OFFERING MEMORANDUM...McDonald’s, Subway, Taco Bell, Starbucks and More. • Direct Frontage on...

OFFERING MEMORANDUM

217 N BOONE ST | ABERDEEN, WA 915 SIMPSON AVE | HOQUIAM, WA

CLAYTON BROWN National Retail Group206.826.5787 [email protected]

JOSEPH BLATNER National Retail Group503.200.2029 [email protected]

E X C L U S I V E LY L I S T E D B Y :

CONFIDENTIALITY DISCLAIMERThe information contained in this Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCBs or asbestos, the compliance with State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property.The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein.

By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment Services and hold it harmless from any kind of claim, cost, expense, or liability arising out of your investigation and/or purchase of this net leased property. The information contained in this Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCBs or asbestos, the compliance with State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.WASHINGTON BROKER OF RECORD: JOEL DEISACTIVITY ID: ZAA0210184 & ZAA0210185

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SUPERVALU | WASHINGTON

TABLE OF CONTENTS

01INVESTMENT SUMMARY

PAGE 4Executive SummaryRent Roll

ABOUT THE PROPERTY

03MARKET SUMMARY

PAGE 15Location OverviewsDemographics

ABOUT THE MARKET

02PROPERTY DETAIL

PAGE 7Location OverviewsAerial MapsTenant Overview

3


INVESTMENT SUMMARY01Hoquiam Location

4


GRAYS HARBOR

EXECUTIVE SUMMARY

SUPERVALU

ABERDEENHOQUIAM

217 North Boone StreetAberdeen, WA 98520

915 Simpson Avenue Hoquiam, WA 98550

SUBJECT PROPERTY

SUBJECT PROPERTY

PRICE

$7,857,144CAP RATE

7.00%

ABERDEEN & HOQUIAM LOCATIONS

NET OPERATING INCOME $550,000 PRICE PER SF $128.00

LEASE TYPE Absolute NNN GUARANTOR Swanson’s SuperValu

LEASE COMMENCEMENT Upon Closing INCREASES 1.5% Annual Increases

LEASE EXPIRATION DATE 20 Years After Commencement OPTIONS (4) 5-Year Options

LOT SIZE (ACRES) Aberdeen: 2.56Hoquiam: 1.71 BUILDING SF Aberdeen: 39,000

Hoquiam: 22,495

5


RENT ROLL

TENANT INFO LEASE TERMS CURRENT RENT RENT INCREASES LEASE

NAME SIZE COMMENCEMENT EXPIRATIONANNUAL BASE

RENTANNUAL RENT

PER FOOTDATE ANNUAL RENT

(COMBINED)OPTIONS TYPE

SUPERVALU(2 LOCATIONS)

ABERDEEN: 39,000 SF

HOQUIAM:22,495 SF

UPON CLOSING20 YEARS AFTERCOMMENCEMENT

$550,000 $8.94

YEAR 1YEAR 2YEAR 3YEAR 4YEAR 5YEAR 6YEAR 7YEAR 8YEAR 9YEAR 10YEAR 11YEAR 12YEAR 13YEAR 14YEAR 15YEAR 16YEAR 17YEAR 18YEAR 19YEAR 20

$550,000.00$558,250.00 $566,623.75 $575,123.11 $583,749.95 $592,506.20 $601,393.80 $610,414.70 $619,570.92 $628,864.49 $638,297.45 $647,871.92 $657,589.99$667,453.84 $677,465.65 $687,627.64 $697,942.05 $708,411.18 $719,037.35 $729,822.91

(4) 5-YEAR OPTIONS

ABSOLUTENNN

6


02 PROPERTY OVERVIEW

Aberdeen Location

7


HIGHWAY

101

*Subject parcel outline is not exact

HIGHWAY 105

N BO

ON

E ST

CHEHALIS RIVER

ABERDEEN LOCATION

OVERVIEW

HIGHLIGHTS

The subject property has been a staple of its location for many years. The tenant will sign, at closing, a brand-new, absolute net lease with a term of 20 years and 1.5% annual rental increases. The Aberdeen location, sandwiched between Highways 101 and 105, provides excellent visibility and traffic volume. There are more than six points of ingress and egress around the parking lot. This location also offers a Subway restaurant in the building along with the SuperValu grocer.

