1530 JOPPA ROAD TOWSON, MD
Transcript of 1530 JOPPA ROAD TOWSON, MD
OFFERING MEMORANDUM
1530 JOPPA ROAD · TOWSON, MD
A c t u a l Pro p e r t y P h o to
Holliday Fenoglio Fowler, L.P. (“HFF”) has been engaged by the owner of Art Van Furniture to market 10688 Perry Hwy, Wexford PA 15090 for sale. Information concerning the property described herein has been obtained from sources other than HFF, and neither Owner nor HFF, nor their respective equity holders, officers, employees and agents makes any representations or warranties, express or implied, as to the accuracy or completeness of such information. Any and all reference to age, square footage, income, expenses and any other property specific information are approximate. Any opinions, assumptions, or estimates contained herein are projections only and used for illustrative purposes and may be based on assumptions or due diligence criteria different from that used by a purchaser, and HFF, its partners, officers, employees and agents disclaim any liability that may be based upon or related to the information contained herein. Prospective purchasers should conduct their own independent investigation and rely on those results. The information contained herein is subject to change.
PHILADELPHIA
1700 Market Street
Suite 3232
Philadelphia, PA 19103
DALLAS
2323 Victory Avenue
Suite 1200
Dallas, TX 75219
MARC MANDELManaging Director
[email protected] Investment Advisory
FINANCING ADVISOR
BRANDON CHAVOYA Managing Director
Financing Advisor
COLER YOAKAMSenior Managing Director
[email protected] Advisory
STEVE SCHRENKDirector
[email protected] Advisory
EXCLUSIVE MARKETING ADVISORS
EXECUTIVE SUMMARY 01
INVESTMENT HIGHLIGHTS 02
LEASE ABSTRACT 03
TENANT PROFILE 05
INVESTMENT MERITS 07
LOCATION OVERVIEW 08
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Holliday Fenoglio Fowler, L.P. (“HFF”), on behalf of Art Van Furniture (the “Tenant”) and Thomas H. Lee Partners (“Thomas H. Lee” or “Sponsor”), is pleased to present an outstanding opportunity for the sale-leaseback of 1530 Joppa Road retail location currently branded as Gardiner Wolf Furniture, located in Towson, MD (the “Property”). The Property is being offered by Art Van Furniture, as a result of its November 2017 53 Mid-Atlantic store acquisition of Wolf Furniture and Levin Furniture bringing its total store count to 176.
Art Van Furniture to execute a 20 year primary lease upon close of escrow showing a long term commitment to the location. Art Van Furniture will operate the store with their proven commitment to high-quality and immense value that has allowed the brand to grow and become the #1 furniture and mattress retailer in the Midwest.
EXECUTIVE SUMMARY
INVESTMENT SUMMARY
Location1530 Joppa RoadTowson, MD 21286
Branded As Gardiner Wolf FurnitureSite Area 2.20 AcresBuilding Size 54,000 SFLease Type NNNRent Commencement
Close of escrow
Lease Expiration 20 years from close of escrowNOI $660,960 Annual Rent Increase
Lesser of (i) 2% or (ii) 1.25 times the change in the Price index
Options Four (4), Five Year options
TENANT REVENUE: ~$1.3 BN TENANT EBITDA: GREATER THAN $70MM
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A c t u a l Pro p e r t y P h o to
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INVESTMENT HIGHLIGHTS
$954,000
ANNUAL RENT
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RENT SCHEDULE
DESCRIPTION DATESANNUAL
RENTINCREASE
Base Term Year 1 Year 1 $660,960 2%
Base Term Year 2 Year 2 $674,179 2%
Base Term Year 3 Year 3 $687,663 2%
Base Term Year 4 Year 4 $701,416 2%
Base Term Year 5 Year 5 $715,444 2%
Base Term Year 6 Year 6 $729,753 2%
Base Term Year 7 Year 7 $744,348 2%
Base Term Year 8 Year 8 $759,235 2%
Base Term Year 9 Year 9 $774,420 2%
Base Term Year 10 Year 10 $789,908 2%
Base Term Year 11 Year 11 $805,707 2%
Base Term Year 12 Year 12 $821,821 2%
Base Term Year 13 Year 13 $838,257 2%
Base Term Year 14 Year 14 $855,022 2%
Base Term Year 15 Year 15 $872,123 2%
Base Term Year 16 Year 16 $889,565 2%
Base Term Year 17 Year 17 $907,356 2%
Base Term Year 18 Year 18 $925,504 2%
Base Term Year 19 Year 19 $944,014 2%
Base Term Year 20 Year 20 $962,894 2%
First Option- Year 1 Year 21 $982,152 2%
First Option- Year 2 Year 22 $1,001,795 2%
First Option- Year 3 Year 23 $1,021,831 2%
First Option- Year 4 Year 24 $1,042,267 2%
First Option- Year 5 Year 25 $1,063,113 2%
Second Option- Year 1 Year 26 $1,084,375 2%
Second Option- Year 2 Year 27 $1,106,062 2%
Second Option- Year 3 Year 28 $1,128,184 2%
Second Option- Year 4 Year 29 $1,150,747 2%
Second Option- Year 5 Year 30 $1,173,762 2%
** Annual Rental Adjustment: The lesser of (i) 2% or (ii) 1.25 times the change in the Price index
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A c t u a l Pro p e r t y P h o to
LEASE ABSTRACT
A c t u a l Pro p e r t y P h o to
ART VAN FURNITURELessee Art Van FurnitureBranded As AVF Parent, LLCGuarantor Gardiner Wolf FurnitureBuilding Size 54,000 SFLot Area 2.20 AcresYear Built 1963NOI $660,960 Annual Rent Increase
Lesser of 2% or 1.25 times the change in the Price index
Lease Type NNNRent Commencement
Close of escrow
Lease Term 20 years Lease Expiration 20 years from close of escrowRemaining Options
Four (4), Five Year options
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TENANT RESPONSIBILITY DETAIL
MaintenanceLessee, at its sole cost and expense is responsible for keeping all of the building, structures and improvements on the property in good order and repair. Lessee shall make all necessary structural, non-structural, exterior and interior repairs and replacements to the building.
