urer in EXCLUSIVE LISTING Knoxville, TN€¦ · Tenant Name Blue Ridge Foods Ownership Type Fee...

Burger King | Knoxville, TNOffering Memorandum

SHEREE STROME, CCIMASSOCIATE DIRECTOR

(404) 900-5629 [email protected]

KEELEE PETERSONASSOCIATE DIRECTOR


Actual Site

EXCLUSIVE LISTINGOffering Memorandum

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C A L K A I N .C O MC A L K A I N .C O M

Burger King | Knoxville, TN


5310 N Middlebrook Pike | Knoxville, TN 37921

Asking Price $1,670,000 | Cap Rate 5.75%

Net Operating Income (NOI) $96,000

Rent/Month $8,000

Rent/SF $48

Rentable Square Feet 2,000+/- SF

Land Area 0.62+/- Acres

Tenant Name Blue Ridge Foods

Ownership Type Fee Simple

Lease Type NNN

Landlord Responsibilities None

Store Opened 1995

Lease Term Remaining 17 Years

Increases 5% Every 5 Years

Options Four (4), Five (5) Year

Rent Schedule

Term Increases Annual Rent Monthly Rent Avg Cap RateYears 1-6 - $96,000.00 $8,000.00 5.75%

Years 7-10 5% $100,800.00 $8,400.00 6.04%

Years 11-15 5% $105,840.00 $8,820.00 6.34%

Years 16-17 5% $111,132.00 $9,261.00 6.65%

Option 1 5% $116,688.60 $9,724.05 6.99%

Option 2 5% $122,523.00 $10,210.25 7.34%

Option 3 5% $128,649.20 $10,720.77 7.70%

Option 4 5% $135,081.60 $11,256.80 8.09%

Investment Highlights • Established and renovated location

• Strong tenant with increasing sales

• Average HH income of $66,871 within 3 miles

• Population of over 156,400 within 5 miles

• Traffic count of 36,220 VPD

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Financial Summary


Site Photos

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About Burger KingBurger King is the second largest fast food hamburger chain in the world, trailing only McDonald’s. For a non-investment grade net lease tenant, Burger King is a solid net lease investment, providing stability in an uncertain market.

Burger King has been in business for 50 years and owns or franchises a total of 15,738 Burger King restaurants in approximately 100 countries and US territories worldwide. Of these restaurants, 15,667 are franchised, approximately 99.5 %, and 71 are company-owned.

In 2014, Restaurant Brands International Inc. formed to serve as the indirect parent of Tim Hortons and its consolidated subsidiaries, and Burger King Worldwide and its consolidated subsidiaries. Since 2010, the Burger King brand has increased annual net restaurant growth by approximately four times, from adding 173 new units in 2010, to 631 new restaurants in 2015. This growth has made Burger King one of the fastest growing QSRs in the world. Burger King has implemented a modernization plan, and will offer incentives to franchisees who remodel their stores in the new modern format.

About Blue Ridge FoodsThe tenant is Blue Ridge Foods which currently operates 19 Burger King Locations and 11 Panera Bread locations thru an affilated entity. Blue Ridge Foods has been in business since 1992 and the principals of the company have been in business since 1982.

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Tenant Overview


Distance To:Nashville, TN 177 miles

Atlanta, GA 210 miles

Charlotte, NC 234 miles

Louisville, KY

Nashville, TN

Charlotte, NC

Knoxville, TN

Atlanta, GA

Location Overview

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Subject Site

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5310 N Middlebrook Pike | Knoxville, TN


I-40 154,660 VPD

N Middlebrook Pike 36,220 VPD

107-acres 556,083 SF hospital with272 beds, 24 operating &

procedure rooms

CrossroadsWest Apartments

Pond GapElementary School

RecSports Complex

Army National Guard Rectuiting

Dowell SpringsMedical Complex

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Subject Site

Knox Plaza

New Development

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5310 N Middlebrook Pike | Knoxville, TN


