Offering Memorandum - Matthews Real Estate Investment Services

Representative Photo
KENTUCKY FRIED CHICKEN
2251 JACKSBORO HIGHWAY, FORT WORTH, TX 76114
OFFERING MEMORANDUM
™
C O N FID EN T I A L I T Y & DI SCL A IMER STATEMEN T
T his Of f e r ing M e m o r a n du m co n t a i n s s e l e c t i nform ati on pertai ni ng to the busi ness and affai rs of KFC located at 2251 Jacksboro Hwy, Fort Worth, TX
76114 ( “P r o p ert y ” ) . It h a s be e n p r e p a r e d by Matthews Retai l Advi sors. Thi s O fferi ng Mem orandu m may n ot b e all-in clu s ive or con t ain all of
t he inf o r ma t io n a p r o s p e ct i v e p u r ch a s e r m ay desi re. The i nform ati on c ontai ned i n thi s O fferi ng M emoran d u m is con fid en t ial an d fu rn is h ed
s o le ly f o r t he p u r p o s e o f a r e v i e w by a p rospec ti ve purc haser of the Property. It i s not to be used for an y ot h er pu rpos e or mad e availab le t o
a ny o t he r p e r s o n w i t h o u t t h e w r i t t e n co n sent of Sel l er or Matthews Retai l Advi sors . The m aterial is b as ed in part u pon in format ion s u pplied
b y t he Selle r an d i n p a r t u p o n f i n a n ci a l i nform ati on obtai ned from sourc es i t deem s rel i abl e. Own er, n or t h eir officers , employees , or agen t s
ma kes a ny r epr e s e n t a t i o n o r w a r r a n t y, e xpress or i m pl i ed, as to the ac c urac y or c om pl eteness of t h is Offerin g M emoran d u m or an y of it s
c o nt e nt s a nd n o l e g a l l i a bi l i t y i s a s s u m e d or shal l be i m pl i ed wi th respec t thereto. Prospec ti ve pu rch as ers s h ou ld make t h eir own project ion s
a nd f o r m t he ir o w n co n cl u s i o n s w i t h o u t rel i anc e upon the m ateri al c ontai ned herei n and c ondu ct t h eir own d u e d iligen ce.
B y a c kno w le dg i n g y o u r r e ce i p t o f t h i s O fferi ng Mem orandum for the Property, you agree:
1. T he Of f e r i n g M e m o r a n du m a n d i t s c ontents are c onfi denti al ;
2. Yo u w il l h o l d i t a n d t r e a t i t i n t h e s tri c test of c onfi denc e; and
3. Yo u w ill n o t , di r e ct l y o r i n di r e ct l y, di sc l ose or perm i t anyone el se to di sc l ose thi s O fferi n g M emoran d u m or it s con t en t s in an y fas h ion
o r ma nn e r de t r i m e n t a l t o t h e i n t e rest of the Sel l er.
Ow ne r a nd Mat t h e w s Re t a i l A dv i s o r s e x pressl y reserve the ri ght, at thei r sol e di sc reti on, to reject an y an d all expres s ion s of in t eres t or
o f f er s t o p ur ch a s e t h e P r o p e r t y a n d t o t erm i nate di sc ussi ons wi th any person or enti ty revi ewin g t h is Offerin g M emoran d u m or makin g an
o f f er t o p ur c h a s e t h e P r o p e r t y u n l e s s a nd unti l a wri tten agreem ent for the purc hase and sal e of t h e Propert y h as b een fu lly execu t ed an d
d e liv er e d .
I f y o u w ish no t t o p u r s u e n e g o t i a t i o n s l e adi ng to the ac qui si ti on of the Property or i n the future you d is con t in u e s u ch n egot iat ion s , t h en you
a g r ee t o p ur g e a l l m a t e r i a l s r e l a t i n g t o t hi s Property i nc l udi ng thi s O fferi ng Mem orandum .
A p r o sp ec t iv e p u r ch a s e r ’s s o l e a n d e xcl usi ve ri ghts wi th respec t to thi s prospec ti ve transac ti on , t h e Propert y, or in format ion provid ed h erein
o r in c o nne c t i o n w i t h t h e s a l e o f t h e P r o perty shal l be l i m i ted to those expressl y provi ded i n an execu t ed Pu rch as e Agreemen t an d s h all b e
s ub je c t t o t he t e r m s t h e r e o f. In n o e v e n t shal l a prospec ti ve purc haser have any other c l ai m s again s t Seller or M at t h ews Ret ail Ad vis ors or
a ny o f t heir a ff i l i a t e s o r a n y o f t h e i r r e s p ec ti ve offi c ers, Di rec tors, sharehol ders, owners, em ployees , or agen t s for an y d amages , liab ilit y, or
c a us es o f a c t i o n r e l a t i n g t o t h i s s o l i ci t a t i on proc ess or the m arketi ng or sal e of the Property.
