THE HUMAN BEAN GROUND LEASE - ASU CAMPUS Freddy’s...

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REPRESENTATICE

THE HUMAN BEAN GROUND LEASE - ASU CAMPUSSWC MCCLINTOCK & UNIVERSITYTEMPE, AZ 85281

Offering Memorandum

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This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, assumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2013 Marcus & Millichap ACT ID Y0070277


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TEMPE CAMPUS76,000+ STUDENTS McDonald’s

E UNIVERSITY DR - 28,390 CPD

S MCCLINTOCK DR - 49,760 CPD

165,100 CPD

SUN DEVIL FOOTBALL STADIUM

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THE HUMAN BEAN GROUND LEASE



Starbucks

E UN

IVER

SITY

DR

- 28

,390

CPD


McDonald’s

GATEWAY AT TEMPE288 UNITS

TEMPE CAMPUS76,000+ STUDENTS




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E UNIVERSITY DR - 28,390 CPD


McDonald’s

165,100 CPD

GATEWAY AT TEMPE288 UNITS

36,900 CPD

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Starbucks

THE NOVUS INNOVATION CORRIDOR

330 ACRES IN THE HEART OF TEMPE, AN ADAPTIVE URBAN ENVIRONMENT AT THE VALLEY’S GEOGRAPHIC CROSSROADSNovus Innovation Corridor, in Tempe Arizona, sits in the geographic center of the Valley of the Sun. Only five minutes to Sky Harbor International Airport, the location is served by three major freeways. Adjacent to Tempe Town Lake, ASU Tempe Campus, blue chip and high tech companies, Tempe Center for the Arts, abundant night life and day life, and more, Novus Innovation Corridor is a prime location for corporations in need of a vibrant location for regional office or headquarters facilities.

• 330 gross acres of real estate including, athletic facilities, roadways and public spaces, all built with Smart City initiatives as a design criteria.• Access to major transportation corridors including the 20-mile long light rail, Sky Harbor International Airport and the regions interconnected freeway system.• Central location at ASU Tempe campus, close to Sun Devil Stadium and Wells Fargo Arena.• Premium mixed-use development, including office, multi-family residential, hospitality and retail spaces.

Visitors to the Novus Innovation Corridor will encounter fresh thinking in the area’s hospitality and nightlife experience. At their fingertips will reside some of the best names in culinary, entertainment and hotel excellence, all integrated along a network of pedestrian - and bike - friendly spaces.State-of-the-art athletic training and exhibition facilities will attract world-class athletes and events to Novus Innovation Corridor. Already a hub for dozens of Olympic and professional athletes, this Innovation Zone provides space to thrive and push the boundaries of competitive sport, entertainment, art, and excellence.




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THE NOVUS INNOVATION CORRIDOR

The information contained in this site plan is subject to change without notice. Catellus Development Corporation, their affiliates and representatives makes, and expressly dis-claims any representations or warranties as to the accuracy of the site plan or that the site plan will not change. Each party receiving this site plan acknowledges it is relying on its own investigations in connection with the Novus property and not on any statements in the site plan or on the site plan not changing.

Novus Innovation CooridorLAND USE PLAN

January 2017

McC

lin

tock

Dri

ve

Pack

ard

Dri

ve

Marina Heights

Sun Devil Stadium

Wells Fargo Arena

DesertArboretum

Park

Events Venue

Existing Garage

Tempe Town Lake

6th Street

3rd Street

Athletics VillageVeterans Way

University Drive

Rio Salado Parkway

Ru

ral R

oad

Do

rsey

Lan

e

G S

tree

t

Metro Station

4th Street

ASU

0’ 200’ 400’ 800’

Parks & PlazasRetail

Low- to Mid-Rise OfficeMid- to High-Rise OfficeHospitalityResidential

Parking

Land Use Plan


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THE HUMAN BEAN GROUND LEASESWC McClintock & UniversityTempe, AZ 85281

FINANCIAL SUMMARY

Price $1,348,000

Down Payment 100% $1,309,000

Cap Rate 5.5% (1)

Building SF +/- 546 SF

Net Cash Flow 5.5% $74,160

Year Built 2017

Lot Size .71 Acres

LEASE SUMMARY

Lease Type Absolute Triple-Net (NNN) Ground Lease

Tenant H&L, LLC

Lease Guarantor Dr. Todd Holton & Karen Holton (2)

