WalMart neighbOrhOOd Market - Matthews Real Estate Investment

Representative Photo
Walmart Neighborhood Market
1422 w oglethorpe hwy, hinesville, ga 31313
Offering Memorandum
™
R E T A I L
A D V I S O R S
C O NFIDENTIALITY & DIS CLAIMER STATEMENT
This Offering Memorandum contains select information pertaining to the business and affairs of Walmart Neighborhood Market located at
1422 W Oglethorpe Hwy, Hinesville, GA 31313 (“Property”). It has been prepared by Matthews Retail Advisors . This Offering Memorandum
may not be all-inclusive or contain all of the information a prospective purchaser may desire. The information contained in this
Offering Memorandum is confidential and furnished solely for the purpose of a review by a prospective purchaser of the Property.
It is not to be used for any other purpose or made available to any other person without the written consent of Seller or Matthews
Retail Advisors . The material is based in part upon information supplied by the Seller and in part upon financial information
obtained from sources it deems reliable. Owner, nor their officers, employees, or agents makes any representation or warranty,
express or implied, as to the accuracy or completeness of this Offering Memorandum or any of its contents and no legal liability is
assumed or shall be implied with respect thereto. Prospective purchasers should make their own projections and form their own
conclusions without reliance upon the material contained herein and conduct their own due diligence.
By acknowledging your receipt of this Offering Memorandum for the Property, you agree:
1. The Offering Memorandum and its contents are confidential;
2. You wi ll hold it and treat it in t he strictest of confidence; and
3. You will not, directly or indirectly, disclose or permit anyone else to disclose this Offering Memorandum or its contents
in any fashion or manner detrimental to the interest of the Seller.
Owner and Matthews Retail Advisors expressly reserve the right, at their sole disc retion, to reject any and all expressions
of interest or offers to purchase the Property and to terminate discussions with any person or entity reviewing this Offering
Memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase and sale of
the Property has been fully executed and delivered.
If you wish not to pursue negotiations leading to the acquisition of the Property or in the future you discontinue such
negotiations, then you agree to purge all materials relating to this Property including this Offering Memorandum.
A prospective purchaser’s sole and exclusive rights with respect to this prospective transaction, the Property, or information
provided herein or in connection with the sale of the Property shall be limited to those expressly provided in an executed
Purchase Agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims
against Seller or Matthews Retail Advisors or any of their affiliates or any of their respective officers, Directors, shareholders,
owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the
marketing or sale of the Property.
This Offering Memorandum shall not be deemed to represent the state of affairs of the Property or constitute an indication that
there has been no change in the state of affairs of the Property since the date this Offering Memorandum.
Matthews Retail Advisors
TABLE OF CONTENTS
Pricing & Financial Analysis
INVESTMENT RANKING.............................................................2-3
INVESTMENT OVERVIEW..............................................................4
EXECUTIVE SUMMARY................................................................. 5
COMPANY OVERVIEW................................................................... 6
Property Description
PROPERTY DESCRIPTION............................................................ 9
BIRDS EYE MAP..............................................................................10
REGIONAL MAP............................................................................... 11
TENANT MAP..................................................................................12
Demographics
CITY OVERVIEW | Hinesville, GA............................................... 14
DEMOGRAPHICS REPORT..........................................................15
E XC LUSIVELY LISTED BY:
Chad Kurz
Managing Partner
direct +1.310.919.5850
MOBILE +1.562.480.2937
[email protected]
License No. 01911198
Kyle B. Matthews, CCIM
Josh Bishop
Senior Associate
direct +1.310.919.5823
MOBILE +1.315.730.6228
[email protected]
License No. 01940394
Chairman & CEO
Kyle Matthews
Broker of Record
direct +1.310.919.5757
MOBILE +1.310.622.3161
License No. 363764
[email protected]
License No. 01469842
Matthews Retail Advisors
Representative Photo
Pricing & Financial Analysis
™
PRICING ANALYSIS
Walmart vs. drugstores
Ranking Your Next Investment
AA+
S&P Investment Grade Credit
AA
RENT GROWTH • 20 Years
% Increase from Initial NOI
20%
AA15%
A+
11.4% Walmart
10% Rite Aid
10%
A
A-
5%
BBB+
0% CVS/Walgreens
0%
BBB
BBB-
-5%
0 Years
5 Years
10 Years
15 Years
20 Years
Not Investment Grade Credit
P. 2
Matthews Retail Advisors
OFFERING MEMORANDUM | Walmart Neighborhood Market
PRICING ANALYSIS
#1
Market Cap
Revenue
1
#10
$500
$250
$484B
$200
$400
$150
$300
$98B
$100
#35
50
$200
$78B
100
$149B
$50
$113B
$100
#117
$29B
$8B
$0
Fortune 500 rankings
$214B
$0
Walmart
CVS
WALGREENS
Rite Aid
Walmart Neighborhood Market | OFFERING MEMORANDUM
Walmart
CVS
WALGREENS
Rite Aid
150
Matthews Retail Advisors
P. 3
INVESTMENT
OVERVIEW
PRICING
ANALYSIS
INVESTMENT
HIGHLIGHTS
Investment
The Matthews Retail Advisors are
pleased to exclusively offer for sale
the brand new construction Walmart
Neighborhood Market located in
Dalton, Georgia. Walmart is the #1
company in the United States based
on a report by Fortune 500. Walmart
has extremely strong investment
grade credit, S&P rated AA; Moody’s
rated Aa2.
