brought about the recent remodel of Silver Spring’s City Place Mall, which was located near relatively newly constructed Downtown Silver Spring outdoor shopping plaza. Now known as Ellsworth Place, the mall brought in new tenants including TJ Maxx, Ross Dress for Less, Dave & Buster’s, Michaels and Forever 21.

B u s i n e s s C l i m a t eDowntown Silver Spring and the Route 29 corridor have emerged as centers of economic development. The downtown area has attracted telecommunications, healthcare, technology and real estate development companies, as well as government contractors, consultants, lawyers, and trade and professional associations such Discovery Communications and the U.S. Food and Drug Administration, which have both relocated their headquarters in downtown Silver Spring. Meanwhile, northeast of downtown Silver Spring, the Route 29 Corridor has drawn numerous sizeable health and technology-oriented companies.


C i t y D e m o g r a p h i c s

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Subject Property


BALTIMORE, MARYLANDThe city of Baltimore is the largest city in the state of Maryland and the largest independent city in the United States. Historically a working-class port town focused on steel processing, shipping, auto manufacturing and transportation, Baltimore now has a modern service economy led by biotechnology, medicine, and tourism. As home to some of the earliest National Register historic districts in the nation, including Fell’s point, Federal Hill, and Mount Vernon Place, Baltimore has more public monuments than any other city per capita in the country.

From Fort McHenry National Monument and Historic Shrine and the Star-Spangled Banner Flag House to the Edgar Allan Poe House and Federal Hill, there is so much to explore in Baltimore. Each period in America’s march from a British colony to industrial powerhouse can be discovered along Belgian-block streets, on national historical trails and scenic byways, in tiny row houses, and in mansions of the gilded-age.

Baltimore’s Inner Harbor is an attraction in itself and it is surrounding this urban waterfront park that a number of family-friendly places can be found. The National Aquarium features more than 16,000 animals, from sharks to a giant sea turtle, while the Maryland Science Center’s highlights include two-story dinosaurs and

interactive exhibits to keep the kids busy. The Port Discovery Children’s Museum features more activities for the little ones, and, a short ride away, the Maryland Zoo in Baltimore’s Druid Hill Park engages visitors with the giraffe-feeding station and much more.

With more than 20,000 businesses, Baltimore enjoys a diverse local economy that comprises of the medical, defense, manufacturing, logistics and education sectors. The entrepreneurial spirit thrives in Maryland’s capital, which has become a location of choice for business headquarters for companies such as Constellation Energy/BGE, T. Rowe Price Group, Erickson Retirement Communities, Under Armour, and McCormick & Co. as it offers easy access to Washington, D.C., Philadelphia and New York.

Furthermore, among many other competitive advantages, Baltimore has an availability of affordable commercial space and housing, an excellent transportation network throughout the Mid-Atlantic corridor, and access to an educated workforce from some of the best colleges in the nation.

B u s i n e s s C l i m a t e


To p E m p l o y e r s

D e v e l o p m e n tSince the 1980’s, Baltimore has initiated urban renewal efforts that rank among the most ambitious in the United States. Downtown and many other neighborhoods have been revitalized, with special attention given to the city’s greatest asset - the harbor. Additionally, state-of-the-art stadiums have been constructed for the Baltimore Orioles and Baltimore Ravens. A few miles away, billion-dollar biotechnology parks attract the world’s leading scientists.

Baltimoreans take pride in their city, boasting one of the most remarkable transformations in history as they continue to welcome and amaze visitors with “down to earth, small town” spirit and hospitality.


PROPERTY FEATURES

THE OFFERING

PARCEL MAP

Property Name 7-Eleven

Property Address 11303 Lockwood Drive

Silver Spring, MD 20904

Assessor’s Parcel Number 05-00255503

Zoning C2

Site DescriptionNumber of Stories One

Year Built / Renovated 1967

Gross Leasable Area (GLA) ± 2,200 SF

Lot Size ± 0.34 Acres (14,588 SF)

Type of Ownership Fee Simple

Parking ± 27 Surface Spaces

Parking Ratio 12.3 : 1,000 SF

Landscaping Professional

Topography Generally Level

ConstructionFoundation Concrete Slab

Framing Steel

Exterior Brick

Parking Surface Asphalt

Roof Flat

PROPERTY FEATURES

Subject Property

White Oak Shopping Center

Oak Hill Apartments

The Birches Apartments

Yorkshire Apartment

Homes

The Enclave Apartments19 stories containing 1,120

units

Orchard Center

Columbia TowersCondominium

± 480,000 sf containing about 35 retail stores

Vista atWhite Oak

Apartments

Development project in phase 1 for

White Oak Life Sciences CenterPlan includes 300 acres of land which should encompass over 7,000,000 SF of commercial

space, 5,300 residential units, and an elementary school.

White Oak Tower Apartments

Westech Village Corner

MontgomeryPaint Branch Apartments

FDA White Oak Campus±3.8 million gross SF of laboratory and o�ce space.

Currently employs over 10,000 people with plans to add another 5,900 by 2020.Major $1.5 billion reconstruction project underway.

A e r i a l T e n a n t M a p

2017 Est. Population441,817

2017 Est. Households153,056

Projected Population Growth 2017 - 2022

4.44%Projected Household Growth 2017 - 2022

4.54%

2017 Est. Average Household $103,514

Property Demographics5-mile radius


TENANT REPORT

Te n a n t O v e r v i e w7-Eleven is the world’s largest convenience store chain operating, franchising and licensing more than 60,000 stores in 18 countries and is also one of the nation’s largest independent gasoline retailers. As the pioneer of the convenience store concept, 7-Eleven strives to meet the needs of convenience-oriented guests by providing a broad selection of fresh, high-quality products and services at everyday fair prices, speedy transactions and a clean, friendly shopping environment. Each store maintains a selection of approximately 2,500 different products and services tailored to meet the needs and preferences of its local clientele. Stores typically vary in size from 2,400 to 3,000 square feet and are most often located on corners to maximize visibility and allow for easy access.

