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Strayer University 3421 Olympia Drive, Raleigh, NC 27603
Offering Memorandum
Subject Property
Strayer University • Raleigh, NC 2
Confidential Disclaimer
This Confidential Memorandum has been prepared by Stan Johnson Company (“SJC”) and is being furnished to you solely for the purpose of your review of the commercial Property located at 4523 North Peoria Avenue, Tulsa, OK 74106 (the “Property”). The material contained in this Offering Memorandum shall be used for the purposes of evaluating the Property for acquisition and shall not be used for any purpose or made available to any other person without the express written consent of Stan Johnson Company (“Broker”).
By accepting the Confidential Memorandum, you acknowledge and agree that: (1) all of the information contained herein and any other information you will be receiving in connection with this transaction, whether oral, written or in any other form (collectively, the “Materials”), is confidential; (2) you will not reproduce the Confidential Memorandum in whole or in part; (3) if you do not wish to pursue this matter, you will return this Confidential Memorandum to SJC as soon as practicable together with all other materials relating to the Property which you may have received from SJC; and (4) any proposed actions by you which are inconsistent in any manner with the foregoing agreements will require the prior written consent of SJC.
This Confidential Memorandum has been prepared by SJC, based upon certain information pertaining to the Property and any information obtained from SJC to assist interested parties in making their own evaluation of the Property is offered on a no representation or warranty provision other than customary warranties of title and is sold on an “as-is, where-is” basis and with all faults. The material and transaction does not purport to be all inclusive. This Confidential Memorandum contains descriptive materials, financial information and other data compiled for the convenience of parties interested in the Property. The Materials are being delivered by SJC to prospective investors with the understanding that it is not all inclusive and that it is qualified in its entirety by independent investigation by prospective investors of those matters which they deem appropriate in evaluating this offering without reliance upon SJC, the Broker or any of their respective affiliates or any of the information set out in the Materials. Neither SJC, the Broker, nor any of their respective affiliates have independently verified any of the information contained herein or in any of the Materials, and no representations or warranties as to the accuracy or completeness thereof or of any other kind whatsoever are made or intended and none should be inferred.
SJC, for itself and its affiliates of the Property, expressly disclaim any and all liability for statements or representations, express or implied, contained herein or for omissions from the Materials or for any other written, oral or other format of communication transmitted to a prospective investor in the course of its evaluation of the proposed transaction. All summaries and discussions of documentation and/or financial information contained herein are qualified in their entirety by reference to the actual documents and/or financial statements, which upon request may be made available. The terms and conditions described herein are subject to change without notice.
This Confidential Memorandum does not constitute an offer to accept any investment proposal but is merely a solicitation of interest with respect to the investment described herein. The Confidential Memorandum does not constitute an offer of security. The investment described herein may be financed or withdrawn from the market, without prior notice. By accepting this Confidential Memorandum you agree to release SJC and hold it harmless from any kind of claim, expense, or liability arising out of your discovery or purchase of the Property. SJC reserves the right to request the return of the Materials at any time. Ownership of the Property reserves the right to negotiate with one or more prospective investors at any time.
In Association With:Jeff HughesNC Broker License #101282
Stan Johnson Company 180 Madison Avenue | Suite 1500 New York, NY 10016 P: +1 646.778.5560 stanjohnsonco.com
Tom Georges Associate [email protected]
Offering Exclusively By
Strayer University • Raleigh, NC 3
The Offering
Stan Johnson Company is pleased to offer for sale to qualified investors, the opportunity to purchase a Strayer University property located at 3421 Olympia Drive, Raleigh, NC 27603 (the “Property”).
The Property totals ± 17,500 square feet on ± 2.95 acres. It is operating under a 10-year base lease term with under 3 years remaining, offering two, 5-year lease option periods.
The lease features 2.00% annual rental escalations. Additionally, the lease is NN with the landlord only being responsible for expenses related to the roof and structure.
