Sepulveda. plaza BRANDON MICHAELS Sepulveda Boulevard, North Hills, CA GROUP

Transcription

1 Sepulveda plaza 8332 Sepulveda Boulevard, North Hills, CA BRANDON MICHAELS GROUP

2 INVESTMENT ADVISORS BRANDON MICHAELS Senior Managing Director Investments Senior Director, National Retail Group Tel: (818) License: CA # EXECUTIVE SUMMARY INVESTMENT HIGHLIGHTS FINANCIALS SALES COMPARABLES ARIA POURNAZARIAN National Retail Group Tel: (213) aria.pournazarian@marcusmillichap.com License: CA # Ventura Blvd. Suite 100, Encino, CA SEPULVEDA PLAZA NORTH HILLS, CA 3

3 EXECUTIVE SUMMARY A multi-tenant strip center ideally located on heavily trafficked Sepulveda Boulevard The Brandon Michaels Group of Marcus & Millichap has been selected to exclusively market for sale Sepulveda Plaza, a 13,135 SF multi-tenant strip ideally situated on 35,711 square feet of land zoned C2, in North Hills, CA. 85% 6.60% 13, ,000 OCCUPANCY CAP RATE BLDG SF PARKING SPACES VEHICLES AT THE INTERSECTION Sepulveda Plaza is located just north of the NE signalized intersection of Sepulveda Boulevard and Roscoe Boulevard, one of the busiest intersections in Southern California with daily traffic counts averaging 80,000 vehicles. Sepulveda Plaza offers the rare opportunity to acquire a value-add multi-tenant strip center in a prime east San Fernando Valley location. The subject property is currently 85% occupied. The diverse tenant mix of national and local tenants caters to the needs of the local residents. A majority of the tenants are on NNN leases, offering ease of management to a prospective purchaser. With an average unit size of 772 square feet, this is an ideal unit size that is easily leasable and offers very low tenant improvements costs upon a re-lease. This ideal unit size allows the astute investor to maximize their rental income. Sepulveda Plaza offers excellent surface parking with a total of 54 parking spaces. The parking ratio of 4.01 per 1,000 allows for a multitude of potential uses. In addition, 35,711 square feet of C2 zoned land offers long term development potential. Sepulveda Plaza is well located within an extremely densely populated sub-market, with an immediate population of 750,000 people within a five mile radius. The average household income within a five mile radius is $71,098. With excellent visibility and frontage, this strong location benefits from significant daily foot and vehicle traffic, ease of ingress and egress, and solid visibility from Sepulveda Boulevard. 4 SEPULVEDA PLAZA NORTH HILLS, CA 5

4 PROPERTY OVERVIEW One of the busiest intersections in Southern California with daily traffic counts of approximately 80,000 vehicles per day. PROPERTY INFORMATION ADDRESS PROPERTY TYPE GROSS SQUARE FEET LOT SIZE 8332 Sepulveda Boulevard, North Hills, CA Shopping Center 13,135 SF 35,711 SF APN ZONING LAC2 YEAR BUILT 2006 PARKING SPACES PARKING RATIO TYPE OF OWNERSHIP 52 spaces 4.11: 1,000 SF Fee Simple FINANCIAL INFORMATION ASKING PRICE $5,000,000 PRICE/SF $ CURRENT CAP RATE 6.60% OCCUPANCY 95% PROPOSED FINANCING LOAN AMOUNT $3,000,000 (60% LTV) INTEREST RATE 4.50% TERM 25 year amortization 6 SEPULVEDA PLAZA NORTH HILLS, CA 7

