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www.preservewestcapital.com
OFFERING MEMORANDUM
Carl’s Jr.Greenfield, CA | Monterey County
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www.preservewestcapital.com
TABLE OF CONTENTS
Michael MaffiaPartner [email protected] RE License #01340853
Putnam DailyPartner - Brokerage Division [email protected] RE License #01750064
Michael Maffia (“Broker”) has been retained on an exclusive basis to market the property described herein (“Property”). Broker has been authorized by the Seller of the Property (“Seller”) to prepare and distribute the enclosed information (“Material”) for the purpose of soliciting offers to purchase from interested parties. More detailed financial, title and tenant lease information may be made available upon request following the mutual execution of a letter of intent or contract to purchase between the Seller and a prospective purchaser. You are invited to review this opportunity and make an offer to purchase based upon your analysis. If your offer results in the Seller choosing to open negotiations with you, you will be asked to provide financial references. The eventual purchaser will be chosen based upon an assessment of price, terms, ability to close the transaction and such other matters as the Seller deems appropriate.
The Material is intended solely for the purpose of soliciting expressions of interest from qualified investors for the acquisition of the Property. The Material is not to be copied and/or used for any other purpose or made available to any other person without the express written consent of Broker or Seller. The Material does not purport to be all-inclusive or to contain all of the information that a prospective buyer may require. The information contained in the Material has been obtained from the Seller and other sources and has not been verified by the Seller or its affiliates. The pro forma is delivered only as an accommodation and neither the Seller, Broker, nor any of their respective affiliates, agents, representatives, employees, parents, subsidiaries, members, managers, partners, shareholders, directors, or officers, makes any representation or warranty regarding such pro forma. Purchaser must make its own investigation of the Property and any existing or available financing, and must independently confirm the accuracy of the projections contained in the pro forma.
Seller reserves the right, for any reason, to withdraw the Property from the market. Seller has no obligation, express or implied, to accept any offer. Further, Seller has no obligation to sell the Property unless and until the Seller executes and delivers a signed agreement of purchase and sale on terms acceptable to the Seller, in its sole discretion. By submitting an offer, a purchaser will be deemed to have acknowledged the foregoing and agreed to release Seller and Broker from any liability with respect thereto.
Property walk-throughs are to be conducted by appointment only. Contact Broker for additional information.
Disclaimer
PROPERTY HIGHLIGHTS 1PROPERTY INFORMATION 2TENANT INFORMATION 3SITE PLAN 4
AERIALS 5ABOUT THE AREA 6DEMOGRAPHICS 8
PRESERVE WEST CAPITAL | 1
Walnut Ave
3rd S
t
(31,5
00
AA
DT
)
El C
amino R
eal
CESAR CHAVEZELEMENTARY
SAN JOSE(~1.5 hrs)
SAN LUIS OBISPO
(~1.5 hrs)
+ Car Wash
11-Acre Highway Commercial
Development(Hotel, Retail, Restaurant & Wine Tasting)
DRIVE THRU
SANTA LUCIA SQUARE
Walnut AvenueSpecific Plan
63-Acre Mixed-Use Development
Project(Retail & Residential)
PRESERVE WEST CAPITAL | 1
PROPERTY HIGHLIGHTS
Property Highlights
• New 20-Year Absolute NNN Lease to Seasoned Franchise Operator
- 10% Rental Escalations Every 5 Years
• Excellent Access and Visibility Adjacent to US-101
- AADT of 31,500
- Major North-South Arterial Linking Bay Area to San Luis Obispo and Santa Barbara
• Highly Functional Footprint with Drive-Thru Component
• Strong Co-Tenancy Adjacent to Only Starbucks in 11-Mile Radius
• Located within the Vines at Greenfield – Phase I of Walnut Avenue Specific Plan
- 11-Acre Mixed-Use Retail and Hotel Development
- Targeted to Fill Unmet Demand for Retail Space
- Specific Plan Area Expected to Include up to 445,000 square feet of Retail Space and 220 Residential Units
• Greenfield Is Among the Fastest Growing Communities in Monterey County
• Brand New 2018 Construction
- Approximately 30 Minutes’ Drive from Salinas
PRESERVE WEST CAPITAL | 2
Net Annual Income
PROPERTY INFORMATION
PRICE
$2,632,0004.75% Return
LocationThe property is located at 369 Walnut Avenue in Greenfield, California.
