MOUNTAIN IRON RETAIL CENTER - 8580 ROCK RIDGE DRIVE MOUNTAIN IRON, MN - OFFERING MEMORANDUM - LoopNet
←
→
Page content transcription
If your browser does not render page correctly, please read the page content below
OFFERING
MEMORANDUM
MOUNTAIN IRON RETAIL CENTER
8580 ROCK RIDGE DRIVE
MOUNTAIN IRON, MN
TABLE OF
CONTENTS
MOUNTAINIRONRETAILCENTER
01 02 03
FINANCIAL INVESTMENT MARKET
OVERVIEW OVERVIEW OVERVIEW
PAGES 03-08 PAGES 09-15 PAGES 16-18
ACT ID: ZAB0260100
FINANCIAL OVERVIEW SECTION 1 01 FINANCIAL OVERVIEW
EXECUTIVE
SECTION 1
SUMMARY
MOUNTAIN IRON RETAIL CENTER
8580 Rock Ridge Drive, Mountain Iron, MN 55768
PRICING
Price: $2,125,000
Cap Rate: 7.75%
PRICE: CAP RATE: NOI:
Gross Leasable Area: 11,500
$2,125,000 7.75% $164,660
Price Per Square Foot: $184.78
Year Built: 2016
Lot Size: 1.92 Acres
SQUARE FEET: LEASE TYPES: ACREAGE:
INVESTMENT HIGHLIGHTS 11,500 NNN 1.92 Acres
➢ 11,500 Square Foot Three-Tenant Retail Center
➢ Offered at 100% Occupancy | Tenants Include
Maurices, Famous Footwear & Great Clips
DEMOGRAPHICS
➢ All NNN Leases | Very Minimal Landlord
1-Mile 3-Mile 5-Mile
Responsibility | Tenants Reimburse for their Pro Rata
Share of Expenses Population 1,022 10,270 14,755
Repeat clients
➢ Long-Term Leases | Zero Near-Term Lease Rollover | Average HH
Maurices & Famous
Decades worthFootwear both have 8+ Years
of experience $48,479 $54,942 $55,478
Income
Left Highly-focused specialization
➢ Scheduled Rent Increases for Each Tenant Provide a
Hedge Against Future Inflation
4
OPERATING
SECTION 1
SUMMARY
SUMMARY PROPOSED NEW FINANCING
Price: $2,125,000 Loan Amount: $1,487,500
Down Payment (30%): $637,500
Terms 4.50% Interest Rate
Current CAP: 7.75%
Cash on Cash: 9.90% 25 Year Amortization
Square Feet 11,500
5 Year Term
Cost per Square Feet: $184.78
Debt Coverage Ratio: 1.66 Monthly Payment: $8,268.01
Year Built: 2016 Annual Payment: $99,216.10
OPERATING DATA EXPENSES
Scheduled Gross Income: $168,500 Taxes: $2.52 $28,948
CTI Reimbursements: $52,370
Insurance: $0.30 $3,440
Admin Reimbursements: $2,872
CAM: $1.74 $19,982
Total Income: $223,742
Management: 3.00% $6,712
Vacancy Factor: $-
TOTAL EXPENSES: $59,082
Gross Operating Income: $223,742
Per RSF: $5.14
Less Expenses: $59,082
Net Operating Income: $164,660 7.75%
Capital Reserves: $2,300 ($.20)
Loan Payments: $99,216
Pre Tax Cash Flow: $63,144 9.90%
Plus Principal Reduction: $32,953
Total Return Before Taxes: $96,096 15.07%
5
RENT
SECTION 1
ROLL
Sq. % of Lease Lease Monthly Annual Annual Bump New Annual Lease Option
Tenant
Ft. Total Start End Rent Rent PSF Date Rent PSF Reimb. Type Terms
Maurices 5,000 43.48% 10/21/2016 1/31/2027 $5,833.33 $70,000.00 $14.00 11/1/2021 $14.50 $23,638.17 NNN (4) 5-yr
Option I 11/1/2026 $15.00
Option II 11/1/2031 $15.50
Option III 11/1/2036 $16.00
Option IV 11/1/2041 $16.50
Great Clips 1,500 13.04% 1/12/2017 10/31/2021 $2,375.00 $28,500.00 $19.00 $7,965.36 NNN (2) 5-yr
Option I 11/1/2021 $20.71
Option II 11/1/2026 $22.57
Famous
5,000 43.48% 10/26/2016 10/31/2026 $5,833.33 $70,000.00 $14.00 11/1/2021 $15.00 $23,638.17 NNN (2) 5-yr
Footwear
Option I 11/1/2026 $16.00
Option II 11/1/2031 $170.00
TOTALS 11,500 100% $14,042 $168,500 $14.65 $55,241
Occupied 11,500 100% $14,042 $168,500 $14.65 $55,241
Vacant
6
TENANT
SECTION 1
PROFILES
Maurice's is a part of Ascena Retail Group, Inc., through its Great Clips is a 100% franchised company with more than 4,200
subsidiaries, operates as a specialty retailer of clothing, salons across North America—each one offering a great
shoes, and accessories for missy, plus-size women, and haircut at a great location at a great price. We pride ourselves
