17292 Main Street Hesperia, CA 92345
Offering Memorandum For Sale | Investment Opportunity
Del Taco
PRESENTED BY: Shawn Bakke Senior VP | Net Leased Retail direct +1 213 532 3282 email
[email protected] Gregory Ching Project Coordinator direct +1 213 532 3209 email
[email protected] SUNNYMEAD TOWNE CENTER | COLLIERS INTERNATIONAL | 1
Table of Contents > EXECUTIVE OVERVIEW
Offering Summary .................................................................................................. 2
Investment Highlights & Summary......................................................................... 2
> FINANCIAL OVERVIEW Investment Summary............................................................................................... 4 National Net Lease News........................................................................................ 5
> Property OVERVIEW Property Photographs.............................................................................................. 7 Surrounding Property Photographs........................................................................ 9
> TRADE AREA OVERVIEW Trade Area............................................................................................................. 15 Local Area Map.......................................................................................................16 Regional Information...............................................................................................17 Regional Map...........................................................................................................18
> COMPARABLE PROPERTIES On-Market Comparables....................................................................................... 16 Sold Comparables . ................................................................................................18 Comparable Property Analysis ............................................................................20
> TENANT OVerviEW Tenant Profile . ......................................................................................................23
Subject Property Del Taco
Main St/G Ave Average Daily Traffic: 30,534
Del Taco Restaurant > Executive Overview Offering Summary ...................................................2 Pricing Summary......................................................2
EXECUTIVE OVERVIEW
Offering Summary Colliers International presents for sale the fee simple interest in a quick service restaurant-Del Taco (“Property”).
> Pricing SUMMARY Property Address.....................................17292 Main St, Hesperia, CA Year Built......................................................................................... 1979 Building Size (SF).........................................................................±1,932
Situated on a busy thoroughfare with clear signage, drive-through window and ample parking, the subject property offers a stable investment in an area with strong demographics. With numerous national credit retail tenants located in the vicinity and high traffic counts of 30,000+ cars daily, this retail property is a core performing asset based on these factors.
Lot Size (Acres/SF)........................................................0.98 / 42,689 Purchase Price/PSF................................. $1,203,448/ $622.90 Blended Cap Rate............................................................6.11% Cap Rate on Base Rent................................................................ 6.00% Cap Rate on % Rent..................................................................... 6.50%
> 2011 Rent Annual Base Rent.................................................................... $56,167
Investment Highlights:
Percentage Rent....................................................................... $17,364
»» Rare, low 5.0% Percentage Rent Clause guarantees increasing cash flows over
Total Rent................................................................................. $73,531
life of investment »» High 5-mile radius population count projected to be 129,767 people in 2015 »» Surrounded by national tenants such as McDonald’s, Walgreen’s, Rite-Aid and Stater Brothers »» Strong 2010 unit sales totaling over $1.4 million »» High probability that corporate Del Taco will exercise 10-year option to renew based on low 3.8% occupancy cost and high store sales
Lease Summary Lease Period
Dates
Base Rent
*Percentage Rent
Current
Nov. 7, 2003-Nov. 7, 2013
$56,167
5%
10 yr Option
Nov. 7, 2013-Nov. 7, 2023
$56,167
5%
*Percentage rent is equal to the difference between 5% of sales revenue and base rent. E.g. $1,470,614 (2010 Sales) x 5% - $56,167 (Base Rent) = $17,364 Del Taco Restaurant | COLLIERS INTERNATIONAL | 2
Del Taco Restaurant > Financial Overview Investment Summary................................................4
FINANCIAL OVERVIEW
Investment Summary Purchase Assumptions
Property Name
6.00% Cap on Base Rent
$936,117
Year 1
1,932
6.50% Cap on % Rent
$267,123
Base Rent (occupied space)
0.98
Purchase Price
Del Taco
Building Size (SF) Lot Size (Acres) Land Area SF
42,689
Year Built:
1979
$1,203,448
Blended Cap Rate Year 1
6.11%
Building Price PSF
$622.90
$/SF Land Gross
Sales Occupancy Cost % Growth
$1,460,463.60 3.85%
Total $56,167
Percentage Rent
$17,364
Total Rent
$73,531
Net Operating Income
$73,531
$28.25
Rent History
Sales History 2009
Annualized Operating Data
2010 $1,470,614
Base Rent
2010
2011
$56,167
$56,167
3.82%
Percentage Rent
$16,856
$17,363.
