offering memorandum -...

OFFERING MEMORANDUM

Capital Markets | Net Lease Properties

CBRE, Inc. | Licensed Real Estate Broker

BJ’S RESTAURANT & BREWHOUSE5929 W. WACO DRIVE, WACO, TX

Actual Property

MARK DRAZEKSenior Vice PresidentCBRE | Capital MarketsNet Lease Properties

For further information:+1 407 404 [email protected]


EXCLUSIVELY MARKETED BY

RAY ROMANOFirst Vice PresidentCBRE | Capital MarketsNet Lease Properties

LOCAL LICENSEEBRAD BENJAMINAssociateCBRE | Capital MarketsNet Lease Properties

1INVESTMENT SUMMARY

2AREA OVERVIEW

5PROPERTY DESCRIPTION

Investment Highlights City OverviewLocal & Regional Maps

Property DescriptionAerial Photographs

Site Plan

Tenant Description

12TENANT SUMMARY

D

BJ’S RESTAURANT & BREWHOUSE | WACO, TX

1


CBRE is pleased to exclusively offer this absolute NNN BJ’s Restaurant & Brew House corporate ground lease located in front of the Richland Mall at the intersection of U.S. Route 84 and Highway 6 in Waco, Texas. BJ’s is in their fourth year of a 20 year ground lease that benefits from fixed rental rate increases of 4.5%every five years including the option periods. This is a prominent location that benefits from the heavy traffic volume and a very high daytime population. The City of Waco is located in the heart of the Texas manufacturing and technology corridor on Interstate Highway 35, just 90 miles south of Dallas and 100 miles north of Austin.

investment highlights• Long term absolute NNN ground lease

• Corporate Guaranty – NASDAQ: BJRI

• Fixed rental increases throughout entire lease term including options

• No landlord management obligations

• Prime mall/retail location – Richland Mall is a 708,000 sq. ft. regional mall anchored by Dillard’s, Bealls, H&M, Forever 21 and JC Penney

• Near Baylor University

• High visibility corner location

• Abundant parking, with a ratio of 15.76 per 1,000 sq. ft.

• No debt to assume

• Texas has NO STATE INCOME TAX

INVESTMENT SUMMARY

PRICE: $4,476,190

ANNUAL RENT: $235,500

CAP RATE: 5.25%

TENANT TRADE NAME: BJ’s Restaurant & Brewhouse

RENTAL INCREASES: 4.5% every 5 years, including options

REMAINING LEASE TERM: 15.8 years remaining (expires May 31, 2032)

INITIAL LEASE TERM: 20 years

OPTIONS: Two 5-year options

LANDLORD OBLIGATIONS: None – Absolute NNN

EXISTING FINANCING: No debt to assume

BUILDING SIZE: 8,500± SF

LAND SIZE: 0.43 acres plus protected parking area

PARKING SPACES: 134 spaces (15.76 spaces per 1,000 SF)

YEAR BUILT: 2012

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AREA OVERVIEW

Waco, TXThe Waco Region includes McLennan and six contiguous counties. Waco is the largest of 20 cities in the one-county McLennan County Metropolitan Statistical Area. The Waco Region Population (2010) was 715,080, and the overall Waco MSA is 234,906. Growth (2000-2010) for the Waco MSA +16 percent.

Greater Waco is also one of seven metropolitan areas in the Texas Triangle mega-region. The others are Dallas-Fort Worth-Arlington; Killeen-Temple-Fort Hood; Austin-Round Rock-San Marcos; San Antonio-New Braunfels; Houston-Sugar Land-Baytown; and College Station-Bryan.

Education

Greater Waco is home to one university and two colleges with a total enrollment of 31,243. Additionally, we are at the center of the state’s highly educated future workforce with 344,729 students enrolled in four-year colleges and 219,178 students enrolled in two-year colleges within a 200-mile radius.

Baylor University, McLennan Community College and Texas State Technical College (plus cities, county and local chambers) are partners in the Baylor Research and Innovation Collaboration (BRIC) at the Central Texas Technology and Research Park just north of downtown on U.S. 77. The BRIC promises to be a game-changer for Greater Waco in that it will make the region competitive for globally impactful, knowledge-based products and firms.

McLennan County has 18 school districts and four charter schools serving a total student population of 41,438. The area also has more than a dozen private and parochial schools. Private elementary and secondary education in McLennan

DEMOGRAPHICS: 1-Mile 3-Mile 5-Mile

2016 Population 6,734 55,672 131,201

2021 Population 7,031 57,636 135,923

Percent Pop Change: 2010 to 2016 1.22% 0.88% 0.80%

Percent Pop Change: 2016 to 2021 0.87% 0.70% 0.71%

Percent HH Change: 2010 to 2016 1.09% 0.76% 0.72%

2016 Average Household Income $42,015 $60,232 $56,655

Average Household Size 2.16 2.46 2.54

Daytime Employment (Total Employees)

19,164 63,148 94,685

County includes schools with a classical, parochial and/or college preparatory curriculum.

