Flowers Foods - OFFERING MEMORANDUM - LoopNet
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OFFERING MEMORANDUM
Fl o we r s F ood s
3527 Melrose Ave NW, Roanoke, VA 24017
Representative Photo
™
Representative Photo
Exc lu s i v e l y L i st ed By
J o s h B i s h op C h ad Ku rz Ar o n Cline Calvi n Short
VP & Director SVP & National Director SVP & Senior Director SVP & Senior Director
Kyle Matthews
Josh. Bishop@m atthew s .com LIC # 0191198 (CA) LIC # 01 904371 ( CA ) LIC # 01 927216 (CA) Broker of Record
DIR ( 214) 692 - 2 2 89 Lic # 22602771 (VA)
MOB (3 15 ) 7 30- 62 2 8
L IC # 6 88 810 (T X )
™
Investment
H ighlights
LEASE DETAILS
• Proven location for Flowers Foods – The tenant has successfully operated at this location for 10+ years
• Brand new 15 year lease – Flowers recently signed a brand new 15 year lease, showing their long-term commitment to the site
• Rare annual rent increases – Attractive 1.75% annual rent increases throughout the base term and 2% annual rent increases
in the option periods
• Minimal landlord responsibility – Tenant responsible for HVAC, CAM, taxes, and insurance
• Undergoing Renovations – The landlord is currently making extensive renovations to the building that are expected to be
completed by mid-May
LOCATION
• Strategic location – The subject property is located along highway 460 with easy access to both Interstate 81 and Interstate
581
• Roanoke MSA - An ideal market for a distribution center with more than 315,000 residents
TENANT
• The property is 100% leased to Flowers Baking Co. of Lynchburg, LLC, a wholly owned subsidiary of Flowers Foods Inc.
• Flowers Foods, Inc. has strong investment grade credit, S&P rated BBB- & Moody’s rated Baa2
• Flowers Foods is the second-largest producer and marketer of packaged bakery foods, serving over 90% of the United States
population with baked goods
• Flowers Foods operates over 47 bakeries in 16 states, producing fresh baked products for some of the top brands including
Hostess, Nature’s Own, White Wheat, Bunny Bread, Sunbeam, Wonder Bread, Tasty Kakes, Mary Jane, Holsum, Hattie’s, and
more
03
Financial
Overview
3527 Melrose Ave NW, Roanoke, VA 24017
List Price Cap Rate Lot Size GLA
$2,000,000 6.75% ±2.43 AC ±11,850 SF
Tenant Summary Annualized Operating Data
Monthly Rent Annual Rent Rent/SF Cap Rate
Tenant Trade Name Flowers Foods 2/1/2018 - 1/31/2019 $11,250.00 $135,000.00 $11.39 6.75%
Type of Ownership Fee Simple 2/1/2019 - 1/31/2020 $11,446.88 $137,362.50 $11.59 6.87%
Lease Type NN+ 2/1/2020 - 1/31/2021 $11,647.20 $139,766.34 $11.79 6.99%
Roof and Structure Owner Responsible 2/1/2021 - 1/31/2022 $11,851.02 $142,212.25 $12.00 7.11%
Original Lease Term 15 Years 2/1/2022 - 1/31/2023 $12,058.41 $144,700.97 $12.21 7.24%
Rent Commencement Date February 1, 2018 2/1/2023 - 1/31/2024 $12,269.44 $147,233.24 $12.42 7.36%
Lease Expiration Date Februrary 1, 2033 2/1/2024 - 1/31/2025 $12,484.15 $149,809.82 $12.64 7.49%
Term Remaining on Lease ± 15 Years 2/1/2025 - 1/31/2026 $12,702.62 $152,431.49 $12.86 7.62%
1.75% Annual Increases in Base Term 2/1/2026 - 1/31/2027 $12,924.92 $155,099.04 $13.09 7.75%
Increases
2% Annual Increases in Extensions
2/1/2027 - 1/31/2028 $13,151.11 $157,813.27 $13.32 7.89%
Extensions Three, 5-Year Options
2/1/2028 - 1/31/2029 $13,381.25 $160,575.01 $13.55 8.03%
2/1/2029 - 1/31/2030 $13,615.42 $163,385.07 $13.79 8.17%
2/1/2030 - 1/31/2031 $13,853.69 $166,244.31 $14.03 8.31%
2/1/2031 - 1/31/2032 $14,096.13 $169,153.58 $14.27 8.46%
2/1/2032 - 1/31/2033 $14,342.81 $172,113.77 $14.52 8.61%
*Three, 5-Year Options with 2% Annual Increases
04
Tenant
Overview
Property Name Flowers Foods
Property Type Net Leased Distribution Center
Parent Company Trade Name Flowers Foods, Inc. (NYSE: FLO)
Ownership Public
Net Income $189 M
No. of Locations ± 46
No. of Employees ± 10,900
Headquartered Thomasville, Georgia
Website www.flowersfoods.com
Year Founded 1919
TENANT OVERVIEW
As one of the largest wholesale bakeries in the US, Flowers Foods’ flour products business is booming. Flowers Foods bakes, markets and distributes fresh breads,
buns, rolls, corn and flour tortillas, and sweet bakery goodies to retail food and food-service customers in the western, southern and northeastern US. The company’s
brand names include Cobblestone Mill, Nature’s Own, Tastykake and Whitewheat. Flowers Foods makes snack cakes, pastries, donuts and frozen bread products
for retail, vending and co-pack customers nationwide. It also rolls out hamburger buns for national fast-food chains. Flowers Foods bought several bread brands,
including Wonder and about 20 bakeries from Hostess Brands.
