16100 jacqueline court - loopnet
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OFFERING MEMORANDUMAbsolute* NNN Leased Investment - Highly Improved Office/Manufacturing BuildingFor Sale: $21,000,000
OFFERING MEMORANDUMAbsolute* NNN Leased Investment - Highly Improved Office/Manufacturing BuildingFor Sale: $21,000,000
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
03 INVESTMENT HIGHLIGHTS
04 LEASE HIGHLIGHTS
05 PROPERTY HIGHLIGHTS
06 TENANT HIGHLIGHTS
07 LOCATION HIGHLIGHTS
08 EXECUTIVE SUMMARY
09-12 PROPERTY PHOTOS
13-15 MAPS Aerial View Area Amenities Parcel Map
16-17 FLOOR PLANS
18-20 FINANCIAL INFORMATION Proforma Cash Flow/Return Capitalization Rate Calculations Loan Quote Terms
21-22 CONTACT & DISCLAIMER
PAGE:
TABLE OF CONTENTS
Please Contact Exclusive Agent:
BRIAN COSTELLO, Vice President+1 408.316.7447bcostello@ritchiecommercial.comDRE License No. 01914680
3 | 16100 JACQUELINE COURT
INVESTMENTHIGHLIGHTS
• Capitalization Rate: 5.46%
• Capitalization Rate Over Lease Term: 6.23%
• Average Cash Flow Over Lease Term: 6.83% (35% Down Payment) ** • Average Annual Return Including Amortization:** 11.7%
• Annual Absolute* NNN Income: $1,213,059
* Lessor Maintains Roof (New Roof in 2015/2016)** See Attached Bridge Bank Loan Quote and Attached Proforma Calculation Estimate
LEASEHIGHLIGHTS
4 | 16100 JACQUELINE COURT
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
• Single Tenant: Mission Bell Manufacturing Company (USA Millwork)
• Monthly NNN Rent: $97,989 Including the Building and the Expansion Land Parcel • Lease Breaks Out Rent: Expansion Land Parcel: $ 5,117 / Per Month, NNN Building: $92,872 / Per Month, NNN Total: $97,989 / Per Month, NNN
• Annual Rent Increase: ±5% (See Rent Schedule Below)
• Lease Expiration Date: December 31, 2027
• Options: Two (2) Options to Renew for Five (5) Years Each at Market Rate
• NNN: Absolute NNN Lease (except Lessor Maintains Roof Only)
• Rent Schedule BUILDING LAND PARCEL TOTAL January 1 to December 31, 2021: $ 92,872 $5,117 $ 97,989 January 1 to December 31, 2022: $ 98,031 $5,270 $103,302 January 1 to December 31, 2023: $103,191 $5,429 $108,620 January 1 to December 31, 2024: $108,351 $5,591 $113,942 January 1 to December 31, 2025: $113,510 $5,759 $119,269 January 1 to December 31, 2026: $118,670 $5,932 $124,602 January 1 to December 31, 2027: $123,829 $6,110 $129,939
PROPERTY HIGHLIGHTS
Highlights:• ±103,191 Square Foot Highly Improved Office/Manufacturing Building on ±4.55 Acres• ±2.18 Acre Expansion Parcel • ±38% High End Office• Heavy Power: 2,400 AMPS, 480 Volt• Solar Panels Allowing for Lower Utility Rates• New Extensive Lobby Upgrades in 2019• New Roof in 2015/2016• HVAC Energy Efficient Wireless Control Thermostat Upgrades in 2018• Large Cafeteria with Hood and Grease trap• Additional ±15,000 Square Feet of Covered Parking/Overhang Storage Area• Fenced Yard Space• Starline Industrial Electrical Bus Track (480 Volt, 3 phase)• 6 Dock High Doors, 2 Grade Level Doors • Load Levelers• 30’ Ceiling Height• Column Spacing: 26’x32’• Fully Fire Sprinklered• 5 Restroom Cores• 245 Parking Stalls On Site• Zoning: IG (General/Heavy Industrial)• APNs: Building: 817-32-046 Expansion Land Parcel: 817-32-058• Construction: Concrete Tilt-Up• Partial Two-Story• Year Built: 1987
5 | 16100 JACQUELINE COURT
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
TENANTHIGHLIGHTS
6 | 16100 JACQUELINE COURT
h�p://missionbell.com/
Mission Bell Manufacturing Company manufactures,
delivers, and installs custom millwork and casework
for commercial projects in the San Francisco Bay
Area, a region brimming with top tech companies,
world-renowned hospitals, and leading universities.