tween girls in the United States, Canada, and Puerto Rico. on making it easy for customers to get a great haircut at a time
The company operates through five segments: Justice, Lane and place that’s convenient for them. That’s why we’re open
Bryant, Maurice's, Dressbarn, and Catherine's. creates, evenings and weekends, no appointments necessary. What
designs, and develops a range of merchandise and sets us apart is how easy we’ve made it for customers to make
operates more than 4,900 stores. Great Clips their salon of choice with their online check-in
service, and clip notes, a technology that allows stylists to keep
notes on a customer’s haircut and is accessible at any Great
Clips salon.
Headquarters: Duluth, Minnesota Headquarters: Bloomington, Minnesota
No. of Locations: 950+ No. of Locations: 4,200+
Symbol: NASDAQ: “ASNA” Symbol: Private
Website: www.maurices.com Website: www.greatclips.com
Square Footage: 5,000 Square Footage: 1,500
Lease Start: October 21, 2016 Lease Start: January 12, 2017
Lease Expiration: January 31, 2027 Lease Expiration: October 31, 2021
7
TENANT
SECTION 1
PROFILES
Famous Footwear is your place for athletic and casual shoes
for the whole family from hundreds of name brands. You will
find styles for women, men, and kids from brands like Nike,
Converse, Vans, Sperry, Madden Girl, Skechers, ASICS and
more. With over 1,100 stores nationwide and even more of a
selection online, Famous Footwear is a leading family
footwear destination for the famous brands you know and
love. Famous Footwear is part of St. Louis based Caleres Inc.,
a diverse portfolio of global footwear brands.
Headquarters: St. Louis, Missouri
No. of Locations: 1,109
Symbol: NYSE: “CAL” (Parent Co.)
Website: www.famousfootwear.com
Square Footage: 5,000
Lease Start: October 26, 2016
Lease Expiration: October 31, 2026
8
INVESTMENT OVERVIEW SECTION 2 02 INVESTMENT OVERVIEW
INVESTMENT
OVERVIEW
INVESTMENT HIGHLIGHTS INVESTMENT WRITE-UP
➢ 11,500 Square Foot Three-Tenant Retail Marcus & Millichap is pleased to exclusively present for your
Strip Center acquisition review Mountain Iron Retail Center located in
SECTION 2
Mountain Iron, Minnesota.
➢ Offered Fully Stabilized at 100%
Occupancy Mountain Iron Retail Center is a 11,500 square foot three-tenant
center positioned on 1.92 acres. The Center has excellent
➢ National Credit Retailer Tenant Mix visibility just off of Highway 169 as a Wal-Mart Supercenter
Including Maurices, Great Clips & Famous outparcel. The tenants in the Center benefit from the
Footwear consistent traffic generated by the Wal-Mart and capitalize off
the lack of competition in the market. The building sits off
➢ Perfectly Positioned as an Outparcel to a Highway 169 just down the street from the intersection of
Walmart Supercenter Highway 169 and Highway 53. The Thunderbird Mall is less than
a mile away along with Target, Menards, Super One Foods and
➢ Very Minimal Landlord Responsibility – All several other national tenants.
NNN Leases | Tenants Reimburse for Pro
Currently Mountain Iron Retail Center is fully occupied and
Rata Share of All Expenses
stabilized. The Center has an excellent tenant mix with national
credit from Maurices and Famous Footwear. Each of the three
➢ Long-Term Leases | Zero Near-Term Lease leases are triple net, requiring very minimal responsibility from
Rollover | 87% of the GLA Leased until at the landlord. There is zero near-term lease rollover providing
least October 2016 further stabilization to the deal, with both Maurices and Famous
Footwear having more than 8 years remaining on their leases.