UtilitiesLessee shall contract, in its own name, for and pay when due all charges for the connection and use of water, gas, electricity, telephone, garbage collection, sewer use and all other utilities supplied to the premises.
Taxes Lessee shall pay all taxes and assessnents of every type imposed upon the property.
InsuranceLessee, at Lessee's expense, at all times during the Term of the Lease, will procure, maintain and keep in force commercial general liability insurance, a cause of loss (special form insurance), workers' compensation and employers liability insurance, business interruption insurance, automobile liability insurance, and comprehensive boiler and machinery insurance.
LEASE ABSTRACT
E JOPPA ROAD (TRAFFIC COUNT VPD: 24,101)
Bear’s Paw Fabrics
Mo’s SeafoodMonro Muffler
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Art Van Furniture (“AVF”) was founded in 1959 in Detroit by Mr. Van Elslander. His founding philosophy was to provide the community with quality furniture at great prices, with always high standards of customer service.
Art Van Furniture transitioned to private equity sponsorship in March 2017 through Thomas H. Lee Partners (“THL”) investment.
TENANT PROFILE
With 61 full-line showrooms, including 15 franchised locations, plus operates across the consumer value spectrum and through multiple store formats, including a deep discount format called the Clearance Center and a premium store-within-a-store. In November of 2017 Art Van Furniture acquired Levin and Wolf Furniture making them one of the top ten furniture retailers in the country and added 35 stores to its brand.
With this acquisition, Art Van now operates 176 stores, including 18 franchise stores in nine states with $1.3 billion in expected annual sales. The companies will add 1,900 new employees to Art Van’s current 3,600 employees to bring the total to 5,500.
Re p re s e ntat i ve P h o to
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Thomas H. Lee Partners (“THL”) founded in 1974 is one of the world’s oldest and most experienced private equity firms. Since THL was founded they have raised over $22 billion of equity capital and invested in more than 140 portfolio companies with an aggregate value of over $150 billion.
THL invests in growth oriented businesses that are headquartered primarily in North America and specialize in four sectors:• Business & Financial Services • Consumer & Retail• Healthcare & Media• Information Services & TechnologyTHL partners with portfolio company management to identify and implement operational and strategic improvements to accelerate sustainable revenue and profit growth. They strive to build great companies of lasting value and generate superior investment returns.
THL’s deep industry knowledge and relationships allow them to make informed decisions quickly and contribute as owner/operators, not just passive capital providers. They seek to support portfolio company management teams with financing, merger & acquisitions and structuring capabilities as well as operational expertise. Their investor base includes some of the world’s leading public and corporate pension funds, sovereign wealth funds, financial institutions, endowments and high net worth families.
THL views the long-standing relationships they have with their investors as an important cornerstone of their business model. In the last eight years, THL’s investors have committed more than $2.1 billion in co-investments, and their principals have committed $335 million of their own capital to invest alongside THL’s limited partners in their last two funds.
Re p re s e ntat i ve P h o to
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INVESTMENT MERITS
ATTRACTIVE PRICINGAVF also uses its scale advantages to negotiate attractive discounts with suppliers, which it will pass on to Levin and Wolf customers in the form of highly competitive prices, driving sales.
MULTIPLE IN-STORE FORMATSAVF segments its stores between Showroom, Clearance Center, PureSleep bedding aisle, Art Van Flooring, and the high-end Scott Shuptrine Interiors. AVF also advertises these different formats separately; allowing the brand to reach multiple audiences.
ECOMMERCE SALESAVF is developing a world-class eCommerce platform and digital in-store support. AVF will leverage this investment in Levin and Wolf markets, which will drive traffic to their stores and enhance their ability to compete across multiple channels.
CONTIGUOUS GEOGRAPHIC EXPANSIONOpportunity to accelerate AVF’s plans for contiguous geographic expansion in new markets by partnering with market leaders in the Mid-Atlantic, and simultaneously expand into attractive new markets to eliminate strong competitors.
AVF HAS SUBSTANTIAL SCALE IN THE MIDWEST, RANKING #1 IN FURNITURE STORES, WHICH IT USES TO SUPPORT A LARGE, BEST-IN-
CLASS IN-STOCK ASSORTMENT AND NEXT-DAY DELIVERY.