Originally called Morgan Hill Millwork, the company
was founded by Leonard and Margorie Scianna, along
with the two business partners in 1959. In 1963, the
Scianna’s brought out the two business partners and
became Mission Bell Manufacturing Company.
The Scianna family continued to own and operate the business, including over the recent years
on the shoulders of three Scianna brothers. With strong ties to the local community, the Scianna
brothers converted the company to an ESOP in 2002 until merginng with USA Millwork in 2019
and becoming Mission Bell, a USA Millwork Company. The company has called Morgan Hill, or
immediate surrounding areas, its home since the founding in 1959 and has continued to grow
into larger facilities, including moving into the subject property in 2008. Mission Bell also began
sourcing Reclaimed Wood in 2014 allowing their work to be accompanied by unique history.
LOCATIONHIGHLIGHTS
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
7 | 16100 JACQUELINE COURT
Morgan Hill is located in South Silicon Valley, only 10
miles south of San Jose, 30 minutes from Mineta San
Jose International Airport, and within minutes of Apple,
Google, and hundreds of other technology leading
companies.
Over the past recent years, a large part of the workforce
including industry executives, have sought out Morgan
Hill to relocate their families and businesses.
The Morgan Hill Economic Development Department states Morgan Hill has had a steady 2%
growth in workforce housing, and now contains 85,000 skilled workers within 30 minutes of
Morgan Hill.
Consequently, Morgan Hill’s downtown has recently been revamped, including now 30 plus
restaurants, and continues to attract families from all over the Bay Area.
The subject property is located just 1 mile from downtown Morgan Hill, and 1.5 miles from the
Morgan Hill Caltrain Station.
h�ps://www.choosemorganhill.com/why-morgan-hill
Norman Y. Mineta San Jose International Airport
EXECUTIVESUMMARY
8 | 16100 JACQUELINE COURT
Ritchie Commercial is pleased to present this single tenant
absolute Triple Net Leased Investment located in South
Silicon Valley. This investment presents a buyer the
opportunity to receive a high average cash flow return
over the lease term while obtaining a highly improved
office/manufacturing building with extra land for future
upside.
The property boasts an approximate 103,191 square foot
high image office/manufacturing building with extensive
recent upgrades including solar panels, covered parking, a
new roof in 2015/2016, increased heavy power, energy
efficient HVAC upgrades, and more. There is also a
separate expansion parcel consisting of approximately
2.18 acres that allows for future upside. The expansion
parcel is located to the north of the main parcel, and is a
part of the lease.
The lease breaks down the rent as follows; $92,872 per
month NNN rent on the building, and $5,117 per month
NNN rent on the expansion land parcel for a current
monthly total of $97,989 per month NNN rent.
The value of the expansion land parcel based on the
$5,117 NNN monthly rent and the 5.46% capitalization
rate referenced in this package, is $1,096,925, or $11.55
per square foot.
Yet, current market value for industrial land in Morgan Hill
is in the $13 to $15 per square foot range (market
information available upon request). Therefore, a buyer
can capitalize on the difference since the capitalized value
is less than the market value.
For sale at $21 million and evaluating the land per above
at $1,096,925, the building is evaluated at $19.9 million, or
$193 per square foot, strategically evaluated to be in line
with market values.
According to CoStar Analytics, the average sale price for
comparable buildings in the last two years in Morgan Hill,
South San Jose, and Gilroy is $200 per square foot.
The current rent for the building is $0.90 per square foot,
NNN. According to CoStar Analytics, the average monthly
rent for comparable buildings in the last three years in
Morgan Hill, South San Jose, and Gilroy is $0.88 per
square foot, NNN. Market information available upon
request.
Mission Bell Manufacturing is currently in their fourth year
of a ten-year lease, and has two (2) options to renew the
lease for five (5) years each. The lease is a modified AIR
lease, and contains an average of above market annual
increases at approximately five (5%) percent.
The investment allows for a 5.46% Capitalization Rate (6.23% over the lease term), and a 6.83% average cash
flow over the lease term with a 35% down payment
(11.7% average annual return including amortization).
See proforma calculations enclosed.
