STARBUCKS (S&P: A-) - The Boulder Group - Savage, MN - OM.pdfStarbucks is a publicly traded company...

STARBUCKS (S&P: A-)13945 Highway 13 Frontage RoadSavage, MN 55378 (Minneapolis-St. Paul MSA)

NET LEASE INVESTMENT OFFERING

TABLE OF CONTENTS

I. Executive Profile Executive Summary Investment Highlights Property Overview

II. Location Overview Photographs Aerial Site Plan Maps

III. Market & Tenant Overview Demographic Report Market Overview Tenant Overview

TABLE OF CONTENTS


The information contained in the following Offering Memorandum is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from The Boulder Group and should not be made available to any other person or entity without the written consent of The Boulder Group.

This Offering Memorandum 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. The Boulder Group has not made any investigation, and makes no warranty or representation.

The information contained in this Offering Memorandum has been obtained from sources we believe to be reliable; however, The Boulder Group has not verified, and will not verify, any of the information contained herein, nor has The Boulder Group 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.

DISCLAIMERSTATEMENT:

DISCLAIMER STATEMENT



EXECUTIVESUMMARY:

The Boulder Group is pleased to exclusively market for sale a single tenant Starbucks property strategically located in an affluent part of the Minneapolis-St. Paul MSA. This is a proven Starbucks location as evidenced by the tenant’s recent execution of an early ten year lease extension. There are over 10 years remaining on the Starbucks lease which expires on July 31, 2026. The lease features rental escalations every five years and three 5-year renewal option periods. Starbucks is an investment grade rated company (S&P: A-) and is publicly traded (NASDAQ: SBUX) with a market capitalization in excess of $86 billion.

The 1,925 square foot Starbucks building is strategically located along Minnesota State Highway 13 in an affluent area. The property is positioned just north of the signalized intersection of Minnesota State Highway and Connelly Parkway with direct access to the Highway 13 South Front Road. Minnesota State Highway 13 is the primary north-south thoroughfare in the trade area. The average household incomes within a one mile radius of the Starbucks property exceed $127,000 annually. There are over 111,000 people living within a five mile radius of the property earning household incomes in excess of $104,000 annually.

The Starbucks is benefitted by its location within a strong retail trade area that is anchored by a SuperTarget, Cub Foods and Rainbow Foods. Additional retailers in the immediate area include OfficeMax, Walgreens, Goodyear, Associated Bank, Buffalo Wild Wings, Advance Auto Parts and others. The Starbucks is located approximately five miles northwest from the Mystic Lake Casino and Hotel which features over 150,000 square feet of gaming space, 67,000 square feet of meeting and banquet space and a 600-room hotel.

EXECUTIVE SUMMARY


INVESTMENT HIGHLIGHTS:

• Located within the Minneapolis-St. Paul MSA

• Investment grade rated tenant (S&P: A-)

• Long term lease with over ten years remaining

• Brand new early ten year lease extension

• Rental escalations every five years

• Affluent area with average annual household incomes in excess of $127,000 within a one mile radius

• Positioned along Minnesota State Highway 13 which is the primary north-south thoroughfare in the area

• Strong retail corridor that features SuperTarget, Cub Foods, Rainbow Foods, Walgreens and OfficeMax

• Over 110,000 people living within a five mile radius of the property

• Approximately five miles from the Mystic Lake Casino and Hotel

INVESTMENT HIGHLIGHTS


PROPERTY OVERVIEW:

PROPERTY OVERVIEW

Price: $1,540,000

Cap Rate: 5.25%

Rent Schedule: NOI Escalation Date

$80,850$84,700 8/1/2021$88,550 8/1/2026 (Option 1)$92,400 8/1/2031 (Option 2)$98,945 8/1/2036 (Option 3)

Rent Commencement Date: July 2006

Lease Expiration Date: July 31, 2026

Rental Escalations: Every Five Years

Renewal Options: Three 5-Year

Tenant: Starbucks Corporation

Credit Rating: Investment Grade (S&P: A-)

Year Built: 2006

Lease Type: NN (Roof, Structure & Parking Lot Maintenance and Repair)

Building Size: 1,925 SF


PHOTOGRAPHS


AERIAL

1 4 0 T H S T R E E T

HW

Y 13 S FR

ON

T RD

L O W E R P R I O R L A K E

CONNELLY PARKWAY


SITE PLAN

SUBJECT PROPERTY

H I GH WAY 1

3 FR O N TA G E R

O A D


MAPS


Population 1-Mile 3-Mile 5-Mile

Total Population 7,534 43,793 111,384

Total Households 2,665 14,991 42,090

Income 1-Mile 3-Mile 5-Mile

Median Household Income $112,636 $101,632 $85,471

Average Household Income $127,132 $113,910 $104,428

DEMOGRAPHICREPORT:

DEMOGRAPHIC REPORT


Savage is a suburban city located 15 miles southwest of downtown Minneapolis in Scott County. The city is situated on the south bank of the Minnesota River in a region commonly referred to as South of the River, comprising the southern portion of Minneapolis-St. Paul, the sixteenth largest metropolitan area in the United States. The population of Savage was 26,911 at the 2010 census. Minnesota State Highway 13 and County Road 42 are two of the main routes in Savage. Interstate 35W and U.S. Highway 169 are in close proximity to the city. Once a shipbuilding port for the U.S. Navy, Savage is now an industrial manufacturing job center in the southern metro. The city remains relatively undeveloped, with sections of the Minnesota Valley National Wildlife Refuge and Murphy-Hanrehan Park Reserve within its borders.

Minneapolis-St. Paul is a major metropolitan area built around the Mississippi, Minnesota and St. Croix rivers. The area is commonly known as the Twin Cities for its two largest cities, Minneapolis the city with the highest population in Minnesota and Saint Paul, the state capital. Together the two cities anchor the second-largest economic center in the Midwest, behind Chicago. The entire region known as the Minneapolis-St. Paul MN-WI Combined Statistical Area, has a population of 3,797,883, the 14th largest, according to 2013 Census estimates.

The Minneapolis–Saint Paul area is home to 16 of Minnesota’s 17 Fortune 500 headquarters - UnitedHealth Group, Target, Best Buy, Supervalu, CHS, 3M, US Bancorp, General Mills, Land O’Lakes, Xcel Energy, Ameriprise Financial, CH Robinson Worldwide, Mosaic, Thrivent Financial, Ecolab, and St. Jude Medical. Large private companies include Cargill, Carlson, Andersen, Holiday Stationstores . Foreign companies with U.S. headquarters in the Twin Cities include Aimia, Allianz, Canadian Pacific, Coloplast, Medtronic, Pearson VUE, Pentair and RBC. The area has the second largest economy in the Midwest, behind only Chicago. The metro area continues to grow at a rapid pace. Currently, the Twin Cities is the second largest medical device manufacture center in North America. In August 2013, Minneapolis–Saint Paul appeared on Forbes magazine’s list of Best Places for Business and Careers. CNBC ranked Minnesota as the top state for business in 2015.

Minneapolis-St. Paul is served by Interstate 35, Interstate 94, Interstate 394, Interstate 494 and Interstate 694. The main airport in the region is Minneapolis–St. Paul International Airport (MSP), which is a major hub for Delta Air Lines.

MARKETOVERVIEW:

MARKET OVERVIEW


Starbucks Corporation operates as a roaster, marketer, and retailer of specialty coffee worldwide. The company operates in four segments: Americas; Europe, Middle East, and Africa; China/Asia Pacific; and Channel Development. Its stores offer coffee and tea beverages, packaged roasted whole bean and ground coffees, single-serve and ready-to-drink coffee and tea products, juices, and bottled water. The company�s stores also provide fresh food and snack offerings; and various food products, such as pastries, and breakfast sandwiches and lunch items, as well as serve ware, beverage-making equipment, and accessories. In addition, it licenses its trademarks through licensed stores, and grocery and national foodservice accounts. The company offers its products under the Starbucks, Teavana, Tazo, Seattle�s Best Coffee, Evolution Fresh, La Boulange, Ethos, Starbucks VIA, Seattle�s Best Coffee, Frappuccino, Starbucks Doubleshot, Starbucks Refreshers, and Starbucks Discoveries Iced Café Favorites brand names. As of September 27, 2015, it operated 23,043 stores. Starbucks Corporation was founded in 1985 and is based in Seattle, Washington.

Starbucks is a publicly traded company on the NASDAQ (SBUX) with a market capitalization in excess of $86 billion. Starbucks is an investment grade rated company with a Standard & Poor’s rating of A-.

Website: www.starbucks.comCredit Rating: Investment Grade (S&P: A-)Stock Symbol: NASDAQ: SBUXMarket Capitalization: $86 BillionHeadquarters: Seattle, WA

TENANT OVERVIEW

TENANT OVERVIEW:

666 Dundee Road, Suite 1801Northbrook, IL 60062

www.bouldergroup.com

Randy [email protected]

Jimmy [email protected]

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