5 INVESTMENT HIGHLIGHTS TENANT ROSTER STABILIZED MULTI-TENANT STRIP CENTER Unique opportunity to acquire an 95% leased, multi-tenant strip center in a densely populated East San Fernando Valley location. EXCELLENT PARKING Approximately 54 parking spaces are available, a parking ratio of 4.11:1,000 SF. HIGH TRAFFIC COUNTS Sepulveda Plaza is located just north of the signalized intersection of Sepulveda Blvd. and Roscoe Blvd., one of the busiest intersections in Southern California. Approximately 80,000 vehicles pass through the intersection of Sepulveda Boulevard and Roscoe Boulevard daily. 35% NATIONAL TENANTS National tenants include Little Caesars, Herbalife, Opportun, and Boost Mobile. Little Caesars is the third largest pizza chain in the United States and Boost Mobile is a subsidiary of Sprint, with over 23,000 stores. The synergistic mix of national and local tenants caters to the diverse needs of the surrounding population. NEW CONSTRUCTION Sepulveda Plaza was built in EXCELLENT VISIBILITY 164 feet of frontage on Sepulveda Boulevard STRONG AND DENSE IMMEDIATE DEMOGRAPHICS Over $71,000 average household income within a one mile radius in an excellent San Fernando Valley location. Over 750,790 people within a five mile radius EXCELLENT LOCATION Ideally located just north of the NE signalized intersection of Sepulveda Boulevard and Roscoe Boulevard. Within close proximity to the 405 San Diego Freeway. DENSE RETAIL AREA Multiple national retailers in the immediate area including Autozone, Domino s Pizza, Jack in the Box, 7-Eleven, and more. NORTH HILLS SAN DIEGO FWY SEPULVEDA BOULEVARD CHASE STREET ROSCOE BOULEVARD Unit Tenant SF SPL-1 Oportun Inc. 1,330 SPL-3 Nail Shop 634 SPL-4 Boba Coffee 634 SPL-5 Restaurant 634 SPL-6 Martial Arts Studio 634 SPL-7 Massage 842 SPL-8 Herbalife 1,404 SPL-9 Herbalife 1,145 SPL-10 Vacant 607 SPL-11 Farmer s Insurance 607 SPL-12 Pet Grooming 607 SPL-13 Cigarettes 4 Sale 607 SPL-14 Church 690 SPL-15 Cell Phone 690 SPL-16 Barbershop 690 SPL-17 Little Caesars 1,380 Total 13,135 8 SEPULVEDA PLAZA NORTH HILLS, CA 9

6 National tenants include Little Caesars, Opportun, Herbalife, and Boost Mobile. Little Caesars is the third largest pizza chain in the United States and Boost Mobile is a subsidiary of Sprint, with over 23,000 stores. 10 SEPULVEDA PLAZA NORTH HILLS, CA 11

7 Within a 5 mile radius... POPULATION 750,790 AVERAGE HOUSEHOLD INCOME SEPULVEDA BOULEVARD Sepulveda plaza 8332 Sepulveda Boulevard, North Hills, CA SEPULVEDA BOULEVARD 54 parking spaces Parking ratio of 4.11: 1,000 SF $71,098 ROSCOE BOULEVARD 12 SEPULVEDA PLAZA NORTH HILLS, CA 13

8 PROPERTY OVERVIEW MAJOR TENANTS Oportun is a financial technology company founded in 2005 with the mission of providing affordable loans that help people with little or no credit history establish credit and build a better future. Little Caesar Enterprises Inc. is the third-largest pizza chain in the United States, behind Pizza Hut and Domino's Pizza. It operates and franchises pizza restaurants in the United States and internationally. The company was founded in 1959 and is based in Detroit, Michigan. Little Caesar Enterprises, Inc. operates as a subsidiary of Ilitch Holdings, Inc Boost Mobile is a wireless telecommunications carrier used by two independent networks in Australia and the U.S. Boost Mobile was founded in 2000 by Pete Bourke in Australia and New Zealand. Boost Mobile in the United States is owned and operated by Boost Worldwide, Inc a Sprint Corporation subsidiary. TYPE Private TYPE Private TYPE Subsidiary LOCATION 8332 Sepulveda Boulevard, North Hills, CA LOCATION FRONTAGE AND ACCESS 164 feet of frontage on Sepulveda Boulevard. YEAR BUILT TRAFFIC COUNT Roscoe Boulevard: 42,003 vehicles per day Sepulveda Boulevard: 31,689 vehicles per day Total: 73,692 vehicles per day FOUNDED 2005 NO. OF LOCATIONS 245 WEBSITE FOUNDED 1954 NO. OF LOCATIONS 4,503 WEBSITE FOUNDED 2000 NO. OF LOCATIONS 23,016 WEBSITE The site is located north of the northeast signalized intersection of Sepulveda Boulevard and Roscoe Boulevard. SQUARE FOOTAGES The building square footage is 13,135 SF on a 35,711 SF lot ZONING LAC2 PARCEL NUMBER PARKING 54 surface spaces are available. Parking ratio of 4.11/1,000 SF. Herbalife International is a global multi-level marketing corporation that develops, markets and sells nutrition supplements, weight management, sports nutrition and personal-care products. The company was founded by Mark Hughes in 1980, and it employs an estimated 7,800 people worldwide. Herbalife reported net sales of US$4.488 billion in TYPE Public FOUNDED 1980 EMPLOYEES 7,800 WEBSITE 14 SEPULVEDA PLAZA NORTH HILLS, CA 15