09 | 16100 JACQUELINE COURT
PROPERTYPHOTOS
10 | 16100 JACQUELINE COURT
PROPERTY PHOTOS
11 | 16100 JACQUELINE COURT
16100 JACQUELINE COURT
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13 | 16100 JACQUELINE COURTR A I L R O A D AV E N U E
B U T T E R F I E L D B LV D .B A R R E T T A V E N U E
B A R R E T T A V E N U E
T E N N A N T A V E N U E
T E N N A N T A V E N U E
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
AERIAL VIEW
AREAAMENITIES
14 | 16100 JACQUELINE COURT
0101
0101
SITE
DOWNTOWN MORGAN HILL
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
15 | 16100 JACQUELINE COURT
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
PARCEL MAP
EXPANSION PARCEL
13 | 16100 JACQUELINE COURT
IN-F
EED
TABL
E
TABLE
OU
TFEE
DTA
BLE
SPLI
CER
TABLE
HOMAGEDGE BANDER
ELEC. REQ.:460 / 3, 32ADUST DUCT:6" + 6"
BACKGROOVER
HOMAGEDGE BANDERTOPS & PANELS
ELEC. REQ.:460 / 3, 20ADUST DUCT:6" + 6"
WEEKEVENTURE 1
SAFETY MAT
ELEC. REQ.:verify 460 / 3, 50ADUST DUCT8"
ELEC. REQ.:460 / 3, 20ADUST DUCT8"
GANNOMAT
WEE
KEBH
P200
SAFE
TY M
AT
ELEC
. REQ
.:46
0 / 3
, 50A
DU
ST D
UC
T8"
SHR
INK
WR
APPERTRANSFERRAMPBENCH
CO
NVEYO
RC
ON
VEYOR
CO
NVEYO
R
CASE C
LAMP
BENCHBENCHBENCH
DELTA
RIP SAW
,TO
PS
HARDWARE
LARGE SPRAYBOOTH W/HEATERS
SMALL SPRAYBOOTH
ALTENDORFELEC. REQ.:460 / 3-20ADUST DUCT:5" + 3"
ALTENDORFELEC. REQ.:460 / 3-20ADUST DUCT:5" + 3"
TRAN
SFER
TABL
E
LAMINATE& VENEERPRESS
GLU
ESPR
EADER
LIFT
TRANSFERTABLE ELEC. REQ.:
460 / 3, 48A
ELEC. REQ.:460 / 3, 4A
ELEC. REQ.:460 / 3, 10A
LIFTELEC. REQ.:460 / 3, 4A BU
ILD
UP
BEN
CH
WID
E BE
LTSA
ND
ERW
/OU
TFEE
DEL
EC. R
EQ.:
460
/ 3, 1
50A
DU
ST D
UC
T8"
SAMPLES CABINET
VENEER SAMPLESELECTION TABLE
VENEER SAMPLESELECTION TABLE
VENEER SAMPLESELECTION TABLE
VENEER SAMPLESELECTION TABLE
GU
ILLO
TIN
EFR
ON
T
END CLIPPINGTABLE
VENEER TABLE
VENEER TABLE
VENEER TABLE
VENEER TABLE
VENEER TABLE
VENEER TABLE
VENEER TABLE
VENEER TABLE
VENEER TABLE
10' VENEERRACK
10' VENEERRACK
10' VENEERRACK
POSTFORMERCONVEYOR
FEED TABLEFEEDER PANELS & LIFT CLEANER &
SPREADERINDEXINGSTATION
HEATTUNNEL
TRANSFERTABLE
RIPSAW
ELEC. R
EQ.:
460 / 3, 20AD
UST D
UC
T4" + 5"
ELEC. REQ.:460 / 3, 20ADUST DUCT:4"
JOIN
TER
PLAN
ER
RAD
IAL
ARM
SAW
ELEC
. REQ
.:46
0 / 3
, 10A
DU
ST D
UC
T6"
ELEC
. REQ
.:46
0 / 3
, 20A
DU
ST D
UC
T6"
ELEC
. REQ
.:46
0 / 3
, 15A
DU
ST D
UC
T5"
SHAPER
CANTILEVERLUMBER RACK
VERTICALLUMBER RACK
ALTENDORFELEC. REQ.:460 / 3-20ADUST DUCT:5" + 3"
TOPS C
OVER
TOPS SWIVELTRANSFER
TABLE
FEEDER
TOPSSPRAYBOOTH
ELEC. REQ.:460, 3, 20ADUST DUCT?
