DAIRY QUEEN HEREFORD, TEXAS - LOOPNET
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Representative Photos
Offering Memoranum
Cap Rate of
7.42% as of
Dairy Queen
September Hereford, Texas
2021
20-Year, NNN Lease with 10% Rental Increases Sizable Franchisee, Owns Amarillo Metro Area is a
More Than 15 Years Throughout Base Term and and Operates 45 DQ Major Transportation Hub in
Remaining on Base Term Option Periods Restaurants the TX Panhandle
CONFIDENTIALITY AND DISCLAIMER NET LEASED DISCLAIMER
The information contained in the following Marketing Brochure is proprietary and strictly Marcus & Millichap hereby advises all prospective purchasers of Net Leased property
confidential. It is intended to be reviewed only by the party receiving it from Marcus & as follows:
Millichap Investment Services of Texas, Inc. and should not be made available to any
other person or entity without the written consent of Marcus & Millichap. This Marketing The information contained in this Marketing Brochure has been obtained from sources
Brochure has been prepared to provide summary, unverified information to prospective we believe to be reliable. However, Marcus & Millichap has not and will not verify any
purchasers, and to establish only a preliminary level of interest in the subject property. of this information, nor has Marcus & Millichap conducted any investigation regarding
The information contained herein is not a substitute for a thorough due diligence these matters. Marcus & Millichap makes no guarantee, warranty or representation
investigation. Marcus & Millichap has not made any investigation, and makes no whatsoever about the accuracy or completeness of any information provided.
warranty or representation, with respect to the income or expenses for the subject
property, the future projected financial performance of the property, the size and square As the Buyer of a net leased property, it is the Buyer’s responsibility to independently
footage of the property and improvements, the presence or absence of contaminating confirm the accuracy and completeness of all material information before completing
substances, PCB’s or asbestos, the compliance with State and Federal regulations, the any purchase. This Marketing Brochure is not a substitute for your thorough due
physical condition of the improvements thereon, or the financial condition or business diligence investigation of this investment opportunity. Marcus & Millichap expressly
prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy denies any obligation to conduct a due diligence examination of this Property for Buyer.
of the subject property. The information contained in this Marketing Brochure has
been obtained from sources we believe to be reliable; however, Marcus & Millichap Any projections, opinions, assumptions or estimates used in this Marketing Brochure
has not verified, and will not verify, any of the information contained herein, nor has are for example only and do not represent the current or future performance of this
Marcus & Millichap conducted any investigation regarding these matters and makes no property. The value of a net leased property to you depends on factors that should be
warranty or representation whatsoever regarding the accuracy or completeness of the evaluated by you and your tax, financial and legal advisors.
information provided. All potential buyers must take appropriate measures to verify all
of the information set forth herein. Buyer and Buyer’s tax, financial, legal, and construction advisors should conduct a
careful, independent investigation of any net leased property to determine to your
satisfaction with the suitability of the property for your needs.
Like all real estate investments, this investment carries significant risks. Buyer and
NON-ENDORSEMENT NOTICE Buyer’s legal and financial advisors must request and carefully review all legal
Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial and financial documents related to the property and tenant. While the tenant’s
tenant or lessee identified in this marketing package. The presence of any corporation’s past performance at this or other locations is an important consideration, it is not a
logo or name is not intended to indicate or imply affiliation with, or sponsorship or guarantee of future success.Similarly, the lease rate for some properties, including
endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or newly-constructed facilities or newly-acquired locations, may be set based on a
any agent, product, service, or commercial listing of Marcus & Millichap, and is solely tenant’s projected sales with little or no record of actual performance, or comparable
included for the purpose of providing tenant lessee information about this listing to rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail
prospective customers. to pay the lease rent or property taxes, or may fail to comply with other material terms
of the lease; cash flow may be interrupted in part or in whole due to market, economic,
environmental or other conditions. Regardless of tenant history and lease guarantees,
Buyer is responsible for conducting his/her own investigation of all matters affecting
ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONSULT the intrinsic value of the property and the value of any long-term lease, including
YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS. the likelihood of locating a replacement tenant if the current tenant should default or
abandon the property, and the lease terms that Buyer may be able to negotiate with a
potential replacement tenant considering the location of the property, and Buyer’s legal
ability to make alternate use of the property.
By accepting this Marketing Brochure you agree to release Marcus & Millichap Real
Estate Investment Services and hold it harmless from any kind of claim, cost, expense,
or liability arising out of your investigation and/or purchase of this net leased property.