GEOGRAPHIC OUTREACH
Flowers Foods operates in 18 states in US Southeast, Mid-Atlantic, New England, Southwest, California and select markets in Nevada, the Midwest, and the Pacific
Northwest.
STRATEGY
The company focuses on developing new and core markets through new customers, new products, strong brands, and acquisitions. From its stronghold in the
Southeast, Flowers Foods has been expanding its retail and wholesale reach, moving north and west Flowers Foods in 2014 opened the Knoxville, Tennessee plant
that was acquired as a part of the Hostess Brands deal in 2013. Acquisitive Flowers Foods purchases other businesses to grow and enter new markets. The company
has completed more than 100 acquisitions during the past 40 years.
SALES & MARKETING
As a leading US baker, the company’s products are available to consumers through traditional supermarkets and their in-store deli/bakeries, food service distributors,
convenience stores, mass merchandisers, club stores, wholesalers, casual dining and quick-serve restaurants, schools, hospitals, dollar stores and vending machines.
Flowers Foods’ direct-store-delivery system is comprised of 5,100 independent distributors who own the rights to distribute certain brands of the company’s fresh
packaged bakery foods in their geographic territories. Also, Flowers Foods has about 600 company-owned distributors and distributorships available for sale. The
warehouse segment’s fresh snack cakes and frozen breads and rolls are sold nationally direct to customers’ warehouses by frozen and non-frozen contract carriers.
05Surrounding Tenants
Roanoke-Blacksburg
Regional Airport Towne Square
~300,000 SF of
national anchors
06Surrounding Tenants
Roanoke Valley
Golf Course
Roanoke
Country Club
Caru
Apartments
Westside Stories
Apartments
Fair View Melro
Westwoo se Av
d Cemetery e NW
Village ± 16,0
00 A
DT
Shenandoah
Apartments
07Area
Overview
ROANOKE, VA D E MOGRA PHI C S
Located in the Roanoke Valley of the Roanoke Region Population 1 Mile 3 Mile 5 Mile
of Virginia, Roanoke is the largest municipality in 2023 Projection 9,247 66,917 155,829
Southwest Virginia. The city is bisected by the Roanoke 2018 Estimate 9,092 65,327 152,115
River and is the main focus of the Roanoke MSA. Other Growth 2018-2023 1.71% 2.43% 2.44%
cities in the MSA include Salem, Botetourt, Craig, and Households 1 Mile 3 Mile 5 Mile
Franklin. 2023 Projection 3,813 28,393 66,937
The Roanoke community has been growing for 2018 Estimate 3,762 27,755 65,383
decades. Being positioned midway between the “great Growth 2018-2023 1.36% 2.30% 2.38%
valley” between Maryland and Tennessee has been the Income 1 Mile 3 Mile 5 Mile
key to the city’s growth. The city is also the center for 2018 Est. Average
$42,116 $54,539 $63,866
industry, trade, health, education, travel, conventions, Household Income
and entertainment.ECONOMY
Roanoke’s economy was developed around the Norfolk and Western Railroad.
Since then, the city’s economy has grown into many strong sectors. The region
is the healthcare and retail hub of a large area, driving the expansion of Carilion
Health System and Valley View Mall. Advance Auto Parts is headquartered here
and has expanded into one of the largest auto parts retailers in the country.
Norfolk Southern remains a major employer, although FreightCar America has
been gradually moving closer to being the top employer.
The corporate offices of Virginia Transformer Corporation and utility company,
RGC Resources, are also located in Roanoke. Kroger operates its mid-Atlantic
regional office in the region, as well. The Roanoke Regional Airport is one of
the major facility’s for the United Parcel Service (UPS).
