MICHAEL LINDER, SIOR 614.410.5628 email@example.com
JEFF DEVINE 847.698.8264 firstname.lastname@example.org
STEVE DISSE 847.698.8263 email@example.com
Grove City, Ohio 43123
3500 Southwest Boulevard
8 15 22
6250 N. River Road Ste 11100 Rosemont, IL 60018 847.698.8444
Two Miranova Place Suite 900 Columbus, OH 43215 614.436.9800
STEVE DISSE 847.698.8263 firstname.lastname@example.org
JEFF DEVINE 847.698.8264 email@example.com
MICHAEL LINDER, SIOR 614.410.5628 firstname.lastname@example.org
TABLE OF CONTENTS: Executive Summary
3500 SOUTHWEST BOULEVARD GROVE CITY, OHIO 43123
THIS PROPERTY IS BEING SOLD AS AN “AS IS, WHERE IS” SALE.
THIS CONFIDENTIAL MEMORANDUM SHALL NOT BE DEEMED A PREPRESENTATION OF THE STATE OF AFFAIRS OF THIS PROPERTY OR CONSTITUTE AN INDICATION THAT THERE HAS BEEN NO CHANGE IN THE BUSINESS OR AFFAIRS OF THE PROPERTY SINCE THE DATE OF PREPARATION OF THIS MEMORANDUM.
If you do not wish to pursue negotiations leading to this acquisition, or if in the future you discontinue such negotiation, you agree to return this confidential memorandum to Colliers.
THE SELLER EXPRESSLY RESERVES THE RIGHT AT ITS SOLE DESCRETION TO REJECT ANY OR ALL PROPOSALS OR EXPRESSIONS OF INTEREST IN THE PROPERTY AND TO TERMINATE DISCUSSIONS WITH ANY PARTY AT ANY TIME WITH OR WITHOUT NOTICE.
By receipt of this confidential memorandum, you agree that the memorandum and its contents are confidential, that you will hold and treat it in the strictest of confidence, that you will not, directly or indirectly, disclose or permit anyone else to disclose this memorandum or its contents to any other person, firm or entity without prior written authorization of Seller and that you will not use or permit to be used this memorandum or its contents in any fashion or manner detrimental to the interest of the Seller. Photocopying or other duplication is strictly prohibited.
This confidential memorandum, which contains brief, selected information pertaining to the business and affairs of the Property, has been prepared by Colliers International (“Colliers). This confidential memorandum does not purport to be all-inclusive or to contain all the information which a prospective purchaser may desire. Neither Seller nor Colliers nor any of their officers, employees or agents make any representation or warranty, expressed or implied, as to the accuracy or completeness of this confidential memorandum or any of its contents and no legal liability is assumed or shall be implied with respect thereto.
THIS IS A CONFIDENTIAL MEMORANDUM intended solely for your own limited use in considering whether to pursue negotiations to acquire 3500 Southwest Boulevard (the “Property”) located in Grove City, Ohio and is not intended to be an offer for the sale of the Property.
BUILDING HIGHLIGHTS > Class-A bulk warehouse > 100% occupied > Stabalized asset > Tenant has occupied the building since it was built
Built in 1992, this fully occupied Class-A facility is home to Pier 1 Imports (U.S.), Inc. Pier 1 Imports (U.S.), Inc. a wholly owned subsidiary of Pier 1 Imports, Inc., guarantor of the lease.
EXECUTIVE SUMMARY On behalf of Sun Life Insurance of Canada (“Seller”), Colliers International, as exclusive broker, is pleased to offer for sale 3500 Southwest Boulevard. This offering consists of one bulk distribution building totaling 527,127 square feet. The Property is located west of Broadway on Southwest Boulevard in Grove City, Ohio less than two and a half miles from the Interstate 270/SR 62 interchange. The southwest industrial submarket is located only ten minutes south of Interstate 70 which serves as a major trans-America distribution avenue connecting the east coast with the west coast.
• • • • • • • • •
Single load design 180’ deep truck court ESFR fire protection system 28’6”-31’8”z clear height 521’ building depth 5” thick reinforced concrete slab Typical 51’ W x 40’ D column spacing 2.9% office finish Trailer parking
LEASE RATE $3.15 PSF (annually), NNN
LEASE EXPIRATION Lease renewal with new expiration date of December 31, 2017
TERM 20-year and two day term with a commencement date of December 30, 1994
CURRENT CASH FLOW STABILITY 100% leased to Pier 1 Imports (U.S.) Inc. with lease guaranteed by Pier 1 Imports Inc.
NET LEASE STRUCTURE Tenant reimburses pro rata share of CAM, taxes, insurance and management fees
QUALITY TENANCY Pier 1 Imports Inc. is North America’s largest specialty retailer of unique fashion-forward, decorative home furnishings and gifts directly imported from many countries around the world - displayed in over 1,000 Pier 1 Imports stores.
