Cascade Plaza - Capital Pacific

Cascade Plaza
Spoka
n
A
e, W
Dollar Tree Anchored retail center
Along major retail corridor
7414-7458 N Division St., Spokane, WA, 99208
[ www.CapitalPacific.com ]
CASCADE PLAZA IS A 26,818 SF MULTI-TENANT RETAIL
CENTER WITH ROBUST TRAFFIC COUNTS IN SPOKANE,
WASHINGTON.
Investment Highlights
The offering provides an opportunity to acquire an established multitenant retail center located along North Division Street, the primary
commercial corridor in Spokane. Cascade Plaza is situated within a
larger shopping center anchored by Hobby Lobby, Grocery Outlet,
Michael’s, and Furniture Row, creating a daily needs draw to the
immediate area. The Property is anchored by publicly-traded Dollar
Tree (NASDAQ: DLTR), who is issued a Standard and Poor’s credit rating
of ‘BB’ and has occupied space at the Property for more than 13 years.
The Property also benefits from a balanced rollover schedule with the anchor
tenant having approximately eight years remaining on their lease term.
Cascade Plaza’s location along North Division Street boasts traffic counts of nearly 50,000
vehicles per day. The dominant retail corridor features several national retailers including a
Costco located across the street and NorthTown Mall, a regional mall anchored by Macy’s,
Kohl’s, and Regal Cinemas. Cascade Plaza’s location also benefits from the dense close-in
population of more than 175,000 residents within a five mile radius.
PRICE: $2,570,000
CAP: 7.80%
OCCUPANCY . . . . . . . . . . . . . 96%
LEASABLE SF. . . . . . . . . . . . . ±26,818 SF
PRICE PER SF. . . . . . . . . . . . . $96
LAND AREA*. . . . . . . . . . . . . . ±27,000 SF
LEASE TYPE. . . . . . . . . . . . . . NNN
YEAR BUILT. . . . . . . . . . . . . . . 1980
AVG CURRENT RENT. . . . . . . $8.62/SF
PARKING*. . . . . . . . . . . . . . . . ±99 Spaces or 3.7/1,000 SF
ANCHOR . . . . . . . . . . . . . . . . . Dollar Tree
*Subject is located within a larger shopping center that has reciprocal parking and access easements.
ADDRESS:
7414-7458 N Division St., Spokane, WA, 99208
CASCADE PLAZA | 2
Core Characteristics
STRONG PERFORMING CREDIT TENANT ANCHOR
Cascade Plaza is anchored by publicly-traded Dollar Tree (NASDAQ: DLTR) who
has a Standard and Poor’s credit rating of ‘BB’. Dollar Tree has occupied space at
the Property for more than 13 years and has an additional eight years remaining
on its lease term. Notably, Dollar Tree has reported strong store sales in this
location and has one, five-year option period remaining. Please contact Capital
Pacific for more information about store performance.
PRICED BELOW REPLACEMENT COST
With true replacement costs estimated in excess of $200/SF, the Property is offered
well below replacement cost at $96/SF. An investor has the ability to remain
competitive in the leasing market and be a lower cost provider in which cost-feasible
rents are significantly higher. Cascade Plaza’s current in-place rent is $8.62/SF, which
is significantly below market averages and minimizes risk upon turnover.
DOMINANT RETAIL ACROSS FROM COSTCO
The Property is located along Spokane’s main retail artery, North Division Street, which
boasts traffic counts of nearly 50,000 vehicles per day. Division Street is home to several
national retailers within close proximity to Cascade Plaza including Costco, located
across the street. Additionally, NorthTown Mall is a more than one million square foot
regional mall anchored by Macy’s, Nordstrom Rack, and Regal Cinemas located south of
the Property on Division Street.
FAVORABLE LEASE TERMS WITH MINIMAL ROLLOVER EXPOSURE
Cascade Plaza benefits from the balanced rollover schedule of its shop tenants. Additionally,
anchor Dollar Tree is committed to this location until 2023, spreading out future rollover
risk over time and reducing the threat of any major decrease in cash flow.
PART OF LARGER CENTER ANCHORED BY HOBBY LOBBY
Cascade Plaza is part of a larger center anchored by Hobby Lobby, Grocery Outlet, Michael’s
and Furniture Row. Also located within the larger center are pad restaurants, Noodle Express,
The Onion and Old European. The diverse tenant mix within the larger shopping center
creates excellent retail synergy and a wide draw. Further, each property owner within the
larger shopping center benefits via reciprocal access and parking agreements.
