net lease la fitness for sale | the boulder group
TRANSCRIPT
LA FITNESS - TROPHY CHICAGO LOCATION6107 North Broadway Street, Chicago, IL 60660
TABLE OF CONTENTS
I. Executive Profile Executive Summary Investment Highlights Property Overview
II. Location Overview Photographs Aerial Site Plan Maps
III. Market & Tenant Overview Demographic Report Market Overview Tenant Overview
TABLE OF CONTENTS
NET LEASE INVESTMENT OFFERING
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.
DISCLAIMERSTATEMENT:
DISCLAIMER STATEMENT
NET LEASE INVESTMENT OFFERING
NET LEASE INVESTMENT OFFERING
EXECUTIVESUMMARY:
The Boulder Group is pleased to exclusively market for sale a single tenant trophy LA Fitness property located in the city of Chicago. The LA Fitness property is located in the Edgewater neighborhood, strategically positioned adjacent to both a new Whole Foods & a new Walgreens at a signalized intersection. The property features rare on-site parking and is benefitted by its close proximity to Loyola University. The retro-fitted building underwent a full scale renovation that was recently completed in the summer of 2014. LA Fitness has over 14 years remaining on their lease that expires in June 2029. The lease features 10% rental escalations throughout the primary term and in each renewal option period. LA Fitness is a privately owned company that is the leader in the fitness and health club industry with over 600 locations.
The 39,291 square foot property is strategically located along North Broadway Street at a signalized intersection. North Broadway Street is a primary north-south thoroughfare in the area and experiences average traffic volumes in excess of 22,500 vehicles per day. A new Whole Foods is located adjacent to the property immediately to the south. A brand new Walgreens is located adjacent to the property to the north. Walgreens has operated at this location for 35 years and recently signed a new 25 year lease and built a flagship store at the location further illustrating the strength of the immediate area. Additional retailers located in the immediate area include CVS, Aldi, MB Financial Bank, McDonald’s, Sleepy’s, Starbucks, and Physicians Immediate Care.
The LA Fitness is benefitted by its close proximity to Loyola University Chicago. Loyola University is home to over 15,000 students. The surrounding area is densely populated with over 70,000 people living within a one mile radius. Additionally, there are over 351,000 people living within a three mile radius earning average annual household incomes in excess of $66,000. The property is strategically located within two blocks of two different CTA Red Line “L” stations. The Red line is the most used “L” line in the city.
The 22,000 square foot state of the art fitness facility consists of two levels. The free-standing building was fully renovated in 2014 and the roof and mechanicals are all brand new. Unlike most LA Fitness properties, this building is more adaptable as it does not feature an indoor swimming pool. The LA Fitness benefits from the presence of on-site parking; a rare feature for properties located in the city of Chicago. LA Fitness has 60 exclusively designated parking spaces as well as an additional 12 parking spots that are shared with the adjacent Walgreens.
LA Fitness has over 14 years remaining on their net lease that expires June 25, 2029. The lease features 10% rental escalations every five years and in each renewal option period. LA Fitness is the dominant market leader in the Chicago MSA with approximately 40 locations in the area. LA Fitness is a privately held company with over 600 locations across the country. LA Fitness has an estimated annual revenue in excess of $1.7 billion.
EXECUTIVE SUMMARY
NET LEASE INVESTMENT OFFERING
INVESTMENT HIGHLIGHTS:
• Trophy free standing location in the city of Chicago
• Long term lease with over 14 years remaining
• 10% rental escalations every five years in the primary term and renewal option periods
• Retro-fitted & fully renovated state of the art building with a brand new roof and mechanicals (renovated in 2014)
• Rare on-site parking spaces (72)
• LA Fitness is the leader in the health care industry with annual revenue estimated to be in excess of $1.7 billion
• Situated between a new Whole Foods and Walgreens at the hard corner of a signalized intersection
• Additional retailers located within the immediate area include CVS, Aldi, MB Financial Bank, McDonald’s, Sleepy’s, Starbucks, and Physicians Immediate Care
• Located along North Broadway Street, a primary north-south thoroughfare with over 22,500 VPD
• Immediate proximity to Loyola University Chicago (15,000+ students)
• Close proximity to two CTA ‘L’ stations
