Class A Call Center Leased to Verizon - Offering Memorandum - Stan Johnson Company
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Subject Property
Offering Memorandum
Class A Call Center Leased to Verizon
3601 Converse Drive | Wilmington, North Carolina 28403
Corporately Guaranteed Lease | 10.5 Years of Base Lease Term Remaining | Mission-Critical, Highly Accessible Location
Class A Institutional Quality Asset | Verizon Communications, Inc. (S&P: BBB+/Stable) Subsidiary Tenant
Confidentiality and Restricted Use Agreement Offered Exclusively by
This Confidential Offering Memorandum (“COM”) is provided by Stan Johnson Company (“SJC”), solely
for your consideration of the opportunity to acquire the commercial property described herein (the Brad Feller
“Property”). This COM may be used only as stated herein and shall not be used for any other purpose, or Senior Director
in any other manner, without prior written authorization and consent of SJC. bfeller@stanjohnsonco.com
+1 312.240.0194
This COM does not constitute or pertain to an offer of a security or an offer of any investment contract.
This COM contains descriptive materials, financial information and other data compiled by SJC for the
Isaiah Harf
convenience of parties who may be interested in the Property. Such information is not all inclusive and
Director
is not represented to include all information that may be material to an evaluation of the acquisition
iharf@stanjohnsonco.com
opportunity presented. SJC has not independently verified any of the information contained herein and
+1 312.777.2437
makes no representations or warranties of any kind concerning the accuracy or completeness thereof. All
summaries and discussions of documentation and/or financial information contained herein are qualified in
their entirety by reference to the actual documents and/or financial statements, which upon request may Blaise Bennett
be made available. An interested party must conduct its own independent investigation and verification Associate
of any information the party deems material to consideration of the opportunity, or otherwise appropriate, bbennett@stanjohnsonco.com
without reliance upon SJC. +1 312.777.2449
The Property may be financed or withdrawn from the market without notice, and its owner(s) reserve(s) Brandon Duff
the right to negotiate with any number of interested parties at any time. The Property is offered and sold Regional Director
by its owner(s) as is, where is, and with all faults, without representation or warranty of any kind except for
any customary warranties of title.
In Association With:
BY ACCEPTING THIS COM, YOU AGREE THAT: (1) all information contained herein, and all other information Jeff Hughes
you have received or may hereafter receive from SJC relating to the Property, whether oral, written or in NC Lic. #101282
any other form (collectively, the “Information”), is strictly confidential; (2) you will not copy or reproduce,
and claim as your own without attribution to SJC, all or any part of this COM or the Information; (3)
upon request by SJC at any time, you will return and/or certify your complete destruction of all copies of
this COM and the Information; (4) for yourself and all your affiliates, officers, employees, representatives,
agents and principals, you hereby release and agree to indemnify and hold harmless SJC all of its affiliates,
Stan Johnson Company
officers, employees, representatives, agents and principals, from and with respect to any and all claims and
303 East Wacker Drive | Suite 1111
liabilities arising from or related to the receipt or use of this COM and/or any other Information concerning
Chicago, Illinois 60601
the Property; (5) you will not provide this COM or any of the Information to any other party unless you first
P: +1 312.240.0127 | F: +1 312.240.0158
obtain such party’s acceptance and approval of all terms, conditions, limitations and agreements set forth
herein, as being applicable to such party as well as to you; and (6) monetary damages alone will not be an
stanjohnsonco.com
adequate remedy for a violation of these terms and that SJC shall be entitled to equitable relief, including,
but not limited to, injunctive relief and specific performance, in connection with such a violation and shall
not be required to post a bond when obtaining such relief.
Table of Contents About the Investment The Offering.....................................................................................................................................................................4 Investment Highlights................................................................................................................................................5 Pricing and Property Overview............................................................................................................................6 Lease Abstract & Rent Schedule .......................................................................................................................7 Tenant & Parent Company Overview.................................................................................................................8 Location Information Location Overview......................................................................................................................................................9 Strip Maps..................................................................................................................................................................10-11 Site Plan............................................................................................................................................................................12 Property Photos....................................................................................................................................................13-14 Demographics..............................................................................................................................................................15
The Offering
Stan Johnson Company is pleased to exclusively offer for sale
to qualified investors, the opportunity to purchase a 100% fee-
simple interest in the single tenant commercial property located
at 3601 Converse Drive in Wilmington, North Carolina 28403 (the
“Property”). The Property is fully leased and operated as a call
center for Verizon Wireless, a primary operating segment of Verizon
Communications, Inc.
The Property is a 160,500 SF facility on 17.55 Acres. It was built in
2004 and is a well-maintained three-story building. It is located near
the intersection of Shipyard Boulevard and Independence Boulevard
and is surrounded by a number of other retail and commercial
properties including the Live Oak Bank, Cardinal Lanes Shipyard
(bowling alley), State Employees’ Credit Union and a number of
churches and medical offices, as well as homes.
