popeYes
exclusive offering memorandum
POPEYES Fee Simple Ground Lease Single tenant nnn investment 605 w. craig road | las vegas, nevada Eric Carlton
Senior Advisor License No. 01809955 949.724-5561 [email protected]
> Fee Simple Ground Lease - 12% Rent Bump June 2012 - Tenant Pays All Expenses > Strong Franchisee Guaranty - ZNA Foods, Inc. - One of the Largest Popeye’s Franchisee’s in Nevada and S. California - 34 Locations and Growing > Excellent Rental Increases - 12.5% Every 5 Years Including All Options > 16+ Years Remaining on Brand New 20 Year Absolute NNN Lease > 2nd Largest Quick-Service Chicken Restaurant Chain in the World > Premiere Corner Outparcel to Craig Promenade - Big Lots Anchored Shopping Center > Surrounding Retail Includes; Home Depot, Petsmart, Office Depot, Michaels, Smart n Final, Wells Fargo, Walgreens, CVS, Ruby Tuesday, 99c Only, McDonalds, Chevron, Metro PCS & Cannery Casino
Jereme Snyder
Senior Vice President License No. 01360233 949.724.5552 [email protected]
Colliers NNN Group
Table of contents
Confidentiality Agreement
3
Tenant Description
4
Property Description
6
Investment Highlights
7
Property Overview
8
9
Financial Analysis
Property Photos
10
Site Plan
16
Aerial View
17
Location Map
18
Demographics
19
Area Profile
20
Colliers International is the 2rd largest commercial real estate firm in the world.
The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Confidentiality Agreement This Offering Memorandum was prepared by Colliers International (“Broker”) solely for the use of prospective for the purchase of 2,157 square feet on 0.62 acres of land, located at 605 W. Craig Road, Las Vegas, NV 89032 (“Property”). Neither the Broker nor the Owner of the Property, make any representation or warranty, expressed or implied, as to the completeness or accuracy of the material contained in the Offering Memorandum. Prospective purchasers of the Property are advised that changes may have occurred in the physical or financial condition of the Property since the time this Offering Memorandum or the financial statements herein were prepared. Prospective purchasers acknowledge that this Offering Memorandum and the financial statements herein were prepared by Broker, and not by Owner, and are based upon assumptions or events beyond the control of both Broker and Owner, and therefore may be subject to variation. Other than current and historical revenue and operating expense figures for the Property, Owner has not, and will not, provide Broker or any prospective purchaser with any projections regarding the Property. Prospective purchasers of the Property are advised and encouraged to conduct their own comprehensive review and analysis of the Property. The Offering Memorandum is a solicitation of interest only and is not an offer to sell the Property. The Owner and Broker expressly reserve the right, at their sole discretion, to reject any or all expressions of interest or offers to purchase the Property and expressly reserve the right, at their sole discretion, to terminate discussions with any entity at any time with or without notice.
The Owner shall have no legal commitments or obligations to any entity reviewing the Offering Memorandum or making an offer to purchase the Property unless and until such offer is approved by Owner pursuant its Governing Authorities and the signature of the Owner or Owner’s representative is affixed to a Real Estate Purchase Agreement prepared by Owner. This Offering Memorandum is confidential. By accepting the Offering Memorandum, you agree (i) that you will hold and treat the Offering Memorandum and its contents in the strictest confidence, (ii) that you will not photocopy or duplicate any part of the Offering Memorandum, (iii) that you will not disclose the Offering Memorandum or any of its contents to any entity without the prior authorization of the Owner, and (iv) that you will not use the Offering Memorandum in any fashion or manner detrimental to the Owner or Broker. Colliers International obtained the information contained in this Offering Memorandum from sources we believe to be reliable. However, we have not verified its accuracy and make no guarantee, warranty or representation about it. It is submitted subject to the possibility of errors, omissions, changes of price, rental or other conditions, prior sale, lease or financing, or withdrawal without notice. We include projections, opinions, assumptions, or estimates for example only, and they may not represent current or future performance of the Property. You and your tax and legal advisors should conduct your own investigations of the physical condition of the Property and of the financial performance of its future Ownerships.
Tenant Description Profile Popeyes® was founded in New Orleans, Louisiana in 1972 and is the world’s second largest quick-service chicken concept based on the number of units. Within the QSR industry, Popeyes distinguishes itself with a unique “New Orleans” style menu that features spicy chicken, chicken sandwiches, chicken tenders, fried shrimp and other seafood, jambalaya, Red Beans and Rice and other regional items. Popeyes is a highly differentiated QSR brand with a passion for its New Orleans heritage and flavorful authentic food. • Build a Distinct, Relevant Brand - offering a distinctive brand and menu with superior food at affordable prices. • Running Great Restaurants - improving restaurant operations and Popeyes’ guest experience by delighting the guest with “service as distinctive as our food”. • Strengthening Unit Economics - reducing restaurant operating costs and increasing restaurant profitability while maintaining excellent food quality for our guests. • Ramp Up Unit Growth - building more restaurants across the U.S. and abroad with superior profits and investment returns.