• Densely populated area with over 70,000 people living within a one mile radius
INVESTMENT HIGHLIGHTS
NET LEASE INVESTMENT OFFERING
PROPERTY OVERVIEW: Price: $10,000,000
Cap Rate: 5.34%
Rent Schedule: NOI Escalation Date
$534,475 $587,923 7/1/2019 $646,715 7/1/2024 $711,386 7/1/2029 (Option 1) $782,525 7/1/2034 (Option 2)
$860,778 7/1/2039 (Option 3)
Lease Commencement Date: June 26, 2014
Lease Expiration Date: June 25, 2029
Renewal Options: Three 5-Year
Tenant: LA Fitness
Guarantor: Fitness International, LLC (Corporate)
Year Renovated: 2014
Lease Type: NN (Roof, Structure & Parking Lot)
Building Size: 22,000 SF (Two-Level)
Land Size: 39,291 SF
Parking Spaces: 60 (Exclusively Designated) + 12 (Shared with Walgreens)
PROPERTY OVERVIEW
NET LEASE INVESTMENT OFFERING
PHOTOGRAPHS
NET LEASE INVESTMENT OFFERING
PHOTOGRAPHS
NET LEASE INVESTMENT OFFERING
AERIAL
(160 CONDO UNITS)
EVANSTON
L A K EM I C H I G A N
CHICAGO
W E S T G L E N L A K E AV E N U E
NO
RTH
BR
OA
DW
AY (22,500 VPD) CTA R
ED LIN
E
15,000 STUDENTS
NET LEASE INVESTMENT OFFERING
SITE PLAN
NORTH BROADWAY AVENUE
LA FITNESS PARKING
WES
T G
LEN
LAKE
AVE
NU
E
NET LEASE INVESTMENT OFFERING
MAPS
LAKEMICHIGAN
NET LEASE INVESTMENT OFFERING
MAPS
LAKEMICHIGAN
NET LEASE INVESTMENT OFFERING
Population 1-Mile 2-Mile 3-Mile
Total Population 70,077 197,805 351,357
Total Households 34,972 90,655 159,062
Income 1-Mile 2-Mile 3-Mile
Median Household Income $39,728 $40,276 $46,984
Average Household Income $57,835 $58,281 $66,128
DEMOGRAPHICREPORT:
DEMOGRAPHIC REPORT
NET LEASE INVESTMENT OFFERING
Edgewater is a lakefront community area on the North Side of the city of Chicago, Illinois seven miles north of the Loop. As one of Chicago’s 77 official community areas, Edgewater is bounded by Foster Avenue on the south, Devon Avenue on the north, Ravenswood Avenue on the west, and Lake Michigan on the east. Edgewater contains several beaches that residents enjoy in the late spring, summer, and early autumn. Chicago’s largest park, Lincoln Park, stretches south from Edgewater for seven miles along the waterfront, almost to downtown.
Today, it provides the northern terminus of both Lincoln Park and Lake Shore Drive. With the exception of pockets acknowledged as historic districts, east-Edgewater boasts a skyline of high-rise apartment buildings, condominium complexes, and mid-rise homes. To the west, Edgewater is characterized by commercial businesses; single-family homes; and two-, three-, or four-story flats, including the historic neighborhood of Andersonville.
www.edgewater.org
Chicago is the most populous city in the Midwestern United States and the third most populous city in the United States with 2,700,000 residents. Chicago is the county seat of Cook County, the second largest county in the United States. The Chicago MSA is the third most populated metropolitan area in the United States with 9,580,567 residents. The MSA covers over 1,300 square miles and six counties. The Chicago metropolitan area is home to the corporate headquarters of 57 Fortune 1000 companies, including Boeing, McDonald’s, Motorola, Discover Financial Services and United Airlines. Chicago is a major hub for industry, telecommunications and infrastructure and O’Hare International Airport is the second busiest airport in the world in terms of traffic movement.
The metro is a major financial center in North America, and is home to the largest futures exchange in the United States, the CME Group. Chicago is third in the world on the Global Financial Centers Index which ranks the competitiveness of financial centers based on people, business environment, market access, infrastructure and general competitiveness.
www.cityofchicago.org
MARKETOVERVIEW:
MARKET OVERVIEW
NET LEASE INVESTMENT OFFERING
LA Fitness is a privately-owned American health club chain with over 600 clubs across the United States and Canada. LA Fitness is the dominant market leader in the Chicago MSA with approximately 40 locations in the area.
LA Fitness has grown substantially recently and their growth strategy in new markets has been to purchase existing competitors. For example, on November 30, 2011, the company completed the acquisition of 171 clubs for $153M from Bally Total Fitness. After the closing, LA Fitness began closing some former Bally Fitness clubs near existing LA Fitness facilities.
The company was formed in 1984 and is based in Irvine, California. LA Fitness is the #1 revenue generating health club in the industry with estimated annual revenue in excess of $1.7 billion.
Website: www.lafitness.comNumber of Illinois Locations: 600Headquarters: Irvine, CA
TENANT OVERVIEW
TENANT OVERVIEW:
666 Dundee Road, Suite 1801Northbrook, IL 60062
www.bouldergroup.com
Randy [email protected]
Jimmy [email protected]