FINANCIAL OVERVIEW
Overview Base Term Monthly Annual Rent PSF
801 East Park Avenue, Hereford, Texas 79045 Current-8/31/2021: $4,303 $51,636 $24.50
Price: $765,000 9/1/2021-8/31/2026: $4,733 $56,800 $26.94
Cap Rate: 7.42%* 9/1/2026-8/31/2031: $5,207 $62,480 $29.64
Rentable Square Feet: 2,108 9/1/2031-8/31/2035: $5,727 $68,727 $32.60
Annual Rent: $56,800
Price PSF: $362.90 Option Periods Monthly Annual Rent PSF
Land Area: 0.8 Acres
9/1/2035-8/31/2040: $6,300 $75,600 $35.86
Year Built: 1970
9/1/2040-8/31/2045: $6,930 $83,160 $39.45
*Cap Rate is based on rent increase on Sept 1, 2021 with Seller credit
9/1/2045-8/31/2050: $7,623 $91,476 $43.39
at closing for any rent difference as compared to the current rent.
9/1/2050-8/31/2055: $8,385 $100,624 $47.73
Lease Summary
Investment Highlights
Tenant: Dairy Queen
• 20-Year, Triple Net (NNN) Lease with 15 Years Remaining
Website: www.DairyQueen.com
• Four, Five-Year Renewal Options With 10 Percent Rent Increases
Lease Guarantor: Franchisee, Square 1 Restaurants, LLC
Throughout Base Term and Option Periods
Lease Type: NNN
• Square 1 Restaurants, LLC is One of the Largest Dairy Queen
Option Periods: 4, 5-Year Options Franchisees, Currently Owning and Operating 40+ DQ Restaurants
Rent Increases: 10% Throughout Base Term and Options
• Part of the Amarillo, Texas Metro Area, Which is the Heart of Cattle
Roof & Structure: Tenant Country and is a Major Transportation Hub in the Texas Panhandle
Commencement: 8/17/2015 • DQ has 4,503 Stores in the U.S. With Approx. 2,351 Franchisees;
Lease Expiration: 8/31/2035 and 688 Stores With Approx. 537 Franchisees in Canada
Subject Property TENANT SUMMARY
Dairy Queen
is a Subsidiary
of Berkshire
Hathaway Inc.
(NYSE: BRK.A and
BRK.B)
Dairy Queen, often abbreviated DQ, is a chain of soft serve ice cream and About Square 1 Restaurants, LLC
fast-food restaurants. There are few brands as iconic as the DQ brand. Square 1 Restaurants, LLC serves as one of the largest Dairy Queen franchisees
Since inception, the innovative DQ food and treats along with the unique in Texas and the Dairy Queen system currently owning and operating more
DQ restaurant concepts, have positioned International Dairy Queen as a than 40 Dairy Queen Restaurants in Texas, employing roughly 700 workers.
leader in the quick-service restaurant industry both in the U.S. as well as
internationally. Today, the DQ system is a $4.5 billion brand.
William Spae, their president and CEO has been in franchising for more than
40 years, most recently serving as CEO of Mooyah Burgers and COO of Cici’s
The first DQ restaurant was located in Joliet, Illinois. It was operated by
Pizza.
Sherb Noble and opened for business on June 22, 1940. It served a variety
of frozen products, such as soft serve ice cream. The company’s corporate
offices are located in the Minneapolis suburb of Edina, Minnesota. Lou Ramanus, CEO of the Texas Dairy Queen Operators Council, issued a
statement saying “Texas remains a key market for the Dairy Queen brand
The soft-serve formula was first developed in 1938 by Douds, Iowa-born being home to more than 130 Dairy Queen franchisees and over 575
John Fremont McCullough and his son Alex. They convinced friend and loyal locations - more than any other state in the U.S.”
customer Sherb Noble to offer the product in his ice cream store in Kankakee,
Illinois. On the first day of sales, Noble dished out more than 1,600 servings
of the new dessert within two hours. Noble and the McCulloughs went on
to open the first store in Joliet, Illinois. While this Dairy Queen has not been
in operation since the 1950s, the building still stands as a city-designated
landmark.
Dairy Queen restaurants are franchised by American Dairy Queen Corporation,
a Berkshire Hathaway company. Restaurants in Canada are franchised through
Dairy Queen Canada.
LOCAL & REGIONAL MAPS Amarillo Lubbock
MARKET OVERVIEW
AMARILLO
OVERVIEW METRO HIGHLIGHTS
Amarillo is in the heart of cattle country and is a major AIRCRAFT ASSEMBLY PLANT
transportation hub in the Texas Panhandle. The metro consists A manufacturing facility for the Bell Boeing V-22 Osprey hybrid
of Potter, Armstrong, Carson, Randall and Oldham counties. The military aircraft is located in the area.
market houses 266,000 residents and over the next five years, CATTLE AND AGRICULTURAL PRODUCTION
the area is projected to grow by 9,000 people and 4,700 Tyson Foods is a large employer in the metro, and 14 million
households. Amarillo is the most populous city in the region acres of agricultural land are used to grow various crops.
with 199,400 residents and it is the seat of Potter County. DISTRIBUTION
The major trucking route, Interstate 40 contributes to the
economic make-up of Amarillo. The metro also plays an important
role in the rail freight system.