Lot SizeApproximately 0.58 acres, or 25,265 square feet.
ImprovementsA 2,581 square foot retail building with a drive-thru component for Carl’s Jr.
ParkingApproximately 24 parking spaces are available onsite.
LeaseLeased to South Valley Investments and guaranteed by Gary and Becky Vick and Gary and Becky Vick, Inc. for 20 years from an estimated rent commencement date of December 2018 through December 2028 at an initial annual rent of $125,000. There are four (4) five-year options to renew the lease. Rent is to increase by 10% in years 6, 11, and 16 and at the start of each option period. The lease is net with tenant responsible for all taxes, insurance, maintenance, including roof and structure, and proportionate share of common area maintenance.
FinancingThis property will be delivered free and clear of permanent financing.
Years Annual Rent Return
1-5 $125,000 4.75%
6-10 $137,500 5.22%
11-15 $151,250 5.75%
16-20 $166,375 6.32%
21-25 (Option 1) $183,012 6.95%
26-30 (Option 2) $201,314 7.65%
31-35 (Option 3) $221,445 8.41%
36-40 (Option 4) $243,590 9.25%
PRESERVE WEST CAPITAL | 3
ABOUT THE TENANT
Carl’s Jr. is ranked #15 in Entrepreneur Magazine’s 2018 Franchise 500 rankings.
Carl’s Jr. is a fast food restaurant which serves burgers, milkshakes, breakfast items, and other fast food and novelty food items. There are approximately 1,500 Carl’s Jr. restaurants nationwide, and the company was ranked #15 in Entrepreneur Magazine’s annual Franchise 500 rankings for 2018, a substantial improvement from its rank of #29 the year prior. The brand is a subsidiary of CKE Restaurants, which also operates the Hardee’s, Green Burrito, and Red Burrito brands. In November 2013, Roark Capital Group, an Atlanta based private equity firm, acquired CKE Restaurant Holdings for $1.65-1.75 billion; exact terms of the acquisition were not disclosed.
South Valley Investments, the lease entity, is a Carl’s Jr. franchisee operated by the lease’s personal guarantors, Gary and Becky Vick, seasoned Carl’s Jr. operators. Gary and Becky Vick, Inc., the guarantor entity, operates 8 restaurants in the Salinas/Monterey County area and has repeatedly been awarded the Carl’s Jr. Franchisee of the Year award.
Elevation (actual site with slight modifications)
WALNUT AVE
2,581 SF
SITE PLAN
(31,500 AA
DT)
Walnut Ave
3rd St
El Cam
ino Real
GREENFIELDHIGH SCHOOLVISTA VERDE
MIDDLE SCHOOL
OAK AVENUEELEMENTARY
JEKEL VINEYARDS
WINERY
CESAR CHAVEZELEMENTARY
TUNZI VILLAGESPlanned Residential
Development(40+ Single Family Homes)
WALNUT GROVE APARTMENTS
New Construction(64 Units)
TERRACINA OAKSAPARTMENTS
New Construction
MAGNOLIA PLACESENIOR APARTMENTS
New Construction
NEW 3-ACRE COMMUNITY PARK
WALNUT AVENUESPECIFIC PLAN
63-Acre Mixed-Use Development Project(Retail & Residential)
SANTA LUCIA SQUARE
+ Car Wash
11-Acre Highway Commercial
Development(Hotel, Retail, Restaurant & Wine Tasting)
DRIVE THRU
AERIAL
General OverviewGreenfield is located in Monterey County within the Salinas Valley, approximately 13 miles northwest of King City, 39 miles southeast of Salinas, and 53 miles southeast of Monterey. The city benefits from the strong regional agricultural economy within the Salinas Valley. Over the last ten years, the city’s population has grown by approximately 3.5% annually, outpacing nearby cities and Monterey County as a whole; this trend is expected to continue over the next 20 years, and the regional population is projected to reach 120,000 by 2035. Development activity has increased substantially in recent years in the region and is expected to continue to grow, particularly given the existing shortfall of retail space in the region and increases in demand triggered by a growing population.