TOPS LAMINATERACK
LIFTELEC
. REQ
.:460 / 3, 4A
BLUM BLUM460 / 3, 2A, 4" 460 / 3, 2A, 4"
DR
ILL110 / 1, 15A DRILL
110 / 1, 15A
10' S
HEE
TG
OO
DS
STAC
K
8' S
HEE
TG
OO
DS
STAC
K
10' SHEETGOODS RACK
10' SHEET
GO
OD
S RAC
K
STAND
UP
WASTE R
ACK
ELEC. REQ.:460 / 3, 20ADUST DUCT4" + 5"
SHAPER
CONVEYOR CONVEYOR CONVEYOR
CO
NVEYO
RC
ON
VEYOR
10' SHEETGOODS RACK
8' SHEETGOODS RACK
8' SHEETGOODS RACK
8' SHEETGOODS RACK
8' SHEETGOODS RACK
10' SHEETGOODS RACK
8' SHEETGOODS RACK
8' SHEETGOODS RACK
HARDWAREHARDWARE
HAR
DW
ARE
HAR
DW
ARE
HAR
DW
ARE
HAR
DW
ARE
HAR
DW
ARE
HAR
DW
ARE
HAR
DW
ARE
HAR
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HAR
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HAR
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ARE
HAR
DW
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HAR
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HAR
DW
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LAM
INAT
ETA
BLE
MITER SAW
10' SHEET
GO
OD
S STACK8'
SH
EET
GO
OD
S ST
ACK
SLITTER
MEZZANINEOFFICE
460, 3, 20A
277-480, 3, 125A
120V
460, 3, 50A
460, 3, 20A
460, 3, 20A
460, 3, 20A
460, 3, 20A
460, 3, 20A
460, 3, 20A
460, 3, 20A
460, 3, 20A
460, 3, 30A
460, 3, 30A
460, 3, 20A
460, 3, 20A
460, 3, 50A
460, 3, 50A
S-750
S-750
S-75
0
S-750
S-10
00
S-10
00
HO
LZMA
BEAM SAW
SIDE
LOAD
ER
ELEC. R
EQ.:
460 / 3, 48A VFYD
UST D
UC
T:8" + 6" + 4" VFY FLAT BED
CNCROUTER
ELEC. REQ.:460 / 3, 50ADUST DUCT:6" + 6"
ALTENDORFELEC. REQ.:460 / 3-20ADUST DUCT:5" + 3"
Vac Pump
RO
LLC
OAT
FLAT
FIN
ISH
ER
WID
E BE
LTSA
ND
ERW
/OU
TFEE
DEL
EC. R
EQ.:
460
/ 3, 1
50A
DU
ST D
UC
T8"
FLOOR PLANS
MEZZANINE
DOWNSTAIRS SHOP GROUND FLOOR
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
17 | 16100 JACQUELINE COURT
PARCEL
FLOOR PLANS 16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
CAFETERIA
PATIO
DOWNSTAIRS OFFICE
UPSTAIRS OFFICE
18 | 16100 JACQUELINE COURT
INVESTMENTINFORMATION
Proforma - Estimated Cash Flow/Return Excludingand Including Amortization
PREMISE AND ASSUMPTIONS
Close of Escrow: July 31, 2021 (77 Month Lease Term)Purchase Price: 21,000,000$
Cash at COE: 7,350,000$ * Plus Loan & Closing Cost: 100,000$ ***TOTAL: 7,450,000$
Loan Amount: 13,650,000$ *Interest Rate: 4% Per Annum, Fixed Rate for 10 Years*Amortization: (25 Years)*Monthly Payment: 72,469$ *Average Monthly Absolute** NNN Rent Over Lease Term From July 31, 2021: 115,396$
Notes:*See Attached Bridge Bank Quote (subject to change)
** Absolute NNN Lease except Landlord Maintains Roof - Estimate: $6,000/Year (New Roof in 2015/2016) No Property Management Fee Since Absolute NNN Lease Except Roof Maintenance*** Subject to Final Bank and Title Company Cost, Initial Estimate Only
(1) CASH FLOW EXCLUDING AMORTIZATION
$115,396 Monthly Average Rent Over Term (x 12 Months): 1,384,754$ Annual Roof Maintenance Estate (Less): < 6,000$ >Monthly Loan Payment ($72,469 x 12 Months) (Less): < 869,628$ >CASH FLOW ESTIMATED: 509,126$
$509,126 Divided by Estimated Cash at Close of Escrow: 7,450,000$
6.83% Average Cash Flow Return Over Lease Term (Excluding Amortization) (2) RETURN INCLUDING AVERAGE ANNUAL AMORTIZATION OVER 77 MONTHS (LEASE TERM)
$2,326,296 Amortization Over Term (divided by 77 Months) =$30,211 Per Month (x 12 Months): 362,532$ Average Annual Amortization over 77 MonthsPlus $509,126 Cash Flow Excluding Amortization from Above = 509,126$
871,665$ Total Return
$871,665 Return Divided by $7,450,000 Cash at Close = 11.7% Average Annual Return (Cash Flow + Amortization)
19 | 16100 JACQUELINE COURT
INVESTMENTINFORMATION
Capitalization Rates Based On First Year Rent*And Average Rent Over The Lease Term