9 FINANCIALS RENT ROLL UNIT TENANT SF % LEASE START LEASE EXP OPTIONS RENT RENT/SF SPL-1 Oportun Inc. 1,330 10% 7/1/2016 6/30/2021 (2) 5-Year Options 10% bump LEASE TYPE PROFORMA $ PF $/SF $3,200 $2.41 NNN - - SPL-3 Nail Shop 634 5% 1/1/2012 6/30/ $1,250 $1.97 MG - - SPL-4 Boba Coffee 634 5% 1/1/2018 1/1/ $1,236 $1.95 NNN - - ANNUALIZED OPERATING DATA INCOME AND EXPENSE CURRENT PROFORMA Scheduled Lease Income: $357,944 $374,333 NNN Charges $69,793 $79,930 Effective Gross Income: $427,737 $454,264 Vacancy: (5%) - $22,713 71% NNN LEASES 71% NNN leases SPL-5 Restaurant 634 5% 5/1/2015 4/30/2020 3% Annual Increases $1,700 $2.68 NNN - - Expenses: $97,847 $97,847 SPL-6 Martial Arts Studio 634 5% 7/15/2015 7/14/2020 3% Annual Increases $1,294 $2.04 NNN - - SPL-7 Massage 842 6% 8/1/2017 7/31/ $2,947 $3.50 NNN - - SPL-8 Herbalife 1,404 11% 4/1/2018 3/31/2021 $250/Month Annual Increase $2,500 $1.78 NNN - - SPL-9 Herbalife 1,145 9% 11/1/2012 M2M - $2,500 $2.18 MG - - SPL-10 Vacant 607 5% N/A N/A NNN $1,366 $2.25 SPL-11 Farmer's Insurance 607 5% 3/1/2018 3/1/ $1,159 $1.91 NNN - - SPL-12 Pet Grooming 607 5% 6/15/2016 6/14/2019 3% Annual Increases $1,306 $2.15 NNN - - Net Operating Income: $329,890 $333,703 Loan Payment $200,100 $200,100 Pre-Tax Cash Flow $129,790 $133,603 Principal Reduction $65,100 $65,100 Total Return Before Taxes $194,890 $198,703 EXPENSES ANNUAL PER SF Taxes: 1.25% $62,500 $7.77 Insurance $3,921 $ % AVERAGE UNIT SIZE Over 1,000 SF: 32% Under 1,000 SF: 68% SPL-13 Cigarrettes 4 Sale 607 5% 7/1/2010 6/30/2020 3% Annual Increases $1,326 $2.18 NNN - - Pest $342 $0.03 SPL-14 Church 690 5% 8/1/2013 7/31/ $1,373 $1.99 NNN - - SPL-15 Cell Phone 690 5% 3/1/2013 MTM - $1,468 $2.13 MG - - SPL-16 Barbershop 690 5% 5/15/2011 5/31/ $1,550 $2.25 MG - - Trash $3,947 $0.30 Electricity $3,226 $0.25 Management $10,738 $0.72 Water $2,888 $0.22 SPL-17 Little Caesars 1,380 11% 9/1/2007 1/31/2023 (1) 5 Year Option, Begins 1/1/2018 $5,019 $3.64 NNN - - Total 13, % $27,329 $ $4,525 $2.25 Repairs $10,285 $0.79 Total $97,847 $7.48/$0.62 Occupied SF 12,528 95% Vacant SF 607 5% 16 SEPULVEDA PLAZA NORTH HILLS, CA 17