While there are grocery options over the river in North Aberdeen, the South Aberdeen area is heavily under-served. There isn’t another grocery option south of the property to serve the entire southern Aberdeen area. The property sits within close proximity to many other national retailers including, but not limited to, Walmart, Marshalls, Big 5 Sporting Gods, Tractor Supply, McDonald’s, Subway, Taco Bell, Starbucks and more.

• Absolute Net Lease – No Landlord Responsibility Whatsoever• Long, 20-Year Term• 1.5% Annual Increases During Primary Term and Throughout Options• Established Locations Having Served the Area for More than 112 Years

With Strong Sales

• The SuperValu Brand Brings In Over $14 Billion in Annual Sales

• Dense Retail Location Surrounded by More than 20 National Retailers Including Walmart, Marshalls, Big 5 Sporting Goods, Tractor Supply, McDonald’s, Subway, Taco Bell, Starbucks and More.

• Direct Frontage on Both Highway 101 and Highway 105 With Traffic Counts at the Intersection Totaling 30,000 VPD

• Last Retail Stop on Highway 101 Before Heading North over the Chehalis River to North Aberdeen

8

SUPERVALU | ABERDEEN, WA

*Photographs have been modified for marketing purposes, contact agent for actuals.

PROPERTY PHOTOS

9


AERIAL VIEW

McDonald’s

Miller Jr.High School

Stevens Elementary School

Pioneer Park

Grays Harbor College

Grays HarborInn & Suites

SHOPPES AT RIVERSIDE

Thai Carrot

Blue BeaconRestaurant & Lounge

Grays Harbor Historical Seaport

RIVERSIDE CINEMA 10

TECTONICComics & Books

SUBJECT PROPERTY

217 N BOONE ST | ABERDEEN, WA 98520

VPD: 30,000*

S Boone St

N Boone St

E W

ishk

ah S

t

E Wishkah St

South G St

101W Curtis St

105

105*Source: costar.com

CHEH

ALIS

RIV

ER 10


SIMPSON AVE

*Subject parcel outline is not exact

HOQUIAM RIVER

10TH ST

9TH S

THOQUIAM LOCATION

OVERVIEW

HIGHLIGHTS

The subject property has been a staple of its location for many years. The tenant will sign, at closing, a brand-new, absolute net lease with a term of 20 years and 1.5% annual rental increases. The Hoquiam location, with direct frontage of Highway 101, has excellent visibility and traffic volume. While there are grocery options over the river in East Hoquiam, the West Hoquiam area is heavily under-served as there is only one additional, local grocery option west of the property to serve the entire western Hoquiam area.

The property is surrounded by an abundance of national retail including US Bank, Ace Hardware, Dollar Tree, Subway, Grocery Outlet, Bi-Mart, and more. This location is also neighbored by the US Social Security Administration and the Hoquiam Police Department which typically do not relocate.

• Absolute Net Lease – No Landlord Responsibility Whatsoever

• Long, 20-Year Term with 1.5% Annual Increases During Primary Term and Throughout Options

• The SuperValu Brand Brings In Over $14 Billion in Annual Sales

• Neighbored Directly by Anchored Tenants in the US Social Security Administration and The Hoquiam Police Department

• Direct Frontage of Highway 101 with Traffic Counts Exceeding 15,000 VPD

• Last Retail Stop on Highway 101 Before Heading East over the Hoquiam River

• Hoquiam is Home to the Grays Harbor National Wildlife Refuge which Sees More than One Million Travelers Pass through Each Year

• Surrounded by an Abundance of National Retail Including US Bank, Ace Hardware, Dollar Tree, Subway, Grocery Outlet, Bi-Mart, and More

11

SUPERVALU | HOQUIAM, WA

*Photographs have been modified for marketing purposes, contact agent for actuals.