DENSE DEMOGRAPHIC AREA
The area surrounding the Property is densely populated with more than 175,000 residents living
within a five mile radius.
CASCADE PLAZA | 3
Quick Stats
ABOUT
STAGGERED LEASE EXPIRATIONS
NASDAQ: DLTR
39%
STANDARD & POOR’S
CREDIT RATING
17%
2014
50%
2013
BB
64%
$8.60B
$7.84B
$7.39B
2012
100%
100%
ANNUAL REVENUE
0%
YEAR 1
YEAR 2
YEAR 3
YEAR 4
YEAR 5
YEAR 6
YEAR 7
Annual
Cumulative
LEASE TENANCY
955%
OCCUPANCY
10-YEAR SHARE
PRICE GAIN
SINCE 2005
13,600+
CURRENT LOCATIONS
US & CANADA
10+ YEARS - 51%
3+ YEARS - 13%
< 2 YEAR - 32%
96%
OCCUPANCY
AVAILABLE - 4%
CASCADE PLAZA | 4
NN
ew
po
rt H
WY
E Hawthorne Road
Retail Corridor
2
395
NORTHPOINTE PLAZA
NORTHPOINTE PLAZA
Best Buy
Big Lots
HobbyTown USA
Olive Garden
Panda Express
PetSmart
Pier 1 Imports
Red Robin
Safeway
Shakey’s Pizza
Shopko
Sports Authority
Staples
Starbucks
T.J.Maxx
Taco Bell
Target
Total Wine & More
2
E Magnesium Road
395
Famous Footwear
Game Stop
JCPenney
Kohl’s
Macy’s
Marshall’s
Men’s Wearhouse
Payless Shoe Source
RadioShack
Red Lobster
Regal Cinemas
Sears
Starbucks
Subway
Yankee Candle
N Nevada Street
AT&T
Barnes & Noble
Baskin Robbins
Bath & Body Works
Chili’s
N Division Street
NORTHTOWN MALL
FOR A FULL LIST OF RETAILERS, CLICK HERE
CASCADE
PLAZA
FRANKLIN PARK COMMONS
Bed, Bath & Beyond
Burlington Coat Factory
Guitar Center
Outback Steakhouse
Rite Aid
Ross
Shari’s Restaurant
Trader Joe’s
291
W Francis Avenue
OTHER SURROUNDING RETAIL
Albertsons
Babies “R” Us
Bed Bath & Beyond
Big 5 Sporting Goods
Burlington Coat Factory
Carl’s Jr
Costco
Dollar Tree
Grocery Outlet
Hobby Lobby
IHOP
KMart
Office Depot
Petco
Quizno’s
Rite Aid
Ross Dress for Less
Shari’s Restaurant
Taco Bell
Walmart Supercenter
SEATTLE
NORTHTOWN MALL
Site
44,000 DAILY
10,710 DAILY
E Lincoln Rd
N Division Street
CASCADE PLAZA IS LOCATED AMONG
NUMEROUS NATIONAL RETAILERS AND
REGIONAL RESTAURANTS, SURROUNDED
BY HIGH TRAFFIC COUNTS.
CASCADE
PLAZA
3,900 DAILY
CASCADE PLAZA | 6
NORTHGATE LLC
Site Plan
Old European
Michael’s
SITE PLAN KEY
LAND AREA:
±27,000 SF
LEASABLE AREA: ±26,818 SF
LEASED:
44,000 DAILY
PARCEL OUTLINE:
Cash And Carry
AVAILABLE:
The Onion
INGRESS/EGRESS:
N Division St.
NOT A PART:
Furniture Row
RECIPROCAL EASEMENT AGREEMENT
There shall be established mutual ingress and egress areas
providing for ingress and egress between the Northgate,
LLC Property and the Subject Property. The agreement runs
with the land and shall be binding upon the owners of the
Subject Property and The Northgate, LLC Property, and their
successors.
Noodles
Express
MAINTENANCE AGREEMENT
KINJA SUSHI
ESCAPE
ENTERTAINMENT
DOLLAR TREE
JULIE’S
DANCE
*Site plan not to scale
PYLON SIGN
BEYOND BEADS
Building owners are responsible for reimbursing their
proportionate share of Real Estate taxes, General Liability
Insurance and all maintenance and utilities including paving,
lighting, water, sewer, gas and striping of the common area
costs incurred by the larger shopping center’s land owner,
Northgate, LLC.