10 SALES COMPARABLES 6800 BALBOA BOULEVARD, VAN NUYS SHERMAN WAY, RESEDA VENTURA BOULEVARD, ENCINO SUBJECT PROPERTY ADDRESS 6800 Balboa Boulevard, Van Nuys SALES PRICE $3,900, PRICE/SF $ BLDG SF 9,664 LOT SF 18,661 CAP RATE 5.03% CLOSE OF ESCROW 3/30/2017 ADDRESS Sherman Way, Reseda SALES PRICE $2,495, PRICE/SF $ BLDG SF 8,304 LOT SF 17,298 CAP RATE 6.27% CLOSE OF ESCROW 8/16/2016 ADDRESS Ventura Boulevard, Encino SALES PRICE $4,145, PRICE/SF $ BLDG SF 14,117 LOT SF 30,492 CAP RATE - CLOSE OF ESCROW 7/28/2017 ADDRESS 8332 Sepulveda Boulevard, North Hills, CA SALES PRICE $5,300,000 PRICE/SF $ BLDG SF 13,135 SF LOT SF 35,711 SF CAP RATE 6.18% CLOSE OF ESCROW n/a $ $ $ $ $ $ $ SALES COMPARABLES PRICE/SF $ $ $ $ $ $50.00 $ Balboa Boulevard Sherman Way Ventura Boulevard 18 SEPULVEDA PLAZA NORTH HILLS, CA 19 Average

11 AREA OVERVIEW NORTH HILLS, CA North Hills is about a 5.41 square mile neighborhood in San Fernando Valley. North Hills is boredered by Northridge to the west, Panorama City to the east, Van Nuys to the south, and Granada Hills to the north. The main thoroughfares include Sepulveda Boulevard, Roscoe Boulevard, Hayvenhurst, Woodley and Haskell Avenue. North Hills has easy access to the rest of Los Angeles via the San Diego 405 Freeway. According to the LA Times, North Hills has a population of about 60,000 and a median household income of $52,456. NORTH HILLS DEMOGRAPHICS The median age is 28, young for the city of Los Angeles and young for the country. 17.8% of residents 25 and older have a four-year degree, about average for the city of Los Angeles and about average for the county $52,456 median household income (2008 dollars), about average for the city of Los Angeles and about average for the county Highly diverse for the city of Los Angeles and highly diverse for the county Average household size of 3.4 people, high for the city of Los Angeles and high for the county DEMOGRAPHICS 1 Mile 3 Miles 5 Miles 2014 Population 55, , , Households 14,405 93, , Average Household Size Daytime Population 14,074 84, , Owner Occupied Housing Units 21.99% 42.85% 45.34% 2014 Renter Occupied Housing Units 75.16% 54.14% 51.48% 2014 Vacant 2.85% 3.02% 3.18% BREAKDOWN OF HOUSEHOLD INCOME $ 0 - $14, % 13.9% 12.9% $ 15,000 - $24, % 13.4% 12.3% $ 25,000 - $34, % 12.3% 11.5% $ 35,000 - $49, % 15.3% 14.7% $ 50,000 - $74, % 17.4% 17.3% $ 75,000 - $99, % 10.9% 11.6% $100,000 - $124, % 6.6% 7.6% $125,000 - $149, % 3.8% 4.2% $150,000 - $199, % 3.4% 4.0% $200,000 - $249, % 1.0% 1.4% $250, % 1.8% 2.4% AVERAGE HOUSEHOLD INCOME 2014 Median Household Income $34,409 $44,565 $48, Per Capita Income $12,633 $18,883 $22, Average Household Income $48,066 $64,493 $71,098 SAN FERNANDO VALLEY Almost 2.5 million people reside in the San Fernando Valley, which includes the submarkets of Northridge-Northwest San Fernando Valley, Van Nuys-Northeast San Fernando Valley, Woodland Hills, Burbank-Glendale-Pasadena and Sherman Oaks-North Hollywood-Encino. The area s population is expected to increase by 1.9 percent through 2020, or by 47,400 new residents. Known for its entertainment industry, the Valley boasts more than 100 soundstages. Entertainment giants calling the Valley home include Walt Disney Co., Universal Studios, Warner Brothers, DreamWorks and Paramount Ranch. The entertainment industry continues to set the area s economic pulse. Local motion-picture and entertainment companies employ roughly 25,000 people. While the Valley has grown into the world s center for entertainment, aerospace giants Boeing and Northrop Grumman and 21st Century Insurance also generate numerous well-paying jobs. Healthcare is also a major source of employment with providers that include Kaiser Permanente and Providence Health & Services. As a result of its large concentration of high-salaries and successful companies, the area s median household income of$61,600 per year has risen dramatically in recent years. Although the median home prices dipped during the recession, affordability remains a challenge for much of the local population. High home prices keep the homeownership rate at 50 percent in the San Fernando Valley and provide a large rental base. 20 SEPULVEDA PLAZA NORTH HILLS, CA 21