Popeyes serves food the world craves and is continuing to expand its global reach. As of December 26, 2010, the Company operated and franchised 1,977 Popeyes restaurants in 45 states, the District of Columbia, Puerto Rico, Guam, the Cayman Islands and 26 foreign countries. Of the 1,542 domestic franchised restaurants, approximately 70% were concentrated in Texas, California, Louisiana, Florida, Illinois, Maryland, New York, Georgia, Virginia and Mississippi. Of the 397 international franchised restaurants, approximately 55% were located in Korea, Canada and Turkey. Of the 38 company-operated restaurants, more than 90% were concentrated in Louisiana and Tennessee
Popeyes rankings > 2nd Largest Quick-Service Chicken Restaurant Group in the World > The Company Operated and Franchised 1,977 Popeye’s Restaurants in 45 States & 26 Countries- as of December 26, 2010 > Only 3% of All Popeye’s Locations are Company-Owned- AFC Enterprises, Inc. (NASDAQ: AFCE) > ZNA Foods, Inc. is One of the Largest Popeye’s Franchisees in Nevada and S. California- 34 Restaurants > Popeye’s Louisiana Chicken is the Primary Brand of Fast Food Restaurants Franchised by AFC Enterprises
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Property Description Property overview This offering includes a single tenant, free-standing Popeye’s Chicken & Biscuits with drive-thru in the world famous city of Las Vegas, NV . The property consists of a fee simple ground lease, 20 Year absolute NNN with 3- 5 yr. options and 12.5% increases every 5 years including all option periods. Built in 2007, this newer construction models the new look for the brand. Popeye’s is owned by AFC Enterprises, Inc. (NASDAQ: AFCE) who develops, operates, and franchises quick-service restaurants (“QSRs” or “restaurants”) under the trade name Popeyes®. Only 3% of all locations world- wide are corporate-owned, while most are franchised. ZNA Foods, Inc. is the Franchisee for this location, which is one of the largest franchisees in the state of Nevada and S. California. With 34 Popeye’s restaurants, ZNA Foods has strong financials, an excellent reputation and are poised for future growth. Currently, Popeyes is the 2nd largest quick-service chicken restaurant group in the world, only behind YUM! Brands’ KFC, with aggressive plans for expansion all over the globe. Today, there are over 1,977 locations in 45 states and 26 countries. Within the QSR industry, Popeyes distinguishes itself with a unique “New Orleans” style menu that features spicy chicken, chicken sandwiches, chicken tenders, fried shrimp and other seafood, jambalaya, Red Beans and Rice and other regional items. It’s a highly differentiated QSR brand with a passion for its New Orleans heritage and flavorful authentic food.
Location overview
The property is located on W. Craig Road near the corner of Revere Street, just off Interstate 15 , the main Freeway connecting north and south Las Vegas. As an outparcel to The Craig Promenade (Big Lots Anchored), this location enjoys high visibility and street frontage along this main retail corridor servicing all of northern part of the city. Popeyes is strategically positioned in this dense community and retail trade area, near the master-planned community of Summerlin, an affluent golf-resort community and just minutes away from The Las Vegas Strip and Downtown Las Vegas. This location surrounded by most of the major retailers (The Grove, Revere Marketplace, Gateway Plaza, North Mesa Plaza Shopping Centers) including, Home Depot, Petsmart, Office Depot, Michaels, Smart n Final, Wells Fargo, Walgreens, CVS, Ruby Tuesday, 99c Only, McDonalds, Chevron, Metro PCS and many more. Aside from retail, this part of town hosts several major manufacturing companies, office complexes and Southern Nevada College , generating high traffic and a vibrant commercial trade area. Anchored by Big Lots and Party Pro, this Center is one of the nicest in the area and Popeye’s enjoys a competitive advantage for this type of fast food. This high traffic location at the corner of W. Craig Rd boasts over 50,000 cars per day (2010) just off the Craig Rd exit of the Interstate 15 Freeway. Popeyes enjoys street frontage, excellent visibility and monument signage. p. 5
POPULATION Estimated Population (2010)
1-MILE 16,432
3-MILE 138,387
5-MILE 377,591
Projected Population (2015)
19,356
160,892
423,746
Projected Annual Growth
17.79%
16.26%
12.22%
$70,307
$62,398
Average Household Income (2010) $69,250
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Investment Highlights STRONG FRANCHISE GUARANTY > One of the Largest Popeyes Franchisees in Nevada & S. California - ZNA Foods, Inc. > 34 Unit Operator - Strong Financials and Great Reputation > Popeyes is the 2nd Largest Quick Service Restaurant Group in the World > Over 1,977 Locations in 45 States and 26 Countries - Aggressive Expansion
STABLE INCOME - EASE OF MANAGEMENT > Fee Simple Ground Lease Ownership- Coupon Clipper Asset > 20 Year Absolute NNN Lease - 3 - 5 Year Options With Bumps > Zero Management Responsibilities - Tenant Pays All Expenses > Newer Construction- Built in 2007 - Modern Popeyes Concept/Design
EXCELLENT RETAIL DESTINATION LOCATION > Corner Outparcel to Craig Promenade- Big Lots Anchored Shopping Center > Surrounding Retailers Include; , Home Depot, Petsmart, Office Depot, Michaels,
Smart n Final, Wells Fargo, Walgreens, CVS, Ruby Tuesday, 99c Only, McDonalds, Chevron, Metro PCS and Many More > Irreplaceable Visibility - Over 211,000 Cars Along W. Craig Rd - Main Retail Corridor for N. Las Vegas > Premiere Street Frontage With Monument Signage - Drive Thru Location > Dense Retail Trade Area- The Grove Shopping Center, Revere Marketplace, Gateway Plaza, North Mesa Plaza & Home Depot Regional Power Center
PERFECT 1031 EXCHANGE PROPERTY > 16 Years Remaining on New 20 Year Absolute NNN Ground Lease > 12% Rental Increases Every 5 Years, Including All Options- Next Bump June 2012 > No Existing Financing in Place > Rare Opportunity to Purchase National Tenant at Lower Cost - Pride of Ownership
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Property Overview Property Information
Lease Summary
Subject Property:
Popeye’s Chicken & Biscuits
Tenant:
Popeye’s
Property Address:
605 W. Craig Road
Franchisee:
ZNA Food’s, Inc.