0.69%
Total Rent
$73,023
$73,531
Del Taco Restaurant | COLLIERS INTERNATIONAL | 4
Del Taco Restaurant > Property Overview Property Photos.........................................................6 Surrounding Property Photos................................... 7
PROPERTY OVERVIEW
Property Photographs
CLOCKWISE FROM TOP:
›› Front View ›› Drive-Through
›› Side View ›› Signage from across the street
Del Taco Restaurant | COLLIERS INTERNATIONAL | 6
PROPERTY OVERVIEW
Property Photographs
CLOCKWISE FROM TOP:
›› View from across the street
›› Side View ›› Signage
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PROPERTY OVERVIEW
Surrounding Property Photographs CLOCKWISE FROM TOP:
›› Wendy’s ›› Walgreens ›› Jack in the Box ›› Vons
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Del Taco Restaurant > Trade Area Overview Trade Area.............................................................. 10 Local Area Map........................................................ 11 Regional Information............................................... 12 Regional Map........................................................... 13
TRADE AREA OVERVIEW
Trade Area Hesperia, CA The Del Taco restaurant is located on a busy thoroughfare with visible signage in the downtown Hesperia. Situated in San Bernardino County, California, United States. Hesperia is located in the Mojave Desert 15 miles (24 km) north of San Bernardino. Hesperia, also has its own man-made lake (Hesperia Lake) on the southeastern edge of the town (pictured to the right). Camping and fishing are permitted here, as well as Day Kamp and various junior leagues for sports.
Local Restaurant and Shopping Centers
Population 1 - Mile
3 - Miles
5 - Miles
Projected Population (2015)
7,595
58,126
129,767
Estimated Population (2010)
6,635
50,842
113,155
Census Population (2000)
4,942
38,007
78,072
Shopping centers include:
1990-2000
17.19%
16.58%
24.90%
»» High Desert Gateway
»» Hesperia Square
2000 Average HH Income
$38,922
$46,775
$48,254
»» The Shops at Topaz
»» 9th and Main
»» Hesperia Marketplace
»» G and Main
Historical Annual Growth
Hesperia is known for having many unique restaurants and shopping outlets.
»» Midtown Square
Del Taco Restaurant | COLLIERS INTERNATIONAL | 10
TRADE PROPERTY AREAOVERVIEW OVERVIEW
Local Area Map
Hesperia, CA
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TRADE AREA OVERVIEW
Trade Area Location The city is located on Interstate 15, directly north of the Cajon Pass. Mass transit needs are taken care of by the Victor Valley Transit Authority. Located at the Interstate-15 and Highway 395 interchange and only twenty minutes from the I-40, Hesperia offers easy access to Ontario and Southern California logistics airports, rail service that bisects the City, and the ports of Los Angeles and Long Beach.
Population 10 - Mile
15 - Miles
20 - Miles
Projected Population (2015)
343,969
427,009
613,533
Estimated Population (2010)
299,870
373,135
546,449
Census Population (2000)
199,612
252,489
406,765
1990-2000
29.55%
29.09%
25.58%
2000 Average HH Income
$48,498
$49,845
$49,207
Historical Annual Growth
Population Density 700,000
600,000
500,000
400,000 Projected Population (2015) Estimated Population (2010) 300,000
Census Population (2000)
200,000
100,000
0 1 - Mile
3 - Miles
5 - Miles
10 - Mile
15 - Miles
20 - Miles
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TRADE PROPERTY AREAOVERVIEW OVERVIEW
Regional Map
Los Angeles, CA-80 miles
Hesperia, CA
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Del Taco Restaurant > Comparable Properties On-Market Comparables........................................ 15 Sold Comparables....................................................17 Comparable Properties Analysis .......................... 19
COMPARABLE PROPERTIES
On-Market Comparables del taco - 4490 delta gateway blvd | pittsburg, CA Price: Cap Rate: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
boston market - 13515 whittier blvd | whittier, ca $1,700,000 6.00% 32,278 0.74 $52.67 2001 2,798 SF $607.58
$820,000 6.00% 17,860 0.41 $45.91 1980 1,169 SF $701.45
jack in the box - 6987 university ave | la mesa, ca Price: Cap Rate: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
$1,190,000 6.00% 25,596 0.59 $46.49 n/a 3,325 SF $357.89
Price: Cap Rate: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
$1,350,000 6.50% 20,020 0.46 $67.43 1988 2,416 SF $558.17
arby’s - 670 s e st | San bernadino, ca