Cellco Partnership d/b/a Verizon Wireless’s lease was recently
extended (“Additional Term”) through December 31, 2026, followed
by two, five year option periods at 90% of Market Rent. This lease
extension demonstrates the Tenant’s commitment to operations at
the Property for the foreseeable future. Along with this extension,
current Ownership has invested $642K into the Property, with an
additional $642K due to the tenant upon waiving their termination
right effective 12/31/2021. The lease is NNN with landlord
responsibilities limited to the maintenance, repair and replacement
of the roof and structure, as well as capital repairs to HVAC, the
parking and circulation areas, and the storm water management
system, for the duration of the lease.
Verizon Wireless is an operating segment of Verizon Communications.
It is the largest wireless telecommunications provider in the United
States and as of December 2015, provided wireless services to 112.1
million subscribers. Verizon Communications Inc. reported FY2015
N
(ended December 31, 2015) revenue of $131.620 billion and net
income of $17.879 billion and currently holds a credit rating of BBB+/
Stable from Standard and Poor’s.
Verizon Wireless • Wilmington, NC • 4
Investment Highlights
Corporate Tenant Credit
Verizon Wireless is an operating segment of Verizon Communications, Inc., the largest U.S. wireless
communications service provider. Verizon Communications Inc. reported FY2015 revenue of $131.620
billion and net income of $17.879 billion. The company currently holds a credit rating of BBB+/Stable
from Standard and Poor’s.
Mission-Critical Location
The Property is a mission-critical facility for Verizon Wireless as it is a prime, strategic location, and a
“key node” in their customer service network.
Tenant’s Recent Lease Extension
Cellco Partnership d/b/a Verizon Wireless recently extended their lease term for an additional 5
years (“the Additional Term” per the lease), pushing the remaining term to over 10 years. Extension
demonstrates Tenant’s commitment to continue operations at the Property for the foreseeable future.
Major Property Improvements
The Property recently received all new HVAC systems and is undergoing major interior renovations
including new flooring, bathrooms, and fresh painting throughout the facility. These improvements
signal Verizon’s long-term commitment to location.
Class A Institutional Quality Asset
Property represents a best-in-class call center on approximately 17.55 Acres, with approximately 1,083
parking spots.
Major Economic Driver w/Strong Government Support
Verizon’s operations employ 1,725 employees and represent one of the largest employers in the
Wilmington economy. The local governmental authorities are extremely committed to ensuring
Verizon’s long-term presence through attractive incentives and support.
Subject Property
Verizon Wireless • Wilmington, NC • 5
Pricing Overview
3601 Converse Drive | Wilmington, North Carolina 28403
Offering Price: $25,460,000
Offering Cap Rate: 7.25%
Annual Base Rent*: $1,845,750
Tenant: Cellco Partnership d/b/a Verizon Wireless
Encumbrances: None, Delivered Free & Clear
*effective 1/1/2017.
Property Overview
Building Size: +/- 160,500 SF
Land Area: +/- 17.55 Acres
Year Built: 2004
Property Type: Office
Property Use: Call Center N
Encumbrances: None, Delivered Free & Clear
Verizon Wireless • Wilmington, NC • 6
Lease Abstract Rent Schedule
Tenant: Cellco Partnership
Years Dates Annual Rent Monthly Rent Rent PSF
Tenant d/b/a: Verizon Wireless
Address: 3601 Converse Drive, Wilmington, NC 28403 Current – 12/31/2016 $1,717,350 $143,113 $10.70
Property Type: Office Base 1/1/2017 – 12/31/2021 $1,845,750 $153,813 $11.50
Property Use: Call Center
1/1/2022 – 12/31/2026 $2,006,250 $167,188 $12.50
Building Size (SF): +/- 160,500 SF
Lot Size (Acres): +/- 17.55 Acres Option 1 1/1/2027 – 12/31/2031 90% of Market Rent
Year Built: 2004
Option 2 1/1/2032 – 12/31/2036 90% of Market Rent
Lease/Rent Expiration: December 31, 2026
Lease Term Remaining: 10.5 Years
Annual Base Rent*: $1,845,750
Annual Base Rent PSF*: $11.50
Tenant to have the right to terminate the lease effective
12/31/2021 upon notice due 7/1/2020 and payment of
Termination Option:
$2,000,000 (Tenant to waive right to Lessee Improvement
Allowance of $642,000 upon lease termination)
Rental Increases: See Rent Schedule
Renewal Options: 2, 5 Year Options
Renewal Options Rent: 90% of Market Rent
Renewal Notice: 12 Months
Lease Type: NNN
Maintenance, repair and replacement of roof and
LL Responsibility: structure, and capital repairs to HVAC, parking and
circulation areas, and storm water management system
Tenant to have 15 days from receipt of the First
Right of First Refusal (ROFR):
Refusal Notice to exercise ROFR
APN: R06113-001-010-000
Parking: 1,083 parking spaces
Type of Ownership: Fee Simple
Subject Property
*effective 1/1/2017.