Lease Term:
20 Years
Term Remaining on Lease:
16+ Years
Las Vegas, NV 89032 Price:
$1,225,000
CAP Rate:
6.60%
Current NOI:
$80,804.52
Building Size:
2,157 SF
Land Size:
27,007 SF (.62 Acres)
Construction Year:
2007
Parcel Number:
139-03-314-005
Traffic Count: Over 211,000 AADT at I-15 & W. Craig Rd Over 50,000 AADT at Craig Rd & Revere St Over 36,000 AADT at Craig Rd & MLK
Lease Type: Fee Simple Ground Lease Date of Lease:
07/19/2006
Lease Commencement:
06/01/2007
Rent Commencement:
06/01/2007
Lease Expiration:
05/31/2027
Annual Rent Terms:
Years 1-5:
$80,804.52
Years 6-10:
$90,905.04
Years 11-15:
$102,268.20
Years 16-20:
$115,051.80
Renewal Options: (3-5 Year Option) Years 21-25: $128,858.01
Colliers NNN Group p. 7
Popeye’s | Las Vegas, NV
Years 26-30:
$144,320.97
Years 31-35:
$161,639.48
The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Financial analysis RENT ROLL
Popeye's Chicken & Biscuits - Single Tenant NNN Ground Lease 605 W. Craig Road, North Las Vegas, NV 89032 BLDG SQUARE
TENANT
FOOTAGE
LEASE START
LEASE
RENT/
ANNUAL
EXPIRATION
SQ. FT.
RENT
INCREASES
12.5% Increases Every 5 Years Popeye's
2,157
6/1/2007
5/31/2027
$37.46
$80,804.52
06/01/2012 $90,905.04 06/01/2017 $102,268.20 06/01/2022 $115,051.80
*Total :
2,157
OPTIONS 3- 5 Yr Options 12.5% Increases Every Option 06/01/2027 $128,858.01 06/01/2032 $144,320.97 06/01/2037 $161,639.48
$80,805
PRICING ANALYSIS Popeye's Chicken & Biscuits - Las Vegas, NV INCOME & EXPENSE Net Operating Income
PRICING GUIDANCE $80,805
Price Price / Sq. Ft. Down Payment Down Payment %
$551,250 45.0%
Loan Amount
$673,750
Cap Rate
Interest Rate Amortization LTV Term
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NEW FINANCING TERMS 5.75% 25 55% 10 Years
$1,225,000 $567.92
Net Operating Income Loan Payment Cash Flow Cash-on-Cash DSCR
6.60% $80,805 $50,863 $29,941 5.43% 1.59%
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
property photos
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
property photos
p. 10
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
surrounding area photos
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
surrounding area photos
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
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site map
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
LOCation map
p. 14
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Aerial View
p. 15
CRAIG RANCH REGIONAL PARK
W Craig Road
Over 50,000 Cars Per Day
Craig Promenade
Revere Marketplace North Mesa Plaza
Revere Street
Martin Luther King Blvd Over 36,000 Cars Per Day
Gateway Plaza
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
The Grove
Aerial View
p. 16
ay
CANNERY HOTEL rD e P & CASINO rs
Ov e
Ca 0 0 1,0 1 r2
COMMUNITY COLLEGE OF SOUTHERN NEVADA CHEYENNE CAMPUS
Revere Street
NORTH LAS VEGAS AIRPORT
Martin Luther King Boulevard Over 50,000 Cars Per Day
W Craig Road Over 50,000 Cars Per Day
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Aerial View
McCarran International Airport
p. 17
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Demographics POPULATION Estimated Population (2010)
1-MILE 16,432
3-MILE 138,387
5-MILE 377,591
DAYTIME DEMOS Total # of Businesses (2010)
1-MILE 270
3-MILE 2,501
5-MILE 9,174
Census Population (2000)
7,269
78,203
260,406
Total # of Employees (2010)
3,691
52,742
157,689
Projected Population (2015)
19,356
160,892
423,746
Employee Pop. per Business
13.67
21.09
17.19
Residential Pop. per Business
60.86
55.33
41.16
HISTORICAL ANNUAL GROWTH 1990-2000
2275.49%
206.79%
77.29%
2000-2010
126.06%
76.96%
45.00%
2010-2015
17.79%
16.26%
12.22%
HOUSEHOLDS Estimated Households (2010)
1-MILE 5,381
3-MILE 43,415
5-MILE 119,425
INCOME Avg. Household Income (2010)
1-MILE $69,250
3-MILE $70,307
5-MILE $62,398
Census Households (2000)
2,360
23,942
81,595
Median Household Income (2010)
$61,329
$62,551
$52,333
Projected Households (2015)
6,333
50,285
133,476
Per Capita Income (2010)
$22,689
$22,160
$20,146
1990-2000
2493.41%
224.37%
63.63%
2000-2010
128.01%
81.33%
46.36%
17.69%
15.82%
11.77%
PROJECTED ANNUAL GROWTH
HISTORICAL ANNUAL GROWTH
PROJECTED ANNUAL GROWTH 2010-2015
Colliers NNN Group
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Area Profile - North las vegas Las Vegas
summerlin
Las Vegas is the most populous city in Nevada, the seat of Clark County, and an internationally renowned major resort city for gambling, shopping and fine dining. Las Vegas, which bills itself as The Entertainment Capital of the World, is famous for the number of casino resorts and associated entertainment. A growing retirement and family city, it is the 28th most populous city in the United States with an estimated population by the U.S. Census Bureau of 567,641 as of 2009. The 2008 population estimate of the Las Vegas metropolitan area was 1,865,746.