church’s chicken - 3801 stockton blvd | sacramento, ca Price: Cap Rate: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
Price: Cap Rate: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
taco bell - 20185 us highway 18 | apple valley, ca $1,250,000 6.00% n/a n/a n/a n/a 1,760 SF $710.23
Price: Cap Rate: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
$1,450,000 6.17% 17,510 0.40 $82.81 1997 2,108 SF $687.86
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COMPARABLE PROPERTIES
On-Market Comparables Location
Price
Cap Rate:
Land Area SF
Acres
$/SF Land Gross
Year Built
Building SF
$/Building SF
Del Taco - Pittsburg, CA
$1,700,000
6.00%
32,278
0.74
$52.67
2001
2,798
$607.58
Boston Market - Whittier, Ca
$1,190,000
6.00%
25,596
0.59
$46.49
n/a
3,325
$357.89
Church's Chicken - Sacramento, CA
$820,000
6.00%
17,860
0.41
$45.91
1980
1,169
$701.45
Arby's - San Bernadino, CA
$1,350,000
6.50%
20,020
0.46
$67.43
1988
2,416
$558.77
Jack in the Box - La Mesa, CA
$1,250,000
6.00%
n/a
n/a
n/a
n/a
1,760
$710.23
Taco Bell - Apple Valley, CA
$1,450,000
6.17%
17,510
0.40
$82.81
1997
2,108
$687.86
Subject Property
$1,203,448
6.11%
42,600
0.98
$28.25
1979
1,932
$622.90
Average
$1,280,493
6.11%
25,977
0.60
$53.93
1989
2,215
$606.67
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COMPARABLE PROPERTIES
Sold Comparables del taco - 10644 alondra blvd | norwalk, ca Price: Cap Rate: Days on Market: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
Del taco - 19701 esperanza rd | anaheim, ca $2,350,000 6.20% 31 days 21,780 0.50 $107.90 2005 2,000 SF $1,175.00
El pollo loco - 750 S Grand ave | glendora, ca Price: Cap Rate: Days on Market: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
$1,375,000 5.90% 95 days 20,255 0.47 $67.88 1985 2,368 SF $580.66
el pollo loco - 12909 harbor blvd | Garden grove, ca $1,690,333 5.00% 7 days 30,854 0.71 $54.79 1976 3,199 SF $528.39
del taco - 2804 Main st | san diego, ca Price: Cap Rate: Days on Market: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
Price: Cap Rate: Days on Market: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
Price: Cap Rate: Days on Market: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
$1,400,000 6.00% 94 days 13,634 0.31 $102.68 1984 2,500 SF $560.00
burger king - 14868 bear valley rd | Victorville, ca $1,435,000 6.00% 46 days 19,602 0.45 $73.21 1984 2,873 SF $499.48
Price: Cap Rate: Days on Market: Land Area SF: Acres: $/SF Land Gross: Year Built: Building SF: Price/SF:
$1,410,000 7.00% 193 days 27,452 0.63 $51.36 1987 3,292 SF $428.31
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COMPARABLE PROPERTIES
Sold Comparables
Location
Price:
Cap Rate:
Days on Market:
Land Area SF
Acres
$/SF Land Gross
Year Built
Building SF
$/Building SF
Del Taco - Norwalk, CA
$2,350,000
6.20%
31
21,780
0.50
$107.90
2005
2,000
$1,175.00
Del Taco - Anaheim, CA
$1,375,000
5.90%
95
20,255
0.47
$67.88
1985
2,368
$580.66
El Pollo Loco - Glendora, CA
$1,690,333
5.00%
7
30,854
0.71
$54.78
1976
3,199
$528.39
El Pollo Loco - Garden Grove, CA
$1,400,000
6.00%
94
13,634
0.31
$102.68
1984
2,500
$560.00
Del Taco - San Diego, CA
$1,435,000
6.00%
46
19,602
0.45
$73.21
1984
2,873
$499.48
Burger King - Victorville, CA
$1,410,000
7.00%
193
27,452
0.63
$51.36
1987
3,292
$428.31
Subject Property
$1,203,448
6.11%
n/a
42,600
0.98
$28.25
1979
1,932
$622.90
Average
$1,551,969
6.03%
78
25,168
0.58
$69.44
1986
2,595
$627.82
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COMPARABLE PROPERTIES
Comparable Cap Rate Analysis On-Market Cap Rates 6.60%
6.50%
6.40%
Sold Cap Rates 8.00%
6.30%
7.00%
6.20%
6.00%
6.10%
6.00%
5.90%
5.80%
5.70%
Avg
5.00%
4.00%
3.00%
Avg
2.00%
1.00%
0.00%
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COMPARABLE PROPERTIES
Comparable PSF Analysis On-Market Price per Square Foot $800.00
$700.00
On-Market Price per Square Foot $1,400.00
$600.00
$500.00
$1,200.00
$400.00
$1,000.00
$300.00
Avg
$800.00
$200.00
$600.00
Avg
$100.00
$400.00 $-
$200.00
$-
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Del Taco Restaurant > Tenant Overview Tenant Profile..........................................................22
TENANT OVERVIEW
Tenant Profile Texas Restaurant Entrepreneur Signs Dallas-area Franchise Deal with Del Taco
Del Taco is the #2 quick-service Mexican brand in the US. The chain was founded in 1964 and has more than 520 locations found throughout 18 other western states.