Verizon Wireless • Wilmington, NC • 7
Tenant & Parent Company Overview
Cellco Partnership d/b/a Verizon Wireless is a wholly business provides consumer, business and government
owned subsidiary of Verizon Communications Inc. customers with communications products and enhanced
Cellco Partnership was formed as a joint venture in services, including broadband data and video, corporate
April 2000 by the combination of the U.S. wireless networking solutions, data center and cloud services,
operations and interests of Verizon and Vodafone. On security and managed network services and local and
February 21, 2014, Verizon completed the acquisition long distance voice services, and also owns and operates
of Vodafone Group Plc’s (Vodafone) indirect 45% one of the most expansive end-to-end global Internet
interest in Cellco Partnership d/b/a Verizon Wireless Protocol (IP) networks.
for aggregate consideration of approximately $130
billion (the Wireless Transaction). The consideration
paid was primarily comprised of cash of approximately
$58.89 billion and Verizon common stock with a value TENANT PROFILE
of approximately $61.3 billion. The full control of Verizon
Wireless enhances Verizon’s operational efficiency and Tenant: Cellco Partnership d/b/a Verizon Wireless
positions the company to meet the challenges of an Representative Photo
increasingly competitive industry. Corporate Parent: Verizon Communications, Inc.
Verizon Communications Inc. was formed in June 2000,
with the merger of Bell Atlantic Corp. and GTE Corp.
As of December 2015, Verizon Wireless provided Tenant Business: Telecommunications
Verizon began trading on the New York Stock Exchange
wireless services to 112.1 million subscribers.
Headquarters: New York, NY (NYSE) under the VZ symbol in July 2000. It also began
trading on the NASDAQ exchange under the same symbol
Verizon Communications Inc., (NYSE: VZ) headquartered Founded: October 7, 1983 (As Bell Atlantic Corporation) on March 10, 2010. Verizon Communications was added
in New York, is a holding company that, acting through to the Dow Jones Industrial Average in 2004. Verizon
its subsidiaries, is one of the world’s leading providers Traded As: NYSE: VZ has a highly skilled, diverse and dedicated workforce of
of communications, information and entertainment approximately 177,000 employees as of December 31,
Dow Jones Industrial Average Component
products and services to consumers, businesses and Index: 2015.
S&P 500 Component
governmental agencies.
Credit Rating: S&P: BBB+/Stable
With a presence around the world, Verizon offers voice, Total Revenue
data and video services and solutions on its wireless and $131.620 billion
(FY2015):
wireline networks that are designed to meet customers’
Net Income
demand for mobility, reliable network connectivity, $17.879 billion
(FY2015):
security and control. Verizon Communications has
Net Worth
two reportable segments, Wireless and Wireline. The $18.641 billion
(3/31/2016):
wireless business, operating as Verizon Wireless,
provides voice and data services and equipment Employees: 177,700 (as of 12/31/2015)
sales across the United States using one of the most
extensive and reliable wireless networks. The wireline Website: www.verizon.com
Verizon Wireless • Wilmington, NC • 8
Location Overview
The City of Wilmington is a port city, and the
county seat of New Hanover County in coastal
southeastern North Carolina. The population was
112,067 according to the 2010 Census. Wilmington
is the principal city of the Wilmington Metropolitan
Statistical Area, which includes New Hanover and
Pender counties in southeastern North Carolina.
This MSA had a population of 263,429 as of the
2012 Census.
Wilmington, NC Wilmington, NC
Wilmington was settled by European Americans
along the Cape Fear River. Its historic downtown # OF
has a one-mile-long Riverwalk, originally # EMPLOYER
developed as a tourist attraction, and in 2014 EMPLOYEES
Wilmington’s riverfront was named the “Best 1 New Hanover Health Network 5,991
American Riverfront” by USA Today. Wilmington is
minutes away from nearby beaches, and in close 2 New Hanover County Schools 3,645
proximity to four nearby beach communities: 3 General Electric 2,195
Fort Fisher, Wrightsville Beach, Carolina Beach,
and Kure Beach, all within half-hour drives from University of North Carolina
4 1,844
downtown Wilmington. Wilmington
5 Verizon Wireless 1,725
Wilmington’s many attractions include the World
War II battleship USS North Carolina which is held 6 New Hanover County 1,563
as a war memorial, and located across from the 7 Pharmaceutical Product Development 1,464
downtown port area. Other attractions include the
Cape Fear Museum, the Wilmington Hammerheads 8 Cape Fear Community College 1,176
United Soccer Leagues soccer team, and the 9 Corning 1,000
training camp site for the Charlotte Hornets.