Explore the more than 22,500 acres of Summerlin from the comfort of your computer. Discover all the amenities Summerlin has to offer, including schools, parks, trails, houses of worship, shopping, golf courses and so much more.
Established in 1905, Las Vegas officially became a city in 1911. With the growth that followed, at the close of the century Las Vegas was the most populous American city founded in the 20th century (a distinction held by Chicago in the 19th century). The city’s tolerance for various forms of adult entertainment earned it the title of Sin City, and this image has made Las Vegas a popular setting for films and television programs. There are numerous outdoor lighting displays on Fremont Street, as well as elsewhere in the city. The name Las Vegas is often applied to unincorporated areas that surround the city, especially the resort areas on and near the Las Vegas Strip. The 4.2 mile (6.8 km) stretch of Las Vegas Boulevard known as the Strip is mainly in the unincorporated communities of Paradise and Winchester, while a small portion overlaps into Las Vegas and the unincorporated community of Enterprise.
Welcome to the 22,500 acres we like to call home. From our more than 150 miles of meandering trails that connect nearly 150 neighborhood parks, to our specially designed street lamps, which help minimize artificial light interference to allow for brighter stars in our night sky – Summerlin is truly a community master-planned to perfection. Designed to live as good as it looks, Summerlin offers more choices for how and where you want to live than any other Las Vegas master-planned community. Framed by soaring mountain peaks, woven together by double tree-lined streets, European roundabouts and picturesque streetscapes, Summerlin is unlike any other community in Las Vegas. We invite you to make yourself at home and use the tools on this site to discover the community for yourself. And when you’re ready, contact us for assistance in making the most pleasurable move of your life. Welcome to Summerlin. Today. Tomorrow. Forever. This is home.
summerlin
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Area Profile - Las Vegas Downtown old town las vegas Right off of Las Vegas Boulevard, on Fremont Street, is the heart of old Las Vegas, also known as Downtown Las Vegas. This is a whole other side to Las Vegas, and a visit to this part of town will add depth to your visit. Las Vegas downtown is home to many of the older hotel casinos, many of which are still in use today. Away from the crowds of the Las Vegas strip, the downtown Las Vegas hotels and sights in the area combine to create a unique experience. The Fremont Street Experience opened in 1995 and has since drawn visitors to this older part of the city and revived interest in the city’s history. While the Fremont Street Experience takes up four city blocks, the main draws are not the downtown Las Vegas hotels, but the free light and sound show that begins just after sunset, and the themed shows that are put on here. You can catch the best view from the balcony of the second floor of Fitzgerald’s.
While many of the Downtown Las Vegas Hotels are no longer in operation, many still survive to this day, and visitors who want to gamble straight ahead and enjoy a vintage Vegas experience flock to places such as Binion’s Horseshoe. Check out the exhibit of antique guns near the hotel entrance, and enjoy cowboy cuts of beef in Binion’s Ranch Steakhouse. El Cortez is also one of the remaining downtown Las Vegas hotels and should not be missed, either. The Golden Gate Hotel, which originally opened in 1906, still stands and is known for its 99-cent shrimp cocktails you can enjoy as you admire the photos covering the wall which commemorate the opening of the San Francisco Bay bridge. There is nightly piano entertainment as well.
Neonopolis, on the corner of Fremont Street and Las Vegas Boulevard also brings visitors to Downtown Las Vegas. This newer development which houses restaurants, shops, and indoor entertainment costs $100 million to build. This area of Las Vegas downtown used to be known as “glitter gulch”, because the casinos here were so brightly lit that it seemed like daytime when they were all turned on at night. Vegas Vic is a familiar sight to visitors to Las Vegas. Featured in many old and new movies which are set in Las Vegas, this well-known landmark is a giant neon cowboy used to greet visitors to Downtown Las Vegas with a loud “howdy partner!” until an actor filming here complained about the noise and silenced his boisterous welcome for more than 20 years.
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Eric Carlton
Senior Advisor License No. 01809955 949.724.5561 [email protected]
Jereme Snyder
Senior Vice President License No. 01360233 949.724.5552 [email protected]
Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. This publication is the copyrighted property of Colliers International and /or its licensor(s). 2010. All rights reserved.
