offering memorandum - loopnet · cannabis industry, helping patients heal, offering recreational...

5 0 4 5 G e i s t A v e n u e , L a s V e g a s , N V 8 9 1 1 5

EXCLUSIVE

LISTING AGENTS:

DAVE WRZESINSKISenior Associate

[email protected]

BEN MILLIS Principal, Industrial

[email protected]

offering memorandumsale-leaseback

EXECUTIVE SUMMARYTABLE OF CONTENTS

01 • EXECUTIVE SUMMARY The Offering 3 Property Profile 4

02 • PROPERTY OVERVIEW Floor Plan 5 Property Aerial 7 Surrounding Area 8 Location Overview 9

03 • FINANCIALS Financial Overview 10 Rent Roll 12

04 • PROFILES Tenant Profile 13 Marijuana Sales in Nevada 15 General Contractor Profile 16

05 • MARKET DATA Las Vegas Industrial Market 17 Las Vegas Highlights 19

Alternative Medicine Association • Avison Young 3

EXECUTIVE SUMMARY

THE OFFERING

Avison Young is exclusively offering this unique opportunity to acquire 5045 Geist Avenue, a brand-new, single

tenant, triple net-leased, Class A cultivation facility totaling ±63,624 square feet. The building is estimated to

be completed in April of 2019 and has been specifically built for Alternative Medicine Association (AMA), as a

marijuana cultivation facility. AMA was the first licensed cultivator to sell cannabis in Las Vegas and works closely

with the state of Nevada to set the standards for it.

Price $10,775,000

Cap Rate 8.5%

Term 10 Years & Two, Five Year Renewals

Address 5045 Geist Avenue, Las Vegas, Nevada 89115

Size ±63,624 SF

Year Built 2019

Acreage 1.39 Acres

Stories 2

Parcel Number 140-17-611-011

Percent Leased 100%

No. of Tenants 1

FIRST EVER LICENSED

CULTIVATOR IN NEVADA

ALTERNATIVE MEDICINE ASSOCIATION


SECTION 01 EXECUTIVE SUMMARY

PROPERTY PROFILE

Located at 5045 Geist Avenue, the property is currently being developed as a

±63,624 square foot two-story, purpose-built cultivation facility for Alternative

Medicine Association. The building improvement is being developed on a site that

contains 1.39 acres which is zoned M-1 (Light Manufacturing) by the Clark County

Zoning Department. According to the floor plans prepared by George M. Rogers

Architect, the building will include vegetation/cultivation rooms, packaging areas,

supporting offices, a vault, Men’s and Woman’s locker rooms, climate/humidity

controlled rooms and other work areas. When complete this will be a state-of-the-

art cultivation facility that will be occupied by Alternative Medicine Association and

guaranteed by 1933 Industries, Inc.