Roof & Structure Tenant Responsible

Rent Commencement Date May 1, 2017

Lease Expiration Date April 30, 2027

Lease Term 10 Years

Rental Increases 3% Annual Increases

Renewal Options 3, 5 Year Options

BASE RENT $74,160

Net Operating Income $74,160

Total Return 5.5% $74,160

ANNUALIZED OPERATING DATA

LEASE YEARS ANNUAL RENT CAP RATE

1 $72,000.00 5.34%

2 $74,160.00 5.50%

3 $76,384.80 5.67%

4 $78,676.34 5.84%

5 $81,036.63 6.01%

6 $83,467.73 6.19%

7 $85,971.76 6.38%

8 $88,550.91 6.57%

9 $91,207.44 6.77%

10 $93,943.66 6.97%

EXECUTIVE SUMMARY

Footnotes:1) Cap Rate is based on rent as of May 1, 20182) H&L LLC Company Guarantee remains in place throughout term and options. Personal Guar-antee obligation is reduced to 75% at the 61st month, and 50% at the 91st month, so long as Tenant has never before been in default.




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TENANT OVERVIEW

With a passion for creating happy people and a love of coffee, The Human Bean opened its first drive-thru espresso stand in Ashland, Oregon, in 1998. The demand for convenient, quality coffee & espresso grew a nd soon after opening the first location in Ashland, the company expanded to surrounding cities in Southern Oregon. The Human Bean quickly established a reputation for having friendly and experienced baristas and offering the highest quality ingredients.

The company’s commitment to developing the best drive-thru espresso led to franchis-ing The Human Bean’s brand and system in 2002. The Human Bean has expanded to 70 locations in eleven states, 57 of those being franchised locations and 13 being corporate locations.

FRANCHISEE OVERVIEWOriginally from Oregon, where The Human Bean was founded, Dr. Todd & Karen Holton developed a relationship with the company’s founders and transitioned into the franchise business after years of operating a dental practice. With additional development rights, more locations are planned across the Valley.

website: www.thehumanbean.com

70 Locations in 11 States

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LOCATION OVERVIEWINVESTMENT HIGHLIGHTSLocated just 10 minutes east of downtown Phoenix, Tempe exudes its own personality and the youthful spirit of a college town. Home to Arizona State University, the largest public university in the United States, Tempe has a vi-brant downtown that’s active day and night. Visitors will find locally-owned eateries and microbreweries, annual festivals, arts and cultural events. And plenty of opportunities to enjoy over 300 days of sunshine a year on a bike, hiking trail or stand-up paddleboard.While enjoying dynamic growth, the city has maintained its unique person-ality and style through a careful and masterful blending of the new with the old. Respecting its heritage and energetically planning for the future, Tempe is a wonderful mix of history and modern urban amenities.Tempe has a distinct identity as an emerging destination city, replete with all the offerings of a city rich in economics, technology, culture, tourism and educational resources. Tempe offers a blend of quality new developments, revitalization and redevelopment, prestigious institutions such as Arizona State University, and celebrated traditions. Tempe brings it all together – bright Arizona sun, rewarding places to work, diverse cultures, a myriad of recreational opportunities, the best in entertainment and an unparalleled Southwestern lifestyle.The Phoenix metro consists of Maricopa and Pinal counties, and includes more than 30 incorporated and more than 30 unincorporated towns and cities. Since 2000, the population in the metro increased by more than 38 percent. The largest city is Phoenix, which encompasses about 520 square miles, is the capital city and boasts a population of more than 1.5 million.As one of the primary beneficiaries of the massive shift in the U.S. population from north to south, the Phoenix metro has had little difficulty finding workers; the challenge, though, is attracting high-paying jobs. Phoenix claims five Fortune 500 headquarters, including Freeport-McMoRan, Republic Services, Insight Enterprises, Avnet and PetSmart. Construction, high-tech manufacturing, healthcare and tourism dominate the Phoenix economy. The local economy has strengthened since the recession, with retail sales projected above 8 percent this year and hotel occupancy levels rising.

