starbucks shopping strip - richland, wa - om2€¦ · this marketing brochure has been preparedto...

STARBUCKS SHOPPING STRIP698 Gage Blvd • Richland, WA 99352

100% Leased – 7,038 SF - NNN

Offering Memorandum

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N O N - E N D O R S E M E N T A N D D I S C L A I M E R N O T I C E

Confidentiality and DisclaimerThe 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 prepared 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, nor 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. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2018 Marcus & Millichap. All rights reserved.

Non-Endorsement NoticeMarcus & 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.

STARBUCKS SHOPPING STRIP

Richland, WA

ACT ID ZAA0210117

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EXECUTIVE SUMMARYOFFERING SUMMARY

MAJOR EMPLOYERS

EMPLOYER # OF EMPLOYEES

Barrett Business Services Inc 5,004

Kadlec Regional Medical Center 3,614

Favorite Hlthcare Staffing Inc 1,213

Bechtel Hanford Inc 600

Kaiser Engineer Hanford Co 500

Energy Richland Operations 438

Macys 390

Target 354

McDonalds 323

Lamb Weston Inc 310

Lourdes Counseling Center 300

Lowes 300

DEMOGRAPHICS

1-Miles 3-Miles 5-Miles

2018 Estimate Pop 10,235 41,211 104,812

2010 Census Pop 9,432 35,630 93,090

2018 Estimate HH 4,032 16,311 40,325

2010 Census HH 3,687 13,978 35,392

Median HH Income $97,471 $80,347 $69,940

Per Capita Income $49,603 $42,192 $36,312

Average HH Income $125,902 $106,434 $93,959

YEAR 1

Price $1,975,000 CAP Rate 7.00%

Down Payment 35% / 691,250Net Operating Income

$138,167

Loan Amount $1,283,750Net Cash Flow After Debt Service

7.46% / $51,612

Loan Type Proposed New Total Return 10.21% / $70,212

Interest Rate / Amortization

5.10% / 30 Years

Gross Leasable Area (GLA) 7,038 SFCurrent Occupancy

100.0%

Price/SF $280.62Year Built / Renovated

2005

Lot Size 0.7 acre(s)

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OFFERING SUMMARY

100% Leased Starbucks Anchored 3-Tenant Shopping Strip

Out-Pad to a of Grocery (Albertsons) Anchored Shopping Center

The Only Starbucks Drive-Thru in 3-Mile Radius

Starbucks Funded an Interior Renovation & Addition of Outdoor

Seating in 2015

Average Household Income (1-Mile Radius) - $125,902 !!!

Located on Gage Blvd - 18,000 VPD

Quality Construction (2005) – No Deferred Maintenance

True Triple-Net (NNN) Leases

1.5 Miles from Columbia Center Mall – Largest Regional Mall in

SE Washington

INVESTMENT HIGHLIGHTS

INVESTMENT OVERVIEW

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Marcus & Millichap is pleased to exclusively present for sale

a 3-Tenant strip center anchored by Starbucks. The

property is located at the entrance to a grocery (Albertsons)

anchored shopping center. The property has great visibility

along Gage Blvd the main east-west arterial running through

Richland and benefits from being at the main point of

entrance to this daily-needs center. Starbucks has

anchored the center since it was first developed in 2005

and Club 24 opened their doors in 2014 making South

Richland their 11th location in the Pacific NW. The leases

are triple-net (NNN) with the tenants reimbursing for their

proportionate share of CAM, Taxes, and Insurance.

FINANCIAL ANALYSIS


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TENANT SUMMARY

694-698 Gage Boulevard

Richland, WA 99352

Square % Bldg Lease DatesApprox

Base

Rent/ Annual LeaseLease

Renewal

Tenant Name Feet Share Comm. Exp. Rent/SF Month Rent Type Guarantor Options

Starbucks 1,519 21.6% 12/29/05 2/28/21 $31.05 $3,930 $47,165 NNN Corporate 2, 5 Year Options

Salon Chic 505 7.2% 1/30/17 4/30/22 $20.60 $893 $10,715 NNN Personal 1, 5 Year Option

Club 24 5,014 71.2% 6/25/14 9/30/20 $17.57 $7,538* $90,455* NNN Personal 1, 5 Year Option

*Takes into account rent bump on 7-1-19

Total SF: 7,038 100%Monthly

Income:

$12,361

Occupied SF: 7,038 100%Annual

Income:

$148,335

Available SF: 0 0%Average

Rent/SF:

$23.07

FINANCIAL ANALYSIS


OPERATING STATEMENT

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Income Year 1 Per SF

Scheduled Base Rental Income 148,335 21.08

Expense Reimbursement Income

CAM 24,924 3.54

Insurance 2,628 0.37

Real Estate Taxes 21,552 3.06

Total Reimbursement Income $49,104 99.4% $6.98

Potential Gross Revenue 197,439 28.05

General Vacancy (9,872) 5.0%

Effective Gross Revenue $187,567 $26.65

Operating Expenses Year 1 Per SF

Common Area Maintenance (CAM)

Utilities 1,334 0.19

Repairs & Maintenance 17,789 2.53

Insurance 2,323 0.33

Management Fee 7,414 4.0% 1.05

Other Expenses - Non Reimbursable 704 0.10

Total Expenses $49,400 $7.02

Expenses as % of EGR 26.3%

Net Operating Income $138,167 $19.63

PRICE $1,975,000

CAP Rate 7.00%

REGIONAL MAP


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LOCAL MAP


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AERIAL PHOTO


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MARKET OVERVIEW

OVERVIEW

TRI-CITIES, WASHINGTON

Located in the southwestern portion of Washington state, the Tri-Cities

of Kennewick, Pasco and Richland are within 225 miles of Seattle and

Portland via Interstate 82. The metro is composed of Benton and Franklin

counties. The Department of Energy is a driver of the economy, providing

highly skilled jobs that have contributed to boosting population growth

and incomes well above the U.S. level. The Columbia, Yakima and Snake

rivers provide an array of recreational activities, while the area’s favorable

weather and cultural amenities add to the quality of life.

The DOE in conjunction with partners and contractors including Battelle, Bechtel National,

Washington River Protection Solutions, Mission Support Alliance and CH2M provide more than

13,000 area jobs.

Kadlec Regional Medical Center, Trios Health, Lourdes Medical Center and Prosser Memorial

make up the vital healthcare sector, employing thousands of workers.

Plenty of sun and three rivers lure outdoor enthusiasts to a wide variety of water sports, as well as

golfing, hunting, fishing. Miles of trails attract joggers and bicyclists, while the region’s vineyards

and microbreweries draw tourists.

285K

2017POPULATION:

99K

2017HOUSEHOLDS:

33.5

2017MEDIAN AGE:

$59,400

2017 MEDIAN HOUSEHOLD INCOME:

DEMOGRAPHICS

U.S. Median:

37.8U.S. Median:

$56,3009.9%

Growth2017-2022*:

7.3%

Growth2017-2022*:

ECONOMY

METRO HIGHLIGHTS

* Forecast

Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Moody’s Analytics; U.S. Census Bureau


DEPARTMENT OF ENERGY

The DOE’s vast Hanford Site, Pacific Northwest National Laboratory and other

affiliated programs attract highly skilled engineers, scientists and researchers.

LARGE AGRICULTURAL SECTOR

Crops including wheat, potatoes, apples, cherries and grapes thrive in the conducive

weather. Major employers include Lamb Weston, Tyson Foods and Broetje Orchards.

INSTITUTIONS OF HIGHER LEARNING

Washington State University Tri-Cities, Columbia Basin College, Tri-Tech Skills

Center and Charter College help provide an educated workforce.

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PROPERTY NAME

MARKETING TEAM


DEMOGRAPHICS

Source: © 2018 Experian

Created on March 2019

POPULATION 1 Miles 3 Miles 5 Miles

2023 Projection

Total Population 11,731 46,558 117,247

2018 Estimate


2010 Census


2000 Census


Current Daytime Population

2018 Estimate 6,223 37,054 105,516

HOUSEHOLDS 1 Miles 3 Miles 5 Miles

2023 Projection

Total Households 4,755 18,799 45,842

2018 Estimate


Average (Mean) Household Size 2.47 2.47 2.56

2010 Census


2000 Census


Occupied Units

2023 Projection 4,755 18,799 45,842

2018 Estimate 4,152 16,827 41,165

HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles

2018 Estimate

$150,000 or More 23.16% 17.67% 12.94%

$100,000 - $149,000 25.21% 20.92% 18.34%

$75,000 - $99,999 16.34% 14.65% 15.12%

$50,000 - $74,999 13.08% 16.39% 18.55%

$35,000 - $49,999 7.79% 10.83% 12.21%

Under $35,000 14.44% 19.56% 22.84%

Average Household Income $125,902 $106,434 $93,959

Median Household Income $97,471 $80,347 $69,940

Per Capita Income $49,603 $42,192 $36,312

HOUSEHOLDS BY EXPENDITURE 1 Miles 3 Miles 5 MilesTotal Average Household Retail Expenditure