PROPERTY PHOTOS

12


AERIAL VIEW

Hoquiam PoliceDepartment

VPD: 15,000*

8th Street Ale House

Simpson Avenue Grill

McDonald’s

Hoquiam Library

US Social Security Administration

Hoquiam Municipal Court

Harborena RollerSkating Rink

Olympic StadiumHome of Loggers Playday

WashingtonElementary School

Hoquiam FireDepartment

SUBJECT PROPERTY

Simpson Ave

Simpson Ave

*Source: costar.com

101

101

101

915 SIMPSON AVE | HOQUIAM, WA 98550

HOQU

IAM R

IVER

GRAYS HARBOR

13


SUPERVALU OVERVIEW

THE BRAND

SuperValu, Inc. is a wholesaler and retailer of grocery products. Headquartered in Minneapolis, Minnesota, the brand has been in business since 1925, making it nearly a century old. It is a wholly owned subsidiary of Providence, Rhode Island based United Natural Foods. It is the largest publicly-traded wholesaler and the fifth-largest food retailing company in the United States (after Kroger and Albertsons), and ranks in the top 200 on the 2018 Fortune 500 list.

In July 2018, SuperValu announced that it had agreed to be purchased by Providence, RI-based United Natural Foods Inc., the largest distributor to Whole Foods Market and other natural foods stores.

SuperValu operates a complete range of grocery formats including food and food/drug combination stores, in-store pharmacies, and fuel centers. SuperValu also supplies a network of independent retailers (often found in smaller cities) that sometimes use the SuperValu name. SuperValu also franchises the Cub Foods and Save-A-Lot brands to independent retailers.

In 2018, SuperValu served as a primary grocery supplier to approximately 3,323 stores, and served as a secondary grocery supplier to approximately 2,462 stores. Annual sales for 2018 total over $14.1 billion, a nearly 30% increase from 2017 sales of $10.9 billion.

14.1B IN 2018 REVENUE

31,000 EMPLOYEES NATIONWIDE

3,323 LOCATIONS SUPPLIED

$

5THFOOD RETAILING COMPANY

LARGEST

Sources: supervalu.com/about.html; SUPERVALU_F18_Annual_Report

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MARKET SUMMARY03Aberdeen Location

15


LOCATION OVERVIEWABERDEEN, WA

Aberdeen is a city in Grays Harbor County, Washington. The population was 16,462 at the 2017 census and their cost of living is 18.40% lower than the U.S. average. The city is the economic center of Grays Harbor County, bordering the cities of Hoquiam and Cosmopolis. Aberdeen is often referred to as the “Gateway to the Olympic Peninsula” because of its proximity to the southern end of the peninsula and to Olympic National Park. It is also the home of Kurt Cobain. Aberdeen is the home port of the tall ship Lady Washington, a reproduction of a smaller vessel used by the explorer Captain Robert Gray, featured in the Pirates of the Caribbean film The Curse of the Black.

Aberdeen is at the eastern end of Grays Harbor, near the mouth of the Chehalis River and southwest of the Olympic Mountains. Grays Harbor is

notable as the northernmost ria on North America’s Pacific Coast because it has remained free of glaciers throughout the

Quaternary due to unfavorable topography and warm temperatures.

It is thought that, during glacial periods of the Quaternary, the Chehalis River was a major refugium for aquatic species, as was the west coast from the Olympic Peninsula southward for plants that later formed the northern part of the Pacific temperate rainforest in formerly glaciated areas.

Aberdeen and the rest of Grays Harbor remain dependent on the timber, fishing industries, tourism and as a regional service center for much of the Olympic Peninsula. Historically the area is dependent on harvesting and exporting natural resources. The Port of Grays Harbor is the largest coastal shipping port north of California. It is still a center for the export of logs on the west coast of the U.S. and has become one of the largest centers for the shipment of autos and grains to China and Korea. Major employers in Grays Harbor include Westport Shipyard, Sierra Pacific Industries, The Simpson Door Company, Hoquiam Plywood, Pasha Automotive, Willis Enterprises, Ocean Gold Companies, and Vaughn Company. In 2007, Imperium Renewables of Seattle invested $40 million in the construction of the biodiesel plant at the Port of Grays Harbor. It is estimated the plant will produce as much as 100 million US gallons of biodiesel fuel made

from plants and vegetable material annually. In September 2010, the Weyerhaeuser Cosmopolis Pulp Mill was purchased by the

Beverly Hills-based Gores Group and restarted as Cosmo Specialty Fibers, Inc. They started

production of pulp in May 2011.