Colliers NNN Group
POPEYES Fee Simple Ground Lease Single tenant nnn investment 605 w. craig road | las vegas, nevada Eric Carlton
Senior Advisor License No. 01809955 949.724-5561 [email protected]
> Fee Simple Ground Lease - 12% Rent Bump June 2012 - Tenant Pays All Expenses > Strong Franchisee Guaranty - ZNA Foods, Inc. - One of the Largest Popeye’s Franchisee’s in Nevada and S. California - 34 Locations and Growing > Excellent Rental Increases - 12.5% Every 5 Years Including All Options > 16+ Years Remaining on Brand New 20 Year Absolute NNN Lease > 2nd Largest Quick-Service Chicken Restaurant Chain in the World > Premiere Corner Outparcel to Craig Promenade - Big Lots Anchored Shopping Center > Surrounding Retail Includes; Home Depot, Petsmart, Office Depot, Michaels, Smart n Final, Wells Fargo, Walgreens, CVS, Ruby Tuesday, 99c Only, McDonalds, Chevron, Metro PCS & Cannery Casino
Jereme Snyder
Senior Vice President License No. 01360233 949.724.5552 [email protected]
Colliers NNN Group
Table of contents
Confidentiality Agreement
3
Tenant Description
4
Property Description
6
Investment Highlights
7
Property Overview
8
9
Financial Analysis
Property Photos
10
Site Plan
16
Aerial View
17
Location Map
18
Demographics
19
Area Profile
20
Colliers International is the 2rd largest commercial real estate firm in the world.
The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Confidentiality Agreement This Offering Memorandum was prepared by Colliers International (“Broker”) solely for the use of prospective for the purchase of 2,157 square feet on 0.62 acres of land, located at 605 W. Craig Road, Las Vegas, NV 89032 (“Property”). Neither the Broker nor the Owner of the Property, make any representation or warranty, expressed or implied, as to the completeness or accuracy of the material contained in the Offering Memorandum. Prospective purchasers of the Property are advised that changes may have occurred in the physical or financial condition of the Property since the time this Offering Memorandum or the financial statements herein were prepared. Prospective purchasers acknowledge that this Offering Memorandum and the financial statements herein were prepared by Broker, and not by Owner, and are based upon assumptions or events beyond the control of both Broker and Owner, and therefore may be subject to variation. Other than current and historical revenue and operating expense figures for the Property, Owner has not, and will not, provide Broker or any prospective purchaser with any projections regarding the Property. Prospective purchasers of the Property are advised and encouraged to conduct their own comprehensive review and analysis of the Property. The Offering Memorandum is a solicitation of interest only and is not an offer to sell the Property. The Owner and Broker expressly reserve the right, at their sole discretion, to reject any or all expressions of interest or offers to purchase the Property and expressly reserve the right, at their sole discretion, to terminate discussions with any entity at any time with or without notice.
The Owner shall have no legal commitments or obligations to any entity reviewing the Offering Memorandum or making an offer to purchase the Property unless and until such offer is approved by Owner pursuant its Governing Authorities and the signature of the Owner or Owner’s representative is affixed to a Real Estate Purchase Agreement prepared by Owner. This Offering Memorandum is confidential. By accepting the Offering Memorandum, you agree (i) that you will hold and treat the Offering Memorandum and its contents in the strictest confidence, (ii) that you will not photocopy or duplicate any part of the Offering Memorandum, (iii) that you will not disclose the Offering Memorandum or any of its contents to any entity without the prior authorization of the Owner, and (iv) that you will not use the Offering Memorandum in any fashion or manner detrimental to the Owner or Broker. Colliers International obtained the information contained in this Offering Memorandum from sources we believe to be reliable. However, we have not verified its accuracy and make no guarantee, warranty or representation about it. It is submitted subject to the possibility of errors, omissions, changes of price, rental or other conditions, prior sale, lease or financing, or withdrawal without notice. We include projections, opinions, assumptions, or estimates for example only, and they may not represent current or future performance of the Property. You and your tax and legal advisors should conduct your own investigations of the physical condition of the Property and of the financial performance of its future Ownerships.
Tenant Description Profile Popeyes® was founded in New Orleans, Louisiana in 1972 and is the world’s second largest quick-service chicken concept based on the number of units. Within the QSR industry, Popeyes distinguishes itself with a unique “New Orleans” style menu that features spicy chicken, chicken sandwiches, chicken tenders, fried shrimp and other seafood, jambalaya, Red Beans and Rice and other regional items. Popeyes is a highly differentiated QSR brand with a passion for its New Orleans heritage and flavorful authentic food. • Build a Distinct, Relevant Brand - offering a distinctive brand and menu with superior food at affordable prices. • Running Great Restaurants - improving restaurant operations and Popeyes’ guest experience by delighting the guest with “service as distinctive as our food”. • Strengthening Unit Economics - reducing restaurant operating costs and increasing restaurant profitability while maintaining excellent food quality for our guests. • Ramp Up Unit Growth - building more restaurants across the U.S. and abroad with superior profits and investment returns.
