executive summary - loopnet · 2017. 7. 13. · executive summary 3 property overview price...
TRANSCRIPT
EXECUTIVE SUMMARY
1
6020 Porter Road Niagara Falls, New York
CONFIDENTIAL OFFERING MEMORANDUM
18.5 Year Lease Term Remaining • 10% Rent Escalations Every 5 Years • Wendy’s Corporate Guarantee
2
EXECUTIVE SUMMARY.......................................3
TENANT OVERVIEW...........................................4
LOCATION OVERVIEW........................................5
LEASE ABSTRACT.............................................6
TABLE OF CONTENTS
Holliday Fenoglio Fowler, L.P. (“HFF”) a New York licensed real estate broker.
This Offering Memorandum has been prepared by HFF for use by a limited number of parties and has been obtained from sources believed reliable. While we do not doubt its accuracy, we have not verified it, and make no guarantee, warranty or representation about it. It is your responsibility to confirm, independently, its accuracy and completeness. All projections have been developed by HFF, Owner and designated sources, are based upon assumptions relating to the general economy, competition, and other factors beyond the control of Owner, and therefore are subject to variation. No representation is made by HFF or Owner as to the accuracy or completeness of the information contained herein, and nothing contained herein is or shall be relied on as a promise or representation as to the future performance of the property. Although the information contained herein is believed to be correct, Owner and its employees disclaim any responsibility for inaccuracies and expect prospective purchasers to exercise independent due diligence in verifying all such information. Further, HFF, Owner and its employees disclaim any and all liability for representations and warranties, expressed and implied, contained in, or for omissions from, the Offering Memorandum or any other written or oral communication transmitted or made available to the recipient.
The Offering Memorandum does not constitute a representation that there has been no change in the business or affairs of the property or Owner since the date of preparation of the Offering Memorandum. Analysis and verification of the information contained in the Offering Memorandum is solely the responsibility of the prospective purchaser.
Additional information and an opportunity to inspect the property will be made available upon written request to interested and qualified prospective investors.
Owner and HFF each expressly reserve the right, at their sole discretion, to reject any or all expressions of interest or offers regarding the property and/or terminate discussions with any entity at any time with or without notice. Owner shall have no legal commitment or obligations to any entity reviewing this Offering Memorandum or making an offer to purchase the property unless and until such offer is approved by Owner, a written agreement for the purchase of the property has been fully executed, delivered and approved by Owner and its legal counsel, and any obligations set by Owner thereunder have been satisfied or waived.
This Offering Memorandum and the contents, except such information, which is a matter of public record or is provided in sources available to the public, are of a confidential nature. By accepting this Offering Memorandum, you agree that you will hold and treat it in the strictest confidence, that you will not photocopy or duplicate it, that you will not disclose this Offering Memorandum or any of the contents to any other entity (except to outside advisors retained by you, if necessary, for your determination of whether or not to make a proposal and from whom you have obtained an agreement of confidentiality) without the prior written authorization of Owner or HFF and that you will use the information in this Offering Memorandum for the sole purpose of evaluating your interest in the property and you will not use the Offering Memorandum or any of the contents in any fashion or manner detrimental to the interest of Owner or HFF. If you have no interest in the property, please return the Offering Memorandum forthwith.
TIMOTHY HALL
Holliday Fenoglio Fowler, L.P.
Senior Managing Director
202.533.2521
ANDREW SCANDALIOS
Holliday Fenoglio Fowler, L.P.
License # : 10331200140
Senior Managing Director
212.632.1821
VIJAY MALIK
Holliday Fenoglio Fowler, L.P.
Analyst
202.533.2529
CRAIG CHILDS
Holliday Fenoglio Fowler, L.P.
Analyst
202.777.2315
EXECUTIVE SUMMARY
3
PROPERTY OVERVIEW
Price $1,916,080 (5.00% cap rate)
Tenant's Name Wendy's Properties LLC
Premises 6020 Porter Rd Niagara Falls, NY
Size 3,254 SF
Acreage 1.45 acres
Lease Commencement March 21, 2016
Lease Expiration March 20, 2036
Annual Rent $95,804
Rent Escalations 10% rental increases each 5-year option period
Options to Extend Two (2) successive periods of five (5) years each
Lease Structure NNN
INVESTMENT HIGHLIGHTS
• Recently Executed 20-Year Lease Term (LED: 3/2036) with two (2) 5-year extension options at fixed renewal rates
• Corporate Lease – Guaranteed by the Wendy’s Company.
• Lease includes 10% rental increase every five (5) years (next increase is 10% in 3/2021)
• Located less than 5 miles from Niagara Falls State Park, one of the top tourist destinations in the world
• Operated by the largest Wendy’s franchisee, the MUY! Companies, with 245 locations
INVESTMENT OPPORTUNITY
HFF is pleased to exclusively present the opportunity to purchase the net-leased, fee simple interest in the
commercial building located at 6020 Porter Road in Niagara Falls, NY (the “property”). The free-standing
building, with a remaining lease term of 18.5 years alongside two 5-year options, is 100% leased to Wendy’s
Properties, LLC (“Wendy’s” or “company”), and guaranteed by Wendy’s.