• New 10 Year Absolute Triple-Net (NNN) Ground Lease• Three Percent Annual Increases• 2017 Construction• Excellent Location Just Minutes from Arizona State University’s Tempe Campus with 76,000+ Students, ASU is the Largest Public University in the U.S.• Visible to 78,160 Cars per Day from the Intersection of S. McClintock Dr. & E. University Dr. • Infill Tempe, AZ - 338,900 Residents in Trade Area• 517,300+ Daytime Employees in Trade Area• Easily Accessible from AZ-Loop 202 (165,100 CPD)• Close Proximity to Mill Avenue, Tempe’s Primary Entertainment District• Surrounded by Student Housing • Two Minutes from Tempe Markeplace, a 1.3 Million-Square-Foot Retail Destination• Strong Residual Value - The Site Benefits from Ample Parking and Ability to Develop a Large Building in the Future

PROPERTY DESCRIPTION

Income 1-Mile 3-Miles 5-Miles2016 Est. Average Household Income $35,399 $51,979 $56,9072016 Est. Median Household Income $24,061 $37,765 $41,6392016 Est. Per Capita Income $16,847 $22,473 $23,774

Population 1-Mile 3-Miles 5-Miles2021 Projection 22,338 140,777 342,2542016 Estimate 21,796 138,434 338,896Growth 2016 - 2021 2.49% 1.69% 0.99%Households 1-Mile 3-Miles 5-Miles2021 Projections 10,513 58,376 140,8632016 Estimate 10,130 56,736 138,245Growth 2016 - 2021 3.78% 2.89% 1.89%

DEMOGRAPHICS

Click here to read more about Tempe

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Starbucks

PROPERTY PHOTOS

PROPERTY PHOTOSREGIONAL MAP PROPERTY PHOTOS




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SITE PLAN

McDonald’s

SITE

The Human Beanhas rights to 41 parking spaces off parcel

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BUILDING ELEVATIONS




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Williams-Sonoma

MAP

REGIONAL MAP

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LOCAL MAP

Marcus & Millichap hereby advises all prospective purchasers of Net Leased property as follows:

By accepting this Marketing Brochure, you agree to treat the information contained herein regarding the lease terms as confidential and proprietary and to only use such information to evaluate a potential purchase of this net leased property.

The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has Marcus & Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee, warranty or representation whatsoever about the accuracy or completeness of any information provided.

As the Buyer of a net leased property, it is the Buyer’s responsibility to independently confirm the accuracy and completeness of all material information before completing any purchase. This Marketing Brochure is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus & Millichap expressly denies any obligation to conduct a due diligence examination of this Property for Buyer.

Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example only and do not represent the current or future performance of this property. The value of a net leased property to you depends on factors that should be evaluated by you and your tax, financial and legal advisors.

Buyer and Buyer’s tax, financial, legal, and construction advisors should conduct a care-ful, independent investigation of any net leased property to determine to your satisfaction with the suitability of the property for your needs.

Like all real estate investments, this investment carries significant risks. Buyer and Buyer’s legal and financial advisors must request and carefully review all legal and finan-cial documents related to the property and tenant. While the tenant’s past performance at this or other locations is an important consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties, including newly-constructed fa-cilities or newly-acquired locations, may be set based on a tenant’s projected sales with little or no record of actual performance, or comparable rents for the area. Returns are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or may fail to comply with other material terms of the lease; cash flow may be inter-rupted in part or in whole due to market, economic, environmental or other conditions. Regardless of tenant history and lease guarantees, Buyer is responsible for conducting his her own investigation of all matters affecting the intrinsic value of the property and the value of any long-term lease, including the likelihood of locating a replacement tenant if the current tenant should default or abandon the property, and the lease terms that Buyer may be able to negotiate with a potential replacement tenant considering the location of the property, and Buyer’s legal ability to make alternate use of the property.

Net Leased Disclaimer

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 Marcus & Millichap and it should not be made available to any other person or entity without the written consent of Marcus & Millichap. By taking possession of and reviewing the information contained herein the recipient agrees to hold and treat all such information in the strictest confidence. The recipient further agrees that recipient will not photocopy or duplicate any part of the offering memorandum. If you have no interest in the subject property at this time, please return this offering memorandum to Marcus & Millichap.

This offering memorandum has been prepared to provide summary, unverified financial and physical 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 local, 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 offering memorandum 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. Prospective buyers shall be responsible for their costs and expenses of investigating the subject property.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONTACT THE MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

Confidentiality Agreement

exclusively listedExclusively listed by:

OFFICES NATIONWIDEwww.marcusmillichap.com

JAMIE MEDRESSSenior Managing Director InvestmentsPHOENIX OFFICETel: (602) 687-6778Fax: (602) [email protected]

MARK RUBLESenior Managing Director InvestmentsPHOENIX OFFICETel: (602) 687-6766Fax: (602) [email protected]

CHRIS LINDVice President InvestmentsPHOENIX OFFICETel: (602) 687-6780Fax: (602) [email protected]

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