Jump-N-Party
CASCADE PLAZA | 7
Financial Summary
Cascade Plaza
Income & Expense
PRICE
$2,570,000
Capitalization Rate
7.80%
Price Per Foot
$96
NET OPERATING INCOME SUMMARY
SCHEDULED INCOME
Scheduled Rent:
Plus: Rent Increases Through:
Plus: Expense Reimbursement
Equals: Scheduled Gross Income
Vacancy Factor
Equals: Effective Gross Income (EGI)
Per SF
$8.27
$0.04
$3.48
$12.14
6/1/2016
5/31/2017
5%
$11.07
Less: OPERATING EXPENSES
CAMS
Property Taxes
Insurance
Management Fee
Reserves
Total Operating Expenses
Per SF
$1.59
$1.37
$0.16
$0.40
$0.10
$3.61
3.5% of EGI
Equals: NET OPERATING INCOME
$221,853
$1,202
$89,529
$312,585
($15,629)
$296,955
$42,655
$36,634
$4,200
$10,645
$2,682
($96,815)
$200,140
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed or implied, as
to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
[ www.CapitalPacific.com ]
<
>
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed
or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
CASCADE PLAZA | 8
Rent Roll
TENANT INFO
LEASE TERMS
CURRENT RENT
38.47%
Occupancy
Date
12/1/02
Lease
Expiration
1/31/23
Monthly Base
Rent
$8,597
5/1/05
11/30/16
$2,200
$7.70
Tenant Name
Suite
Size
% of SF
Dollar Tree
7414
10,316
Rent/SF/YR
$10.00
RENT INCREASES
Date of
Increase
2/1/18
Monthly Base
Rent
$9,362
OPTIONS
Additional
Annual
1-5 YR
180 Days
10% Increase
1-2 YR
180 Days
FMR
comments: Tenant has exercised the two of their three (3) option periods.
Beyond Beads
7452
3,428
12.78%
Available
7452R
1,072
4.00%
LEASE
TYPE
NNN
NNN
comments: Space is not leasable for retail use in currrent status. Space is being used by Beyond
Beads free of charge as storage space. Analysis assumes lease up of space with no base rent but
Tenant will assume pro-rata share of NNN charges.
Julie's Dance Academy
7454
5,532
20.63%
9/1/14
11/30/17
$4,034
$8.75
12/1/16
$4,149
$692
Escape Entertainment
7456
3,050
11.37%
8/1/15
10/31/18
$2,033
$8.00
11/1/16
11/1/17
$2,097
$2,160
$445
7458
3,420
12.75%
12/1/12
3/31/19
$1,624
$5.70
4/1/17
4/1/18
$1,657
$1,690
$66
$18,488
$18,488
$8.27
$8.62
comments: Lease is personal guaranteed.
Kinja Sushi
comments: Percentage rent of 5% of Gross Sales if total exceeds base rent. Tenant must provide
statement of Sales monthly. Lease has personal guarantee.
Totals:
Occupied
Leasable
26,818
25,746
1,072
100%
96%
4%
NNN
1-3 YR
180 Days
$2,287.50
NNN
NNN
$1,202
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed or implied, as to the accuracy of the information.
Buyer must verify the information and bears all risk for any inaccuracies.
3/21/2016
[ www.CapitalPacific.com ]
<
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed
or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed
or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
>
CASCADE PLAZA | 9
Operating Expenses
Cascade Plaza
Operating Expenses
2015 OPERATING EXPENSES
REIMBURSEMENTS
Total
/SF
Notes
CAMS
$42,655
$1.59
1
$40,244
Property Taxes
$36,634
$1.37
2
$36,634
Insurance
$4,200
$0.16
1
$4,200
Management
$10,645
$0.40
3
$8,452
Reserves
$2,682
$0.10
4
$0
$96,815
$3.61
Total Expenses
$89,529
Notes:
1) Based on 2015 Operating Budget.
2) Based on 2015 Spokane County Tax Assessment of Cascade Plaza building parcel plus 15.197% share of Northgate
Center parking lot parcel.
3) Based on 3.5% of Stabilized EGI.
4) Methodology: $0.10/SF for maintenance and repairs.
