Market Positioning and Pricing Analysisimages1.loopnet.com/d2/4OAQzRtmGyDqyr72...BNY Mellon Corp. PNC Financial Services Eat’n Park Hospitality Group Carnegie Mellon University Highmark

GIANT EAGLE CENTER - PENN HILLS16 Federal Dr • Pittsburgh, PA 15235

Market Positioning and Pricing Analysis

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GIANT EAGLE CENTER - PENN HILLSPittsburgh, PAACT ID ZAA0320036

N O N - E N D O R S E M E N T A N D D I S C L A I M E R N O T I C E

Non-EndorsementsMarcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of anycorporation's logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates orsubsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information aboutthis listing to prospective customers.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

DisclaimerTHIS IS A BROKER PRICE OPINION OR COMPARATIVE MARKET ANALYSIS OF VALUE AND SHOULD NOT BE CONSIDERED AN APPRAISAL. This information hasbeen secured from sources we believe to be reliable, but we make no representations or warranties, express or implied, as to the accuracy of the information. Referencesto square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a service mark of Marcus &Millichap Real Estate Investment Services, Inc. © 2018 Marcus & Millichap. All rights reserved.

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P R E S E N T E D B Y

John P. ReehilFirst Vice President InvestmentsDirector - National Retail GroupColumbus OfficeTel: (614) 360-9037Fax: (614) [email protected]: OH SAL.2005007737

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GIANT EAGLE CENTER - PENN HILLS

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INVESTMENT

OVERVIEW

PROPERTY OVERVIEW

GIANT EAGLE CENTER

PROPERTY OVERVIEW

Marcus & Millichap is excited to exclusively represent ownership in the sale of the Giant Eagle Center located at 16 Federal Drive in the Penn Hills suburb of Pittsburgh, PA.Penn Hills is approximately 10 miles east of downtown Pittsburgh.

The Giant Eagle Center is also home to a brand-new Goodwill Center, an extremely successful Planet Fitness franchise, and the Pittsburgh location of The Office FurnitureWarehouse. Three tenants are encumbered by NNN leases; Goodwill is on a gross lease for its first 5 years and a net lease for the next 5 and options. Giant Eagle has beenhere since 1977 and has consistently seen sales in excess of $575/ft. That steady sales stream also leads to typical percentage rent payments to the landlord of over $103,000annually. They are in their fifth option period that runs through February of 2023. Planet Fitness has been here since 2014 and their rent increases in November 2020 to $176Kper year. OFW has a unique space accommodating furniture showrooms, office suites, and storage for yet to be assembled furniture.

This center offers the savvy real estate investor the opportunity to own an incredibly successful Giant Eagle location in the heart of its home market, a brand new tenant that hasjust taken 10,000 SF, a very successful franchise in one of the hottest franchise segments available (fitness), and a unique user who may be best suited for the space left in thebuilding who can be extremely flexible if changes are on the horizon for a new owner and/or potential new tenants paying higher, market rents. This property is adjacent to thePenn Hills Center which is home to 277,000+ SF of retail, restaurant, and service tenants including Aldi, Big Lots, Dollar Tree, and USPS among a host of others. The GiantEagle Center is the street front retail of this massive hub of everything several of the surrounding 195,000 residents require.

PROPERTY OVERVIEW

Giant Eagle Anchored Center - Pittsburgh's #1 Grocer $9B+ in Sales

Giant Eagle Here Since 1977; Consistently Around $575+/ft in Sales

Brand New 10 Year Lease with Goodwill

Very Successful Planet Fitness, Well Above Target Enrollment Rate

Planet Fitness Has 6+ Years Left on NNN Lease

$51/ft Asking Price Is Well Below Replacement Cost

195,000+ People with $69K+ Average HHI in 5 Mile Radius

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LOCATION OVERVIEW

CLOSE PROXIMITY TO:

16 Federal Dr, Pittsburgh, PA 15235

LOCATION OVERVIEWTENANT SUMMARYPRICING AND VALUATION MATRIX

PROPERTY NAMEGIANT EAGLE CENTER - PENN HILLS

PRICING AND VALUATION MATRIX

PROPERTY NAMEGIANT EAGLE CENTER - PENN HILLS

LOCATION OVERVIEW

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REGIONAL MAP


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LOCAL MAP


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AERIAL PHOTO


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FINANCIAL

ANALYSIS

FINANCIAL ANALYSIS


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TENANT SUMMARY

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TENANT SUMMARYFINANCIAL ANALYSIS


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FINANCIAL ANALYSIS


OPERATING STATEMENT

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FINANCIAL ANALYSIS


PRICING DETAIL

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MARKET

OVERVIEW

MARKET OVERVIEW

PITTSBURGHOVERVIEW

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The Pittsburgh metro area rests at the foothills of the AlleghenyMountains in the southeastern corner of Pennsylvania, outside thecongested East Coast corridor. Consisting of Armstrong, Butler,Fayette, Westmoreland, Washington, Allegheny and Beaver counties,the metro contains nearly 2.4 million residents, with nearly halfconcentrated in Allegheny county. The region’s economy, which wasonce dominated by the steel industry, has diversified with the help ofthe area’s many colleges and universities. The city of Pittsburgh islocated where the Allegheny and Monongahela rivers join to form theOhio River. Pittsburgh is the most populous city in the metro and thesecond-largest in Pennsylvania, with approximately 309,000 residents.