T his Of f er ing M e m o r a n du m s h a l l n o t be deem ed to represent the state of affai rs of the Prope rt y or con s t it u t e an in d icat ion t h at t h ere h as
b e en no c ha nge i n t h e s t a t e o f a f f a i r s o f the Property si nc e the date thi s O fferi ng Mem orandum.
ii
TABLE OF CONTENTS
KENTUCKY FRIED CHICKEN
2251 JACKSBORO HIGHWAY | FORT WORTH, TX 76114
TABLE O F CO NT ENTS
01. Executive Summary
03. Tenant Overview
05. Property Overview
11. Demographics
12. Area Overview
™
Ryan Muller
Associate
Gary Chou
VP & Director
Mark Cohen
Broker of Record
License No. 01985081
O 310.919.5786
M 303.916.4362
[email protected]
License No. 01911222
O 310.919.5827
M 714.928.8016
[email protected]
License No. 447509
E XECUTIVE S UMMARY
Investment Highlights
PROPERTY DETAILS
• Long Term Stabilized Income - 13 years left on the original lease term;
4 (four), 5 (five) year options
• Absolute NNN Investment – ZERO landlord responsibilities with
maintenance, taxes and insurance paid by tenant for the landlord –
Ideal for out of state investors looking for passive income
• Attractive Rental Escalations - Rare 10% rental escalations every 5 years
TENANT
• Strong Franchise Operator – Treadwell Enterprises is one of YUM!
Brands most successful operators, having acquired or built 115 KFC
and KFC multi-brand restaurants
LOCATION
• Located 3-miles from Downtown Fort Worth - Fort Worth is located in
North Central Texas and is the 16th-largest city in the United States and
the fifth-largest city in the state of Texas
• Texas Christian University and Naval Air Station Joint Reserve Base Only 9-miles from TCU which enrolls over 10,300 students and directly
down the street from the Naval Air Station which stations over 10,000
active duty military
• New Development - Brand new Walmart Supercenter was built directly
behind the location less than two years ago. 2016 construction
Whataburger, Jack in the Box and Advance Auto Parts are being built
across the street.
• Busy Intersection of Jacksboro Hwy, River Oaks Blvd and Ephriham
Ave - Seeing around 48,000 cars per day
• Growing Demographics – 1.54% growth 2000-2010; 3.81% growth
2010-2015; projected 4.14% growth 2015-2020 within a one mile radius
• Dense Demographics – An estimated 2016 population of 209,447
people in a 5-mile radius
• High Performing Store – Historical sales that are above the national
average for KFC
• Texas is an income tax free state
Actual Storefront
Executive Summary
KENTUCKY FRIED CHICKEN
2251 Jacksboro Highway
Fort Worth, TX 76114
List Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $1,940,000
Gross Leasable Area . . . . . . . . . . . . . . . . . . . . . . . . ± 2,084 SF
CAP Rate - Current . . . . . . . . . . . . . . . . . . . . . . . . . . . 5.50%
Year Built . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2008
Lot Size . . . . . . . . . . . . . . . . . . . . . . . ± 0.49 Acres (21,334 SF)
Annualized Operating Data
Monthly Rent
Annual Rent
Rent/SF
CAP Rate
Present - 7/13/2019
$8,891.67
$106,700
$43.20
5.50%
7/13/2019 - 7/13/2024
$9,780.83
$117,370
$47.52
6.05%
7/13/2024 - 7/13/2029
$10,758.92
$129,107
$52.27
6.66%
Option 1
$11,834.81
$142,018
$57.50
7.32%
Option 2
$13,018.29
$156,219
$63.25
8.05%
Option 3
$14,320.12
$171,841
$69.57
8.86%
Option 4
$15,752.13
$189,026
$76.53
9.74%
Tenant Summary
Tenant Trade Name
Type of Ownership
Lease Guarantor
Lease Type
Roof and Structure
Original Lease Term
KFC
Fee Simple
Treadwell Enterprises (100+ locations)
NNN
Tenant Responsible
20 Years
Lease Commencement Date
7/13/2009
Rent Commencement Date
7/13/2009
Lease Expiration Date
7/13/2029
Term Remaining on Lease
Increases
Options
13 Years
10% Every 5 Years
Four (4), Five (5) Year
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T ENANT O VERVIEW
Representative Photo
Tenant Overview
Property Name
KFC
Property Type
Net Leased QSR
Parent Company Trade Name
Yum Brands, Inc.