Health Care

Two non-profit acute-care hospitals, Providence Healthcare Network and Baylor Scott & White Medical Center – Hillcrest, offer state-of-the-art, full-service facilities for inpatient and outpatient care. Greater Waco’s health care sector also includes Scott & White clinics supported by Scott & White Memorial Hospital in Temple.

The Family Health Center provides basic care for reduced fees, and the Central Texas Veterans Health System operates a VA Hospital in Waco.

Culture and Entertainment

Waco’s popular outdoor music venues include Indian Spring Park with its grassy-sloped amphitheater and the Bosque River Stage, a 530-seat amphitheater on the McLennan Community College campus.

The 8,000-seat Extraco Events Center, home of the Heart O’ Texas Fair and Rodeo, hosts special events and concerts during the nine-day event.

Live music also is played in nightclubs and bars throughout the city. The Waco Symphony Orchestra brings world-class performers to Waco Hall. Professional Rodeo Cowboys of America competition and throughout the year.

The Waco Civic Theatre produces six Main Stage Productions annually, ranging from works by Shakespeare to Neil Simon.

distance to

160Houston

miles

95Dallas

miles

87Austin

miles

90Fort Worth

miles

159San Antonio

miles

249Corpus Christi

miles

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AREA OVERVIEW

Additionally, aspiring local artists and youth work in partnership to produce Studio Shows that are scheduled between Main Stage Productions and other events. And outstanding theatre programs at McLennan Community College and Baylor University result in a full calendar of performances throughout the year.

Art Center Waco is housed in the historic, Mediterranean-style, William Cameron summer home. Studios overlook the Brazos River Valley, a beautiful natural setting conducive to creative learning and inspiration. In addition to regular exhibits, a two and one-half acre Sculpture Garden is open daily.

Across town, on the Baylor campus, the Martin Museum of Art brings outstanding art exhibitions, speakers and guest artists to Greater Waco. The museum’s permanent collection consists of approximately 1300 objects by such well-known artists as Robert Rauschenberg, Kathe Kollwitz, Francisco de Goya, and Edouard-Leon Cortes. Included in the collection are approximately 300 paintings representing famous watercolor artists such as George Post, Phil Dike, Edgar Whitney and John Marin.

Finally, the Chamber building features works by 27 Waco and central Texas artists and includes oils, watercolors, acrylics, lithographs, photography, ceramics, textiles, sculpture and stained glass.

Rivers, Lake and Parks

As it winds its way through the center of Waco, the Brazos River creates the perfect location for a variety of attractions and outdoor activities ranging from the Texas Ranger Museum to the mountain biking and equestrian trails that twist and turn through Cameron Park. There is even an 18-hole disc golf course that follows the Brazos River.

With natural habitats and close up encounters, the Cameron Park Zoo includes more than 1,731 animals and 300 species. An accredited member of the Association of Zoos and Aquariums and the World Association of Zoos and Aquariums, zoo exhibits include the Asian Forest featuring critically endangered Orangutans, Sumatran tigers and Komodo Dragons.

Waco Regional Tennis & Fitness Center is an outstanding facility with a top-rated professional staff offering the finest in tennis programs and instruction for all levels.

Dubl-R Fields at Riverbend Park is one of the premiere softball and baseball facilities in the state. The park sits in a natural setting along the Bosque River and features eight fields for baseball and softball.

Lake Waco features boating, fishing, swimming and camping and is the source of Waco’s drinking water. The Lake Waco Wetlands was created to mitigate the habitat loss when Lake Waco was raised by seven feet. With the addition of the Research and Education Center, the Wetlands have become an important living laboratory for research, education and recreation.

The Waco Mammoth National Monument sits in a 100-plus-acre stretch of wooded parkland along the Bosque River. Covered in sprawling oak, mesquite and cedar trees, the site offers an escape from the modern world and provides a glimpse into the lives of Columbian mammoths.

Transportation

Waco is in the heart of Texas with 81 percent of the state’s 23 million people living within 200 miles.

Interstate 35 traverses Waco and McLennan County, linking the region to Dallas and Fort Worth and on to Duluth, Minn. at the Canada border, and to Austin and San Antonio and on to Laredo just short of the Mexican border.

US 84 and Texas State Highway 6 are the region’s other primary highways. US 84 extends east to Georgia and west to Colorado while SH6 runs northwest to the Red River at the Texas-Oklahoma border and southeast through Bryan-College Station to Houston.

Air Transportation is provided from Waco Regional Airport (ACT) by American Eagle to the Dallas/Fort Worth International Airport (DFW). The regional airport beats national averages for on-time flights and offers free parking, fast security screening and four on-site rental car companies. DFW, Dallas Love Field, Killeen/Fort Hood and Austin-Bergstrom airports are also within driving distance.