The company’s iconic products have become a substantial part of American culture from its well-known Big Gulp® fountain soft drink and Big Bite® grill items to the Slurpee® beverage and its fresh-brewed coffee. 7-Eleven’s food service offerings bring guests a proprietary line of prepared-fresh-daily and daily delivered deli sandwiches, wraps, breakfast sandwiches and a wide assortment fruits, salads and baked goods. Serving guests 24 hours a day is one of the cornerstones of 7-Eleven’s business.

MARKETING & COMPANY STRATEGYWith nonstop innovation, 7-Eleven and its product development teams continue to introduce new products as they search for new flavors, better recipes and useful inventions to satisfy time-constrained customers. Keeping pace with the ways technology is redefining how people shop, 7-Eleven has invested in software and business processes that have revolutionized store operations.

Furthermore, stores reap the benefits from the strong marketing campaigns and advertisements, including national TV and radio commercials, social media, special events and promotions and even public relations support.

GEOGRAPHIC REACHThe company operates, franchises and licenses approximately 10,700 stores in the U.S. and Canada. Of the close to 8,500 stores the company operates and franchises in the United States, more than 6,700 are franchised. Outside of the U.S. and Canada, there are more than 49,300 7-Eleven and other convenience stores in Japan, Taiwan, Thailand, South Korea, China, Malaysia, Mexico, Singapore, Australia, the Philippines, Indonesia, Norway, Sweden, Denmark and United Arab Emirates.

Company Name 7-Eleven Inc.

Ownership Private

No. of Locations (all) ± 60,000

No. of Employees ± 48,000

Headquartered Irving, Texas

Website www.7-eleven.com

Year Founded 1927

TENANT REPORT

This Offer ing Memorandum contains select informat ion pertaining to the business and af fa i rs of 7-Eleven located at 11303 Lockwood Drive, Silver Spring, MD 20904 (“Property”) . I t has been prepared by Matthews Retai l Advisors. This Offer ing Memorandum may not be al l - inclusive or contain a l l of the informat ion a prospect ive purchaser may desire. The informat ion contained in th is Offer ing Memorandum is conf ident ia l and furnished solely for the purpose of a review by a prospect ive purchaser of the Property. I t is not to be used for any other purpose or made avai lable to any other person without the wri t ten consent of Sel ler or Matthews Retai l Advisors. The mater ia l is based in part upon informat ion suppl ied by the Sel ler and in part upon f inancial informat ion obtained from sources i t deems rel iable. Owner, nor their of f icers , employees, or agents makes any representat ion or warranty, express or impl ied, as to the accuracy or completeness of th is Offer ing Memorandum or any of i ts contents and no legal l iabi l i ty is assumed or shal l be impl ied with respect thereto. Prospect ive purchasers should make their own project ions and form their own conclusions without rel iance upon the mater ia l contained herein and conduct their own due di l igence.

By acknowledging your receipt of th is Offer ing Memorandum for the Property, you agree:

1 . The Offer ing Memorandum and i ts contents are conf ident ia l ;

2 . You wi l l hold i t and treat i t in the str ictest of conf idence; and

3. You wi l l not , d i rect ly or indirect ly, d isclose or permit anyone else to disclose this Offer ing Memorandum or i ts contents in any fashion or manner detr imental to the interest of the Sel ler.

Owner and Matthews Retai l Advisors expressly reserve the r ight , at their sole discret ion, to reject any and al l expressions of interest or of fers to purchase the Property and to terminate discussions with any person or ent i ty reviewing this Offer ing Memorandum or making an of fer to purchase the Property unless and unt i l a wr i t ten agreement for the purchase and sale of the Property has been ful ly executed and del ivered.

I f you wish not to pursue negot iat ions leading to the acquis i t ion of the Property or in the future you discont inue such negot iat ions, then you agree to purge al l mater ia ls relat ing to th is Property including this Offer ing Memorandum.

A prospect ive purchaser ’s sole and exclusive r ights with respect to th is prospect ive t ransact ion, the Property, or informat ion provided herein or in connect ion with the sale of the Property shal l be l imited to those expressly provided in an executed Purchase Agreement and shal l be subject to the terms thereof. In no event shal l a prospect ive purchaser have any other c la ims against Sel ler or Matthews Retai l Advisors or any of their af f i l iates or any of their respect ive of f icers , Directors , shareholders, owners, employees, or agents for any damages, l iabi l i ty, or causes of act ion relat ing to th is sol ic i tat ion process or the market ing or sale of the Property.

This Offer ing Memorandum shal l not be deemed to represent the state of af fa i rs of the Property or const i tute an indicat ion that there has been no change in the state of af fa i rs of the Property s ince the date this Offer ing Memorandum.

CONFIDENT IAL I TY & D I SCLA IMER STATEMENT


EXCLUSIVE LISTING AGENTS

MATT COATESAssociate

matt [email protected] (949) 432-4505MOB (714) 366-1236LIC # 01980718

ARON CLINESVP & Senior Director

aron.c l [email protected] (949) 432-4509MOB (818) 632-0233LIC # 01904371

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JOHN P. LINBROKER OF RECORD

LIC # 318697

7-ElevenSilver Spring, MD

actual location 7-eleven - matthews.com...the city’s ability to attract businesses, create jobs,...

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