*Based on Close of Escrow of July 31, 2021 ** Absolute NNN Lease Except Landord Maintains Roof - Estimate $6,000 / Year (New Roof in Year 2015/2016) No Property Management Fee Since Absolute NNN Lease Except Roof Maintenance
(1) CAPITALIZATION RATE BASED ON FIRST YEAR RENT No Property Management Fee** First Year Absolute ** NNN Rent: 1,213,059$ 5% Vacancy (Less): < 60,652$ > Roof Maintenance (Less): < 6,000$ > Annual: 1,146,407$
1,146,407$ 21,000,000$ 5.46% Capitalization Rate
(2) CAPITALIZATION RATE BASED ON AVERAGE RENT OVER 77 MONTH LEASE TERM No Property Management Fee** Average Absolute ** NNN Rent: 1,384,752$ 5% Vacancy (Less): < 69,237$ > Roof Maintenance** (Less): < 6,000$ > Annual: 1,309,515$
1,309,515$ 21,000,000$ 6.23% Capitalization Rate
20 | 16100 JACQUELINE COURT
16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
• Purchase Price: $21,000,000
• Loan Amount: $13,650,000 (65% LTV)
• Rate: 10 Year T + 2.58% (4% Presently), Fixed for Ten (10) Years Floor of 4.00%
• Term: Ten (10) Years
• Amortization: Twenty-Five (25) years
• Fee: 0.50% Bank Fee. Appraisal, Environmental, Escrow, Title Insurance (as required)
• Repayment: $72,469 Monthly
• Repayment Penalty: Five (5) Years 5% of the Outstanding Principal Balance in Year One, 4% in Year Two, 3%, 2%, 1%. Up to 10% of the outstanding principal balance may be prepaid in any year without penalty.
• DSCR Requirement: 1.30 x Minimum
• Recourse: Yes, Full Personal or Corporate Guaranty of Any Individual or Entity Owning 20% or more of the Subject Real Estate
• Collateral: 1st Deed of Trust and Assignment of Lease on Subject Property located at 16100 Jacqueline Court, Morgan Hill, California
• Disclaimer Please note that this quote is not a commitment or an offer to lend. Any proposal the bank makes to lend will be subject to all necessary due diligence
Ken Mannina SVP Bridge Bank, a division of Western Alliance Bank MEMBER FDIC Direct 408.556.8336 | Cell 408.529.1618 55 Almaden Blvd Suite 100 San Jose CA 95113 ken.mannina@bridgebank.com www.bridgebank.com
Loan Quote & TermsINVESTMENTINFORMATION
21 | 16100 JACQUELINE COURT
BRIAN COSTELLOVice President+1 408.316.7447bcostello@ritchiecommercial.comDRE License No. 01914680
Please Contact Exclusive Agent:
34 WEST SANTA CLARA STREET, SAN JOSE, CA. 95113408.971.2700 fax: 408.971.1600DRE #01209214 | www.ritchiecommercial.com
San Francisco | San Jose | Walnut Creek
INVESTMENT CONTACT
All information herein distributed by Ritchie Commercial is intended to be viewed only by the parties specifically targeted by Ritchie Commercial.
The Investment Offering is prepared to provide a summary of 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 thorough due diligence investigation. Ritchie Commercial 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 improvements, the presence or absence of contaminating substances, PCB’s or asbestos, the compliance with State and Federal
regulations, the physical condition of improvements thereon, nor 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 investment offering has been obtained from sources
Ritchie Commercial deems reliable, however, Ritchie Commercial has not verified and will not verify any of the information contained herein. Ritchie
Commercial has not conducted any investigations regarding these matters and makes no warranty or representation whatsoever regarding the
accuracy of completeness of the information provided. All potential buyers must take the appropriate measures to verify all of the information which
is stated herein.
DISCLAIMER16100 Jacqueline Court | Morgan Hill | California±103,191 Square Feet on ±4.55 Acres±2.18 Acre Expansion Parcel
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