$95,571 $87,729 $83,171

Consumer Expenditure Top 10 Categories

Housing $24,826 $22,855 $21,740

Transportation $15,877 $14,280 $13,382

Shelter $14,992 $13,955 $13,382

Food $10,814 $9,699 $9,097

Personal Insurance and Pensions $9,291 $8,343 $7,809

Health Care $6,319 $5,562 $5,089

Utilities $4,479 $4,139 $3,917

Entertainment $3,958 $3,561 $3,316

Apparel $3,745 $3,251 $2,941

Cash Contributions $3,396 $2,806 $2,503

POPULATION PROFILE 1 Miles 3 Miles 5 Miles

Population By Age

2018 Estimate Total Population 10,235 41,211 104,812

Under 20 26.00% 26.20% 28.63%

20 to 34 Years 14.82% 18.19% 20.74%

35 to 39 Years 5.57% 6.16% 6.71%

40 to 49 Years 11.56% 12.00% 11.47%

50 to 64 Years 22.09% 20.85% 18.50%

Age 65+ 19.93% 16.60% 13.95%

Median Age 43.32 39.54 35.45

Population 25+ by Education Level

2018 Estimate Population Age 25+ 7,059 28,030 68,170

Elementary (0-8) 0.57% 1.14% 1.85%

Some High School (9-11) 2.10% 3.47% 3.90%

High School Graduate (12) 13.54% 18.19% 22.45%

Some College (13-15) 22.39% 24.65% 25.79%

Associate Degree Only 11.16% 11.71% 11.02%

Bachelors Degree Only 31.38% 25.13% 21.56%

Graduate Degree 18.09% 14.85% 12.23%

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Income

In 2018, the median household income for your selected geography is

$97,471, compare this to the US average which is currently $58,754.

The median household income for your area has changed by 18.09%

since 2000. It is estimated that the median household income in your

area will be $105,480 five years from now, which represents a change

of 8.22% from the current year.

The current year per capita income in your area is $49,603, compare

this to the US average, which is $32,356. The current year average

household income in your area is $125,902, compare this to the US

average which is $84,609.

Population

In 2018, the population in your selected geography is 10,235. The

population has changed by 78.78% since 2000. It is estimated that

the population in your area will be 11,731.00 five years from now,

which represents a change of 14.62% from the current year. The

current population is 48.37% male and 51.63% female. The median

age of the population in your area is 43.32, compare this to the US

average which is 37.95. The population density in your area is

3,248.30 people per square mile.

Households

There are currently 4,032 households in your selected geography. The

number of households has changed by 105.09% since 2000. It is

estimated that the number of households in your area will be 4,755

five years from now, which represents a change of 17.93% from the

current year. The average household size in your area is 2.47 persons.

Employment

In 2018, there are 2,505 employees in your selected area, this is also

known as the daytime population. The 2000 Census revealed that

83.70% of employees are employed in white-collar occupations in

this geography, and 17.95% are employed in blue-collar occupations.

In 2018, unemployment in this area is 3.87%. In 2000, the average

time traveled to work was 22.00 minutes.

Race and Ethnicity

The current year racial makeup of your selected area is as follows:

84.98% White, 1.50% Black, 0.09% Native American and 6.56%

Asian/Pacific Islander. Compare these to US averages which are:

70.20% White, 12.89% Black, 0.19% Native American and 5.59%

Asian/Pacific Islander. People of Hispanic origin are counted

independently of race.

People of Hispanic origin make up 8.34% of the current year

population in your selected area. Compare this to the US average of

18.01%.

PROPERTY NAME

MARKETING TEAM


Housing

The median housing value in your area was $265,685 in 2018,

compare this to the US average of $201,842. In 2000, there were

1,674 owner occupied housing units in your area and there were 291

renter occupied housing units in your area. The median rent at the

time was $641.

Source: © 2018 Experian

DEMOGRAPHICS

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