Ownership
Credit Rating
Rating Agency
Revenue
Net Income
Stock Symbol
Board
Public
BBB
Standard & Poor’s
$23 B
$488.45 M
YUM
NYSE
No. of Locations
± 18,000
No. of Employees (All)
± 24,000
Headquartered
Louisville, KY
Web Site
www.kfc.com
Year Founded
KFC, or Kentucky Fried Chicken, is a fast food restaurant chain that specializes
in fried chicken. It is the world’s second largest restaurant chain (as measured
by sales) after McDonald’s, with 18,875 outlets in 118 countries and territories as
of December 2013. Since the early 1990s, KFC has expanded its menu to offer
other chicken products such as chicken fillet burgers and wraps, as well as
salads and side dishes, such as French fries and coleslaw, desserts, and soft
drinks. The company is a subsidiary of Yum! Brands, a restaurant company that
also owns the Pizza Hut and Taco Bell chains.
YUM! Brands, Inc.
YUM! Brands, Inc., together with its subsidiaries, operates quick service
restaurants. It operates in five segments: YUM China, YUM India, the KFC
Division, the Pizza Hut Division, and the Taco Bell Division. The company
develops, operates, franchises, and licenses a system of restaurants, which
prepare, package, and sell various food items. As of August 18, 2015, it operated
approximately 41,000 restaurants in approximately 125 countries and territories
primarily under the KFC, Pizza Hut, and Taco Bell brands, which specialize in
chicken, pizza, and Mexican-style food.
1952
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P ROPERTY O VERVIEW
Representative Photo
Physical Description
THE OFFERING
Property Name . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . KFC
Property Address . . . . . . . . . . . . . . . . . .2251 Jacksboro Highway
Fort Worth, TX 76114
Assessor’s Parcel Number . . . . . . . . . . . . . . . . . . . . . .22564-1-1
Zoning . . . . . . . . . . . . . . . . . . . . . . . . F - General Commercial
SITE DESCRIPTION
Number of Stories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . One
Year Built . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2008
Gross Leasable Area (GLA) . . . . . . . . . . . . . . . . . . . . ± 2,084 SF
Lot Size . . . . . . . . . . . . . . . . . . . . . . . ± 0.49 Acres (21,344 SF)
Type of Ownership . . . . . . . . . . . . . . . . . . . . . . . . . Fee Simple
Parking . . . . . . . . . . . . . . . . . . . . . . . . . . ± 18 Surface Spaces
Parking Ratio . . . . . . . . . . . . . . . . . . . . . . . . . ± 8.64 : 1,000 SF
Landscaping . . . . . . . . . . . . . . . . . . . . . . . . . . . Professional
Topography . . . . . . . . . . . . . . . . . . . . . . . . . . Generally Level
CONSTRUCTION
Foundation . . . . . . . . . . . . . . . . . . . . . . . . . . . Concrete Slab
Framing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Wood
Exterior . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Brick
Parking Surface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Asphalt
Roof . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Flat
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Tenant Map
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Aerial
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Regional
Matthews Retail Advisors | 10
Demographics
Population
1-Mile
3-Mile
5-Mile
2021 Projection
15,442
87,277
209,447
2016 Estimate
14,828
83,379
197,867
2010 Census
14,284
78,705
183,427
2000 Census
14,068
76,533
166,310
Growth 2016 - 2021
4.14%
4.67%
5.85%
Growth 2010 - 2016
3.81%
5.94%
7.87%
Growth 2000 - 2010
1.54%
2.84%
10.29%
Households
1-Mile
3-Mile
5-Mile
2021 Projection
4,698
29,918
76,253
2016 Estimate
4,473
28,221
71,397
2010 Census
4,237
25,906
65,242
2000 Census
4,308
24,660
57,775
Growth 2016 - 2021
5.02%
6.01%
6.80%
Growth 2010 - 2016
5.57%
8.94%
9.43%
Growth 2000 - 2010
-1.65%
5.05%
12.92%
Income
1-Mile
3-Mile
5-Mile
Income < $15,000
17.47%
15.96%
14.04%
Income $15,000 - $24,999
16.39%
14.12%
12.00%
Income $25,000 - $34,999
17.15%
14.78%
12.39%
Income $35,000 - $49,999
14.98%
14.79%
14.65%
Income $50,000 - $74,999
17.97%
18.28%
18.51%
Income $75,000 - $99,999
8.42%
8.64%
10.14%
Income $100,000 - $124,999
2.88%
4.61%
6.20%
Income $125,000 - $149,999
2.11%
3.11%
3.78%
Income $150,000 - $199,999
1.48%
2.52%
3.51%
Income $200,000 - $249,999
0.51%
0.94%
1.56%
Income $250,000 - $499,999
0.43%
1.48%
2.18%
Income $500,000+
0.23%
0.77%
1.04%
2016 Est. Average Household Income
$47,134
$58,553
$68,123
2016 Est. Median Household Income
$34,416
$40,207
$46,852
Matthews Retail Advisors | 11
A REA O VERVIEW
FORT WORTH, TEXAS
Fort Worth is located in North Central Texas and is the 16th-largest city in the
United States and the fifth-largest city in the state of Texas. The city is the
second-largest in the Dallas–Fort Worth–Arlington metropolitan area and has
been designated as one of America’s “Most Livable Communities” by the
Partners for Livable Communities. The city was established in 1849 as an Army
outpost on a bluff overlooking the Trinity River. Today, Fort Worth still embraces
its Western heritage and traditional architecture and design. USS Fort Worth
(LCS-3) is the first ship of the United States Navy named after the city.