12 AREA OVERVIEW SAN FERNANDO VALLEY HIGHLIGHTS About 2.5 million residents in the San Fernando Valley Population growth projected of 45,000 new residents by 2019 in the San Fernando Valley Strong ties to the entertainment industry Home of Walt Disney Company, Universal Studios, Warner Brothers, DreamWorks and Paramount Ranch Local motion picture and entertainment companies employ roughly 25,000 people Aerospace (Boeing & Northrop Grumman) Insurance (21st Century Insurance) and Healthcare (Kaiser Permanente and Providence Health & Services) industries also generate numerous well-paying jobs Substantial income growth since 2000 Home ownership rate is near 50% and large rental base LOS ANGELES COUNTY Los Angeles County covers 4,752 square miles and includes the islands of San Clemente and Santa Catalina. It is bordered on the east by San Bernardino and Riverside counties, on the north by Kern and Ventura counties, on the west by the Pacific Ocean and on the south by Orange County. Nearly every type of climate is represented in Los Angeles, ranging from desert and mountain to coastal. The Los Angeles coastline stretches along 81 miles of world-famous beaches. The Santa Monica and San Gabriel mountains are located in the county, with the highest point at Mount San Antonio reaching more than 10,000 feet. LOS ANGELES COUNTY ECONOMY Long recognized as the financial, commercial and industrial capital of Southern California, the sprawling Los Angeles metropolitan area is one of the nation s leading urban-industrial hubs. There are 15 Fortune 500 companies headquartered in the county. Tourism, trade, manufacturing, entertainment, healthcare and defense provide a foundation for the local economy. LOS ANGELES COUNTY MAJOR EMPLOYERS Kaiser Permanente Northrop Grumman Corporation The Boeing Company Kroger Company Cedars-Sinai Medical Center University of Southern California Target Bank of America Corp. The Home Depot Providence Health & Services SFV SHARE OF TOTAL EMPLOYMENT Services 47% Retail Trade 17% Manufacturing 9% Finance, Insurance & Real Estate 8% Wholesale Trade 5% Public Administration 5% Transportation, Communications 5% Construction 5% SAN FERNANDO VALLEY MAJOR EMPLOYERS Los Angeles is home to two of the busiest ports in the world: the Port of Los Angeles and the Port of Long Beach. The two ports generate more than $10 billion in U.S. Customs revenues and taxes. Together, the ports account for related employment for nearly l.3 million people in Southern California and receive more than 40 percent of all U.S. container traffic. Aerospace is still a significant employment force. The metro s aerospace employers, including Boeing, Northrop Grumman and Lockheed Martin, have benefited from new defense and homeland security-related contracts. The motion picture/entertainment industry is one of the most high-profile sectors of the local economy. Los Angeles is known as the entertainment capital of the world, with most of the major motion-picture studios located in the county; much of the music recording and production industry is centered is Los Angeles as well. 22 SEPULVEDA PLAZA NORTH HILLS, CA 23

13 BRANDON MICHAELS Senior Managing Director Investments Senior Director, National Retail Group Tel: (818) License: CA # ARIA POURNAZARIAN National Retail Group Tel: (213) License: CA # BRANDON MICHAELS GROUP