clearfield retail center - loopnet · actual market value after vacancy & leasing expenses...

Offering Memorandum

CLEARFIELD RETAIL CENTER

Marcus & Millichap Real Estate Investment Services, Inc. (“M&M”) 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 M&M, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of M&M, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers.

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 YOURMARCUS & MILLICHAP AGENT FOR MORE DETAILS.

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analysisM A R K E T A N D P R O P E R T Y A N A LY S I S

5This information has been secured from sources we believe to be reliable, but we make no representations or warranties, express or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates herein are for example purposes only and do not represent the current of future performance of the property. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2016 Marcus & Millichap. All rights reserved.

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, express or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates herein are for example purposes only and do not represent the current of future performance of the property. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2016 Marcus & Millichap. All rights reserved.

Executive Summary

Clearfield Retail Center

TENANT GLA % of GLA LEASE EXP

Cricket Wireless 1,800 SF 19% 11/30/2019

Heartsong Spay/Neuter 1,500 SF 16% 7/31/2018

H&R Block 1,500 SF 16% 4/30/2018

Vacant 4,496 SF 48% N/A

Major Tenants

CLEARFIELD RETAIL CENTER600 South State StreetClearfield, UT 84015

INCOME CURRENT PRO FORMA

Base Rent / Occupied Space $58,647 $58,647

Base Rent / Vacant Space at Market Rents $49,456 $49,456

Gross Potential Rent $108,103 $108,103

Expense Reimbursments $25,170 $25,170

Gross Potential Income $133,273 $133,273

Vacancy/Uncollected CAM $62,056 5% / $6,664

Effective Gross Income $71,217 $126,609

Total Expenses $25,170 $25,170

Net Operating Income $46,047 $101,439

Annualized Operating Data

Investment Highlights�� Anchored by 39,000 SF Kent’s Market Grocery

�� Excellent Upside Opportunity with 48% Vacancy

�� Combined Traffic Counts in Excess of 30,075

�� 75 Free Surface Parking Spaces; 8 stalls per 1000 SF

�� Nearby Tenants Include Family Dollar, First National Bank, Kent’s Market, & Tai’pan Trading

�� Population of 187,809 within a 5-Mile Radius

Offering SummaryOffering Price $1,205,000

Total Gross Leasable Area (GLA) 9,296 SF

Price/SF $129.63

Cap Rate - Current 3.82%

Cap Rate - Pro Forma 8.42%

Year Built 2000

Lot Size 0.64 Acres

PRO FORMA MARKET VALUE - INCOME CAPITALIZATION APPROACH: Cap Rate

PRO FORMA MARKET VALUE (INCOME) 7.00% $1,449,130



Financial Summary


FINANCING - LONG-TERM LOAN

Loan Amount $723,000

Interest Rate 4.50%

Interest Constant 6.67%

Amortization Period 25 Years

Annual Debt Service ($48,224)

Monthly Mortgage Payment ($4,019)

Loan to Value Ratio 60%

Debt Coverage Ratio 2.10

INCOME APPROACH

Gross Potential Rent $108,103

Add: CAM (Taxes, Insurance, Etc.) $25,170

TOTAL GROSS POTENTIAL INCOME $133,273

(Less) Vacancy 5.00% / $6,663.64

EFFECTIVE GROSS INCOME $126,609

EXPENSES:

CAM (Taxes, Insurance, Etc.) 19.88% / ($25,170)

TOTAL EXPENSES 19.88% / ($25,170)

