Burger King - Constant Contactfiles.constantcontact.com/011cb4c9501/1d957cad-550c-401e-a803-6d… · Burger King ACTUAL PROPERTY ... Pizza, Taco Bell, Starbucks, Papa John’s,

926 Central Avenue - EAST GRAND FORKS, MINNESOTA 56271

Burger K ing

ACTUAL PROPERTY

o f f e r i n g m e m o r a n d u m

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. Marcus & Millichap is a trademark of © 2016 Marcus & Millichap. Activity ID: Y0331001 1


Financia l Overv iew

Annualized Operating Data

Base Rent Annual RentMonthly

Rent

Current 10/31/2017 $98,056 $8,171

11/1/2017 10/31/2018 $99,282 $8,273 1.25%

11/1/2018 10/31/2019 $100,523 $8,377 1.25%

11/1/2019 10/31/2020 $101,779 $8,482 1.25%

11/1/2020 10/31/2021 $103,052 $8,588 1.25%

11/1/2021 10/31/2022 $104,340 $8,695 1.25%

11/1/2022 10/31/2023 $105,644 $8,804 1.25%

11/1/2023 10/31/2024 $106,965 $8,914 1.25%

11/1/2024 10/31/2025 $108,302 $9,025 1.25%

11/1/2025 10/31/2026 $109,655 $9,138 1.25%

11/1/2026 10/31/2027 $111,026 $9,252 1.25%

11/1/2027 10/31/2028 $112,414 $9,368 1.25%

11/1/2028 10/31/2029 $113,819 $9,485 1.25%

11/1/2029 10/31/2030 $115,242 $9,603 1.25%

11/1/2030 10/31/2031 $116,682 $9,724 1.25%

11/1/2031 10/31/2032 $118,141 $9,845 1.25%

11/1/2032 10/31/2033 $119,618 $9,968 1.25%

11/1/2033 10/31/2034 $121,113 $10,093 1.25%

PRICE $1,568,896

CAP RATE 6.25%

NOI $98,056

PRICE PER SQUARE FOOT $400.64

RENT PER SQUARE FOOT $25.04

YEAR BUILT 2000

APPROXIMATE LOT SIZE 1.86 Acres

GROSS LEASEABLE AREA 3,916

TYPE OF OWNERSHIP Fee Simple

LEASE GUARANTOR Corporate Guaranty

LEASE TYPE Absolute Net

ROOF AND STRUCTURE Tenant Responsible

LEASE COMMENCEMENT DATE 10/31/2014

LEASE EXPIRATION DATE 10/31/2034

LEASE TERM 20 Years

TERM REMAINING 17+ Years

INCREASES 1.25 Percent Annually

OPTIONS TO RENEW Four, Five-Year Options

OPTIONS TO TERMINATE None

OPTIONS TO PURCHASE None

FIRST RIGHT OF REFUSAL None

Offering Summary

Lease Summary

ACTUAL PROPERTY



Investment Overv iew

• Burger King in East Grand Forks, Minnesota | Largest Community in Polk County

• Tenant Demonstrates Commitment | Plans to Deploy Significant Capital | “20/20” Renovation Scheduled for 2018

• More than 17 Years Remaining on Absolute Net Lease | Zero Landlord Responsibilities

• Strong Inflation Hedge | 1.25 Percent Annual Rent Increases Over the Base Term and in Four, Five-Year Renewal Options

• Lease is Corporately Guaranteed by Meridian Restaurant Unlimited, Limited Company Plus a Full Term Personal Guaranty from Both Principals | 100-Unit Franchisee Restaurant Operator Across Multiple Concepts

• Irreplaceable Hard Corner Location at the Intersection of Central Ave and 10th Street | More Than 15,000 Vehicles Pass Through This Corridor Each Day

• Dense Residential Area | More Than 67,000 Residents With An Average Household Income Greater Than $69,000 | Population Increased 8 Percent From 2010 to 2017

• Less Than Five Miles From The Alerus Center and Ralph Engelstad Arena | More Than 32,000 Seats For Sporting and Entertainment Events

• Close Proximity To Three Schools | University to North Dakota, Red River High School, East Grand Forks Senior High School | More Than 16,000 Students

• Additional Tenants in the Immediate Vicinity Include: McDonald’s, Subway, Dairy Queen, Domino’s Pizza, Taco Bell, Starbucks, Little Caesars, Pizza Hut, AutoZone, Hertz, Taco John’s, Planet Fitness.