Popeyes serves food the world craves and is continuing to expand its global reach. As of December 26, 2010, the Company operated and franchised 1,977 Popeyes restaurants in 45 states, the District of Columbia, Puerto Rico, Guam, the Cayman Islands and 26 foreign countries. Of the 1,542 domestic franchised restaurants, approximately 70% were concentrated in Texas, California, Louisiana, Florida, Illinois, Maryland, New York, Georgia, Virginia and Mississippi. Of the 397 international franchised restaurants, approximately 55% were located in Korea, Canada and Turkey. Of the 38 company-operated restaurants, more than 90% were concentrated in Louisiana and Tennessee
Popeyes rankings > 2nd Largest Quick-Service Chicken Restaurant Group in the World > The Company Operated and Franchised 1,977 Popeye’s Restaurants in 45 States & 26 Countries- as of December 26, 2010 > Only 3% of All Popeye’s Locations are Company-Owned- AFC Enterprises, Inc. (NASDAQ: AFCE) > ZNA Foods, Inc. is One of the Largest Popeye’s Franchisees in Nevada and S. California- 34 Restaurants > Popeye’s Louisiana Chicken is the Primary Brand of Fast Food Restaurants Franchised by AFC Enterprises
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Property Description Property overview This offering includes a single tenant, free-standing Popeye’s Chicken & Biscuits with drive-thru in the world famous city of Las Vegas, NV . The property consists of a fee simple ground lease, 20 Year absolute NNN with 3- 5 yr. options and 12.5% increases every 5 years including all option periods. Built in 2007, this newer construction models the new look for the brand. Popeye’s is owned by AFC Enterprises, Inc. (NASDAQ: AFCE) who develops, operates, and franchises quick-service restaurants (“QSRs” or “restaurants”) under the trade name Popeyes®. Only 3% of all locations world- wide are corporate-owned, while most are franchised. ZNA Foods, Inc. is the Franchisee for this location, which is one of the largest franchisees in the state of Nevada and S. California. With 34 Popeye’s restaurants, ZNA Foods has strong financials, an excellent reputation and are poised for future growth. Currently, Popeyes is the 2nd largest quick-service chicken restaurant group in the world, only behind YUM! Brands’ KFC, with aggressive plans for expansion all over the globe. Today, there are over 1,977 locations in 45 states and 26 countries. Within the QSR industry, Popeyes distinguishes itself with a unique “New Orleans” style menu that features spicy chicken, chicken sandwiches, chicken tenders, fried shrimp and other seafood, jambalaya, Red Beans and Rice and other regional items. It’s a highly differentiated QSR brand with a passion for its New Orleans heritage and flavorful authentic food.
Location overview
The property is located on W. Craig Road near the corner of Revere Street, just off Interstate 15 , the main Freeway connecting north and south Las Vegas. As an outparcel to The Craig Promenade (Big Lots Anchored), this location enjoys high visibility and street frontage along this main retail corridor servicing all of northern part of the city. Popeyes is strategically positioned in this dense community and retail trade area, near the master-planned community of Summerlin, an affluent golf-resort community and just minutes away from The Las Vegas Strip and Downtown Las Vegas. This location surrounded by most of the major retailers (The Grove, Revere Marketplace, Gateway Plaza, North Mesa Plaza Shopping Centers) including, Home Depot, Petsmart, Office Depot, Michaels, Smart n Final, Wells Fargo, Walgreens, CVS, Ruby Tuesday, 99c Only, McDonalds, Chevron, Metro PCS and many more. Aside from retail, this part of town hosts several major manufacturing companies, office complexes and Southern Nevada College , generating high traffic and a vibrant commercial trade area. Anchored by Big Lots and Party Pro, this Center is one of the nicest in the area and Popeye’s enjoys a competitive advantage for this type of fast food. This high traffic location at the corner of W. Craig Rd boasts over 50,000 cars per day (2010) just off the Craig Rd exit of the Interstate 15 Freeway. Popeyes enjoys street frontage, excellent visibility and monument signage. p. 5
POPULATION Estimated Population (2010)
1-MILE 16,432
3-MILE 138,387
5-MILE 377,591
Projected Population (2015)
19,356
160,892
423,746
Projected Annual Growth
17.79%
16.26%
12.22%
$70,307
$62,398
Average Household Income (2010) $69,250
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Investment Highlights STRONG FRANCHISE GUARANTY > One of the Largest Popeyes Franchisees in Nevada & S. California - ZNA Foods, Inc. > 34 Unit Operator - Strong Financials and Great Reputation > Popeyes is the 2nd Largest Quick Service Restaurant Group in the World > Over 1,977 Locations in 45 States and 26 Countries - Aggressive Expansion
STABLE INCOME - EASE OF MANAGEMENT > Fee Simple Ground Lease Ownership- Coupon Clipper Asset > 20 Year Absolute NNN Lease - 3 - 5 Year Options With Bumps > Zero Management Responsibilities - Tenant Pays All Expenses > Newer Construction- Built in 2007 - Modern Popeyes Concept/Design
EXCELLENT RETAIL DESTINATION LOCATION > Corner Outparcel to Craig Promenade- Big Lots Anchored Shopping Center > Surrounding Retailers Include; , Home Depot, Petsmart, Office Depot, Michaels,
Smart n Final, Wells Fargo, Walgreens, CVS, Ruby Tuesday, 99c Only, McDonalds, Chevron, Metro PCS and Many More > Irreplaceable Visibility - Over 211,000 Cars Along W. Craig Rd - Main Retail Corridor for N. Las Vegas > Premiere Street Frontage With Monument Signage - Drive Thru Location > Dense Retail Trade Area- The Grove Shopping Center, Revere Marketplace, Gateway Plaza, North Mesa Plaza & Home Depot Regional Power Center
PERFECT 1031 EXCHANGE PROPERTY > 16 Years Remaining on New 20 Year Absolute NNN Ground Lease > 12% Rental Increases Every 5 Years, Including All Options- Next Bump June 2012 > No Existing Financing in Place > Rare Opportunity to Purchase National Tenant at Lower Cost - Pride of Ownership
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Property Overview Property Information
Lease Summary
Subject Property:
Popeye’s Chicken & Biscuits
Tenant:
Popeye’s
Property Address:
605 W. Craig Road
Franchisee:
ZNA Food’s, Inc.