Construction Type Concrete Tilt-Up

Sprinklers ESFR

Power 6,000 Amps, Three Phase

Auto Parking Spaces ±79 Parking Spaces

General Contractor Bentar Development

Architect GMRA

Construction Progress as of 12/20/18


SECTION 02 FLOOR PLANS

1ST FLOOR ±32,063 SF


SECTION 02 FLOOR PLANS

2ND FLOOR ±31,561 SF


EXECUTIVE SUMMARY

GEIST AVENUE

NELLIS BO

ULEV

ARD

ALTO AVENUE

SUBJECT±63,624 SF BUILDING

±1.39 ACRES 1933 INDUSTRIES±12,000 SF Building for Extraction

Not a part of this Sale

1933 INDUSTRIES±2.78 Acres for Expansion

Not a part of this Sale


SECTION 02 SURROUNDING AREA

NELLIS BLVD

LAS VEGAS BLVD

LAMB BLVD

CHEYENNE AVENUE

SunriseIndustrial

Center

Northpoint

CheyenneIndustrial

Center

CareyIndustrial

Center

CheyenneDistribution

Center

Lamb Technology

CenterLogistiCenter

CheyenneWalker

Distribution Center

THE LAS VEGAS “STRIP”McCARRAN INTER’L AIRPORT

SUBJECT


SECTION 02 LOCATION OVERVIEW

SUBJECT

LAS

VEG

AS

STRI

P


SECTION 03 FINANCIAL DATA

FINANCIAL OVERVIEW

Price $10,775,000

10 Year IRR 11.49%

Price Per Sq. Ft. $169.35

Year 1 Cap Rate 8.50%

Cash on Cash 8.46%

Annual Rent Increases 3%

Lease Type Absolute NNN

Year 1 Monthly Base Rent $76,349

Year 1 Net Operating Income $916,186

Terms Cash or Cash to New Loan

10 YEAR LEASE EFFECTIVE 2/1/19 ABSOLUTE NNN. RENEWAL INCREASES AT 3% ANNUALLY

A FEW AMA PRODUCTS

SHATTER TROPICALTHUNDER

THC OIL TANGERINEDREAM

DISTILLATEPEN

11Alternative Medicine Association • Avison Young

SECTION 03 FINANCIAL DATA

INIT IAL INVESTMENT

Purchase Price $10,775,000

+ Acquisition Costs $53,875

+ Loan Costs 0

- Mortgage 0

= INITIAL INVESTMENT $10,828,875

SALE PROCEEDS BEFORE TAX

Sale Price $15,391,000

- Cost of Sale $769,550

- Mortgage Balance 0

= SALE PROCEEDS $14,621,450

PERFORMANCE MEASURES

Gross Rent Multiplier 11.76

Cash on Cash 8.46%

Acquisition Capitalization Rate 8.50%

Internal Rate of Return 11.49%

Net Present Value $14,295,616

ANNUAL CASH FLOWS BEFORE TAX

EOY 1 2 3 4 5 6 7 8 9 10 11

Potential Rental Income $916,186 $943,671 $971,981 $1,001,141 $1,031,175 $1,062,110 $1,093,974 $1,126,793 $1,160,597 $1,195,414 $1,231,277

- Vacancy & Credit Losses

= Effective Rental Inc $916,186 $943,671 $971,981 $1,001,141 $1,031,175 $1,062,110 $1,093,974 $1,126,793 $1,160,597 $1,195,414 $1,231,277

+ Other Income 0 0 0 0 0 0 0 0 0 0 0

= Gross Operating Inc $916,186 $943,671 $971,981 $1,001,141 $1,031,175 $1,062,110 $1,093,974 $1,126,793 $1,160,597 $1,195,414 $1,231,277

- Real Estate Taxes 0 0 0 0 0 0 0 0 0 0 0

- Insurance 0 0 0 0 0 0 0 0 0 0 0

- Repairs & Maintenance 0 0 0 0 0 0 0 0 0 0 0

- Landscaping 0 0 0 0 0 0 0 0 0 0 0

- Property Management 0 0 0 0 0 0 0 0 0 0 0

= Net Operating Income $916,186 $943,671 $971,981 $1,001,141 $1,031,175 $1,062,110 $1,093,974 $1,126,793 $1,160,597 $1,195,414 $1,231,277

- Annual Debt Service 0 0 0 0 0 0 0 0 0 0 0

- Leasing Commissions 0 0 0 0 0 0 0 0 0 0 0

= Cash Flow Before Taxes $916,186 $943,671 $971,981 $1,001,141 $1,031,175 $1,062,110 $1,093,974 $1,126,793 $1,160,597 $1,195,414

BEFORE TAX INTERNAL RATE OF RETURN

EOY $

0 ($10,828,875)