➢ Scheduled Rent Escalations Provide an
Excellent Hedge Against Future Inflation Mountain Iron Retail Center provides an investor with an ideal
Repeat clients opportunity to acquire a fully stabilized center with minimal
➢ Excellent Exposure
Decades worth & Visibility | Immediate
of experience responsibility yet still having upside in the deal in capturing the
Access to both U.S. Route 169 & U.S. Route upcoming rent bumps for each tenant. The deal has excellent
53 Highly-focused specialization real estate fundamentals as well, situated as a Wal-Mart
outparcel.
10PROPERTY
PHOTOS
SECTION 2
Repeat clients
Decades worth of experience
Highly-focused specialization
30
19
11PROPERTY
PHOTOS
SECTION 2
Repeat clients
Decades worth of experience
Highly-focused specialization
30
19
12MARKET
AERIAL
SECTION 2
Repeat clients
Decades worth of experience
Highly-focused specialization
30
19
13LOCAL
MAP
SECTION 2
Repeat clients
2.8 MILES
Decades worth of experience 3.2 MILES 9.5 MILES
Mesabi Range Virginia Golf Eveleth,
Highly-focused specialization
Community Course Minnesota
Campus
30
19
14REGIONAL
MAP
SECTION 2
Repeat clients
66 MILES
Decades worth of experience 198 MILES 326 MILES
Duluth, Minneapolis, Winnipeg,
Highly-focused specialization
Minnesota Minnesota Canada
30
19
15MARKET OVERVIEW SECTION 3 03 MARKET OVERVIEW
MARKET
OVERVIEW
Race and Ethnicity
Population
The current year racial makeup of your selected area is as
In 2019, the population in your selected geography is 14,755.
follows: 92.60% White, 1.34% Black, 0.01% Native
The population has changed by -3.84% since 2000. It is
American and 0.44% Asian/Pacific Islander. Compare
estimated that the population in your area will be 14,624.00 five
these to US averages which are: 70.20% White, 12.89%
years from now, which represents a change of -0.89% from the
Black, 0.19% Native American and 5.59% Asian/Pacific
current year. The current population is 48.88% male and
Islander. People of Hispanic origin are counted
51.12% female. The median age of the population in your area
independently of race.
is 42.85, compare this to the US average which is 37.95. The
population density in your area is 187.26 people per square
People of Hispanic origin make up 1.61% of the current
mile. 2018
SECTION 3
HOUSEHOLDS: year population in your selected area. Compare this to the
Households
US average of 18.01%.
There are currently
Growth 6,974 households in your selected Employment
2018-2023*:
geography. The number of households has changed by -0.57%
6.0%
since 2000. It is estimated that the number of households in In 2019, there are 11,531 employees in your selected area,
your area will be 6,991 five years from now, which represents a this is also known as the daytime population. The 2000
change of 0.24% from the current year. The average household Census revealed that 55.66% of employees are employed
size in your area is 2.02 persons. in white-collar occupations in this geography, and 44.10%
are employed in blue-collar occupations. In 2019,
Income
unemployment in this area is 4.70%. In 2000, the average
time traveled to work was 17.00 minutes.
In 2019, the median household income for your selected
geography is $42,680, compare this to the US average which is
currently $58,754. The median household income for your area
has changed by 42.96% since 2000. It is estimated that the
median household income in your area will be $48,784 five
years from now, which represents a change of 14.30% from
the current year.
Repeat clients
The current year per capita income in your area is $26,713,
Decades
compare worth
this to of experience
the US average, which is $32,356. The current
yearHighly-focused
average household income in your area is $55,478,
specialization
compare this to the US average which is $84,609.