NET OPERATING INCOME (PRO FORMA) $101,439

Long Term Debt Service $48,224

Net Cash Flow after Debt Service $53,215

PRICE ADJUSTMENTS FOR VACANCY & LEASING EXPENSES

Leasing Agent Commission $8,902

Tenant Improvement Costs $89,920

Rent & CAM Loss - (9 Months) $46,542

Developer Time & Risk Factor $98,766

TOTAL PRICE REDUCTION $244,130

ACTUAL MARKET VALUE AFTER VACANCY & LEASING EXPENSES $1,205,000

INVESTMENT ANALYSIS

Cash Required (Down Payment) $482,000

Percent Down 40%

Annual Cash Flow $53,215

Cash on Cash (Equity Dividend Rate) 11.04%

SALES COMPARISON APPROACH

Value / Price $1,205,000

Price/SF $129.63

Building Square Footage 9,296



Rent Roll


TENANT NAME TYPE & SUITE NUMBER LEASE DATES & TERM

FLOOR SFBLDG SHARE

RATE & AMOUNTPER YEAR

CHANGESON

CHANGESTO

EXPENSES REIMBURSED LEASE TYPE

Cricket WirelessSuite 1 1,800 SF 12/1/2017 $21,234.0012/1/2015-11/30/2019 19.36% $20,202.00 12/1/2018 $21,774.00 $4,860.00 NNNHeartsong Spay/NeuterSuite 2 1,500 SF8/1/2016-7/31/2018 16.14% $14,445.00 8/1/2017 $14,445.00 $3,510.00 NNNH & R BlockSuite 3 1,500 SF5/1/2016-4/30/2018 16.14% $24,000.00 N/A N/A $4,200.00 NNNVacantSuite 4 4,496 SF

48.36% $49,456.00 N/A N/A $12,600.00 NNNTotal Occupied 4,800 SF / 51.64% $58,647.00 $57,453.00 $12,600.00Total Vacant 4,496 SF / 48.36% $49,456.00 $12,570.00Total 9,296 SF / 100% $108,103.00 $57,453.00 $25,170.00



Lease Expiration Schedule

PRICING AND FINANCIAL ANALYSISClearfield Retail CenterCLEARFIELD, UT

THIS IS A BROKER PRICE OPINION OR COMPARATIVE MARKET ANALYSIS AND SHOULD NOT BE CONSIDERED ANAPPRAISAL. This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed orimplied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bearsall risk for any inaccuracies. Marcus & Millichap is a trademark of Marcus & Millichap Real Estate Investment Services of Denver, Inc. © 2016Marcus & Millichap. All rights reserved.

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 HeartsongSpay/Neuter

ClinicH & R Block

CricketWireless

Total Number of Tenants 2 1

Total Square Feet 3,000 1,800

Total Percentage 32.3% 19.4%

Cumulative Percentage 32.3% 51.6%

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

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

Tota

l Pro

ject S

quar

e Fo

otag

e

0

1

2

Num

ber o

f Ten

ants

Jan 20160%

Jan 20170%

Jan 201832%

Jan 201919%

Jan 20200%

Jan 20210%

Jan 20220%

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.


Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10For The Year Ending JAN-2016 JAN-2017 JAN-2018 JAN-2019 JAN-2020 JAN-2021 JAN-2022 JAN-2023 JAN-2024 JAN-2025

Tena

nts

Expi

ring

Heartsong Spay/Neuter ClinicH & R Block

Cricket Wireless

Total Number of Tenants 2 1

Total Square Feet 3,000 1,800

Total Percentage 32.3% 19.4%

Cumulative Percentage 32.3% 51.6%



Tenant and Lease Summaries

Lease Summary


Cricket Wireless is a prepaid wireless service provider in the United States. Headquar-tered in Atlanta, GA, they offer voice, text, and data plans at competitive prices. In July of 2013, AT&T Inc. agreed to buy Cricket Wireless’ parent company, Leap Wireless, for $1.2 billion and was finalized in April of 2014. Cricket now has over 3800 stores cover-ing customers across the United States.

Cricket Wireless

Lease Commencement 12/1/2015

Lease Expiration 11/30/2019

Gross Leasable Area 1,800 SF

Original Term 4 Years

Pro Rata Share of Project 19%

Headquartered Atlanta, Georgia

No. of Locations 3800+

Website https://www.cricketwireless.com

Lease Years Annual Rent Monthly Rent Annual Rent/SF

12/1/2015-11/30/16 $20,202.00 $1,684 $11.28

12/1/2016-11/30/2017 $20,694.00 $1,725 $11.52

12/1/2017-11/30/2018 $21,234.00 $1,770 $11.76

12/1/2018 - 11/30/2019 $21,774.00 $1,815 $12.12




Lease Summary


Heartsong Spay Neuter Clinic’s mission is to provide high quality, low cost spays and neuters “to stop the killing of our nations ‘surplus’ pet population.” The clinic was founded by Loretta & Erik Emmons who originally started a 501(c) 3 non profit rescue but realized it wasn’t doing enough to save the many lives of pets in their own coun-try. They came up with a better way to ebb the tide of pet overpopulation. Heartsong already has 3 locations in the United States including Utah, Georgia, & South Carolina with more stores opening and franchise opportunities available.