TOP EMPLOYERS
09311,901
Population
ROANOKE MSA
The Roanoke Metropolitan Statistical Area (MSA) is also referred to as the 41.8
Roanoke Valley. It is located in the southwestern region of Virginia and has Median Age
everything from city life, suburbs, and nature. It is the fourth largest MSA in
Virginia, and the largest in the western half of the state. The population is
projected to increase by more than 12% in the next couple years. $50,571
Median Household Income
10C O N F I D E N T I A L I T Y & D I S C L A I M E R S TAT E M E N T
This Of f e r ing Me m o r a n du m co n t a i n s s e l e ct inform ati on pertai ni ng to the busi ness and affai rs of Flowers Foods located at 3527 Melrose Ave NW, Roanoke,
VA 24017 (“ P r o p ert y ” ) . It h a s be e n p r e p a r e d by Matthews Retai l Advi sors. Thi s O fferi ng Mem orand u m may n ot b e all-in clu s ive or con t ain all of t h e
in f o r ma t io n a p r o s p e ct i v e p u r ch a s e r m a y de si re. The i nform ati on c ontai ned i n thi s O fferi ng Mem oran d u m is con fid en t ial an d fu rn is h ed s olely for t h e
pu rpo s e o f a r ev ie w by a p r o s p e ct i v e p u r ch aser of the Property. It i s not to be used for any other pu rpos e or mad e availab le t o an y ot h er pers on
witho ut t he w r it t e n co n s e n t o f S e l l e r o r M a t t hews Retai l Advi sors. The m ateri al i s based i n part upon in format ion s u pplied b y t h e Seller an d in part
u p o n f ina nc ia l inf o r m a t i o n o bt a i n e d f r o m s ourc es i t deem s rel i abl e. O wner, nor thei r offi c ers, employees , or agen t s makes an y repres en t at ion or
warr a nt y, ex p r e s s o r i m p l i e d, a s t o t h e a ccu r ac y or c om pl eteness of thi s O fferi ng Mem orandum or an y of it s con t en t s an d n o legal liab ilit y is as s u med
or sh a ll b e imp lie d w i t h r e s p e ct t h e r e t o. P r o spec ti ve purc hasers shoul d m ake thei r own proj ec ti ons an d form t h eir own con clu s ion s wit h ou t relian ce
u p o n t he ma t e r ia l co n t a i n e d h e r e i n a n d co n duc t thei r own due di l i genc e.
By ac kno w led g ing y o u r r e ce i p t o f t h i s O f f e r ing Mem orandum for the Property, you agree:
1. T he Of f er in g M e m o r a n du m a n d i t s co ntents are c onfi denti al ;
2. Yo u w ill hol d i t a n d t r e a t i t i n t h e s t r i c test of c onfi denc e; and
3. Yo u w ill no t , di r e ct l y o r i n di r e ct l y, di sc l ose or perm i t anyone el se to di sc l ose thi s O fferi ng M emoran d u m or it s con t en t s in an y fas h ion or
ma nner d e t r i m e n t a l t o t h e i n t e r e s t o f the Sel l er.
O wne r a nd Ma t t he w s Re t a i l A dv i s o r s e x p r e s sl y reserve the ri ght, at thei r sol e di sc reti on, to rej ect an y an d all expres s ion s of in t eres t or offers t o
pu rcha se t he P r o p e r t y a n d t o t e r m i n a t e di s cussi ons wi th any person or enti ty revi ewi ng thi s O fferin g M emoran d u m or makin g an offer t o pu rch as e
the P r o p er t y unle s s a n d u n t i l a w r i t t e n a g r e e m ent for the purc hase and sal e of the Property has b een fu lly execu t ed an d d elivered .
If y o u w ish no t t o p u r s u e n e g o t i a t i o n s l e a di n g to the ac qui si ti on of the Property or i n the future you d is con t in u e s u ch n egot iat ion s , t h en you agree
to pu r g e a ll ma t e r i a l s r e l a t i n g t o t h i s P r o p e rty i nc l udi ng thi s O fferi ng Mem orandum .
A p r o s p ec t iv e p ur ch a s e r ’s s o l e a n d e xcl u s i v e ri ghts wi th respec t to thi s prospec ti ve transac ti on, t h e Propert y, or in format ion provid ed h erein or in
co nn e c t io n w it h t h e s a l e o f t h e P r o p e r t y s h a ll be l i m i ted to those expressl y provi ded i n an exec uted Pu rch as e Agreemen t an d s h all b e s u b ject t o t h e
term s t he r eo f. I n n o e v e n t s h a l l a p r o s p e ct i ve purc haser have any other c l ai m s agai nst Sel l er or Mat t h ews Ret ail Ad vis ors or an y of t h eir affiliat es
or an y o f t heir r es p e ct i v e o f f i ce r s , Di r e ct o r s , sharehol ders, owners, em pl oyees, or agents for any d amages , liab ilit y, or cau s es of act ion relat in g t o
this s o lic it a t io n p ro ce s s o r t h e m a r ke t i n g o r sal e of the Property.
Th is Of f er ing Mem o r a n du m s h a l l n o t be de e m ed to represent the state of affai rs of the Property or con s t it u t e an in d icat ion t h at t h ere h as b een n o
chan g e in t he s t a t e o f a f f a i r s o f t h e P r o p e r t y si nc e the date thi s O fferi ng Mem orandum .™
F lowers Foods
3527 Melrose Ave NW, Roanoke, VA 24017
Exc l u s i v e l y L i st e d By
Jo s h B i s h op C h ad Ku rz Ar o n Cline Ca lv in Short
VP & Director SVP & National Director SVP & Senior Director SVP & Senior Director
Kyle Matthews
J osh.Bis h op@matthe ws.co m LIC # 0191198 (CA ) LIC # 01 904371 ( CA ) LIC # 0 1927216 (CA) Broker of Record
DI R (2 14) 692 - 2 2 8 9 Lic # 22602771 (VA)
M OB (315) 7 30- 62 2 8
LI C # 688810 (T X)You can also read