17MARKET
OVERVIEW
POPULATION 1 Miles 3 Miles 5 Miles HOUSEHOLDS BY EXPENDITURE 1 Miles 3 Miles 5 Miles
▪ 2023 Projection Total Average Household Retail
$55,322 $58,722 $59,073
Expenditure
Total Population 1,013 10,065 14,624
▪ Consumer Expenditure Top 10
▪ 2018 Estimate Categories
Total Population 1,022 10,270 14,755 Housing $13,915 $15,008 $15,109
▪ 2010 Census Transportation $9,174 $9,753 $9,911
Total Population 1,023 10,166 14,624 Shelter $8,151 $8,813 $8,863
▪ 2000 Census Food $5,008 $5,308 $5,358
Total Population 1,098 11,014 15,345 Personal Insurance and Pensions $4,406 $5,027 $5,071
▪ Current Daytime Population Health Care $4,118 $4,330 $4,343
2018 Estimate 812 15,579 20,571 Utilities $3,099 $3,418 $3,346
2018
SECTION 3
HOUSEHOLDS HOUSEHOLDS: 1 Miles 3 Miles 5 Miles Entertainment $2,979 $3,148 $3,175
▪ 2023 Projection Cash Contributions $2,276 $2,633 $2,665
Total Households 501 4,892 6,991
Apparel $1,322 $1,429 $1,439
▪ 2018 Estimate
6.0% POPULATION PROFILE 1 Miles 3 Miles 5 Miles
Total Households 500 4,951 6,974
▪ Population By Age
Average (Mean) Household Size 2.01 2.00 2.02
2018 Estimate Total Population 1,022 10,270 14,755
▪ 2010 Census
Under 20 25.46% 21.74% 22.26%
Total Households 503 4,889 6,888
20 to 34 Years 17.09% 18.71% 18.61%
▪ 2000 Census
35 to 39 Years 4.93% 5.78% 6.15%
Total Households 508 5,159 7,014
▪ Occupied Units Growth 40 to 49 Years 9.42% 10.16% 10.32%
2018-2023*:
2023 Projection 501 4,892 6,991 50 to 64 Years 20.68% 22.72% 22.01%
2018 Estimate 534 5,502 7,766 Age 65+ 22.43% 20.87% 20.65%
HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles Median Age 42.86 43.81 42.85
▪ 2018 Estimate ▪ Population 25+ by Education Level
$150,000 or More 1.03% 3.25% 3.82% 2018 Estimate Population Age 25+ 692 7,328 10,489
$100,000 - $149,000 8.67% 8.59% 8.70% Elementary (0-8) 0.89% 1.44% 1.31%
$75,000 - $99,999 11.30% 12.65% 12.49% Some High School (9-11) 3.19% 5.62% 5.17%
$50,000 - $74,999 17.90% 18.08% 18.17% High School Graduate (12) 36.22% 28.94% 27.41%
$35,000 - $49,999 11.26% 14.51% 14.36% Some College (13-15) 25.67% 26.79% 27.97%
Average Household Income $48,479 $54,942 $55,478 Associate Degree Only 13.43% 16.38% 17.64%
Median Household Income $35,143 $42,169 $42,680 Bachelors Degree Only 14.52% 14.82% 14.53%
Per Capita Income $23,796 $26,997 $26,713 Graduate Degree 6.02% 5.58% 5.41%
18CONFIDENTIALITY & DISCLAIMER
The information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be
made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepare to provide summary, unverified information to prospective
purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has
not made any investigation, and makes no 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 footage of the property and improvements, the presence or absence of contaminating substances, PCB’s or asbestos, the compliance with State and Federal regulations, the physical condition of the
improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property. The information contained in this
Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, not has Marcus &
Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers
must take appropriate measures to verify all of the information set forth herein.
NON-ENDORSEMENT NOTICE
Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation’s logo or name is not intended
to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus &
Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers.
ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.
NET LEASED DISCLAIMER
Marcus & Millichap hereby advises all prospective purchasers of Net Leased property as follows:
The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has
Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any
information provided.
As the Buyer of a net leased property, it is the Buyer’s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing
Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any obligation to conduct a due diligence examination of this
Property for Buyer.
Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased
property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors.
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 Buyer’s legal and financial advisors must request and carefully review all legal and financial documents related to the
property and tenant. While the tenant’s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including
newly-constructed facilities or newly-acquired locations, may be set based on a tenant’s projected sales with little or no record of actual performance, or comparable rents for the area. Returns are not
guaranteed; the tenant and any guarantors may fail 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 the intrinsic value
of the property and the value of any long-term lease, including 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.MOUNTAIN IRON RETAIL CENTER | MOUNTAIN IRON, MN
Minnesota BOR
Jon Ruzicka
Minneapolis Office
Lic: 40583288
ACT ID: ZAB0260100
EXCLUSIVE OFFERING
PRESENTED BY:
OFFICES
NATIONWIDE
www.marcusmillichap.comYou can also read