Marcus & Millichap is pleased to present this 3,916-square foot Burger King in East Grand Forks, Minnesota; which is the largest community in Polk County. There are more than 17 years remaining on Burger King’s absolute net lease, where the tenant is responsible for all expenses associated with the asset. The lease features 1.25 percent annual rent increases over the base term and in the four, five-year renewal options.

The lease is corporately guaranteed by Meridian Restaurant Unlimited, Limited Company, as well as a strong, full-term, personal guaranty from its principals. Meridian Restaurant Unlimited, Limited Company is a 100-unit franchisee restaurant operator across multiple concepts. The subject property is scheduled to undergo Burger King’s “20/20” remodel in 2018, demonstrating the tenant’s commitment to this location.

This asset is situated at the hard corner intersection of Central Avenue and 10th Street. This Burger King is located three miles from the centerpiece of Grand Forks, the University of North Dakota, which has more than 14,000 students. The subject property also benefits from its proximity to Red River High School and East Grand Forks High School, which combined, account for more than 1,500 students. There are also multiple entertainment venues in this area. The Alerus Convention Center and Ralph Engelstad Arena are located less than five miles away and offer more than 32,000 seats for sporting and entertainment events. NHL great, Wayne Gretzky, has been quoted saying that the Ralph Engelstad Arena is “one of the most beautiful buildings we have in North America.”

Additional tenants in the immediate vicinity include: McDonald’s, Subway, Dairy Queen, Domino’s Pizza, Taco Bell, Starbucks, Papa John’s, Wendy’s, O’Reilly Auto Parts, KFC, Little Caesars, Pizza Hut, AutoZone, Hertz, Taco John’s, Planet Fitness, K Mart, JCPenney, Subway, GNC, and more.

ACTUAL PROPERTY



Tenant Overv iew - Burger K ing

Every day, more than 11-million guests visit Burger King restaurants around the world. And they do so because Burger King restaurants are known for serving high-quality, great-tasting, and affordable food. Founded in 1954, Burger King is the second largest fast food hamburger chain in the world. The original Home of the Whopper, Burger King’s commitment to premium ingredients, signature recipes, and family-friendly dining experiences is what has defined their brand for more than 50 successful years. In 2010, 3G Capital, a global multi-million-dollar investment firm focused on long term value creation, purchased Burger King Corporation, making it a privately-held company. In 2014, Burger King purchased Tim Hortons, and after the deal closed Burger King was renamed Restaurant Brands International, Incorporated. As of June 2017, 3G capital owns more than 96 percent of Restaurant Brands International.

Meridian Restaurants was founded in 2002 with 14 restaurants, and in 2016 they attained a long-term goal of 100 restaurants consisting of three top-tier brands across eight mid-western states: Burger King, El Pollo Loco, and Chili’s. The tenant; NDM Restaurants, Limited Company; is a wholly owned subsidiary of Meridian Restaurants Unlimited, Limited Company. The lease is corporately guaranteed by Meridian Restaurants Unlimited, Limited Company; as well as a full-term personal guaranty from the entity’s principals: David A. Harper and Stephan L Ralston.

Harper is a Senior Restaurant Operations Executive with more than 25 years of experience in multi-unit management, financial accountability, strategic planning, and project management in both franchisee and company operations. As of March 2016, Harper was an operating partner in more than 70 Burger Kings registering more than $68-Million in annual sales.

TENANT PROFILE

TENANT TRADE NAME Burger King

OWNERSHIP Private

TENANT NDM Restaurants, Limited Company

LEASE GUARANTOR

Meridian Restaurants Unlimited,

Limited Company + Full-Term Personal

Guaranty

NUMBER OF LOCATIONS 100 Units

HEADQUARTERED South Ogden, Utah

WEB SITEhttps://www.meridianrestaurantsunlimited.