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DEMOGRAPHICS

Source: ©2018 Experian

POPULATION 3 Miles 5 Miles 10 Miles 2023 Projection

Total Population 17,889 21,702 30,524

2018 Estimate


2010 Census


2000 Census


Daytime Population

2018 Estimate 19,889 23,053 30,385

HOUSEHOLDS 3 Miles 5 Miles 10 Miles 2023 Projection

Total Households 7,220 8,670 11,794

2018 Estimate


Average (Mean) Household Size 2.48 2.51 2.58

2010 Census


2000 Census


HOUSEHOLDS BY INCOME 3 Miles 5 Miles 10 Miles 2018 Estimate

$250,000 or More 2.07% 2.28% 2.02%

$200,000 - $249,999 1.76% 1.78% 1.52%

$150,000 - $199,000 3.00% 3.07% 3.18%

$100,000 - $149,000 12.67% 12.99% 13.15%

$75,000 - $99,999 16.27% 16.39% 16.01%

$50,000 - $74,999 22.01% 22.24% 22.28%

$35,000 - $49,999 12.53% 12.56% 13.49%

$25,000 - $34,999 9.75% 9.76% 10.48%

$15,000 - $24,999 10.75% 10.17% 9.53%

Under $15,000 9.20% 8.75% 8.34%

Average Household Income $73,557 $75,530 $73,975

Median Household Income $58,994 $59,829 $58,844

Per Capita Income $29,439 $29,957 $28,471

PopulationIn 2018, the population in a five mile radius of the subject property is20,634. The population has changed by 17.90% since 2000. It isestimated that the population in the area will be 21,702.00 five yearsfrom now, which represents a change of 5.18% from the current year.The current population is 48.89% male and 51.11% female. Themedian age of the population in the area is 41.09, compare this to theUS average which is 37.95. The population density in the area is261.98 people per squaremile.

HouseholdsThere are currently 8,134 households in a five mile radius of thesubject property. The number of households has changed by 20.86%since 2000. It is estimated that the number of households in the areawill be 8,670 five years from now, which represents a change of6.59% from the current year. The average household size in the areais 2.51 persons.

IncomeIn 2018, the median household income for the area is $59,829,compare this to the US average which is currently $58,754. Themedian household income for the area has changed by 56.58% since2000. It is estimated that the median household income in the areawill be $68,161 five years from now, which represents a change of13.93% from the current year.

The current year per capita income in the area is $29,957, comparethis to the US average, which is $32,356. The current year averagehousehold income in the area is $75,530, compare this to the USaverage which is $84,609.

HousingThe median housing value in a five mile radius of the subject propertywas $345,372 in 2018, compare this to the US average of $201,842.In 2000, there were 4,206 owner occupied housing units in the areaand there were 2,524 renter occupied housing units in the area. Themedian rent at the time was $463.

EmploymentIn 2018, there are 12,054 employees in the area, this is also known asthe daytime population. The 2000 Census revealed that 55.41% ofemployees are employed in white-collar occupations in thisgeography, and 44.95% are employed in blue-collar occupations. In2018, unemployment in this area is 5.38%. In 2000, the average timetraveled to work was 18.00 minutes.

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LOCATION OVERVIEW

HOQUIAM, WA

Hoquiam is a city in Grays Harbor County, Washington. The town borders the city of Aberdeen at Myrtle Street, with Hoquiam to the west. The two cities share a common economic history in lumbering and exporting, but Hoquiam has maintained its independent identity. The population was 8,500 at the 2017 Census. Hoquiam is strategically located between the natural beauty of the Washington coast and the impressive Olympic Peninsula.

For the past 52 years, Hoquiam has been the home of the Logger’s Playday, celebrated with a parade and logging competition every September, in which loggers from around the world come to participate. Events include axe throwing, log chopping, Ma and Pa bucking, obstacle pole bucking, choker setting, speed climbing, power saw bucking, tree topping, double hand bucking, springboard chopping and more. Each year the event brings enough tourism to the city to nearly double their population.