Investment Highlights
Purchase Price: $5,850,000 Cap Rate: 9.01%
Property Summary
Address: 3421 Olympia Drive, Raleigh, NC 27603
Building Size (SF): ± 17,500 SF
Land Area (Acres): ± 4.93 acres
Annual Rent: $527,027
Strong Tenant - Strayer has over 75 campus locations across 15 states and Washington D.C. About 40,000 students are enrolled in degree-seeking programs
Parent Company - As of 12/31/16 Strayer Education Inc. reported a Total Revenue over $441 million, a Net Income of $34.8 million and a Net Worth in excess of $188 million
Financially Sound - Strayer scores well on the “90/10 Rule” for For-Profit universities (78%), the “Gainful Employment Rule” for Title IV funding as well as other audited metrics used by the U.S. Department of Education when determining financial responsibility
Public Company - Traded on the NASDAQ under the symbol STRA, the stock price approximately doubled from October 2016 to October 2017
Rental Increases - The lease provides for a 2% increase in rent annually
Growing Market - One of the nation’s fastest growing cities, Raleigh, North Carolina ranked #5 in 2016 and is projected to rank #3 in 2017 for overall population growth
Demographics - 165,000+ residents and an Average Household Income of over $61,000 within 5 miles
High Traffic Count - Over 55,000 vehicles per day
Newer Construction - Completed in 2010
Strayer University • Raleigh, NC 4
Subject Property
Years Annual Rent
November 2010 - October 2011 $459,375
November 2011 - October 2012 $468,475
November 2012 - October 2013 $477,757
November 2013 - October 2014 $487,225
November 2014 - October 2015 $496,882
November 2015 - October 2016 $506,732
November 2016 - October 2017 $516,779
November 2017 - October 2018 $527,027
November 2018 - October 2019 $537,480
November 2019 - October 2020 $548,142
1st Five-Year Option FMV
2nd Five-Year Option FMV
Rent ScheduleLease Abstract
3421 Olympia Drive, Raleigh, NC 27603
Tenant/Guarantor: Strayer University
Property Type/Building Use: Office/Education
Building Size: ± 17,500 SF
Acreage: ± 4.93 Acres
Year Constructed: 2010
Base Lease Term: 10 Years
Remaining Lease Term: 3 Years
Lease Expiration: 10/31/2020
Current Annual Rent: $527,027
Base Rent PSF: $29.53
Rent Increases: 2% Annually
Renewal Options: Two (2), Five (5) Year Options
Landlord Responsibilities: NN, Roof & Structure
Additional Rent:Tenant Pays Operating Expenses, Administrative and Management Fees as is reasonably determined by Landlord
Strayer University • Raleigh, NC 5
Founded in 1892, Strayer University offers accredited, higher education degrees from its 75+ campus locations across 15 states and Washington, D.C. and worldwide via the Internet. The university has over 40,000 students enrolled, most of whom are working adults seeking career advancement. The average Strayer University student is 34 years old.
The parent company, Strayer Education, Inc. (NASDAQ: STRA) is a private, for-profit educational institution. Strayer University offers various academic programs in traditional
Tenant Overviewclassrooms and through the internet. Both undergraduate and graduate degree programs are offered in accounting, business administration, information technology, health services administration, public administration, education, and criminal justice.
Strayer also offers an executive MBA online and corporate training programs through its Jack Welch Management Institute. The University is committed to providing an education that prepares working adult students for advancement in their careers and professional lives.
Strayer consistently scores very high on the “90/10 Rule” for For-Profit companies, the “Gainful Employment Rule” for Title IV funding as well as other audited metrics used by the Department of Education when measuring an institutions financial strength and fiscal responsibility.
As of December 31, 2016, Strayer Education, Inc. reported total revenue of more than $441 million and net worth in excess of $188.37 million.