Subject Site

N Middlebrook Pike 36,220 VPD

S Middlebrook Pike

Henson Rd

Hilton Rd

Aztec Candle and Soap Supplies

Wright’s Cafeteria

Middlebrook Inn

Kadunza

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Radius 1 Mile 3 Miles 5 MilesPopulation2017 Population 5,375 59,907 156,406

2022 Population 5,543 62,296 162,928

2010-2017 Annual Rate 0.52% 0.71% 0.81%

2017-2022 Annual Rate 0.62% 0.79% 0.82%

2017 Male Population 49.4% 48.2% 48.9%

2017 Female Population 50.6% 51.8% 51.1%

2017 Median Age 32.9 35.2 33.6

Households2017 Total Households 2,442 26,651 65,485

2022 Total Households 2,502 27,601 68,107

2010-2017 Annual Rate 0.32% 0.57% 0.72%

2017-2022 Annual Rate 0.49% 0.70% 0.79%

2017 Average Household Size 2.19 2.21 2.25

Median Household Income2017 Median Household Income $41,182 $45,037 $42,518

2022 Median Household Income $47,307 $51,094 $48,025

2017-2022 Annual Rate 2.81% 2.56% 2.47%

Average Household Income2017 Average Household Income $51,203 $66,871 $64,496

2022 Average Household Income $58,896 $76,955 $73,772

2017-2022 Annual Rate 2.84% 2.85% 2.72%

Per Capita Income2017 Per Capita Income $23,461 $29,999 $27,729

2022 Per Capita Income $26,797 $34,326 $31,538

2017-2022 Annual Rate 2.69% 2.73% 2.61%

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Demographics


Knoxville, TNKnoxville is a city in the U.S. state of Tennessee, and the county seat of Knox County. The city had an estimated population of 185,291 in 2015, making it the state’s third largest city after Memphis and Nashville. Knoxville is the principal city of the Knoxville Metropolitan Statistical Area, which, in 2013, had an estimated population of 852,715.

Knoxville, Tennessee is often described as a hidden gem. First-time visitors are typically amazed by all this city has to offer. The fact that some of its most appealing attractions are within walking distance of a very vibrant downtown is a plus. Very few places offer the opportunity to experience live music, culture, outdoor adventure, eclectic shopping and highly acclaimed cuisine in one unique location. It’s no wonder that Knoxville was recently named by Trip Advisor as a Top 10 Destination on the Rise. In this one, unique city, mountains meet music… art meets adventure… and culture meets cuisine.

Sunsphere Tower

Neyland Stadium

Knoxville is the home of the flagship campus of the University of Tennessee, whose sports teams, called the “Volunteers” or “Vols”, are extremely popular in the surrounding area. Knoxville is also home to the headquarters of the Tennessee Valley Authority, the Tennessee Supreme Court’s courthouse for East Tennessee and the corporate headquarters of several national and regional companies. As one of the largest cities in the Appalachian region, Knoxville has positioned itself in recent years as a repository of Appalachian culture and is one of the gateways to the Great Smoky Mountains National Park.

In the 2010 ACCRA Cost of Living Index, Knoxville was rated 89.6 (the national average was 100). Kiplinger ranked Knoxville at #5 in its list of Best Value Cities 2011 citing “college sports, the Smoky Mountains and an entrepreneurial spirit.” In April 2008, Forbes magazine named Knoxville among the Top 10 Metropolitan Hotspots in the United States, and within Forbes’ Top 5 for Business & Careers, just behind cities like New York and Los Angeles.

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Market Overview


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Tennova moving ahead on hospitalA planned Tennova Healthcare hospital in West Knoxville still is on track, even though Tennova’s parent company reported it had discouraging financial results for the third quarter of 2016, Tennova officials said Wednesday.

Community Health Systems, which owns Tennova, held a conference call with investors Wednesday to discuss third-quarter results that included a 9.6 percent drop in earnings compared to third quarter 2015.

Asked if this will have an impact on Tennova’s plans for a new hospital off Middlebrook Pike, Tennova vice president of external relations Jerry Askew said the plan is to go through with the hospital project.

“We are going to build a hospital,” he said. “Nothing has changed.”