The Monterey region benefits from a broad economic base in agriculture, tourism, education, and marine research. The Salinas Valley extends through the heart of Monterey County, making it the third largest agricultural county in California. Agriculture contributes upwards of $4 billion to the local economy, with approximately 1.4 acres of farmland. In addition, the wine industry produces upwards of $238 million annually in the region. The county is a global center for marine science research and education with more than 20 higher education and research institutions. The region has also seen strong growth in healthcare employment in recent years, which is projected to continue to increase over the next ten years. In addition, the region draws significant tourist traffic, benefiting from its location less than two hour’s drive from the San Francisco Bay Area and notable tourist attractions, including the Monterey Bay Aquarium, Pebble Beach Reserve Golf Course, Fisherman’s Wharf, and more. Because of the region’s high concentration of higher education and marine biology research institutions, the area is a hub for “ed-tourism,” drawing outdoor enthusiasts, students, researchers, academic conferences, and more.
ABOUT THE AREA
SITE
Site InformationThe subject property is prominently situated with excellent access and visibility along Walnut Drive (500 AADT) adjacent the US-101 (31,500 AADT). The site benefits from robust demographics with a population of 18,410 within a five-mile radius. Average household income within five miles of the site is $67,193.
The property is located within The Vines at Greenfield, an 11-acre component of the Walnut Avenue Specific Plan, a 63-acre mixed-use development project slated to include up to 445,000 square feet of retail space and 220 multi-family residential units. The site is part of Phase I of the project, which includes a recently completed Starbucks, now open, an ARCO gas station and car wash expected to be completed by spring 2019, hotel space, and approximately 43,000 square feet of retail restaurant and shops space. The first phase is intended to appeal both to the needs of local residents and to serve as a way-station for travelers on the adjacent 101 freeway, a major north-south arterial linking Northern California and the San Francisco Bay area to San Luis Obispo, Santa Barbara, and Los Angeles. Phases 2 and 3 of the specific plan will include up to 80,000 additional square feet of retail space, 220 high-density residential units, and approximately 5.4 acres of recreational/open space. Phase 4 will include additional commercial space over the remaining 22 acres of the project.
The development and specific plan are intended to expand Greenfield’s retail profile, increasing retail options both for local residents and the expanded trade area within the southern Monterey County region. Existing retail tenants neighboring the site include Dollar Tree, Rite Aid, True Value, Chase Bank, Wells Fargo, NAPA Auto Parts, O’Reilly Auto Parts, McDonald’s, Fastrip, and more. The site also neighbors numerous schools, including the Mary Chapa Literacy and Technology Academy, Oak Avenue Elementary School, Cesar Chavez Elementary School, Vista Verde Middle School, and Greenfield High School, drawing additional traffic from students, parents, and teachers to the site.
ABOUT THE AREA
SITE
PRESERVE WEST CAPITAL | 8
DEMOGRAPHICS
PRESERVE WEST CAPITAL | 8
369 Walnut Ave | Greenfield, CA 93927
Population Summary 5 Miles1 10 Miles 15 Miles
2010 Total Population 17,215 38,245 60,185
2018 Total Population 18,410 41,127 62,971
2023 Total Population 19,077 42,718 64,736
2018-2023 Annual Rate 0.71% 0.76% 0.55%
Average Household Income
2018 $67,193 $72,635 $71,656
2023 $78,524 $85,408 $84,137
Median Home Value
2018 $284,593 $281,992 $288.991
2023 $379,861 $370,289 $380.250
2018 POPULATION
62,971
MEDIAN HOME VALUE
$288,991
AVG. HOUSEHOLD INCOME
$72,635
BUILDING CAPITALWITH CONFIDENCE
411 Borel Avenue, Suite 650San Mateo, CA 94402D 415.373.4060 F 415.737.6018www.preservewestcapital.com
Putnam DailyPartner - Brokerage Division [email protected] RE License #01750064
Michael MaffiaPartner [email protected] RE License #01340853
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