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™Offering Memorandum
PET PALACE RESORT2320 W ILK INSON BLVD | CHARLOT TE , NC 28208
LISTED BYJosh Bishop VP & Director
DIRECT 214.692.2289 MOBILE [email protected]
LIC # 688810 (TX)
Calv in Shor t SVP & Senior Director | Lic # 01927216 (CA)
Aron Cl ine SVP & Senior Director | Lic # 01904371 (CA)Chad Kur z
SVP & National Director
DIRECT 214.692.2927 MOBILE [email protected]
LIC # 01911198 (CA)
Kyle MatthewsBroker of RecordC27092 (NC)
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P R E M I U M - Q U A L I T Y 2 0 1 8 C O N S T R U C T I O N
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5.4 MILES TO SUBJECT PROPERTY
2.2 MILES TO SUBJECT PROPERTY
S U R R O U N D I N G A R E A
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N A S C A R H a l l o f F a m eThe NASCAR Hall of Fame is located in Uptown Charlotte. The hall opened in 2010 and features artifacts. And hands-on exhibits and technology that celebrate the history and tradition of NASCAR.
B a n k o f A m e r i c a S t a d i u mBank of America Stadium is a 75,523-seat football stadium in uptown Charlotte. The stadium is home to the Carolina Panthers and it originally opened in 1996 as Ericsson Stadium before Bank of America purchased the naming rights in 2004.
C e n t e r C i t yAlso referred to as uptown, Charlotte Center City is the central area of Charlotte. Several Fortune 500 companies have their headquarters in the district, including Bank of America, Duke Energy, and the east coast operations of Wells Fargo. Center City features museums, theaters, hotels, high-density residential developments, with over 214 restaurants and 50 nightspots.
B B & T S t a d i u mBB&T Stadium is another sporting arena based in Uptown Charlotte. The stadium is home to the Charlotte Knights, a Triple-A minor league baseball stadium. The stadium took its current name in 2012 when BB&T acquired the naming rights for the new ballpark.
C h a r l o t t e D o u g l a s A i r p o r tCharlotte Douglas International Airport is the 5th busiest airport in the United States with service to 161 domestic and international destinations. It is the second largest hub for American Airlines after DFW International Airport. Charlotte serves about 45.9 million passengers annually.
P O I N T S O F I N T E R E S T
“ T h e r e a r e j u s t o v e r 5 , 0 0 0 H O T E L R O O M S u p t o w n . ” - C h a r l o t t e O b s e r v e r
“ A n A v e r a g e o f a b o u t 1 2 0 N E W R E S I D E N T S a d a y . ”
“ 1 8 M I L L I O N S F o f o f f i c e s p a c e . ” - C h a r l o t t e c e n t e r c i t y . o r g
C h a r l o t t e h a s b e c o m e a M A J O R U . S . F I N A N C I A L C E N T E R w i t h t h e T H I R D M O S T B A N K I N G A S S E T S a f t e r N e w Y o r k C i t y a n d S a n F r a n c i s c o .
1 1 , 6 7 4 A P A R T M E N T S a r e u n d e r c o n s t r u c t i o n a c r o s s C h a r l o t t e i n A u g u s t - a n d A N O T H E R 1 2 , 6 4 5 o n t h e p l a n n i n g b o a r d
- C h a r l o t t e O b s e r v e r
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T R A F F I C C O U N T S
WILKINSON BLVD & W MOREHEAD ST ±40,000 ADT
CONSTRUCTION COMPLETED FALL 2018
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S U R R O U N D I N G R E T A I L
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E X E C U T I V E O V E R V I E W
I N V E S T M E N T H I G H L I G H T S
• Strategic Location on One of Charlotte’s Best Intersections: The property is located on a signalized corner on two of the busiest streets in Charlotte, NC. Wilkinson Boulevard is the main thoroughfare connecting Downtown Charlotte to Charlotte International Airport. Morehead Street is a major artery through the highly desirable neighborhoods of South Charlotte. The site is strategically nestled between Downtown Charlotte (approximately 2 miles away) and Charlotte Douglas International Airport (approximately 5 miles away). This location was strategically chosen for the convenience for pet owners to drop their pet off while on the way to the airport.