(Lake Forest, CA) Feb. 24, 2011 – Del Taco announced today that it has signed a franchise development deal with Supremo Taco, LLC, an affiliate of the 200-unit, Dallas, Tx-based Sun Holdings owned by Guillermo Perales.
About 290 of the eateries are companyowned while the rest are franchised. Formed in 2004, Del Taco Holdings is backed by investors led by Charlesbank Capital Partners and Leonard Green & Partners
Perales is the largest
Lease summary 2nd 10-yr option commencement
November 8, 2013
2nd 10-yr option termination
November 8, 2023
Monthly rent
$4,680.62
percentage rent
5% vs Base Rent paid yearly
Lease guarantor
Del Taco, LLC
Hispanic franchisee in the US and is the 20th
largest franchisee operator in the country. He is a recipient of the prestigious Ernst & Young Entrepreneur of the Year Award. Perales cited Del
Taco’s strong financial position, history of operations excellence, commitment to the Texas market and long-term brand success as the reasons he chose the chain.
Del Taco Restaurant | COLLIERS INTERNATIONAL | 22
Confidentiality & Disclaimer Statement This Offering Memorandum contains select information pertaining to the business and affairs of the Property at 17292 Main St., Hesperia, CA. It has been prepared by Colliers International. This Offering Memorandum may not be all-inclusive or contain all of the information a prospective purchaser may desire. The information contained in this Offering Memorandum is confidential and furnished solely for the purpose of a review by a prospective purchaser of the Property. It is not to be used for any other purpose or made available to any other person without the written consent of Owner or Colliers International. The material is based in part upon information supplied by the Owner and in part upon financial information obtained by Colliers International from sources it deems reliable. Neither Owner, nor their officers, employees, or agents make any representation or warranty, express or implied, as to the accuracy or completeness or this Offering Memorandum or any of its contents and no legal liability is assumed or shall be implied with respect thereto. Prospective purchasers should make their own projections and form their own conclusions without reliance upon the material contained herein and conduct their own due diligence. By acknowledging your receipt of this Offering Memorandum from Colliers International, you agree: 1) The Offering Memorandum and its contents are confidential; 2) You will hold it and treat it in the strictest of confidence; and 3) You will not, directly or indirectly, disclose or permit anyone else to disclose this Offering Memorandum or its contents in any fashion or manner detrimental to the interest of the Owner. Owner and Colliers International expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers to purchase the Property and to terminate discussions with any person or entity reviewing this Offering Memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase and sale of the Property has been fully executed and delivered. If you wish not to pursue negotiations leading to the acquisition of Del Taco Restaurant or in the future you discontinue such negotiations, then you agree to purge all materials relating to this Property including this Offering Memorandum. A prospective purchaser’s sole and exclusive rights with respect to this prospective transaction, the Property, or information provided herein or in connection with the sale of the Property shall be limited to those expressly provided in an executed Purchase Agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims against Owner or Colliers International or any of their affiliates or any of their respective officers, Directors, shareholders, owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property. This Offering Memorandum shall not be deemed to represent the state of affairs of the Property or constitute an indication that there has been no change in the state of affairs of the Property since the date this Offering Memorandum.
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Del Taco Restaurant Offering Memorandum
FOR MORE INFORMATION: Shawn Bakke 213 532 3282
[email protected] Gregory Ching 213 532 3209
[email protected] COLLIERS INTERNATIONAL 865 S. Figueroa Street, Suite 3500 | Los Angeles, CA 90017 | 213 627 1214 Phone