The property is located in Niagara Falls, NY, in the Buffalo-Niagara Falls metropolitan area, with a population
exceeding 1.1 million. The Niagara Falls State Park, home to Niagara Falls, one of the most visited tourist
attractions in the world recently celebrating its 130 year anniversary, annually attracts more than 10
million visitors with an economic impact exceeding $500 million.
This Wendy’s franchise is operated by MUY! Companies, one of the largest private restaurant employers in the
US, the largest management-owned franchise in the US, and the largest Wendy’s franchisee in the US. MUY!
Companies employs over 20,000 employees and operates more than 245 Wendy’s restaurants, 314 Pizza Hut
restaurants, and 76 Taco Bell Restaurants.
4
TENANT OVERVIEWTHE WENDY’S COMPANY (NASDAQ: WEN)
The Wendy’s Company, through its subsidiaries, operates as a quick-service
restaurant company in the hamburger sandwich segment worldwide. It is
involved in operating, developing, and franchising a system of quick-service
restaurants. The company’s restaurants offer a range of chicken breast
sandwiches, chicken nuggets, chili, French fries, baked potatoes, salads, soft drinks, Frosty desserts, and kids’
meals. As of January, 2017, its restaurant system included approximately 6,537 restaurants, of which 330
were company-owned and operated restaurants. The company was formerly known as Wendy’s/Arby’s Group,
Inc. and changed its name to The Wendy’s Company in July 2011. The Wendy’s Company was founded in
1969 and is headquartered in Dublin, Ohio.
Revenue from the restaurant business is derived from two principal sources: (1) sales at Company operated
restaurants and (2) franchise-related revenues including royalties, rents and franchise fees received from
Wendy’s franchised restaurants. Company-operated restaurants comprised approximately 5% of the total
Wendy’s system as of January 1, 2017.
5
LOCATION OVERVIEW
The Buffalo-Niagara Falls metropolitan area encompasses two counties – Erie and Niagara – in Western New York, totaling 1.1 million residents, making it the second largest metropolitan area in the state. A long-time
center for trade as a result of the Erie Canal, the local economy has transitioned to sectors including financial services, technology, biomedical engineering and education. Major employers include The State of New York,
M&T Bank, University of Buffalo, General Motors, and Labatt Brewing Company.
The area economy has experienced significant recent gains. New York State Governor Andrew Cuomo, through a program known locally as “Buffalo Billion” has brought new construction, increased economic development
and hundreds of new jobs to the area. Accordingly, as of December 2016, the local unemployment rate was 5.1%, approximating the national average. Over twenty colleges and universities in the region provide a steady
workforce for the area’s growing employment base.
The region’s economy is serviced by an extensive network of interstates, state routes and local arterial roads that span more than 3,000 miles. Seven international ports of entry facilitate the $78 billion of annual trade
between the US and Canada while the Buffalo-Niagara International Airport handles 4.6 million passengers each year, providing nonstop service on more than 100 flights daily.
Niagara Falls, a city in Niagara County, is located adjacent to the Niagara River, across from the city of Niagara Falls, Ontario, named after the Niagara Falls which the cities share. Niagara Falls’ main industry is tourism
as the falls are currently visited by more than 10 million tourists each year, making the waterfall one of the world’s top tourist destinations.
United StatesCanada
Ontario Ave
Victoria A
ve
Hyde Park Golf Course
Packa
rd Rd
Lockport Rd
Buffalo AveNiagara Scenic Pkwy
NIAGARA FALLS
NIAGARA FALLS
6262
420
120
49
104
384
384
182
265
61
6020 PORTER ROAD
6
TENANT NAME: Wendy’s Properties, LLC
PREMISES: 6020 Porter Road | Niagara Falls, NY
SIZE: ± 3,254 SF
ACREAGE: 1.45 AC
RENT COMMENCEMENT: March 21, 2016
TERM: 20 Years
ANNUAL RENT: $95,804
RENT ESCALATIONS: 10% every 5th year
OPTION TO EXTEND : The term of the Lease will be automatically extended for two (2)
successive periods of five (5) years each if Tenant does not elect to
terminate the Lease at the end of the Primary Term or any Option Period
OPTION RENTAL INCREASES: 10% rental increases each 5-year option period
REAL ESTATE TAXES: Tenant responsible for all real estate taxes
UTILITIES: Tenant responsible for all utility services used on the Leased Space
INSURANCE: Tenant responsible for all insurance
REPAIRS: Tenant responsible for keeping the Leased Space in safe and good
condition and repair
ANNUAL RENT: Years 1 – 5 $95,804
Years 6 – 10 $105,384
Years 11 – 15 $115,922
Years 16 – 20 $127,515
RENEWAL OPTIONS: Years 21 – 25 $140,266
Years 26 – 30 $154,293
LEASE ABSTRACT
TIMOTHY HALL
Holliday Fenoglio Fowler, L.P.
Senior Managing Director
202.533.2521
ANDREW SCANDALIOS
Holliday Fenoglio Fowler, L.P.
License # : 10331200140
Senior Managing Director
212.632.1821
VIJAY MALIK
Holliday Fenoglio Fowler, L.P.
Analyst
202.533.2529
CRAIG CHILDS
Holliday Fenoglio Fowler, L.P.
Analyst
202.777.2315
1775 Pennsylvania Ave NW | 5th Floor
Washington, DC 20006