1 $916,186

2 $943,671

3 $971,981

4 $1,001,141

5 $1,031,175

6 $1,062,110

7 $1,093,974

8 $1,126,793

9 $1,160,597

10 $1,195,414

+ $14,621,450

IRR 11.49%

SECTION 03 RENT ROLL

Tenant Lease Start Date

Lease Expiration Date SF Building

Share Effective Annual Rent Annual Rent PSF Monthly Rent Monthly

Rent PSF

Alternative Medicine Assoc 04/20/19 03/19/29 63,624 100% 04/20/19 $ 916,186.00 $14.40 $76,348.83 $1.20

04/20/20 $943,671.58 $14.83 $78,639.30 $1.24

04/20/21 $971 981.73 $15.28 $80,998.48 $1.27

04/20/22 $1,001,141.18 $15.74 $83,428.43 $1.31

04/20/23 $1,031,175.41 $16.21 $85,931.28 $1.35

04/20/24 $1,062,110.68 $16.69 $88,509.22 $1.39

04/20/25 $1,093,974.00 $17.19 $91,164.50 $1.43

04/20/26 $1,126,793.22 $17.71 $93,899.43 $1.48

04/20/27 $1,160,597.01 $18.24 $96,716.42 $1.52

04/20/28 $1,195,414.92 $18.79 $99,617.91 $1.57

TOTALS $10,503,045.73

3% Annual Increases



SECTION 04 TENANT PROFILE

ABOUT ALTERNATIVE MEDICINE ASSOCIATION

Alternative Medicine Association stands proud as the first licensed cultivator to sell cannabis in Las Vegas, helping to sow the seeds of the cannabis industry’s rise throughout the state of Nevada. As pioneers of marijuana, they’ve worked closely with the state to set the standards for cultivation to what they should be, ensuring that each bud they trim offers patients and recreational users alike a cannabis experience that’s exceptional, potent, and consistent in quality. Alternative Medicine Association passionately continues to break down the walls of the cannabis industry, helping patients heal, offering recreational users an exceptional experience and continuing to discover the many benefits of marijuana yet to unfold.

Alternative Medicine Association’s founding team began in California, legally cultivating cannabis for as long as possible while working in compliance with the ever-changing state regulations. When updating with the state’s rules became too complicated, the growers moved their operations to Nevada, where the marijuana industry was just getting started. With decades of growing experience and a passionate belief in the medicinal benefits of cannabis, the founders over time had developed particular methods of quality control and cultivation

CSE: TGIF | OTCQB: TGIFF

ABOUT 1933 INDUSTRIES, INC.

1933 Industries Inc. is a vertically integrated cannabis company with operations in the United States and Canada. Operating through three subsidiary companies, 1933 Industries owns licensed medical and adult-use cannabis cultivation and production assets, proprietary hemp-based, CBD infused products, CBD extraction services and a specialized cannabis advisory firm supporting clients in security, intelligence and due diligence.

1933 Industries has three arms of operation: Alternative Medicine Association, Infused MFG and Spire

CORPORATE ENTITY 1933 Industries, Inc.

HEADQUARTERS Chilliwack, Canada

FOUNDED 2008

INDUSTRY Research Services

WEBSITE 1933industries.com

TICKER CSE: TGIF


EXECUTIVE SUMMARY SECTION 04 TENANT PROFILE

to provide safe medical marijuana for very specific health conditions. Committed to continuous innovation and the medical aspects of marijuana, Alternative Medicine Association formed, and eventually sold the very first amount of cannabis in Nevada in August of 2015. Since this landmark event, Alternative Medicine Association continues to develop new tracking and storing methods, and within 2019 will expand into a new, state-of-the-art cultivation facility.