• Charlotte, NC is Booming: Every day there are 120 new people moving to Charlotte with this trend likely to continue. Charlotte is the third fastest growing major city in the United States. Over the past eight years, the 1-mile population has grown by nearly 40% and it is expected to continue growing over the next 5-years by 11.55%. There are currently 207,500 residents that live within 5-mile of the subject property and the average household income is close to $85,000 annually. By 2023 it is expected to grow to more than 228,000 residents.
• E-Commerce Proof Tenant & Growing Concept: Pet Palace Resorts is a full-service boarding, daycare and grooming facility that which is highly resistant to the “Amazon Effect.” The service-oriented retailer makes for a phenomenal business model with inexpensive overhead and a steady customer base. Pet Palace is backed by a private equity firm. They currently have 6 locations with Charlotte being its 7th site and plans of adding 5 more locations annually.
• Thriving Pet Industry: According to the American Pet Products Association (APPA) the pet industry generated $69.51B dollars in 2017, which was an approximate 5% increase from 2016. The association projects that $72.13B will be spent in 2018, a ±4% growth from the previous year. The APPA also notes that there are 89.7M dogs and 94.2M cats owned in the United Sates.
• Long-Term Absolute NNN Lease w/ Rent Increases & Corporate Guarantee: Pet Palace Resorts executed a brand new, 15-Year, absolute NNN lease with zero management responsibility, ideal for a 1031 exchange buyer or an investor looking for a safe source of reliable and passive income. The lease includes extremely attractive $0.50 PSF annual rent increases beginning in year 11 and carrying through the remainder of the lease. If purchased at list price this would equate to an average return of 8.23% over the entire term of the 35-year lease.
• Brand New Build-To-Suit: The subject property is a 16,770 square foot, brand new 2018 construction, build-to-suit for Pet Palace. Pet Palace carefully selected this highly desirable piece of real estate and built their state-of-the-art building here. The relatively cheap rent of less than $20PSF makes for an extremely safe investment.
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F I N A N C I A L O V E R V I E W
EXECUTIVE SUMMARY
Property Name Pet Palace Resort
Property Street 2320 Wilkinson Blvd.
City, State, Zip Charlotte, NC 28208
GLA ± 16,770 SF
Lot Size ± 1.819 AC
Year Built 2018
TENANT SUMMARY
Tenant Trade Name Pet Palace Resort
Type of Ownership Fee Simple
Lease Guarantor Corporate
Lease Type NNN
Roof & Structure Tenant Responsibility
Original Lease Term 15 Year
Rent Commencement Date ± 8/15/2018
Lease Expiration Date 7/31/2033
Term Remaining 15
Increases $0.50 PSF annual increases starting in Year 11
Options Four, 5-year options
ANNUAL OPERATING DATAMonthly Rent Annual Rent Price/SF Cap Rate
Current - 7/31/2028 $27,528.46 $330,341.52 $19.70 6.40%
Year 11 $28,227.21 $338,726.52 $20.20 6.56%
Year 12 $28,925.96 $347,111.52 $20.70 6.72%
Year 13 $29,624.71 $355,496.52 $21.20 6.89%
Year 14 $30,323.46 $363,881.52 $21.70 7.05%
Year 15 $31,018.88 $372,226.52 $22.20 7.21%
Year 16 $31,720.96 $380,651.52 $22.70 7.37%
Year 17 $32,419.71 $389,036.52 $23.20 7.54%
Year 18 $33,118.46 $397,421.52 $23.70 7.70%
Year 19 $33,817.21 $405,806.52 $24.20 7.86%
Year 20 $34,515.96 $414,191.52 $24.70 8.02%
Year 21 $35,214.71 $422,576.52 $25.20 8.19%
Year 22 $35,913.46 $430,961.52 $25.70 8.35%
Year 23 $36,612.21 $439,346.52 $26.20 8.51%
Year 24 $37,310.96 $447,731.52 $26.70 8.67%
Year 25 $38,009.71 $456,116.52 $27.20 8.84%
Year 26 $38,708.46 $464,501.52 $27.70 9.00%
Year 27 $39,407.21 $472,886.52 $28.20 9.16%
Year 28 $40,105.96 $481,271.52 $28.70 9.32%
Year 29 $40,804.71 $489,656.52 $29.20 9.49%
Year 30 $41,503.46 $498,041.52 $29.70 9.65%
Year 31 $42,202.21 $506,426.52 $30.20 9.81%
Year 32 $42,900.96 $514,811.52 $30.70 9.97%