com/



Aer ia l Overv iew



Area Overview & Demographics

1-Mile 3-Mile 5-Mile

P o p u l a t i o n2000 Population 35,287 58,423 61,195

2010 Population 35,935 62,575 65,579

2017 Population 36,954 67,785 71,256

2022 Population 38,751 72,064 75,777

Daytime Employment 2,500 32,479 14,743


H o u s e h o l d s


H o u s e h o l d ( H H ) I n c o m e s2000 Households 14,022 23,114 24,135

2010 Households 14,993 26,150 27,283

2017 Households 15,410 28,476 29,792

2022 Households 16,203 30,393 31,804

2017 Average HH Income $66,093 $69,416 $71,038 2017 Median HH Income $52,069 $51,308 $52,838 2017 Per Capita Income $27,561 $29,161 $29,701



East Grand Forks is a city in Polk County, Minnesota, and the largest community within Polk. It is located in the Red River Valley region along the eastern bank of the Red River of the North, directly across from the larger city of Grand Forks, North Dakota. The cities of Grand Forks and East Grand Forks form the center of the Grand Forks, North Dakota-Minnesota Metropolitan Statistical Area, which is often called “Greater Grand Forks”.

Grand Forks, with a population of 52,838; is more than five times larger than East Grand Forks. The metropolitan area is also sometimes called “The Forks”. Several years ago, local promoters attempted to “brand” the metropolitan area as “The Grand Cities.” This name has not found widespread use in the area, although several buildings and organizations now bear the “Grand Cities” title. Occasionally, the city of Grand Forks uses the nickname “The Sunflake City.”

Grand Forks was originally an important trading and meeting point for Native American tribes. Early fur trappers and French explorers referred to the area as “Les Grandes Fourches”. The first post office of the area was established on June 15, 1870. A steamboat captain named Alexander Griggs, who platted the city in 1875, is regarded as “The Father of Grand Forks.” Grand Forks was incorporated on February 22, 1881.

One can visit the Turtle River State Park while in Grand Forks. Those interested in the area’s history may enjoy a trip to the North Dakota Museum of Art, the Myra Museum or Heritage Village. The Columbia Mall is the local shopping center. Riverside Park, Lincoln Park, University Park, Central Park and Elks Park are some of the local parks. Every year, Grand Forks hosts festivals such as: the Grand Cities Art Fest, the Rhubarb Festival and the Greater Grand Forks Fair and Exhibition.

Market Overview - East Grand Forks, Minnesota

The University of North Dakota is located in the city of Grand Forks on the eastern edge of the state, just a few miles from the Minnesota border. Students at the University of North Dakota can study in more than 200 academic fields, including graduate programs in business, law, engineering and education. The University of North Dakota, which is often abbreviated to UND, also has a highly ranked rural medicine program in its School of Medicine and Health Sciences.

UND competes in Division I of the National Collegiate Athletic Association (NCAA). The men’s ice hockey team competes in the National Collegiate Hockey Conference. The team has won eight national championships and has been runner-up five times. The men’s ice hockey team plays at the Ralph Engelstad Arena. The football team won the Division II national championship in 2001 and was the runner-up in 2003, and play at the Alerus Center. They have qualified for NCAA postseason play 17 times, most recently in 2016, making UND one of the winningest college football programs. Of the 126 schools currently classified in the Football Championship Subdivision, only 12 have won more games than North Dakota. The basketball and volleyball teams play in the Betty Engelstad Sioux Center. The women’s basketball team has won three national championships.

A notable UND athletic alumnus is National Basketball Association (NBA) coach and former player Phil Jackson, widely considered one of the greatest coaches in NBA history. In addition, many UND alumni have played in the National Hockey League (NHL), including: Minnesota Wild wing Zach Parise, New Jersey Devils center Travis Zajac, Los Angeles Kings defensemen Matt Greene and Mike Commodore, Chicago Blackhawks forward and captain Jonathan Toews, former NHL goalie Ed Belfour, and Washington Capitals forward T. J. Oshie.



Brokers Of RecordCra i g Pa t t e r son

Ma rcus & M i l l i c hap1350 Lagoon Avenue, Su i t e 840

Minneapo l i s , MN 55408Te l : (952 ) 852-9700Fax : (952 ) 852-9710L i cense : 40206188

Burger King

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Burger King - Constant Contactfiles.constantcontact.com/011cb4c9501/1d957cad-550c-401e-a803-6d… · Burger King ACTUAL PROPERTY ... Pizza, Taco Bell, Starbucks, Papa John’s,