Wilmington is home to the University of North 10 City of Wilmington 995 UNC - Wilmington Campus
Carolina Wilmington (UNCW) which provides a
wide variety of programs for undergraduates,
graduate students, and adult learners, in addition
to cultural and sports events open to the
community.
Additionally, Wilmington is the home of EUE
Screen Gems Studios, the largest domestic
television and movie production facility outside
of California. “Dream Stage 10,” the facility’s
newest sound stage, is the third-largest in the
US, and houses the largest special-effects water
tank in North America. Since the studio’s opening
in 1984, Wilmington has become a major center
of American film and television production.
Numerous movies in a range of genres and several
television series, including Iron Man 3, Fox’s Sleepy
Hollow, One Tree Hill, and NBC’s Revolution, have
been produced there.
Cape Fear Bridge - Wilmington, NC
Verizon Wireless • Wilmington, NC • 9
WILMINGTON
INTERNATIONAL AIRPORT
US HWY 74 (34,753 VPD)
)
PD
2V
05
5,
UNIVERSITY
US
(6
HW OF NORTH
117
Y 76
(33 CAROLINA
Y
,94
HW
0 WILMINGTON
VP
D)
US
CAPE FEAR
COUNTRY CLUB
NHRMC
ORTHOPEDIC
HOSPITAL
INDEPENDENCE MALL
NEW HANOVER
REGIONAL WILMINGTON
HOSPITAL MUNICIPAL
WILMINGTON JOHN T. GOLF COURSE
MEDICAL PARK HOGGARD
HIGH SCHOOL
D)
1,931 VP
US HW
Y117 (3 N
PINE VALLEY
COUNTRY CLUB
Verizon Wireless • Wilmington, NC • 10INDEPENDENCE MALL
NEW HANOVER EDWIN A.
REGIONAL ALDERMAN
HOSPITAL ELEMENTARY
,278 VPD)
JOHN T.
HOGGARD
HIGH SCHOOL
INDEPENDENCE BLVD (19
WEE CARE
PRESCHOOL &
KINDERGARTEN
LONG LEAF SHOPPING CENTER
)
1 VPD
GREENLAWN CAROLINA SPORTS 117 (31,93 PINE VALLEY
Y
MEMORIAL MEDICINE & US HW BARCLAY
ANIMAL
WILMINGTON HOSPITAL
PARK ORTHOPAEDICS COMMONS
SCHOOL OF
BALLET &
DANCE
PINE VALLEY
COUNTRY CLUB
Verizon Wireless • Wilmington, NC • 11Site Plan
Ti b u
ro n
Dr
Pickard RD
Dr
se
er
nv
Co
N
Shipyard Blvd (32,618 VPD)
Verizon Wireless • Wilmington, NC • 12Subject Property Photos
Verizon Wireless • Wilmington, NC • 13Subject Property Photos
Verizon Wireless • Wilmington, NC • 14Demographics
3601 Converse Drive | Wilmington, NC 0 - 1 mi. 0 - 3 mi. 0 - 5 mi.
Population
2016 Population 5,382 72,156 131,857
2021 Population 5,880 76,759 141,162
2000-2010 Annual Rate 0.60% 1.67% 1.77%
2010-2016 Annual Rate 1.99% 1.13% 1.24%
Households
2016 Total Households 2,596 31,982 56,843
2021 Total Households 2,837 33,989 60,804
2010-2016 Annual Rate 1.96% 1.07% 1.20%
2016-2021 Annual Rate 1.79% 1.22% 1.36%
2016 Average Household Income $79,432 $59,760 $62,867
N
Verizon Wireless • Wilmington, NC • 15Offered Exclusively by
Brad Feller
Senior Director
bfeller@stanjohnsonco.com
+1 312.240.0194
going beyond
Isaiah Harf
Director
iharf@stanjohnsonco.com
+1 312.777.2437
Blaise Bennett
Associate
bbennett@stanjohnsonco.com
+1 312.777.2449
Brandon Duff
Regional Director
In association with:
Jeff Hughes
NC Lic. #101282
Stan Johnson Company
303 East Wacker Drive | Suite 1111
Chicago, IL 60601
P: +1 312.240.0127 | F: +1 312.240.0158
stanjohnsonco.com
The information contained herein was obtained from sources believed reliable, however,
Stan Johnson Company makes no guaranties, warranties or representations as to the
completeness thereof. The presentation of this property for sale, rent or exchange is
submitted subject to errors, omissions, change of price or conditions, or withdrawal
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