The Neighborhood
Market concept is comparable to a
mini Walmart Supercenter offering
costumers the same low prices but
in a smaller and more accessible
location, giving them a distinct
competitive advantage.
The Neighborhood Market concept
focuses on three of Walmart’s
strongest categories, groceries,
pharmacies, and fuel. Moody’s
predicts
that
Neighborhood
Markets will eventually outnumber
Supercenters, they believe that
thousands of locations over time is
a reasonable assumption and their
only restraint will be how fast can
they build, staff and stock the stores.
Dalton, GA is located along the major
highway with traffic counts around
±20,000 vehicles per day. Dalton,
GA borders Fort Stewart which is the
P. 4
Matthews Retail Advisors
Location:
• Located major thoroughfare with ±20,000 vehicles per day
• Immediate trade area has ±30,000 residents in a 3-mile radius
• Hinesville, GA borders Fort Stewart, the largest Army installation east of the Mississippi River
Tenant:
• Extremely strong investment grade credit, S&P rated AA; Moody’s rated Aa2
• In 2015, Fortune 500 named Walmart as the #1 company in the United States
• Walmart plans to open 405 stores in 2015, up from 240 new stores opened in 2014
• Moody’s predicts there will eventually be more Walmart Neighborhood Market stores than
SuperCenter stores. Currently, there are ±700 Walmart Neighborhood Market stores.
• Walmart has +11,500 stores in 28 countries throughout the world, making it the #1 retailer
according to Forbes
Property:
• Recently signed 100 year lease, with firm 15-year base term
• Brand new 2015 Construction
• Absolute NNN lease (no management responsibility)
• 3% rent increases every 5-years of the base term; 5% increases in extension periods
• Neighborhood Market concept offers fresh, affordable groceries at Walmart’s every day low
prices
• Property offers drive-thru pharmacy and fuel station with convenience items
OFFERING MEMORANDUM | Walmart Neighborhood Market
PRICING
ANALYSIS
EXECUTIVE
SUMMARY
Walmart Neighborhood Market
1422 W. Oglethorpe hwy
hinesville, ga 31313
List Price............................................................................................ $11,934,180
CAP Rate - Current�����������������������������������������������������������������������������������5.00%
Gross Leasable Area���������������������������������������������������������������������������41,117 SF
Lot Size ......................................................................5.27 Acres ( 231,812 SF)
Year Built������������������������������������������������������������������������������������������������������� 2015
Annualized Operating Data
Years 1 - 5
Monthly Rent
Annual Rent
Rent/SF CAP Rate
$49,725.75
$596,709.00
$14.51
5.00%
Years 6 - 10
$51,217.52
$614,610.27
$14.95
5.15%
Years 11 - 15
$52,754.05
$633,048.58
$15.40
5.30%
17, 5 Year Options
5% Increases
Tenant Summary
Tenant Trade Name
Wal-Mart Stores, Inc.
Type of Ownership
Fee Simple
Lease Guarantor
Corporate
Lease Type
Roof and Structure
Original Lease Term
Tenant Responsible
15 Years
Rent Commencement Date
9/9/2015
Lease Expiration Date
9/9/2030
Term Remaining on Lease
Increases
Options
Walmart Neighborhood Market | OFFERING MEMORANDUM
NNN
14.50 Years
3% Every 5 Years of Base Term & 5% In Option Periods
17, 5 Year Options
Matthews Retail Advisors
P. 5
COMPANY OVERVIEW
Chase Bank
Parent Company
Ownership
Walmart Neighborhood Market
Wal-mart Stores Inc.