MARKET OVERVIEW

METRO HIGHLIGHTS

POSITIVE EMPLOYMENT TRENDSMore than 30,000 jobs have been added since 2015 and. During this time, growth was led by education, healthcare and the hospitality sectors.

QUALITY HIGHER EDUCATIONThe local economy benefits from university-related startup companies. Carnegie Mellon, Duquesne and the University of Pittsburgh are among the local higher-educational institutions.

POPULATION GROWTHAfter years of decline, job seekers moving to the metro contribute to a rising population.


MARKET OVERVIEW

ECONOMY Once centered on the steel industry, Pittsburgh’s economy has become much more diversified

over the past 20 years and continues to change. A multitude of international firms have headquarters or regional offices in the metro. Additionally,

seven Fortune 500 companies are headquartered in Pittsburgh: U.S. Steel Corp., Kraft Heinz Co, PNC Financial, Wesco International, Alcoa, PPG Industries and Dick’s Sporting Goods.

High-tech is expanding, particularly in automation and manufacturing equipment, software, biotechnology, environmental services, and pharmaceuticals.

SHARE OF 2018 TOTAL EMPLOYMENT

MAJOR AREA EMPLOYERS

UPMC

Allegheny Health Network

University of Pittsburgh

BNY Mellon Corp.

PNC Financial Services

Eat’n Park Hospitality Group

Carnegie Mellon University

Highmark Health

U.S. Steel

Children's Hospital of Pittsburgh* Forecast

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MANUFACTURING7%

GOVERNMENT

HEALTH SERVICESEDUCATION AND

+OTHER SERVICES

4%

LEISURE AND HOSPITALITY FINANCIAL ACTIVITIES

18%AND UTILITIES

TRADE, TRANSPORTATION CONSTRUCTION

PROFESSIONAL ANDBUSINESS SERVICES

2%INFORMATION

16%

5%

10% 10% 6%

21%


MARKET OVERVIEW

DEMOGRAPHICS

SPORTS

EDUCATION

ARTS & ENTERTAINMENT

The metro is expected to add nearly 6,000 people through 2023, which will result in the formation of more than 12,000 households.

A median home price below the national level allows 69 percent of households to own their home, which is above the national rate of 64 percent.

Roughly 32 percent of people age 25 and older hold bachelor’s degrees; among those residents, 12 percent also have earned a graduate or professional degree.

Pittsburgh is a relatively affordable place to live compared with many other major EastCoast metros. In addition, the market has one of the lowest crime rates in the country.There are more than 500 organizations serving southwestern Pennsylvania, such as thePittsburgh Cultural Trust, which has revitalized downtown. Regional amenities also includethree professional sports teams: the Steelers (NFL), Pirates (MLB) and Penguins (NHL).The Pittsburgh Penguins and the University of Pittsburgh Medical Center (UPMC) built a$72 million sports medical center and practice rinks. UPMC is one of the busiest transplantcenters in the world. In addition, Children’s Hospital of Pittsburgh is one of the highest-ranked children’s hospitals in the nation.

QUALITY OF LIFE

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* Forecast Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody’s Analytics; U.S. Census Bureau


43.12018

MEDIAN AGE:

U.S. Median:38.0

$57,3002018 MEDIAN

HOUSEHOLD INCOME:

U.S. Median:$58,800

2.4M2018

POPULATION:

Growth2018-2023*:

0.2%

100K02018

HOUSEHOLDS:

1.2%Growth

2018-2023*:

2018 Population by Age

0-4 YEARS

5%5-19 YEARS

16%20-24 YEARS

6%25-44 YEARS

25%45-64 YEARS

29%65+ YEARS

19%

PROPERTY NAME

MARKETING TEAM


DEMOGRAPHICS

Source: © 2018 Experian

Created on December 2019

POPULATION 1 Miles 3 Miles 5 Miles 2023 Projection

Total Population 10,108 70,733 192,008 2018 Estimate

Total Population 10,161 72,376 196,313 2010 Census

Total Population 10,169 72,412 195,757 2000 Census

Total Population 10,908 80,370 218,897 Current Daytime Population

2018 Estimate 11,859 63,169 196,654HOUSEHOLDS 1 Miles 3 Miles 5 Miles 2023 Projection

Total Households 4,711 32,752 88,981 2018 Estimate

Total Households 4,666 32,956 89,709Average (Mean) Household Size 2.17 2.19 2.16

2010 CensusTotal Households 4,690 33,080 89,822

2000 CensusTotal Households 4,715 34,455 95,350

Occupied Units2023 Projection 4,711 32,752 88,9812018 Estimate 4,998 36,084 100,828

HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles 2018 Estimate

$150,000 or More 3.88% 5.40% 8.48%$100,000 - $149,000 11.40% 11.99% 11.97%$75,000 - $99,999 16.37% 14.18% 12.26%$50,000 - $74,999 22.26% 20.73% 18.27%$35,000 - $49,999 12.45% 14.08% 13.55%Under $35,000 33.62% 33.61% 35.45%

Average Household Income $64,637 $66,572 $73,156Median Household Income $54,614 $52,740 $51,237Per Capita Income $29,852 $30,353 $33,589

HOUSEHOLDS BY EXPENDITURE 1 Miles 3 Miles 5 MilesTotal Average Household Retail Expenditure $63,789 $63,346 $62,716 Consumer Expenditure Top 10 Categories

Housing $18,243 $18,107 $17,974Shelter $10,617 $10,469 $10,460Transportation $8,742 $8,755 $8,647Food $5,765 $5,840 $5,845Personal Insurance and Pensions $5,719 $5,726 $5,710Health Care $4,881 $4,869 $4,635Utilities $4,182 $4,176 $4,080Entertainment $2,670 $2,702 $2,725Education $1,695 $1,592 $1,656Apparel $1,674 $1,661 $1,702

POPULATION PROFILE 1 Miles 3 Miles 5 Miles Population By Age

2018 Estimate Total Population 10,161 72,376 196,313Under 20 20.78% 20.65% 21.54%20 to 34 Years 17.41% 17.88% 19.79%35 to 39 Years 6.43% 5.97% 6.10%40 to 49 Years 11.71% 10.91% 11.08%50 to 64 Years 22.68% 23.24% 22.07%Age 65+ 21.00% 21.34% 19.43%Median Age 44.86 45.32 42.42

Population 25+ by Education Level2018 Estimate Population Age 25+ 7,596 54,073 143,979Elementary (0-8) 1.49% 1.24% 1.42%Some High School (9-11) 3.65% 5.05% 5.06%High School Graduate (12) 32.41% 33.01% 30.26%Some College (13-15) 23.64% 20.37% 18.76%Associate Degree Only 11.54% 10.10% 9.04%Bachelors Degree Only 16.64% 18.46% 19.59%Graduate Degree 10.29% 11.19% 15.26%

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IncomeIn 2018, the median household income for your selected geography is$54,614, compare this to the US average which is currently $58,754.The median household income for your area has changed by 34.92%since 2000. It is estimated that the median household income in yourarea will be $63,100 five years from now, which represents a changeof 15.54% from the current year.

The current year per capita income in your area is $29,852, comparethis to the US average, which is $32,356. The current year averagehousehold income in your area is $64,637, compare this to the USaverage which is $84,609.

PopulationIn 2018, the population in your selected geography is 10,161. Thepopulation has changed by -6.85% since 2000. It is estimated that thepopulation in your area will be 10,108.00 five years from now, whichrepresents a change of -0.52% from the current year. The currentpopulation is 45.73% male and 54.27% female. The median age of thepopulation in your area is 44.86, compare this to the US averagewhich is 37.95. The population density in your area is 3,229.27 peopleper square mile.

HouseholdsThere are currently 4,666 households in your selected geography. Thenumber of households has changed by -1.04% since 2000. It isestimated that the number of households in your area will be 4,711five years from now, which represents a change of 0.96% from thecurrent year. The average household size in your area is 2.17persons.

EmploymentIn 2018, there are 3,747 employees in your selected area, this is alsoknown as the daytime population. The 2000 Census revealed that65.22% of employees are employed in white-collar occupations in thisgeography, and 34.38% are employed in blue-collar occupations. In2018, unemployment in this area is 4.06%. In 2000, the average timetraveled to work was 30.00 minutes.

Race and EthnicityThe current year racial makeup of your selected area is as follows:58.32% White, 36.00% Black, 0.02% Native American and 1.62%Asian/Pacific Islander. Compare these to US averages which are:70.20% White, 12.89% Black, 0.19% Native American and 5.59%Asian/Pacific Islander. People of Hispanic origin are countedindependently of race.

People of Hispanic origin make up 2.20% of the current yearpopulation in your selected area. Compare this to the US average of18.01%.

PROPERTY NAME

MARKETING TEAM


HousingThe median housing value in your area was $91,476 in 2018, comparethis to the US average of $201,842. In 2000, there were 3,698 owneroccupied housing units in your area and there were 1,017 renteroccupied housing units in your area. The median rent at the time was$381.

Source: © 2018 Experian

DEMOGRAPHICS

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DEMOGRAPHICS

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www.MarcusMillichap.com

John P. Reehil

First Vice President InvestmentsDirector - National Retail GroupColumbus OfficeTel: (614) 360-9037Fax: (614) [email protected]: OH SAL.2005007737

P R E S E N T E D B Y

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Documents

Market Positioning and Pricing Analysisimages1.loopnet.com/d2/4OAQzRtmGyDqyr72...BNY Mellon Corp. PNC Financial Services Eat’n Park Hospitality Group Carnegie Mellon University Highmark