CLASS-A BUILDING DESIGN
$ 1,758,443 $ 1,758,441 $ 1,758,250 $ 1,758,053 $
Projected NOI January 2014-December 2014 January 2015-December 2015 January 2016-December 2016 January 2017-December 2017
3 Year Average
Property Tours Market tours are available on appointment. Please contact Michael Linder to coordinate a tour.
Terms The property is being sold on an â€œas-is, where isâ€? basis, without structural, economic or environmental representations or warranties.
Offer Format The building is being offered free and clear of any mortgage financing
Offer Due Date To be determined
3500 Southwest Blvd. is in the heart of Columbusâ€™ Southwest submarket. This submarket is one of central Ohioâ€™s most coveted importing and exporting arena given its quick access to Interstate 71.
3500 Southwest Blvd.
Ohio, United States, North America
3500 Southwest Blvd.
Grove City, Ohio, United States
t ou I-270
isb Ha rr
KEY DISTANCES I-270: 1.5 miles I-71: 4.0 miles I-70: 5.5 miles
ike urg P
53 truck spaces
51 truck spaces
528,300 SF 527,127 SF 30.411 Acres
Lewis Center Way
19 truck spaces
Trailer Parking 140 trailer spots Truck Courts 180’ truck court Dock Loading Forty-five (45) dock doors Drive-In Loading One (1) drive-in door Zoning “IND-2” (Heavy Industrial) in the City of Grove City
Year Completed 1992
Ceiling Height 28’6”-31’8” clear
Sprinkler System ESFR
Column Spacing Typical 51’W x 40’D
Building Depth 521’
Auto Parking 121 auto parking spaces
SF 505,867 15,260 6,000
Type of Space Warehouse Office Axillary
Building Construction Pre-cast concrete
Tenancy Tenant has occupied the building since it was built
Vacancy 100% occupied
Building Type Class-A bulk warehouse, single load design
Site size ±30.411 acres
Office 2.9% office finish
% Occupied 96.0% 2.9% 1.1%
Outside Eating Area
Warehouse Heating • Four (4) Titon direct gas fired air rotations producing 50,000 cfm 92 1/4” external static pressure each and produce a maximum of 3,850,000 BTUH of heating ventilation air.
Warehouse Lighting Combination of 400-watt and 1,000-watt high pressure sodium lighting installed in high-bay fixtures with acrylic reinforcement producing 26-33 foot candles on average
Warehouse Floor • 5” thick, reinforced concrete floor slab
Fire Protection System • ESFR with 150 hp, 1,500 gpm electric fire pump rated at 12.5 psi with backup generator
Roof Structure • Single-ply EPDM membrane roof (Ballasted) over 2” R-12.5 3rd insulation
Exterior Walls • 8” insulated pre-cast concrete panels
Dock Doors and Equipment • Forty-five (45) dock doors (9’2” x 10’) with full vertical, foam insulation and vision lights • 40,000 lb. hydraulic levelers. Dock seals on every door • One (1) 12’ x 14’ drive-in door with motor operator
Pavement Specifications • Car Area: 3” asphalt pavement over 8” stone base • Truck Area: 6” concrete reinforced
Utilities • 2” domestic water line, 8” fire line, 6” sanitary sewer, 2” gas line • Electric - Three (3) 3-phase, 2,000 amp 277/480 volt panels
Warehouse Exhaust • Eleven (11) mounted exhaust fans with interlocked powered levelers • 114 (48” x 96”) skylights
2.5% of Gross Rental Revenue
PSF $0.05 $0.12 $0.18 $0.06 $0.41
320,657 320,657 0 100%
2010 Capital Reserve:
Expense Annual Growth Rate:
Total $16,476 $37,740 $57,222 $18,637 $130,075
Total SF Occupied SF Vacant SF Percent Occupied
2012 Estimated Operating Expenses Insurance Real Estate Taxes CAM Management Fees Total Expenses
Size and Occupancy:
Effective Date of Analysis:
INITIAL OPERATING ASSUMPTIONS
2012 Commission Structure: CASHOUT New Effective Commission 8.0%
2012 2nd Generation TI Allowance: New $2.00/sf
General Inflation Inflation Method: Fiscal Method: Fiscal Inflation Rate: 3.00% Market Rent Growth Rate: 3%, 4%, 4%, 3% thereafter 2012 Market Rates $2.25 PSF Base Rent Escalation (within term): 2.50% Renewal Probability: 75% Downtime on Turnover: 9 Months Term: 5 Years Expense Recoveries: Pro rata share of CAM, Taxes, Insurance, and Management Fees
MARKET LEASING ASSUMPTIONS
NET OPERATING INCOME
TOTAL LEASING & CAPITAL COSTS
LEASING & CAPITAL COSTS
TOTAL OPERATING EXPENSES
Expense Reimbursement Revenue
Scheduled Base Rental Revenue
TOTAL EFFECTIVE GROSS REVENUE
Absorption & Turnover Vacancy
@ 3-1-14 $ / SF
Base Rental Revenue
EFFECTIVE GROSS REVENUE
Insurance Lessee will maintain insurance on the Premises of the following character: Insurance against risks of direct physical loss, including loss by fire, lightning and other risks which at the time are included under “Special Form” coverage, in amounts sufficient to prevent Lessor and Lessee from becoming a coinsurer of any loss but in any event in amounts not less than 100% of the actual replacement value of the Improvements, exclusive of foundations and excavations.