Public
Stock Symbol
WMT
Board
NYSE
Credit Rating
Rating Agency
Revenue
No. of Locations
No. of Employees
Headquartered
Web Site
Year Founded
P. 6
Matthews Retail Advisors
AA/Aa2
Standard & Poor’s/Moody’s
$485.52 Billion
11,000
2,200,000
Bentonville, AR
http://www.walmart.com
1945
Wal-Mart Stores, Inc. operates retail stores in various formats worldwide.
The company operates through three segments: Walmart U.S., Walmart
International, and Sams Club. It operates discount stores, supermarkets,
supercenters, hypermarkets, warehouse clubs, cash and carry stores, home
improvement stores, specialty electronics stores, restaurants, apparel
stores, drug stores, and convenience stores, as well as retail Websites, such
as walmart.com and samsclub.com. The company also provides financial
services and related products, including money orders, prepaid cards, wire
transfers, money transfers, check cashing, and bill payment. In addition,
it offers brand name merchandise, including hardgoods, softgoods, and
selected private-label items, such as Members Mark and its own proprietary
brands, such as Daily Chef and Simply Right. It operates approximately
11,000 stores under 72 banners in 27 countries; and e-commerce websites
in 11 countries. The company was founded in 1945 and is headquartered in
Bentonville, Arkansas.
OFFERING MEMORANDUM | Walmart Neighborhood Market
PROPERTY DESCRIPTION
Wal-Mart has a massive plan that should terrify Whole
Foods, Kroger, and Trader Joe’s
Wal-Mart is gearing up to dominate the grocery business.
The retailer’s smaller-format stores, called Neighborhood Markets, are a major threat to
traditional supermarkets like Whole Foods, Kroger, and Trader Joe’s, and they are expanding
rapidly, according to Moody’s analysts.
“The advantages of the Neighborhood Market concept will be difficult to beat back,” Moody’s
Vice President Charles O’Shea said in a recent note to clients.
Traditional supermarkets have “upped their games over the past few years to somewhat blunt
the onslaught of the Supercenters,” analysts write, but the Neighborhood Market is a “different
animal.”
The Markets are like compacted Supercenters. They offer the same low prices as Wal-Mart’s
giant warehouse stores, but in a much smaller and more easily accessible location, giving the
Neighborhood Markets a “distinct competitive advantage over virtually anyone,” analysts write.
The Markets focus on three of Wal-Mart’s strongest categories — groceries, pharmacies, and
fuel — and they are more conveniently located to urban centers, whereas Supercenters are
typically located on city outskirts.
Traffic has been weakening at big-box stores as consumers increasingly shop online for bigticket purchases like flat-screen TVs.
But it’s a different story for Neighborhood Markets, with their focus on fresh produce and fuel.
“Melding locational convenience with an easier-to-shop store with a Supercenter-oriented
pricing strategy presents a new set of competitive factors that we believe many supermarket
operators will have difficulty addressing,” the analysts write.
Moody’s expects Neighborhood Markets to eventually outnumber Supercenters, with the
smaller stores relying on the warehouses as supply hubs. Wal-Mart now has 645 Neighborhood
Market locations and more than 3,400 Supercenters.
Grocery items represent the largest segment of net sales in
the United States for Walmart and since 2010, grocery sales
are also the fastest growing category for Walmart.
*Yahoo Finance
“We believe thousands of locations over time is a reasonable assumption,” the analysts write.
“The only restraint will be how fast these can be built, staffed and stocked.”