Heartsong Spay/Neuter Clinic






Headquartered N/A

No. of Locations N/A

Website www.heartsongspayneuter.com


8/1/2016-7/31/2017 $14,444.76 $1,204 $9.60

8/1/2017-7/31/2018 $14,733.00 $1,228 $9.84




Lease Summary


H & R Block is a tax preparation company in North America, Austrailia, Brazil and India. The Kansas City-based company also offers banking, payroll, personal finance and buisness consulting services. Founded in 1955 by brothers Henry W. Bloch & Richard Bloch, Block now operates approximately 12,000 stores worldwide and employs over 90,000 tax preparers. Revenue in 2015 was $3.1 billion with total equity at $1.8 bil-lion as of 2015. In January 2016, H & R Block launched Block Advisors, a service that provides year-round consumer tax preparation.

H & R Block






Headquartered Kansas City, MO

No. of Locations 12,000

Website www.hrblock.com


5/1/2016-4/30/2018 $24,000.00 $2,000 $15.96



Investment Overview


The Clearfield Retail Center is located at 600 S State Street in Clearfield, Utah. The subject is a 9,296 square foot multi-tenant retail building on a parcel totaling 0.64 acres. The existing tenants include Cricket Wireless, Heartsong Spay/Neuter Clinic, and H & R Block. The property is primely positioned in Clearfield anchored by Kent’s Market and is just minutes away from Hill Air Force Base, the sixth-largest employer in the state of Utah.

Centrally located between State Street & 700 south, Clearfield Retail Center has great visability with traffic counts exceeding 30,000 combined AADT. This strong mix of local and national tenants in the center contribute to the retail corridor in which the subject is located. Nearby retailers include Family Dollar, America First Credit Union, 7-Eleven, First National Bank, American Title Loans, Pizza Hut, Maverik Gas Station, AutoZone, & Tai’pan Trading, a 102,000 SF Home Goods Super Store. With traffic counts over 154,990 AADT, Exit 334 off Interstate-15 funnels traffic directly down 700 South toward the retail center less than one-mile away.

Clearfield is located just 28 miles north of downtown Salt Lake City. It was ranked #2 among the most livable cities in the U.S. by Forbes 2010. Clearfield was one of the last cities to be built in Utah, and population in the city boomed with the development of Hill Air Force Base in the 1940’s. Nearby attractions include Hill Aerospace Museum, Antelope Island State Park, Pioneer Village, and Great Salt Lake State Park. Utah has been rated by Forbes as the “best state for business” for the past three years, and has had a pro-business climate that offers a low tax rate, low energy costs, and a 4.65 percent unemployment rate. Utah’s economy expanded by two percent per year from 2008 - 2013, the fourth highest growth rate in the country.



Regional Map


Subject Property



Local Map


Subject Property



Aerial Photo


Subject Property

North Davis Junior High

School

Clearfield High School

Subject Property



Retail Market




Location Overview


The Ogden-Clearfield metro of northern Utah, located between the Wasatch Mountains and the Great Salt Lake, consists of Weber, Davis and Morgan counties. The Ogden and Weber rivers traverse the area, flowing into the Great Salt Lake. The metro contains approximately 635,300 residents, with Ogden as the largest city.

Strategically located for highway, rail and air access, Ogden sits at the cross-roads of the CANAMEX shipping corridor, with Interstates 15 and 84 inter-secting in the city. Ogden-Hinckley Airport is the second-largest airport in Utah, and Salt Lake City International Airport is 35 miles south. Ogden is located along the transcontinental railroad system and remains a national hub for east-west rail traffic. The Utah Transit Authority offers commuter rail and bus service throughout the Wasatch Front.

Ogden’s roots in the railroad industry have expanded into military and manu-facturing. Hill Air Force Base, home of the Ogden Air Logistics Center, is a major driver of the economy as the area’s largest employer. The center offers engineering and logistics management for aircrafts worldwide. Another signifi-cant location in the metro is the redeveloped Business Depot Ogden, which provides 6.5 million square feet of industrial and office space to tenants includ-ing Lofthouse Cookies, ICON Fitness and Kenco Logistic Services.

The expanding local economy will help push population growth to an annual average of 1.4 percent for the next five years. The median household income, currently $67,000 per year, is roughly $10,900 above the U.S. median and will exceed $76,000 in 2019.

Government 21%

Trade, Transportation & Utilities 18%

Manufacturing 13%

Professional and Business Services 12%

Construction 7%

Financial Activities 4%

Other Services 3%

Information 1%

HIll Air Force Base

U.S. Government

Lifetime Products Inc.