3/21/2016
[ www.CapitalPacific.com ]
<
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed
or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed
or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
>
CASCADE PLAZA | 10
Reimbursements
Tenant Name
Pro Rata %
Expense Total
CAMS
Property Taxes
Insurance
Management
$42,655
$36,634
$4,200
$10,645
Notes
Tenant Totals
Dollar Tree
38.47%
$19,020
$14,092
$1,616
$1,902
1, 2
$36,629
Beyond Beads
12.78%
$4,598
$4,683
$537
$1,361
3
$11,179
Available - Storage Space
4.00%
$1,375
$1,464
$168
$425
4
$3,433
Julie's Dance Academy
20.63%
$5,983
$7,557
$866
$2,196
5
$16,602
Escape Entertainment
11.37%
$4,368
$4,166
$478
$1,211
3
$10,223
Kinja Sushi
12.75%
$4,898
$4,672
$536
$1,357
$11,463
100.00%
$40,244
$36,634
$4,200
$8,452
$89,529
TOTAL
Notes:
1) Dollar Tree has a combined Admin and Management fee not to exceed 10% of CAM charges.
2) Tenant has 5% year over year cap on CAM charges.
3) Tenant 's management reimbursement NTE 5% of minimum and additional rent.
4) Assumes space can be leased for an amount equal to its pro-rata share of expenses.
5) Tenant has a cap on all common charges of $3.00/SF
3/21/2016
[ www.CapitalPacific.com ]
<
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed
or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed
or implied, as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
>
CASCADE PLAZA | 11
Featured Photos
<< N
ION
DIVIS
>
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CASCADE PLAZA | 12
1.5 Hours
100 Miles
Area Intel & Demos
Spokane
OVERVIEW
Settled in 1871 on the Spokane River, the city of Spokane is presently the second largest city in
Washington. The city is 92 miles south of the Canadian border, approximately 20 miles from the
Washington–Idaho border, and 232 miles east of Seattle. Spokane is known as the birthplace of
Father’s Day, hosted the first environmentally themed World’s Fair, Expo ‘74, and is home to Gonzaga
University, Whitworth University, and the growing Riverpoint campus that includes satellite
campuses for Eastern Washington University and Washington State University.
Coeur D’Alene
90
moses lake
2 Hours
140 Miles
ECONOMY
NATURAL RESOURCES
Natural resources have historically been the foundation of Spokane’s economy, with the mining,
logging, and agriculture industries providing much of the region’s economic activity. Considered to
be one of the most productive mining districts in North America and due to its location between
mining and farming areas, Spokane became an important rail and shipping center.
Tri-Cities
DIVERSIFIED INDUSTRY
Today the city’s economy has diversified to include other industries, including the high-tech and
biotech sectors. As the metropolitan center of the Inland Northwest as well as southeastern British
Columbia and Alberta, Spokane serves as a commercial manufacturing, transportation, medical,
financial, shopping, and entertainment hub.
CORPORATE HEADQUARTERS & OFFICES
Genetics company, Signature Genomic Laboratories and Fortune 1000 technology company, Itron
are headquartered in the area.
Other companies with head offices in the Spokane area include technology company Key Tronic,
hotelier Red Lion Hotels Corporation, and automaker Commuter Cars. The largest military facility
in the area is Fairchild Air Force Base near Airway Heights, which employs over 5,100 military and
civilian employees and is home to the 92d Air Refueling Wing.
5 Miles
CASCADE
PLAZA
3 Miles
1 Mile
POPULATION
2010
2015 2020 1-Mile
16,918 16,812 16,881 3-Mile
97,611 99,265 101,158 5-Mile
171,740
175,197
178,898
2015 HOUSEHOLD INCOMES
Average
Median 1-Mile3-Mile5-Mile
$46,265 $53,570 $54,047
$33,922 $40,506 $39,649
40 min
37 Miles
THE CAPITAL PACIFIC EXPERIENCE - OUR DAILY COMMITMENT TO OUR CLIENTS
[ www.CapitalPacific.com ]
DAVID GELLNER
SEAN TUFTS
KEVIN ADATTO
MICHAEL HORWITZ
SEAN MACK
SCOTT FRANK
[email protected] | (206) 913-2842
[email protected] | (503) 675-8381
[email protected] | (206) 743-8468
[email protected] | (503) 675-8378
PETER DUNN
[email protected] | (503) 607-0197
[ Copyright © 2016 Capital Pacific LLC ]
[email protected] | (503) 675-7726
[email protected] | (503) 675-8383