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LOCATION OVERVIEW
Located approximately 11 miles north of Baltimore and within 60 miles from the Nation’s Capital, Towson enjoys superior access to major highways and is within 28 miles of Baltimore/Washington International Airport. Due to its prime location, Towson’s average household income is over $80,000 resulting in a strong platform to sustain an abundance of businesses. Towson is also home to Towson University which has a student body of over 22,000 and one of the largest employers in the immediate area.
Over the past few years Towson underwent a revitalization adding new amenities and creating a regional destination for the surrounding area. Towson Square an $85 million lifestyle center development which opened in 2014 has added many new amenities including retail shops, a high end movie theater, and many restaurant options.
3 MILE RADIUS DEMOGRAPHICS2010 Population Census 133,7822017 Population Estimate 135,6852017 Average Household Income $81,705.002017 Median Household Income $62,869.50
The area has also flourished from new housing developments which include over 2,700 new townhomes and a new $350 million, 1.2 million square foot mixed use development, Towson Row, which plans to break ground in 2018.
The new development will house a new Whole Foods (1 of 3 in the Baltimore MSA), 200 units of student housing, 250 luxury condominiums and apartments, and 150,000 square feet of new office space. The increase in development will help spur future economic growth in the region.
BALTIMORE
PENNSYLVANIA
NEW JERSEY
DELAWARE
VIRGINIA
WEST VIRGINIA DOVER
FREDERICK
LURAY
WOODSTOCK
MARTINSBURG
GEORGEWASHINGTON
AND JEFFERSONNATIONAL FOREST
WILMINGTON
VINELAND
NEWARK
CAPE MAYWASHINGTON
D.C.
695
95
95
70
68
81
66
83
270
13
1
50
301
341
BALTIMORE: 11 MILES WASHINGTON DC: 60 MILES
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IMMEDIATE TRADE AREA BALTIMORE BELTWAY
695
542
E JOPPA ROAD (TRAFFIC COUNT VPD: 24,101)
TOWSON PLACEBear’s Paw Fabrics
Concordia Preparatory SchoolCromwell Valley
Apartments
Calvert Hall High School College
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MARKET AERIAL
3 MILE RADIUS
95
95
895
BALT
IMORE BELTWAY
695
146
45
542
TOWSON PLACE
TOWSON TOWN CENTER
TOWSON SQUARE
TOWSONUNIVERSITY
ENROLLMENT: 22,000 +
EMPLOYEES:3,000 +
BALTIMORE11 MILES
STUDENT BODY OF OVER 22,000
TOWSON SHOPPING CENTER
NORTH PLAZA
TOWSON OVERLOOK PERRING PLAZA
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DEMOGRAPHICS
POPULATION BY RACE1 MILE 3 MILE 5 MILE
White 62.27% 56.26% 53.24%Black/African American
25.24% 34.69% 37.70%
American Indian/Alaskan Native
0.17% 0.22% 0.24%
Asian 6.45% 4.71% 5.16%Native Hawaiian/Pacific Islander
0.05% 0.06% 0.05%
Some Other Race 1.79% 1.33% 1.07%Two or More Races 4.02% 2.73% 2.54%
POPULATION 1 MILE 3 MILE 5 MILE
2010 Census 14,512 133,782 323,9772017 Estimate 14,443 135,685 328,5192022 Projection 14,555 138,040 334,321
HOUSEHOLDS1 MILE 3 MILE 5 MILE
2010 Census 6,291 54,648 128,2842017 Estimate 6,247 55,566 130,2782022 Projection 6,292 56,630 132,706
POPULATION GROWTH1 MILE 3 MILE 5 MILE
Historical Growth: 2010 to 2017
-0.47% 1.42% 1.40%
Projected Growth: 2017 to 2022
0.78% 1.74% 1.77%
HOUSEHOLD INCOME1 MILE 3 MILE 5 MILE
2017 Average Income
$80,769.00 $81,705.00 $87,392.00
2017 Median Income
$63,861.23 $62,869.50 $64,836.56
AGE BY GENDER1 MILE 3 MILE 5 MILE
Male 6,851 63,431 152,678Female 7,592 72,254 175,842
HOUSEHOLD GROWTH1 MILE 3 MILE 5 MILE
Historical Growth: 2010 to 2017
-0.70% 1.68% 1.55%
Projected Growth: 2017 to 2022
0.72% 1.92% 1.86%
A c t u a l Pro p e r t y P h o to
A c t u a l Pro p e r t y P h o to
PHILADELPHIA
1700 Market Street
Suite 3232
Philadelphia, PA 19103
DALLAS
2323 Victory Avenue
Suite 1200
Dallas, TX 75219
MARC MANDELManaging Director
[email protected] Investment Advisory
FINANCING ADVISOR
BRANDON CHAVOYA Managing Director
Financing Advisor
COLER YOAKAMSenior Managing Director
[email protected] Advisory
STEVE SCHRENKDirector
[email protected] Advisory
EXCLUSIVE MARKETING ADVISORS