Lease Term:
20 Years
Term Remaining on Lease:
16+ Years
Las Vegas, NV 89032 Price:
$1,225,000
CAP Rate:
6.60%
Current NOI:
$80,804.52
Building Size:
2,157 SF
Land Size:
27,007 SF (.62 Acres)
Construction Year:
2007
Parcel Number:
139-03-314-005
Traffic Count: Over 211,000 AADT at I-15 & W. Craig Rd Over 50,000 AADT at Craig Rd & Revere St Over 36,000 AADT at Craig Rd & MLK
Lease Type: Fee Simple Ground Lease Date of Lease:
07/19/2006
Lease Commencement:
06/01/2007
Rent Commencement:
06/01/2007
Lease Expiration:
05/31/2027
Annual Rent Terms:
Years 1-5:
$80,804.52
Years 6-10:
$90,905.04
Years 11-15:
$102,268.20
Years 16-20:
$115,051.80
Renewal Options: (3-5 Year Option) Years 21-25: $128,858.01
Colliers NNN Group p. 7
Popeye’s | Las Vegas, NV
Years 26-30:
$144,320.97
Years 31-35:
$161,639.48
The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Financial analysis RENT ROLL
Popeye's Chicken & Biscuits - Single Tenant NNN Ground Lease 605 W. Craig Road, North Las Vegas, NV 89032 BLDG SQUARE
TENANT
FOOTAGE
LEASE START
LEASE
RENT/
ANNUAL
EXPIRATION
SQ. FT.
RENT
INCREASES
12.5% Increases Every 5 Years Popeye's
2,157
6/1/2007
5/31/2027
$37.46
$80,804.52
06/01/2012 $90,905.04 06/01/2017 $102,268.20 06/01/2022 $115,051.80
*Total :
2,157
OPTIONS 3- 5 Yr Options 12.5% Increases Every Option 06/01/2027 $128,858.01 06/01/2032 $144,320.97 06/01/2037 $161,639.48
$80,805
PRICING ANALYSIS Popeye's Chicken & Biscuits - Las Vegas, NV INCOME & EXPENSE Net Operating Income
PRICING GUIDANCE $80,805
Price Price / Sq. Ft. Down Payment Down Payment %
$551,250 45.0%
Loan Amount
$673,750
Cap Rate
Interest Rate Amortization LTV Term
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NEW FINANCING TERMS 5.75% 25 55% 10 Years
$1,225,000 $567.92
Net Operating Income Loan Payment Cash Flow Cash-on-Cash DSCR
6.60% $80,805 $50,863 $29,941 5.43% 1.59%
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
property photos
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
property photos
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
surrounding area photos
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
surrounding area photos
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
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site map
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
LOCation map
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Aerial View
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CRAIG RANCH REGIONAL PARK
W Craig Road
Over 50,000 Cars Per Day
Craig Promenade
Revere Marketplace North Mesa Plaza
Revere Street
Martin Luther King Blvd Over 36,000 Cars Per Day
Gateway Plaza
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
The Grove
Aerial View
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ay
CANNERY HOTEL rD e P & CASINO rs
Ov e
Ca 0 0 1,0 1 r2
COMMUNITY COLLEGE OF SOUTHERN NEVADA CHEYENNE CAMPUS
Revere Street
NORTH LAS VEGAS AIRPORT
Martin Luther King Boulevard Over 50,000 Cars Per Day
W Craig Road Over 50,000 Cars Per Day
Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Aerial View
McCarran International Airport
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Demographics POPULATION Estimated Population (2010)
1-MILE 16,432
3-MILE 138,387
5-MILE 377,591
DAYTIME DEMOS Total # of Businesses (2010)
1-MILE 270
3-MILE 2,501
5-MILE 9,174
Census Population (2000)
7,269
78,203
260,406
Total # of Employees (2010)
3,691
52,742
157,689
Projected Population (2015)
19,356
160,892
423,746
Employee Pop. per Business
13.67
21.09
17.19
Residential Pop. per Business
60.86
55.33
41.16
HISTORICAL ANNUAL GROWTH 1990-2000
2275.49%
206.79%
77.29%
2000-2010
126.06%
76.96%
45.00%
2010-2015
17.79%
16.26%
12.22%
HOUSEHOLDS Estimated Households (2010)
1-MILE 5,381
3-MILE 43,415
5-MILE 119,425
INCOME Avg. Household Income (2010)
1-MILE $69,250
3-MILE $70,307
5-MILE $62,398
Census Households (2000)
2,360
23,942
81,595
Median Household Income (2010)
$61,329
$62,551
$52,333
Projected Households (2015)
6,333
50,285
133,476
Per Capita Income (2010)
$22,689
$22,160
$20,146
1990-2000
2493.41%
224.37%
63.63%
2000-2010
128.01%
81.33%
46.36%
17.69%
15.82%
11.77%
PROJECTED ANNUAL GROWTH
HISTORICAL ANNUAL GROWTH
PROJECTED ANNUAL GROWTH 2010-2015
Colliers NNN Group
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Area Profile - North las vegas Las Vegas
summerlin
Las Vegas is the most populous city in Nevada, the seat of Clark County, and an internationally renowned major resort city for gambling, shopping and fine dining. Las Vegas, which bills itself as The Entertainment Capital of the World, is famous for the number of casino resorts and associated entertainment. A growing retirement and family city, it is the 28th most populous city in the United States with an estimated population by the U.S. Census Bureau of 567,641 as of 2009. The 2008 population estimate of the Las Vegas metropolitan area was 1,865,746.