Leslie Paul Luke, interim CEO of Tennova, released an email statement:

“Tennova Healthcare is committed to meeting the needs of our communities and continues to invest in resources to enhance the care we provide,” he wrote. “Physicians Regional Medical Center, formerly St. Mary’s Hospital, has provided outstanding care for East Tennesseans for over 86 years. Two years ago, it became clear that the time had come to build a replacement for the venerable old facility.”

Luke said that Tennova has secured the approvals it needs to build the facility, has developed initial designs and worked with the Knoxville Utilities Board to relocate gas and wastewater lines.

“We plan to open the new medical center by early 2019,” he wrote.

Askew said that site preparation work is happening on the property, which is at Middlebrook and Old Weisgarber Road, across from the Dowell Springs medical complex. Tennova bought the 109-acre site in 2014 and 2015 for $11.8 million.

Plans call for a five-story, 556,083-square-foot hospital with 272 beds and 24 operating and procedure rooms. Total cost would be $303.5 million. The new hospital would replace Tennova’s 401-bed, million-square-foot Physicians Regional in North Knoxville.

Market Overview

A site plan for the proposed Tennova Healthcare Physicians Regional Medical Center on Middlebrook Pike. (Tennova/Special to the News Sentinel)


SHEREE STROME, CCIMASSOCIATE DIRECTOR


KEELEE PETERSONASSOCIATE DIRECTOR


Who Are We? Calkain Companies LLC is a national commercial real estate firm that provides consulting and brokerage services to both private and institutional clientele with an expertise on triple net lease investments. We pride ourselves on being a world class leader by providing our clients a full array of commercial real estate investment brokerage and asset management solutions, including advisory, research, estate planning and wealth management.

We have built solid relationships throughout our decades of experience and innovation, implementing long-term allocation within the context of each client’s particular risk tolerance and identifying how best to acquire and dispose of income producing properties for each entities’ specific set of investment criterion. At Calkain, our foresight and past performance are leading the net lease investment industry.

Our HistoryLike most success stories, Calkain was formulated from humble beginnings. Jonathan W. Hipp, President and CEO, took the initiative to build upon his decades of experience and performance and left a large international brokerage firm to become an independent and innovative leader within the triple net lease investment community. Armed with a sole employee and a single office, the firm has grown exponentially since its infancy in 2005.

With the growth in staff, seasoned professionals have been attracted to Calkain’s model of innovation, entrepreneurship and the fostering of long-lasting and meaningful relationships. Industry experts have joined Calkain in the hopes of implementing the skills they have honed in complementary aspects of real estate investment.

Through a tremendous endeavor, tireless hours have been committed to continually prove that Calkain is America’s Net Lease Company®. Its countless accolades received from the world’s leading business publications, including Forbes™, Fortune™ and the New York Times™ have confirmed that Calkain is a true leader in triple net lease investing services.

Client Testimonial

“USRA has worked with Calkain on numerous occasions. They have always been meticulous in their work ethic, providing superior service and extremely prompt attention to our needs. I highly recommend them.

- Jack Genende, Partner | U.S. Realty Advisors, LLC. (USRA)

$11.5 Billion in Closed Transactions

$350 Million

in Active Listings

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C A L K A I N .C O MC A L K A I N .C O M

About Calkain

DISCLAIMER: The information contained in this document is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Calkain and its subsidiaries, and should not be made available to any other person or entity without the written consent of Calkain. This document has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property(s). The information contained herein is not a substitute for a thorough due diligence investigation. Calkain and its subsidiaries have not made any investigation, and make no warranty or representation, with respect to the income or expenses for the subject property(s), the future projected financial performance of the property, the size and square footage of the property(s) and improvements, the presence or absence of contaminating substances, PCB’s or asbestos, the compliance with State and Federal regula-tions, 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(s). The information contained in this document has been obtained from sources we believe to be reliable; however neither Calkain and its subsidiaries nor the Seller have verified, and will not verify, any of the information contained herein, nor has Calkain and its subsidiaries or the Seller conducted any investigation regarding these matters and make 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.

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