Year 33 $43,599.71 $523,196.52 $31.20 10.14%
Year 34 $44,298.46 $531,581.52 $31.70 10.30%
Year 35 $44,999.71 $539,996.52 $32.20 10.46%
FINANCIAL HIGHLIGHTS
LIST PRICE
$5,161 ,586
CAP RATE
6.40%
TERM REMAINING
± 15 Years
* $3,000 of annual rent is derived from signage on the property that is currently leased to Adams Out Door Advertising
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T E N A N T O V E R V I E W
Pet Palace resort is a chain of boarding, daycare, and grooming needs for pets. Pet Palace offers luxurious accommodations for playing, interacting, and relaxing. Services include dog and cat boarding, dog and cat daycare, and grooming services. The facilities are open 7 days a week from 7 am to 8 pm for owner convenience. Customer Review gives Pet Palace Resort a 4.9 out of 5 stars. They encourage clients to stop in and tour the clean and safe locations to put these clients minds at ease. Each location offers both indoor and outdoor areas for the animals to interact and is decorated in a cute, welcoming atmosphere. Pet Palace also separates the dogs and categorizes them into big and small dog categories to ensure the safety of all animals. Pet Palace currently has 6 locations in Ohio and Indiana, with the addition of the newest North Carolina location.
PET PALACE RESORT
PETPALACERESORT.COM
Visit the Site
TENANT SUMMARY
Tenant Name Pet Palace Resort
Type Private
Industry Boarding Services, Kennels
No. of Locations 7
Headquarters Columbus, OH
Website www.petpalaceresort.com
Find out more about Pet Palace Resort
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B y t h e N u m b e r sTHE US PET INDUSTRY IS EXPERIENCING TREMENDOUS GROWTH, ESPECIALLY IN GROOMING AND SPECIALTY PET SERVICES
As the millennial generation trends towards delaying marriage, many pets are taking on the role of children. Millennials, who now make up the majority of pet owners, anticipate spending more on their pet’s health care than their own, per a TD Ameritrade study.
A seemingly recession-proof industry, pet spending saw growth even through the Great Recession of 2008. Pet spending in the US is currently hovering around $70 Billion annually, with projections that it will reach $100 Billion by the end of the decade.
Pet grooming is one of the fastest-growing segments of the industry. Currently, the average cost of pet grooming is between $50 and $90, which is more expensive than the average haircut for a person. The Bureau of Labor Statistics estimates that pet grooming jobs will grow by 20% by 2026.
The demand for high-end pet grooming services is expected to continue seeing tremendous growth in the future. Other pet services seeing growth in popularity include dog training, upscale spa services, pet behavioral consulting, and pet sitting.
Economists and professionals suggest that the pet industry is a great option for investors looking for long-term growth opportunities. Venture capitalists invested approximately $500 Million in pet technology alone between 2012 and 2016. The opportunity to invest in this recession-proof industry awaits!
T h e a n n u a l r e v e n u e g r o w t h r a t e i s 5 . 4 % s i n c e 2 0 0 2 a n d D I D N O T S L O W D U R I N G T H E G R E A T R E C E S S I O N o f 2 0 0 7 - 2 0 0 9 .
A m e r i c a n s w i l l s p e n d m o r e t h a n $ 7 0 B I L L I O N o n t h e i r p e t s i n 2 0 1 8 . G l o b a l l y , p e t c a r e i s a $ 1 0 0 B I L L I O N I N D U S T R Y .
U S H o u s e h o l d s o w n 6 0 . 2 M I L L I O N D O G S a n d 4 7 . 1 M I L L I O N C A T S . A p p r o x i m a t e l y 6 5 % o f U S h o u s e h o l d s h a v e s o m e t y p e o f p e t .
H o u s e h o l d s w i t h p e t s i n t h e U S w i l l s p e n d N E A R L Y $ 6 B I L L I O N o v e r t h e n e x t f e w y e a r s O N P E T G R O O M I N G A L O N E .
S p e n d i n g i n S p e c i a l t y P e t S e r v i c e s g r e w f r o m $ 5 1 0 B I L L I O N i n 2 0 1 3 t o $ 6 2 0 B I L L I O N i n 2 0 1 6 , a n i n c r e a s e o f 2 1 . 7 6 % .