Hoquiam also hosts the Grays Harbor Farmers Market and Craft Fair which is one of only two Washington State farmers markets open year round. The market boasts local produce, delicious pastries, fresh seafood, chowder, fine arts, and quality crafted items.

Further, Hoquiam attractions include the annual Shorebird And Nature Festival. For many years, people have flocked to Grays Harbor in late April and early May to witness the spectacle. Each spring, hundreds of thousands of shorebirds stop to rest and feed along the Washington Coast and in the Grays Harbor estuary during their migration northward. Grays Harbor Audubon Society, Grays Harbor NWR, the City of Hoquiam and a host of local sponsors work together to produce the annual Shorebird and Nature Festival. People from around the world come to view this event and it brings in more than one million travelers each year to the area.

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DEMOGRAPHICS

Source: ©2018 Experian

POPULATION 3 Miles 5 Miles 10 Miles 2023 Projection


2018 Estimate


2010 Census


2000 Census


Current Daytime Population

2018 Estimate 15,909 26,300 31,452

HOUSEHOLDS 3 Miles 5 Miles 10 Miles 2023 Projection


2018 Estimate


Average (Mean) Household Size 2.50 2.52 2.51

2010 Census


2000 Census


Occupied Units

2023 Projection 6,635 10,240 12,818

2018 Estimate 7,799 11,872 14,658

HOUSEHOLDS BY INCOME 3 Miles 5 Miles 10 Miles 2018 Estimate

$150,000 or More 4.96% 4.16% 4.31%

$100,000 - $149,000 7.53% 8.09% 8.97%

$75,000 - $99,999 10.95% 11.33% 11.85%

$50,000 - $74,999 18.35% 18.10% 18.52%

$35,000 - $49,999 14.51% 15.79% 16.36%

Under $35,000 43.70% 42.52% 39.99%

Average Household Income $58,435 $57,230 $59,473

Median Household Income $41,503 $42,068 $44,267

Per Capita Income $23,372 $22,462 $22,922

PopulationIn 2018, the population in a five mile radius of the subject property is26,673. The population has changed by -0.92% since 2000. It isestimated that the population in the area will be 26,005.00 five yearsfrom now, which represents a change of -2.50% from the currentyear. The current population is 49.51% male and 50.49% female.The median age of the population in the area is 38.35, compare thisto the US average which is 37.95. The population density in the areais 338.55 people per squaremile.

HouseholdsThere are currently 10,338 households in a five mile radius of thesubject property. The number of households has changed by -3.28%since 2000. It is estimated that the number of households in the areawill be 10,240 five years from now, which represents a change of -0.95% from the current year. The average household size in the areais 2.52 persons.

IncomeIn 2018, the median household income for the areais $42,068,compare this to the US average which is currently $58,754. Themedian household income for the area has changed by 34.35% since2000. It is estimated that the median household income in the areawill be $46,443 five years from now, which represents a change of10.40% from the current year.

The current year per capita income in the area is $22,462, comparethis to the US average, which is $32,356. The current year averagehousehold income in the area is $57,230, compare this to the USaverage which is $84,609.

HousingThe median housing value in the area was $131,545 in 2018, comparethis to the US average of $201,842. In 2000, there were 6,385 owneroccupied housing units in the area and there were 4,304 renteroccupied housing units in the area. The median rent at the time was$414.

EmploymentIn 2018, there are 10,947 employees in a five mile radius of thesubject property, this is also known as the daytime population. The2000 Census revealed that 44.96% of employees are employed inwhite-collar occupations in this geography, and 54.72% areemployed in blue-collar occupations. In 2018, unemployment in thisarea is 10.23%. In 2000, the average time traveled to work was 23.00minutes.

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O F F E R I N G M E M O R A N D U M

CLAYTON BROWN National Retail Group206.826.5787 [email protected]

JOSEPH BLATNER National Retail Group 503.200.2029 [email protected]

E X C L U S I V E LY L I S T E D B Y :

OFFERING MEMORANDUM...McDonald’s, Subway, Taco Bell, Starbucks and More. • Direct Frontage on...

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