Rental Schedule Period Amount/Mo. $/SF/Yr. 1/1/14 - 12/31/17 $ $
Lease Term 20 years and two days, expiring December 31, 2014 Lease renewed with expiration date of December 31, 2017
Lease Commencement Date December 30, 1994
527,127 SF 100%
Total Leased Premises: Percentage Occupancy:
Tenant Address 3500 Southwest Boulevard Grove City, Ohio
Taxes Lessee shall pay, prior to delinquency, all taxes, assessments, excises, levies, fees, water and sewer rents and charges, and all other governmental charges, general and special, ordinary and extraordinary, foreseen and unforeseen, which are, at any time prior to or during the Primary Term or any Extended Term hereof, imposed or levied upon or assessed against or which arise with respect to the Premises or Lessor’s ownership or interest therein, any Basic Rent, additional rent or other sums payable hereunder, the operation, possession or use of the Premises, or this Lease or the leasehold estate created hereby; all gross receipts or similar taxes (i.e., taxes based upon gross income which fail to take into account deductions with respect to depreciation, interest, taxes or ordinary and necessary business expenses, in each case relating to the Premises) imposed or levied upon, assessed against or measured by any Basic Rent, additional rent or other sums payable hereunder (“Gross Receipts Taxes”); all sales, value added, ad valorem, use and similar taxes at any time levied, assessed or payable on account of the acquisition, ownership, leasing, operation, possession or use of the Premises; all charges of utilities, communications and similar services serving the Premises; and all In-Lieu Taxes.
Guarantor - Pier 1 Imports, Inc. The Guarantor does absolutely, irrevocably and unconditionally guaranty, as primary obligor and not merely as surety, without offset of deduction of any kind whatsoever, to and for the benefit of Lessor, the payment in full by the Lessee of all its payment obligations under the Lease when due (whether on the stated date of payment, on demand, by acceleration or otherwise), whether such obligations now exist or arise hereafter, strictly in accordance with the terms of the Lease and the punctual performance and observance by the Lessee of all other terms, conditions, covenants and agreements under the Lease to be performed or observed by the Lessee, strictly in accordance with the terms therein provided for. The Guarantor agrees that if for any reason whatsoever the Lessee shall fail to punctually make any such payments or to punctually perform or observe any such term, condition, covenant or agreement, the Guarantor shall duly and punctually pay, perform and/or observe the same.
Tenant Pier 1 Imports (U.S.), Inc.
Security Deposit None
Lessee may, on or before the close of business on the tenth (1Oth) business day following delivery of the Negotiation Notice, deliver to Lessor an irrevocable offer (“Lessee’s Offer”) to purchase the Premises upon the same terms and conditions set forth in the Negotiation Notice. If Lessee so elects, the parties shall enter into a contract for the sale of the Premises upon such terms and conditions, which contract shall provide for a closing within 30 days after
Prior to entering into a binding contract to sell the Premises, Lessor shall send a notice to Lessee (“Negotiation Notice”) which shall set forth in reasonable detail the price and other material economic terms which Lessor is desirous of obtaining in a sale of the Premises.
Limitation on Sale Right Lessor shall not be free to sell or transfer its interest in the Premises during the Lease Term unless the purchaser or transferee is, in Lessee’s reasonable judgment, of satisfactory business character and reputation and Lessor has complied with the following procedures:
Revenue increased 11.2% from $1,533.6 million in fiscal year 2012 to $1,704.9 million in fiscal year 2013.
Store occupancy costs during fiscal 2012 were $265.9 million or 17.3% of sales, compared to $262.4 million, or 18.8% of sales during fiscal 2011. Rent, property taxes, utilities and repair and maintenance expenses were all lower as a percentage of sales.