Fort Worth is home to the Van Cliburn International Piano Competition and
several world-class museums designed by internationally known contemporary
architects. With more than 109 acres of museum space, Fort Worth has the
second-largest number of accredited museums within walking distance of
each other, second only to Washington D.C. The Kimbell Art Museum,
considered to have one of the best collections in Texas, is housed in what is
widely regarded as one of Texas’ foremost works of modern architecture,
designed by Louis Kahn with an addition by Renzo Piano. Also of note is the
Modern Art Museum of Fort Worth, designed by Tadao Ando. The Amon Carter
Museum of American Art, designed by Philip Johnson, houses one of the most
extensive collections of American art in the world in a building.
The region benefits from more than 60 colleges and universities, with a
combined enrollment exceeding 325,000 students, graduating in excess of
35,000 annually. The city is stimulated by several university communities:
Texas Christian, Texas Wesleyan, University of North Texas Health Science
Center, and Texas A&M University School of Law. The presence of Texas
Christian University less than 5 miles from downtown and national
competitiveness in football, baseball, and men’s and women’s basketball have
sustained TCU as an important part of Fort Worth’s sports scene as well.
Fort Worth is a major center for industry, technology, distribution and
transportation. Tourism is also a major contribution to the economy brining in
approximately 7.5 million visitors and contributing over $900 million to Fort
Worth’s economy. In 2013, Fort Worth-Arlington ranked 15th on Forbes’ list of
the Best Places for Business and Careers. Fort Worth is the location of many
multinational corporations, including Bell Helicopter, Lockheed Martin,
American Airlines, BNSF Railway, Pier 1 Imports, and Radio Shack.
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Dallas - Fort Worth Metroplex
The Dallas–Fort Worth–Arlington, TX Metropolitan Statistical Area, the official title designated by the United States Office of Management and Budget,
encompasses 13 counties within the U.S. state of Texas. Residents of the area refer to it as the Dallas/Fort Worth Metroplex, DFW, or The Metroplex. It
is the economic and cultural hub of the region commonly called North Texas or North Central Texas and is the largest inland metropolitan area in the
United States.
The 2015 official estimate U.S. Census has the Dallas–Fort Worth Metroplex at 7,102,796, making it the largest metropolitan area in the South. During
the 12-month period from July 2008 to July 2009, the Dallas–Fort Worth–Arlington metropolitan area gained 146,530 new residents, more than any
other metropolitan area in the United States. The area’s population has grown by about one million since the 2000 US census. The Dallas–Fort Worth–
Arlington MSA is, by population, the largest metropolitan area in Texas, the largest in the South, the fourth-largest in the United States, and the tenthlargest in the Americas. The Metroplex encompasses 9,286 square miles (24,100 km2) of total area: 8,991 sq mi (23,290 km2) is land, while 295 sq mi
(760 km2) is water, making it larger in area than the U.S. states of Rhode Island and Connecticut combined. It also has the fourth largest gross
metropolitan product (GMP) in the United States, and approximately tenth largest by GMP in the world.
Matthews Retail Advisors | 13
™
Ryan Muller
Associate
Gary Chou
VP & Director
License No. 01985081
O 310.919.5786
M 303.916.4362
[email protected]
License No. 01911222
O 310.919.5827
M 714.928.8016
[email protected]
Mark Cohen
Broker of Record
License No. 447509