Waco Transit provides safe and reliable public transportation service for the citizens of Waco and the surrounding communities. In addition to a fixed route bus service within the city, the Baylor University Shuttle operates on campus and between campus and downtown via the DASH, and van service is available for individuals with special needs.

Source: Waco Chamber

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AREA OVERVIEW

regional map

local map

SUBJECT

SUBJECT

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PROPERTY DESCRIPTION

Property DescriptionLOCATION

5929 W. Waco Drive Waco, TX 76710

BUILDING AREA

The subject consists of one (1) retail building totaling approximately 8,500 square feet of net rentable area.

SITE

This property is located on an outparcel to the Richland Mall.

PARKING

The Property provides 134 parking stalls which equates to 15.76:1,000 SF parking ratio.

LAND AREA

The Property consists of a Pad lease for 0.43 acres plus large protected parking area.

BUILT

The subject building was built in 2012.

2015 TRAFFIC COUNTS

SR 84 (South of Site) 55,229 AADT

Hwy 6 32,035 AADT

Source: Texas Department of Transportation

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PROPERTY PHOTOGRAPHS

7


N

Hwy 6 (32,035 AADT)

SR 84 (55,229 AADT)

Waco D

r

Franklin Dr

Woodway Dr

Woodway Dr(2

7,196 A

ADT)

Hwy 6 (31,326 AADT)

8


Waco Dr

N

Hwy 6 (32,035 AADT) (55,229 AADT)

Hwy 6 (31,326 AADT)

SR 84 (27,196 AADT)

9

BJ’S RESTAURANT & BREWHOUSE | WACO, TXN

SR 84

Waco Dr

Hwy 6

Hwy 6 (32,035 AADT)

Hwy 6 (31,326 AADT)

(55,229 AADT)

10


N

Hwy 6 (32,035 AADT)

SR 84

Waco Dr

Woodway Dr

11


SITE PLAN

SR 84

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(NASDAQ: BJRI)

BJ’s Restaurants, Inc. owns and operates 177 restaurants as of July 2016, located in Alabama, Arizona, Arkansas, California, Colorado, Florida, Indiana, Kansas, Kentucky, Louisiana, Maryland, Nevada, New Mexico, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, Tennessee, Texas, Virginia and Washington. Each of our restaurants is operated either as a BJ’s Restaurant & Brewery ® which includes a brewery within the restaurant, a BJ’s Restaurant & Brewhouse ® which receives the beer it sells from one of our breweries or independent third party brewers of our proprietary beer recipes, or a BJ’s Pizza & Grill ® which is a smaller format, full service restaurant with a more limited menu than our other restaurants. Our menu features our BJ’s ® award-winning, signature deep-dish pizza, our own handcrafted beers as well as a wide selection of appetizers, entrees, pastas, sandwiches, specialty salads and desserts including our unique Pizookie ® dessert. Several of our BJ’s Restaurant & Brewery restaurants feature in-house brewing facilities where BJ’s proprietary handcrafted beers are produced for many of our restaurants.

The first BJ’s restaurant was opened in 1978 in Orange County, California and centered on bringing the unique flavor of deep-dish pizza to California. The Company acquired the original BJ’s restaurants in 1995 from the original owners. Our initial public offering of common stock occurred in 1996. Over the years we expanded the BJ’s concept from its beginnings as a small pizzeria to a full service, high energy casual dining restaurant with over 100 menu items, including appetizers, specialty salads, soups, pastas, sandwiches, entrees and desserts. In 1996, we introduced our own handcrafted beers through our first BJ’s Restaurant & Brewery in Brea, California and today our brewing team continues to passionately brew a variety of award-winning handcrafted beers you can enjoy on tap every day. In addition to our ten regular signature beers, including BJ’s Brewhouse Blonde and Jeremiah Red, we also offer regular seasonal beers such as BJ’s Pumpkin Ale and Annual Grand Cru, and even experimental beers that we brew out of our award winning Boulder, CO brewery.

TENANT DESCRIPTION

P A G E 0 6 / / B J ’ S R E S T A U R A N T S , I N C .