42.2 MVISITORS TO LAS VEGAS

IN 2017

SOURCE: LAS VEGAS CONVENTION & VISITORS AUTHORITY

ALTERNATIVEMEDICINE ASSOCIATION

LAS VEGAS, NEVADA

• Fully integrated licensed medical and adult-use cannabis cultivation and production company

• Cultivates and produces its own line of unique cannabis-based products and manufactures other third party brands

Cannibis Stocks look set to Flourish! Click here for CNBC Business News article


MARIJUANA SALESMARIJUANA SALES IN NEVADA

SOURCE: STATE OF NEVADA, LAS VEGAS REVIEW JOURNAL

$336.4 MTotal Sales of Medical Marijuana, recreation-al marijuana and marijuana related goods

through February, 2018

$263.7 MRecreational Marijuana Sales

July 1, 2017 - February 28, 2018

$264.8 MRecreational marijuana sales

projected for fiscal 2018July 1, 2017 - June 30, 2018

From July 2017, when marijuana sales began, to April 2018, monthly sales increased about 30 percent. The taxes paid by wholesalers and customers almost doubled in that time.




SECTION 04 GENERAL CONTRACTOR PROFILE

About Bentar Development

Founded in 1991, Bentar Development, Inc. is a well-established

and respected design/build general contractor and professional

manager of construction services. The award-winning company is

owned by long-time Nevada resident Amador “Chi Chi” Bengochea.

Bentar’s mission is simple: Dedication, growth, diversity and in-

comparable construction quality, and unwavering commitment to our client’s satisfaction.

Bentar is licensed and bonded in the State of Nevada with an unlimited contract limit and prides itself on

aggressive schedules that are unmatched by other contractors in the local industry.

The company delivers a wide range of commercial, industrial, retail, casino, office and recreational projects

in the Las Vegas market. A sampling of some of the companies high-profile projects include: 70-plus Terrible

Herbst service stations, three Terrible’s hotel/casino properties in Southern Nevada, the Primm Valley Resort

Travel Center, which is the largest automobile service station with 30 fuel nozzles in the west, the new

Tangerine at Treasure Island, the Revolution Bar at the The Mirage, Red Rock Casino Resort Bowling Alley,

Montana Steakhouses, The Lodges, more than a dozen Del Taco outlets, other restaurants, retail, office and

schools.

An Award Winning Construction Company

• Bentar was inducted as the 2011 Minority Business Hall of Fame

• Chi Chi Bengochea, owner of Bentar Development, Inc. named “Small Business Person of the Year” by the

Small Business Administration (SBA).

• “Annual Contractor of the Year” Latin Chamber of Commerce

• “Ten Best Contractors” List by the Nevada Business Journal

• Builder/Architect Magazine, Southern Nevada Edition, September 2004 cover story “Bengochea Brothers’

General Contracting Firm Impacting Las Vegas Commercial Building Scene”

CORPORATE ENTITY Bentar Development Inc.

HEADQUARTERS Las Vegas, Nevada

FOUNDED 1991

INDUSTRY Building Contractor

WEBSITE bentar.com

TICKER Privately Held

EMPLOYEES Approximately 25

A few of Bentar recent projects:

Bishop Gorman Training & Expansion Facility

Mountains Edge Hospital


SECTION 05 LAS VEGAS INDUSTRIAL MARKET OVERVIEW

Activity in the industrial market continued strong in the third quarter. There was approximately 844,240 square feet of new deliveries with almost 5 million square feet under construction. These new deliveries pushed vacancy down slightly to 5 percent with approximately 525,826 square feet of positive absorption. Average asking lease rates for distribution product remained the same while average asking rates for flex spaces increased slightly.

There were approximately 183 industrial leases executed in the third quarter of 2018. While the largest

lease was 163,000 square feet, there were only four leases completed over 40,000 square feet, with a majority being under 15,000 square feet. By comparison, there were approximately 257 industrial leases executed in the third quarter of 2017. The largest lease was 300,805 square feet, with a majority being under 10,000 square feet.