ECONOMY
▪ Food production and agriculture are major industries in the metro. Aside from
growing corn, wheat, and cotton, and producing milk, the metro has a major
meat-packing industry that processes a quarter of the nation’s beef supply.
▪ The city of Amarillo houses the headquarters for the Texas Cattle Feeders
Association.
▪ Major employers represent a variety of industries and include Owens-Corning,
Amarillo College, B&W Pantex, United Supermarkets and ASARCO.
▪ The expanding healthcare sector is underpinned by Baptist St. Anthony's Health
Care Systems and the Northwest Texas Healthcare System.
DEMOGRAPHICS
2018 2018 2018 2018 MEDIAN
POPULATION: HOUSEHOLDS: MEDIAN AGE: HOUSEHOLD INCOME:
268K 101K 34.8 $55,300
Growth Growth U.S. Median: U.S. Median:
2018-2023*: 2018-2023*:
3.4% 4.6% 38.0 $58,800
* Forecast
Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Moody’s Analytics; U.S. Census Bureau
DEMOGRAPHICS
POPULATION 1 MILE 3 MILES 5 MILES HOUSEHOLD INCOME 1 MILE 3 MILES 5 MILES
2010 Population 8,981 17,113 17,622 2010 Avg Household Income $42,144 $46,145 $46,446
2019 Population 8,907 16,897 17,389 2019 Avg Household Income $51,982 $57,705 $58,190
2024 Population 8,824 16,826 17,313 2024 Avg Household Income $60,912 $67,601 $68,151
2019 Male Population 4,435 8,366 8,619 2010 Med. Household Income $32,822 $34,806 $34,873
2019 Female Population 4,472 8,531 8,770 2019 Med. Household Income $41,491 $46,599 $46,832
2019 Median Age 28.7 31.0 31.1 2024 Med. Household Income $49,815 $54,443 $54,733
2010 Per Capita Income $13,475 $15,276 $15,369
RACE & ETHNICITY 1 MILE 3 MILES 5 MILES 2019 Per Capita Income $16,557 $19,004 $19,153
American Indian, Eskimo 1.2% 1.1% 1.1% 2024 Per Capita Income $19,586 $22,512 $22,694
Asian 0.8% 0.7% 0.7%
Black 1.9% 1.8% 1.8% Click to View in
Hawaiian/Pacific Islander 0.0% 0.0% 0.0% Google Maps
White 71.1% 73.9% 74.0%
Other 21.6% 19.3% 19.2%
Multi-Race 3.4% 3.2% 3.2%
Hispanic Ethnicity 85.6% 75.7% 75.2%
Not of Hispanic Ethnicity 14.4% 24.3% 24.8%
HOUSEHOLDS 1 MILE 3 MILES 5 MILES
2010 Households 2,824 5,573 5,739
2019 Households 2,801 5,497 5,656
2024 Households 2,807 5,546 5,707
T
he Wolfe Retail Group of Marcus & Millichap specializes in
the sale of single-tenant properties and shopping centers and
has successfully assisted clients in selling over 500 separate
commercial properties with a market value exceeding $1.45 billion.
Having closed sales in more than 40 states, our track record is
evidence that we are one of the premier brokerage teams in the
United States.
With our experience and background in various fields such as law
and finance, we have proved to be invaluable to our clients, earning
their trust and exceeding their expectations while best assisting
them in their real estate transactions.
The Wolfe
For more about the Wolfe Retail Group or to view all of our available Retail Group
listings, visit www.WolfeRetailGroup.com has sold over
500 properties
in more than
40 states
About Marcus & Millichap
With nearly 2,000 investment professionals located throughout the U.S. and Canada, Marcus & Millichap (NYSE: MMI) is a leading specialist in
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Marcus & Millichap has been a pioneer in the real estate investment industry and has established a reputation for maximizing value for its clients
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Barry M. Wolfe
Senior Managing Director Investments
License: SL 702613
Barry.Wolfe@marcusmillichap.com
(954) 245-3493
Alan Lipsky Evan Whelan Charles “Chas” Moody
First Vice President Investments Associate Associate
License: SL 3279054 License: SL 310245 License: SL 3404499
Michael Talbert Joseph Prio
Associate Associate
License: SL 3418448 License: SL 3422291
Ashley Barrett Catie Jackson
Transaction Coordinator Marketing Coordinator
SPECIAL COVID-19 NOTICE: All potential buyers are strongly advised to take advantage of their opportunities and obligations to conduct thorough due diligence and seek expert opinions as they
may deem necessary, especially given the unpredictable changes resulting from the continuing COVID-19 pandemic. Marcus & Millichap has not been retained to perform, and cannot conduct, due diligence
on behalf of any prospective purchaser. Marcus & Millichap’s principal expertise is in marketing investment properties and acting as intermediaries between buyers and sellers. Marcus & Millichap and its
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the potential volatility created by COVID-19, all potential buyers should be comfortable with and rely solely on their own projections, analyses, and decision-making.)You can also read