AS OF 2015 YEAR END:

* Net income and diluted net income per share include a one-time gain on lease termination in fiscal 2015 and shareholder settlement costs in 2014

9% INCREASE IN REVENUES

65% INCREASE IN NET INCOME*

78% INCREASE IN DILUTED NET INCOME PER SHARE*

1.7% INCREASE IN COMP SALES

13


AFFILIATED BUSINESS DISCLOSURE

CBRE operates within a global family of companies with many subsidiaries and/or related entities (each an “Affiliate”) engaging in a broad range of commercial real estate businesses including, but not limited to, brokerage services, property and facilities management, valuation, investment fund management and development. At times different Affiliates may represent various clients with competing interests in the same transaction. For example, this Memorandum may be received by our Affiliates, including CBRE Investors, Inc. or Trammell Crow Company. Those, or other, Affiliates may express an interest in the property described in this Memorandum (the “Property”) may submit an offer to purchase the Property and may be the successful bidder for the Property. You hereby acknowledge that possibility and agree that neither CBRE, Inc. nor any involved Affiliate will have any obligation to disclose to you the involvement of any Affiliate in the sale or purchase of the Property. In all instances, however, CBRE Inc. will act in the best interest of the client(s) it represents in the transaction described in this Memorandum and will not act in concert with or otherwise conduct its business in a way that benefits any Affiliate to the detriment of any other offeror or prospective offeror, but rather will conduct its business in a manner consistent with the law and any fiduciary duties owed to the client(s) it represents in the transaction described in this Memorandum.

CONFIDENTIALITY AGREEMENT

This is a confidential Memorandum intended solely for your limited use and benefit in determining whether you desire to express further interest in the acquisition of the Property.

This Memorandum contains selected information pertaining to the Property and does not purport to be a representation of the state of affairs of the property or the owner of all Property (the”Owner”), to be all-inclusive or to contain all or part of the information are provided for general reference purposes only and are based on assumptions relating to the general economy, market conditions, competition and other factors being the control of the Owner and CBRE,Inc. Therefore, all projections, assumptions and other information provided and made herein are subject to material variation. All references to acreages, square footages, and other measurements are approximations. Additional information and an opportunity to inspect the Property will be made available to interested and qualified prospective purchasers. In this Memorandum, certain documents, including leases and other materials, are described in summary form. These summaries do not purport to be complete nor necessarily accurate descriptions of the full agreements referenced. Interested parties are expected to review all such summaries and other documents of whatever nature independently and not rely on the contents of this Memorandum in any manner. Neither the Owner or CBRE, Inc., nor any of their respectful directors, officers, Affiliates or representatives make an representation or warranty, expressed or implied, as to the accuracy or completeness of this Memorandum or any of its contents; and you are to rely solely on your investigations and inspections of the Property in evaluating a possible purchase of the real property.

The Owner expressly reserved the right, at its sole discretion, to reject any or all expressions of interest or offers to purchase the Property, and/or to terminate discussions with any entity at any time with or without notice which may arise as a result of review of this Memorandum. The Owner shall have no legal commitment or obligation to any entity reviewing this Memorandum or making an offer to purchase the Property unless and until written agreement(s) for the purchase of the Property have been fully executed, delivered and approved by the Owner and any conditions to the Owner’s obligations therein have been satisfied or waived.

By receipt of this Memorandum, you agree that this Memorandum and its contents are of a confidential nature, that you will hold and treat it in the strictest confidence and that you will not disclose this Memorandum or any of its contents to any other entity without the prior written authorization of the Owner or CBRE, Inc. You also agree that you will not use this Memorandum or any of its contents in any manner detrimental to the interest of the Owner or CBRE, Inc.

If after reviewing this Memorandum, you have no further interest in purchasing the Property, kindly return this Memorandum to CBRE, Inc.

DISCLAIMER

©2016 CBRE, Inc. The information containing in this document has been obtained for sources believed reliable. While CBRE, Inc. does not doubt its accuracy, CBRE, Inc. has not verified it and makes no guarantee, warranty or representation about it. It is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property, The value of this transaction to you depends on tax and other factors which should be evaluated by your tax, financial and legal advisors. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs.

Photos herein are the property of their respective owners and use of these images without the express written consent of the owner is prohibited.

CBRE and the CBRE logo are service marks of CBRE, Inc. and/or its affiliated or related companies in the United States and other countries. All other marks displayed on this document are the Property of their respective owners.

CONFIDENTIAL MEMORANDUM & DISCLAIMER

© 2016 CBRE, Inc. The information contained in this document has been obtained from sources believed reliable. While CBRE, Inc. does not doubt its accuracy, CBRE, Inc. has not verified it and makes no guarantee, warranty or representation about it. It is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property. The value of this transaction to you depends on tax and other factors which should be evaluated by your tax, financial and legal advisors. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs.CBRE, and the CBRE logo are service marks of CBRE, Inc. and/or its affiliated or related companies in the United States and other countries. All other marks displayed on this document are the property of their respective owners.

MARK DRAZEKSenior Vice President CBRE | Capital MarketsNet Lease Properties

For further information:+1 407 404 [email protected]


EXCLUSIVELY MARKETED BY

RAY ROMANOFirst Vice President CBRE | Capital MarketsNet Lease Properties

LOCAL LICENSEEBRAD BENJAMINAssociateCBRE | Capital MarketsNet Lease Properties

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