In the third quarter of 2018, there were approximately 93 industrial sales, with the largest sale being a 156,564 square foot warehouse in the Henderson submarket which sold for $20,200,000. A majority of the sales that took place were under 40,000 square feet. By comparison, there were approximately 103 industrial sales completed in the third quarter of 2017. The largest sale was a 248,126 square foot warehouse in the North Las Vegas submarket which sold for $24,500,000. A majority of sales that took place in the third quarter of 2017 were under 40,000 square feet.

By the end of the third quarter, there was approximately 844,240 square feet of deliveries and 4,683,806 square feet of industrial product under construction. In the third quarter of 2017, there was 2,755,510 square feet of deliveries and 4,229,469 square feet was under construction.

Partnership. Performance. avisonyoung.com

Industrial Market Snapshot

Las Vegas Industrial SubmarketsVacancy Rates

1. Airport East2. Central3. North Las Vegas4. Henderson/SE

5. Speedway6. Southwest7. West8. Northwest

Absorption

Asking Rents

Flex Distr.

Las Vegas Third Quarter 2018 / Industrial Market Monitor

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6Partnership. Performance. avisonyoung.com





Absorption

Asking Rents

Flex Distr.


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Partnership. Performance. avisonyoung.com





Absorption

Asking Rents

Flex Distr.


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MARKET FACTS

844,240Square footage

of deliveries

4,683,806Total square footageunder Construction

93Number of

Industrial Sales

183Number of

Industrial LeasesSigned

3RD QUARTER 2018


SECTION 05 LAS VEGAS INDUSTRIAL MARKET

avisonyoung.com

2018 Avison Young - Nevada, LLC. All rights reserved.

E. & O.E.: The information contained herein was obtained from sources which we deem reliable and, while thought to be correct, is not guaranteed by Avison Young.

Submarket Total SF * Vacant SF Vacancy Current NetAbsorption

YTD Net Absorption

Under Construction

Avg. AskingRate Flex

Avg. AskingRate Mfg./Distr.

Airport/East 15,294,560 474,775 3.1% 116,471 518,111 224,752 $0.97 $0.77

Central/Downtown 13,270,822 242,506 1.8% 48,711 99,848 0 $0.65 $0.62

North Las Vegas 40,506,191 2,564,875 6.3% 247,034 1,683,150 1,935,863 $0.62 $0.43

Northwest 880,168 46,048 5.2% (12,468) (12,906) 0 $0.87 $0.81

Henderson/SE 17,194,056 958,705 5.6% 56,174 937,884 212,030 $0.65 $0.57

Speedway/NE 4,141,781 723,006 17.5% (67,723) (50,062) 1,784,245 $0.45 $0.46

Southwest 29,929,163 874,910 2.9% 120,714 401,146 526,916 $0.94 $0.56

West 10,806,406 668,826 6.2% 16,913 198,396 0 $0.80 $0.60

Totals 132,023,147 6,553,651 5.0% 525,826 3,775,567 4,683,806 $0.88 $0.48


Market Indicators

Tenant/Buyer Address Submarket Size Term Rate/Price

Suncrest Industrial, LLC 1051 Mary Crest Road Henderson/SE 156,564 SF Sale $20,200,000

CLV Warehouse, LLC 4325 Corporate Center Dr North Las Vegas 155,790 SF Sale $16,231,760

Xtreme Manufacturing 8390 Eastgate Road Henderson/SE 163,000 SF 120 Months $0.57/SF

Ruby Has 3717 Bay Lake Trail North Las Vegas 97,080 SF 60 Months $0.35/SF

n/a 2695 North Lamb Blvd North Las Vegas 56,847 SF n/a $0.30/SF

Top Transactions of the Quarter

* Includes buildings over 5,000 SF

Dave A. [email protected]

3993 Howard Hughes Pkwy, Ste 350, Las Vegas, NV 89169702.472.7979

Prepared by:

avisonyoung.com

2018 Avison Young - Nevada, LLC. All rights reserved.

E. & O.E.: The information contained herein was obtained from sources which we deem reliable and, while thought to be correct, is not guaranteed by Avison Young.