E c o n o m i s t s e s t i m a t e t h a t s p e n d i n g o n U S p e t p r o d u c t s i s G R O W I N G 5 0 % F A S T E R t h a n t h e o v e r a l l r e t a i l s e c t o r .
B o o m i n g P e t I n d u s t r y
P R O P E R T Y P H O T O SP R O P E R T Y P H O T O S
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A R E A O V E R V I E W
C h a r l o t t e , N CCharlotte is the largest city in North Carolina and the second largest Banking Center in the country. It is known for being a world-class city through a variety of art, science, and historical attractions, all while retaining its small-town charm. Referred to as the Queen City, Charlotte is the home of NASCAR and the Charlotte Motor Speedway. 90 percent of the NASCAR Sprint Cup Series teams are headquartered within 50 miles of Charlotte.
The quality of life enjoyed by residents of Metropolitan Charlotte is an important factor in the tremendous growth of the city and surrounding rural acreage. An undisputed hub for entertainment and culture, the city draws regional audiences to performances and events at the North Carolina Blumenthal Performing Arts Center and other venues.
Recreational opportunities are abundant from Atlantic Ocean water and whitewater rafting at the U.S. National Whitewater Center to roller coasters at Carowinds and hiking in one of the many surrounding national parks and reserves.
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POPULATION 3 Mile 5 Mile 7 Mile
2023 Projection 111,809 229,650 427,467
2018 Estimate 100,547 206,648 385,473
2010 Census 76,524 165,161 319,255
Growth 2018-2023 11.20% 11.13% 10.89%
Growth 2010-2018 31.39% 25.12% 20.74%
HOUSEHOLDS 3 Mile 5 Mile 7 Mile
2023 Projection 49,035 97,993 174,419
2018 Estimate 44,475 89,007 158,733
Growth 2018-2023 10.25% 10.10% 9.88%
Growth 2010-2018 37.65% 28.37% 22.40%
INCOME 3 Mile 5 Mile 7 Mile
2018 Est. Average Household Income
$80,139 $89,823 $86,083
D e m o g r a p h i c s
E c o n o m yCharlotte has become a major U.S. financial center with the third most banking assets after New York City and San Francisco. The nation’s second largest financial institution by total assets, Bank of America, calls the city home. Charlotte has become the regional headquarters for East Coast operations of Wells Fargo, which is headquartered in San Francisco, California. Charlotte also serves as the headquarters for Wells Fargo’s capital markets activities including sales and trading, equity research, and investment banking. Bank of America’s headquarters, along with other regional banking and financial services companies, are located primarily in the Uptown central business district. Microsoft’s East Coast headquarters are in Charlotte as well.
Charlotte has six Fortune 500 companies in its metropolitan area. Listed in order of their rank, they are Bank of America, Lowe’s in suburban Mooresville, Duke Energy, Nucor, Sonic Automotive, and Sealed Air Corp. The Charlotte area includes a diverse range of businesses, such as Chiquita Brands International, Harris Teeter, Snyder’s-Lance, Carolina Foods Inc, Bojangles’, Food Lion, Compass Group USA, and Coca-Cola Bottling Co. Consolidated (Charlotte being the nation’s second-largest Coca-Cola bottler); motor and transportation companies such as RSC Brands, Continental Tire the Americas, LLC., Meineke Car Care Centers, Carlisle Companies, along with a wide array of other businesses.
G r o w t hThe city of Charlotte has been marked by impressive growth recently.Charlotte metro has seen an influx of 880,000 new residents over the past 10 years; this has produced a decade-long growth rate of 59.6%, making it the fastest growing city in the country over this time period.
In 2016, Charlotte added more new residents than all but 10 cities inthe country, according to the U.S. Census Bureau. Much of this growthis attributed to the strong economy and good quality of life.
Current estimates have Charlotte metro’s population growing by18.4% between the years 2014 and 2025. Office jobs are projected to increase by 25% over this timeline, with an estimated 42.6% growth in healthcare and social services jobs. Demand for office space is expected to soar up to 132,000,000 square feet, and the city is projected to be home to 14 Fortune 500 companies by 2025.