Explore the more than 22,500 acres of Summerlin from the comfort of your computer. Discover all the amenities Summerlin has to offer, including schools, parks, trails, houses of worship, shopping, golf courses and so much more.
Established in 1905, Las Vegas officially became a city in 1911. With the growth that followed, at the close of the century Las Vegas was the most populous American city founded in the 20th century (a distinction held by Chicago in the 19th century). The city’s tolerance for various forms of adult entertainment earned it the title of Sin City, and this image has made Las Vegas a popular setting for films and television programs. There are numerous outdoor lighting displays on Fremont Street, as well as elsewhere in the city. The name Las Vegas is often applied to unincorporated areas that surround the city, especially the resort areas on and near the Las Vegas Strip. The 4.2 mile (6.8 km) stretch of Las Vegas Boulevard known as the Strip is mainly in the unincorporated communities of Paradise and Winchester, while a small portion overlaps into Las Vegas and the unincorporated community of Enterprise.
Welcome to the 22,500 acres we like to call home. From our more than 150 miles of meandering trails that connect nearly 150 neighborhood parks, to our specially designed street lamps, which help minimize artificial light interference to allow for brighter stars in our night sky – Summerlin is truly a community master-planned to perfection. Designed to live as good as it looks, Summerlin offers more choices for how and where you want to live than any other Las Vegas master-planned community. Framed by soaring mountain peaks, woven together by double tree-lined streets, European roundabouts and picturesque streetscapes, Summerlin is unlike any other community in Las Vegas. We invite you to make yourself at home and use the tools on this site to discover the community for yourself. And when you’re ready, contact us for assistance in making the most pleasurable move of your life. Welcome to Summerlin. Today. Tomorrow. Forever. This is home.
summerlin
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Area Profile - Las Vegas Downtown old town las vegas Right off of Las Vegas Boulevard, on Fremont Street, is the heart of old Las Vegas, also known as Downtown Las Vegas. This is a whole other side to Las Vegas, and a visit to this part of town will add depth to your visit. Las Vegas downtown is home to many of the older hotel casinos, many of which are still in use today. Away from the crowds of the Las Vegas strip, the downtown Las Vegas hotels and sights in the area combine to create a unique experience. The Fremont Street Experience opened in 1995 and has since drawn visitors to this older part of the city and revived interest in the city’s history. While the Fremont Street Experience takes up four city blocks, the main draws are not the downtown Las Vegas hotels, but the free light and sound show that begins just after sunset, and the themed shows that are put on here. You can catch the best view from the balcony of the second floor of Fitzgerald’s.
While many of the Downtown Las Vegas Hotels are no longer in operation, many still survive to this day, and visitors who want to gamble straight ahead and enjoy a vintage Vegas experience flock to places such as Binion’s Horseshoe. Check out the exhibit of antique guns near the hotel entrance, and enjoy cowboy cuts of beef in Binion’s Ranch Steakhouse. El Cortez is also one of the remaining downtown Las Vegas hotels and should not be missed, either. The Golden Gate Hotel, which originally opened in 1906, still stands and is known for its 99-cent shrimp cocktails you can enjoy as you admire the photos covering the wall which commemorate the opening of the San Francisco Bay bridge. There is nightly piano entertainment as well.
Neonopolis, on the corner of Fremont Street and Las Vegas Boulevard also brings visitors to Downtown Las Vegas. This newer development which houses restaurants, shops, and indoor entertainment costs $100 million to build. This area of Las Vegas downtown used to be known as “glitter gulch”, because the casinos here were so brightly lit that it seemed like daytime when they were all turned on at night. Vegas Vic is a familiar sight to visitors to Las Vegas. Featured in many old and new movies which are set in Las Vegas, this well-known landmark is a giant neon cowboy used to greet visitors to Downtown Las Vegas with a loud “howdy partner!” until an actor filming here complained about the noise and silenced his boisterous welcome for more than 20 years.
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Popeye’s | Las Vegas, NV The information listed above has been obtained from sources we believe to be reliable, however, we accept no responsibility for its correctness.
Eric Carlton
Senior Advisor License No. 01809955 949.724.5561 [email protected]
Jereme Snyder
Senior Vice President License No. 01360233 949.724.5552 [email protected]
Colliers International makes no guarantees, representations or warranties of any kind, expressed or implied, regarding the information including, but not limited to, warranties of content, accuracy and reliability. This publication is the copyrighted property of Colliers International and /or its licensor(s). 2010. All rights reserved.
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