Submarket Total SF * Vacant SF Vacancy Current NetAbsorption

YTD Net Absorption

Under Construction

Avg. AskingRate Flex

Avg. AskingRate Mfg./Distr.

Airport/East 15,294,560 474,775 3.1% 116,471 518,111 224,752 $0.97 $0.77

Central/Downtown 13,270,822 242,506 1.8% 48,711 99,848 0 $0.65 $0.62

North Las Vegas 40,506,191 2,564,875 6.3% 247,034 1,683,150 1,935,863 $0.62 $0.43

Northwest 880,168 46,048 5.2% (12,468) (12,906) 0 $0.87 $0.81

Henderson/SE 17,194,056 958,705 5.6% 56,174 937,884 212,030 $0.65 $0.57

Speedway/NE 4,141,781 723,006 17.5% (67,723) (50,062) 1,784,245 $0.45 $0.46

Southwest 29,929,163 874,910 2.9% 120,714 401,146 526,916 $0.94 $0.56

West 10,806,406 668,826 6.2% 16,913 198,396 0 $0.80 $0.60

Totals 132,023,147 6,553,651 5.0% 525,826 3,775,567 4,683,806 $0.88 $0.48


Market Indicators

Tenant/Buyer Address Submarket Size Term Rate/Price

Suncrest Industrial, LLC 1051 Mary Crest Road Henderson/SE 156,564 SF Sale $20,200,000

CLV Warehouse, LLC 4325 Corporate Center Dr North Las Vegas 155,790 SF Sale $16,231,760

Xtreme Manufacturing 8390 Eastgate Road Henderson/SE 163,000 SF 120 Months $0.57/SF

Ruby Has 3717 Bay Lake Trail North Las Vegas 97,080 SF 60 Months $0.35/SF

n/a 2695 North Lamb Blvd North Las Vegas 56,847 SF n/a $0.30/SF

Top Transactions of the Quarter

* Includes buildings over 5,000 SF

Dave A. [email protected]

3993 Howard Hughes Pkwy, Ste 350, Las Vegas, NV 89169702.472.7979

Prepared by:


SECTION 05 LAS VEGAS HIGHLIGHTS

NHL TeamThe Vegas Golden Knights opened their inaugural season on October 10, 2017 at the T-Mobile Arena and the entire city has been rallying behind these golden boys ever since.

The Las Vegas RaidersGround was broken on November 14, 2017 for the 1.9 billion 65,000 seat, domed stadium that will be the new home of the Las Vegas Raiders when completed in 2020. This will also be home to the UNLV Rebels when completed.

20,000 SeatsThe T-Mobile Arena opened April 6, 2016 and seats 20,000 for sporting events, concerts and award shows. The Park, which is just adjacent to the T-Mobile is Las Vegas' newest entertainment spot before the big game or concert.

Mandalay BayConvention CenterRecently underwent a 350,000 square foot expansion and is now the 5th largest convention center in North America.

LVCC ExpansionLas Vegas Convention Center is currently undergoing a $2.5 billion, 600,000 square foot expansion to absorb excess demand.

$1 Billion Public Works ProjectProject Neon just began the final stage of the largest and most expensive public works project ever in the state of Nevada. The project will widen Interstate 15 from the U.S. 95 interchange to Sahara Avenue. The improvements to the busiest stretch of road in Nevada are expected to be complete in the summer of 2019

DAVE WRZESINSKISenior Associate

[email protected]

BEN MILLIS Principal, Industrial

[email protected]

5 0 4 5 G E I S T AV E N U E , L A S V E G A S , N V 8 9 1 1 5

AVISON YOUNG

10845 Griffith Peak Drive, Suite 100, Las Vegas, N V 89135 +1 702 472 7979 • avisonyoung.com

Exclusively Marketed By:

offering memorandum - loopnet · cannabis industry, helping patients heal, offering recreational...

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