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U N C C h a r l o t t eThe University of North Carolina at Charlotte, also known as UNC Charlotte, is a public research university located in Charlotte, North Carolina and with more than 29,000 students, UNC Charlotte is the third largest university in the state system. The University offers 23 doctoral, 64 masters’, and 140 bachelor’s degree programs through nine colleges: the College of Arts + Architecture, the College of Liberal Arts & Sciences, the Belk College of Business, the College of Computing and Informatics, the Cato College of Education, the William States Lee College of Engineering, the College of Health and Human Services, the Honors College, and the University College.
UNC Charlotte is the largest institution of higher education in the Charlotte region and has experienced rapid enrollment growth of 33.4% over the past 10 years, making it the fastest-growing institution in the UNC System, and contributing to more than 50% of the system’s growth since 2009.
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3 , 4 9 5 S t u d e n t s
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This Offer ing Memorandum contains select informat ion pertaining to the business and af fa i rs of Pet Palace Resort located at 2320 Wilkinson Blvd, Charlotte NC 28208 (“Property”) . I t has been prepared by Matthews Real Estate Investment Services. This Offer ing Memorandum may not be al l - inclusive or contain a l l of the informat ion a prospect ive purchaser may desire. The informat ion contained in th is Offer ing Memorandum is conf ident ia l and furnished solely for the purpose of a review by a prospect ive purchaser of the Property. I t is not to be used for any other purpose or made avai lable to any other person without the wri t ten consent of Sel ler or Matthews Real Estate Investment Services. The mater ia l is based in part upon informat ion suppl ied by the Sel ler and in part upon f inancial informat ion obtained from sources i t deems rel iable. Owner, nor their of f icers , employees, or agents makes any representat ion or warranty, express or impl ied, as to the accuracy or completeness of th is Offer ing Memorandum or any of i ts contents and no legal l iabi l i ty is assumed or shal l be impl ied with respect thereto. Prospect ive purchasers should make their own project ions and form their own conclusions without rel iance upon the mater ia l contained herein and conduct their own due di l igence.
By acknowledging your receipt of th is Offer ing Memorandum for the Property, you agree:
1 . The Offer ing Memorandum and i ts contents are conf ident ia l ;
2 . You wi l l hold i t and treat i t in the str ictest of conf idence; and
3. You wi l l not , d i rect ly or indirect ly, d isclose or permit anyone else to disclose this Offer ing Memorandum or i ts contents in any fashion or manner detr imental to the interest of the Sel ler.
Owner and Matthews Real Estate Investment Services expressly reserve the r ight , at their sole discret ion, to reject any and al l expressions of interest or of fers to purchase the Property and to terminate discussions with any person or ent i ty reviewing this Offer ing Memorandum or making an of fer to purchase the Property unless and unt i l a wr i t ten agreement for the purchase and sale of the Property has been ful ly executed and del ivered.
I f you wish not to pursue negot iat ions leading to the acquis i t ion of the Property or in the future you discont inue such negot iat ions, then you agree to purge al l mater ia ls relat ing to th is Property including this Offer ing Memorandum.
A prospect ive purchaser ’s sole and exclusive r ights with respect to th is prospect ive t ransact ion, the Property, or informat ion provided herein or in connect ion with the sale of the Property shal l be l imited to those expressly provided in an executed Purchase Agreement and shal l be subject to the terms thereof. In no event shal l a prospect ive purchaser have any other c la ims against Sel ler or Matthews Real Estate Investment Services or any of their af f i l iates or any of their respect ive of f icers , Directors , shareholders, owners, employees, or agents for any damages, l iabi l i ty, or causes of act ion relat ing to th is sol ic i tat ion process or the market ing or sale of the Property.
This Offer ing Memorandum shal l not be deemed to represent the state of af fa i rs of the Property or const i tute an indicat ion that there has been no change in the state of af fa i rs of the Property s ince the date this Offer ing Memorandum.
C O N F I D E N T I A L I T Y & D I S C L A I M E R S TAT E M E N T
™PET PALACE RESORT2320 W ILK INSON BLVD | CHARLOT TE , NC 28208
LISTED BY
Josh Bishop VP & Director
DIRECT 214.692.2289 MOBILE [email protected]
LIC # 688810 (TX)
Calv in Shor t SVP & Senior Director | Lic # 01927216 (CA)
Aron Cl ine SVP & Senior Director | Lic # 01904371 (CA)Chad Kur z
SVP & National Director
DIRECT 214.692.2927 MOBILE [email protected]
LIC # 01911198 (CA)Kyle MatthewsBroker of RecordC27092 (NC)