Weber State University

Lagoon Corp. Inc.

Ogden Regional Medical Center

McKay-Dee Hospital

Parker Hannifin Corp.

Convergys

Autoliv

Major Employers

Share of Total EmploymentMetro Employment: 239,300



Demographic Summary


INCOME 1-MILE 3-MILES 5-MILES

$0 - $ 14,999 13.4% 8.4% 6.5%

$15,000 - $24,999 13.1% 7.5% 6.7%

$25,000 - $34,999 12.4% 10.2% 8.7%

$35,000 - $49,999 17.8% 15.1% 14.6%

$50,000 - $74,999 23.7% 24.4% 24.6%

$75,000 - $99,999 9.8% 17.2% 18.2%

$100,000 - $124,999 5.8% 9.4% 10.5%

$125,000 - $149,999 1.8% 3.8% 5.0%

$150,000 - $200,000 1.4% 2.8% 3.5%

$200,000 to $249,999 0.3% 0.5% 0.7%

$250,000 + 0.4% 0.9% 1.0%

2014 Median HH Income $44,467 $58,734 $63,459

2014 Per Capita Income $17,464 $21,229 $22,821

2014 Average HH Income $52,024 $67,739 $73,262

HOUSEHOLDS 1-MILE 3-MILES 5-MILES

2000 Households 3,596 19,716 41,905

2010 Households 3,646 24,977 54,893

2014 Households 3,812 26,283 58,116

2019 Households 3,816 28,442 63,214

2014 Average HH Size 2.83 3.17 3.21

2014 Daytime Population 6,044 31,923 52,769

2000 Owner Occupied Housing Units 40.44% 59.49% 70.98%

2000 Renter Occupied Housing Units 54.09% 35.25% 24.74%

2000 Vacant 5.46% 5.26% 4.28%



2014 Vacant 8.20% 4.53% 3.37%



2019 Vacant 8.53% 4.34% 3.19%

POPULATION 1-MILE 3-MILES 5-MILES

2000 Population 11,036 62,917 136,072

2010 Population 11,215 81,030 178,010

2014 Population 11,629 84,907 187,809

2019 Population 11,548 92,127 204,428



Demographic data © 2015 by Experian/Applied Geographic Solutions.


Race and Ethnicity The current year racial makeup of your selected area is as follows: 86.46% White, 1.71% African American, 0.50% Native American and 2.22% Asian/Pacific Islander. Compare these to U.S. averages which are: 71.60% White, 12.70% African American, 0.18% Native American and 5.02% Asian/Pacific Islander. People of Hispanic origin are counted independently of race. People of Hispanic origin make up 12.04% of the current year population in your selected area. Compare this to the U.S. average of 17.13%.

Housing In 2000, there were 31,072 owner occupied housing units in your area and there were 10,832 renter occupied housing units in your area. The median rent at the time was $549.

Employment In 2014, there are 52,768 employees in your selected area, this is also known as the daytime population. The 2000 Census revealed that 59.72% of employees are employed in white-collar occupations in this geography, and 40.30% are employed in blue-collar occupations. In 2014, unemployment in this area is 4.24%. In 2000, the average time traveled to work was 25.2 minutes.

PopulationIn 2014, the population in your selected geography is 187,808. The population has changed by 38.02% since 2000. It is estimated that the population in your area will be 204,427 five years from now, which represents a change of 8.84% from the current year. The current population is 50.45% male and 49.54% female. The median age of the population in your area is 28.9, compare this to the Entire US average which is 37.3. The population density in your area is 2,387.09 people per square mile.

Households There are currently 58,115 households in your selected geography. The number of households has changed by 38.68% since 2000. It is estimated that the number of households in your area will be 63,213 five years from now, which represents a change of 8.77% from the current year. The average household size in your area is 3.20 persons.

Income In 2014, the median household income for your selected geography is $63,458, compare this to the Entire US average which is currently $51,972. The median household income for your area has changed by 31.24% since 2000. It is estimated that the median household income in your area will be $72,055 five years from now, which represents a change of 13.54% from the current year.

The current year per capita income in your area is $22,820, compare this to the Entire US average, which is $28,599. The current year average household income in your area is $73,261, compare this to the Entire US average which is $74,533.

Geography: 5 Miles

Demographic Summary

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clearfield retail center - loopnet · actual market value after vacancy & leasing expenses...

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