Based in Fort Worth, TX, Pier 1’s Gross profit, which is calculated by deducting store occupancy costs from merchandise margin dollars, was 42.5% expressed as a percentage of sales in fiscal 2012, compared to 39.8% a year ago. Merchandise margins were 59.8% as a percentage of sales, an increase of 120 basis points over 58.6% in fiscal 2011. This improvement was the result of strong input margins, the right balance of regular and promotional pricing, and well-managed inventory levels.
Pier 1 Imports (U.S.), Inc. Pier 1 Imports, Inc. www.pier1.com NYSE: PIR
Following a sale of the Premises by Lessor, the purchaser, and each successive party which acquires the Premises thereafter, shall be bound by and subject to the limitations on sale of the Premises set forth in this Section.
Landlord’s Responsibility Lessor shall not be required to maintain, repair or rebuild all or any part of the Premises under any circumstances.
Options to Extend Extension notice was not given by Tenant and therefore Tenant has no right to extend the lease term.
If and only if Lessee fails to deliver a Lessee’s Offer within the time provided in subparagraph, Lessor shall be free to enter into a contract to sell the Premises during the period ending with the close of business on the one hundred eightieth (180th) day following delivery of the Negotiation Notice provided that the purchase price under such contract shall be not less than ninety-two and one-half percent (92.5%) of the purchase price set forth in the Negotiation Notice.
delivery of Lessee’s Offer.
Tenant’s Responsibility Lessee, at its own expense, will maintain all parts of the Premises in good safe repair and condition and will take all action and will make all structural and nonstructural, foreseen and unforeseen and ordinary and extra ordinary changes and repairs which may be required to keep all parts of the Premises in good safe repair and condition (including, but not limited to, all painting, glass, utilities, conduits, fixtures and equipment, foundation, roof, exterior walls, heating and air conditioning systems, wiring, plumbing, sprinkler systems and other utilities, and all paving, sidewalks, roads, parking areas, curbs and gutters, awnings and fences).
Rickenbacker Intermodal Terminal • Provides direct access to and from industrial parks to multiple transportation options, reducing overall transportation costs fordomestic and international shippers • More than 300,000 container transfers a year • Provides many advantages, including reduced shipper costs, less environmental emissions, improved safety, and regional competitiveness • In conjunction with the Heartland Corridor Project, provides direct double-stack, next-day rail service to and from the port of Norfolk, Virginia Rickenbacker Foreign-Trade Zone • Includes the General Purpose Zone at Rickenbacker International Airport in Franklin and Pickaway counties • Provides many benefits to companies engaged in international sourcing and distribution through potential deferral, reduction and elimination of customs duties
Summary of Current Conditions - Columbus, Ohio The Columbus Industrial market consists of approximately 213.5 million square feet of industrial space spread throughout 12 individual submarkets. Within this tracked set, the Columbus Industrial market registered a 6.4 percent vacancy rate at the end of the third quarter, 2013, which represented a 40 basis point decrease from the second quarter’s 6.8 percent rate. Net lease rates continue to increase as the warehouse/distribution rates ranged from $2.46 psf to $4.00 psf. Net absorption totaled 1.73 million square feet
The Southwest Industrial submarket is located along the southwestern edge of Franklin County. Largely industrial and containing an estimated 17.5 million square feet, the Southwest Industrial submarket can easily be seen as one of central Ohio’s most coveted importing and exporting arena given its quick access to Interstate 71. An immense mix of employers such as Wal-Mart Distribution, FedEx, Gap Direct and Pier 1 help to maintain this area’s superior growth of labor and large distribution centers.
EXECUTIVE SUMMARY WHY COLUMBUS? including
Extensive transportation network, coupled with aggressive tax incentives and foreign trade zones, has made Columbus a prime location for warehouse and distribution facilities - over 90% of Columbus’ 213.5 million SF industrial market is bulk/distribution
Fortune 500 and 15 Fortune 1000 companies are headquartered in Columbus
Columbus has been ranked the most favorable business location with accessibility to the American market. Columbus is within 500 miles of 48 percent of the U.S. population, more than any other metro.
Second fastest growing major metropolitan area in the Midwest and the 15th largest city in the country (2 million residents, 1.3%
Over 22 percent growth is projected (2006-2016) for the transportation and warehousing sector
mainline rail (CSX and Norfolk
intermodal facilities served by
The Columbus Region features
Colliers International Two Miranova Place Suite 900 Columbus, OH 43215
Steve Disse 847.698.8263
Jeff Devine 847.698.8264
Michael Linder, SIOR 614.410.5628
The information contained herein was obtained from sources believed reliable; however, Colliers International makes no guarantees, warranties, or representations as to the completeness or accuracy thereof. The presentation of this property is submitted subject to errors, omissions, change of price or conditions prior to sale or lease, or withdrawal without notice.