*Business Insider
Walmart Neighborhood Market | OFFERING MEMORANDUM
Matthews Retail Advisors
P. 7
Property Description
™
PROPERTY DESCRIPTION
THE OFFERING
Property Name................................................. Walmart Neighborhood Market
Property Address........................................................ 1422 W Oglethorpe Hwy
Hinesville, GA 31313
SITE DESCRIPTION
Number of Stories���������������������������������������������������������������������������������������������One
Year Built..............................................................................................................2015
Gross Leasable Area (GLA)��������������������������������������������������������������������� 41,117 SF
Lot Size............................................................................. 5.27 Acres (231,812 SF)
Type of Ownership................................................................................Fee Simple
Parking.................................................................................... 100 Surface Spaces
Parking Ratio...................................................................................2.43 : 1,000 SF
Landscaping.........................................................................................Professional
Topography.................................................................................... Generally Level
CONSTRUCTION
Foundation........................................................................................Concrete Slab
Framing..............................................................................................................Wood
Exterior............................................................................................. Painted Stucco
Parking Surface.............................................................................................Asphalt
Roof.........................................................................................................................Flat
Representative Photo
Walmart Neighborhood Market | OFFERING MEMORANDUM
Matthews Retail Advisors
P. 9
BIRDS EYE
W
O
g
le
thorp
e
H
w
y
CPD
:2
0
,
0
00
P. 10
Matthews Retail Advisors
OFFERING MEMORANDUM | Walmart Neighborhood Market
PROPERTY
REGIONAL DESCRIPTION
MAP
Walmart Neighborhood Market | OFFERING MEMORANDUM
Matthews Retail Advisors
P. 11
TENANT MAP
P. 12
Matthews Retail Advisors
OFFERING MEMORANDUM | Walmart Neighborhood Market
Demographics
™
DEMOGRAPHIC
CITY OVERVIEWANALYSIS
| Hinesville, GA
The City of Hinesville is the seat of Liberty County. Located forty
miles southwest of Savannah, the city is adjacent to Fort Stewart,
making it home to many soldiers from the base. Fort Stewart Military Reservation includes approximately 280,000 acres making it the
largest military installation in the Eastern United States.
Hinesville, one of only six counties on the beautiful Georgia coast,
is also one of the fastest-growing cities in southeast Georgia. In
an area of raw and haunting natural beauty, with Spanish moss
gracefully draping off live oak trees and abundant wildlife, Hinesville is home to a historic old jail and the nearby Fort Stewart.
Hinesville’s year-round moderate climate is just one of the many
reasons the City is an ideal place to live. Its prime location makes
P. 14
Matthews Retail Advisors
OFFERING MEMORANDUM | Walmart Neighborhood Market
DEMOGRAPHICS
REPORT
DEMOGRAPHIC
ANALYSIS
Population
2020 Projection
2015 Estimate
2010 Census
2000 Census
Growth 2000-2010
Growth 2010-2015
Growth 2015-2020
3-Mile
30,077
29,300
28,764
24,065
2.65%
1.86%
19.53%
5-Mile
49,400
47,524
45,505
39,591
3.95%
4.44%
14.94%
10-Mile
72,684
69,245
64,991
61,288
4.97%
6.54%
6.04%
Households
2020 Projection
2015 Estimate
2010 Census
2000 Census
Growth 2000-2010
Growth 2010-2015
Growth 2015-2020
10,812
10,496
10,219
8,132
3.02%
2.71%
25.65%
18,380
17,577
16,503
13,698
4.57%
6.51%
20.47%
25,615
24,238
22,302
19,061
5.68%
8.68%
17.00%
13.56%
11.81%
13.38%
18.88%
20.08%
11.66%
5.01%
2.43%
1.41%
0.56%
0.85%
0.36%
$55,214
$43,935
14.07%
11.68%
13.44%
19.32%
19.74%
11.80%
4.90%
2.30%
1.32%
0.47%
0.68%
0.27%
$53,629
$43,386
Income
$0 - $15,000
$15,000 - $24,999
$25,000 - $34,999
$35,000 - $49,999
$50,000 - $74,999
$75,000 - $99,999
$100,000 - $124,999
$125,000 - $149,999
$150,000 - $199,999
$200,000 - $249,999
$250,000 - $499,999
$500,000+
2015 Est. Average Household Income
2015 Est. Median Household Income
Walmart Neighborhood Market | OFFERING MEMORANDUM
13.49%
12.80%
13.35%
18.72%
20.32%
11.17%
4.98%
2.36%
1.10%
0.49%
0.84%
0.38%
$54,241
$43,311
Matthews Retail Advisors
P. 15
Walmart Neighborhood Market
1422 W Oglethorpe Hwy
Hinesville, GA 31313
OFFERING MEMORANDUM
Chad Kurz
Managing Partner
direct +1.310.919.5850
MOBILE +1.562.480.2937
[email protected]
License No. 01911198
Josh Bishop
Senior Associate
direct +1.310.919.5823
MOBILE +1.315.730.6228
[email protected]
License No. 01940394
Matthews Retail Advisors | 841 Apollo Street, Suite 150 | El Segundo, CA 90245 | www.Matthews.com
™
Kyle Matthews
Broker of Record
License No. 363764