Strayer University • Raleigh, NC 6
Strayer Education, Inc. Reports First Quarter Enrollment, Revenues And Earnings; Q2 2017 Enrollment
From TheStreet.com (May 3, 2017)…Strayer University reports a 6% (six percent) increase in Student Enrollment and a 3% (three percent) increase in Revenues for 1st Quarter 2017 vs. 1st Quarter 2016. Read More>>
Tenant Overview (continued)
Strayer Education Higher on Improved Enrollment Trend
From SeekingAlpha.com (May 3, 2017)… Strayer Education (STRA +7.1%) shoots higher after enrollment trends showed improvement in Q1. The company reported a 8% increase in new students enrolled during the quarter compared to a year ago. Read More>>
Strayer University’s Online Bachelor Of Science In Nursing (RN To BSN) Program Accredited By The Commission On Collegiate Nursing Education
From TheStreet.com (May 30, 2017)… Strayer University today announced the accreditation of its online Registered Nurse (RN) to Bachelors of Science in Nursing (BSN) Program. Read More>>
Tailored MBA Will Expose Students To Emerging Field Of Digital Entrepreneurship
From TheStreet.com (May 20, 2017)… Strayer University in collaboration with Cheddar Inc. announced a new Master of Business Administration (MBA) offering. The MBA program, with a concentration in digital entrepreneurship, will launch in the summer of 2017 pending regulatory approvals. Read More>>
Strayer University • Raleigh, NC 7
North Carolina Museum of Natural Sciences
Raleigh, North Carolina
Raleigh is the capital of the state of North Carolina, and seat of Wake County. It is also one of the
fastest-growing cities in the country. Raleigh is home to North Carolina State University and is part
of the Research Triangle area, together with Durham (home of Duke University) and Chapel Hill
(home of the University of North Carolina at Chapel Hill). The “Triangle” nickname originated after
the 1959 creation of the Research Triangle Park, located in Durham and Wake Counties, partway
between the three cities and their universities. The Research Triangle region encompasses the
U.S. Census Bureau’s RaleighDurham-Chapel Hill Combined Statistical Area (CSA), which had an
estimated population of 2,037,430 in 2013. The Raleigh Metropolitan Statistical Area (MSA) had an
estimated population of 1,214,516 in 2013.
Raleigh’s industrial base includes banking/financial services; electrical, medical, electronic and
telecommunications equipment; clothing and apparel; food processing; paper products; and
pharmaceuticals. Raleigh is number one on the 2015 Forbes List for being the best place for
businesses and careers. Companies based in Raleigh include BB&T Insurance Services, Capitol
Broadcasting Company, Carquest, First Citizens BancShares, Golden Corral, Martin Marietta
Materials, Red Hat and Lulu.
Raleigh-Durham International Airport, the region’s primary airport and the second-largest in North
Carolina, located northwest of downtown Raleigh via Interstate 40 between Raleigh and Durham,
serves the city and greater Research Triangle metropolitan region, as well as much of eastern
North Carolina.
Location Overview
165,521 Total Population within 5-Mile Radius
of Subject Property
$61,379 Avg HHI within 5-Mile Radius
of Subject Property
61,586 Total Households within 5-Mile Radius
of Subject Property
± 4 MIles The Subject Property is approximately
4 miles from downtown Raleigh.
Strayer University • Raleigh, NC 8
The Best Places for Business and Careers
#3 Raleigh, NC#25 in Cost of Doing Business, #18 in Job Growth & #13 in Education
Read More
The #1 Best Big City of the SoutheastFrom Time.com…Raleigh, NC Ranks in the Top 6 Best Big Cities Read More>>
Location Overview (continued)
America’s Hottest Spots For Tech JobsFrom Forbes.com...Raleigh, NC Ranks #2 as America’s Top Spot For Tech Jobs Read More>>
North Carolina is No. 1 ‘Growth State’From bizjournals.com… U-Haul puts the Tar Heel State at No. 1 on its list of U.S. Growth States Read More>>
Strayer University • Raleigh, NC 9
N
The Subject Property is located approximately 4 miles south of downtown Raleigh.
Strayer University • Raleigh, NC 10
N
+/- 27,475 VPD
+/- 39,946 VPD
U.S. ROUTE 70
TRYON RD
FAY
ET
TEV
ILLE
RD
HA
MM
ON
D R
D
+/- 19,271 VPD
MCDONALD’S
Headquarters
+/- 34,978 VPD
International Food
Wake Tech Public Safety Education Campus
Care One Health Training Institute
NCWorks Training Center
Tower Engineering Professionals
Tryon Business Center
+/- 55,181 VPD
Strayer University • Raleigh, NC 11
N
0–5 mi.
0–3 mi.
0–1 mi.
Demographics3421 Olympia Dr, Raleigh, NC, 27603 0 - 1 mi. 0 - 3 mi. 0 - 5 mi.
Population
2016 Population 5,149 55,264 165,521
2021 Population 6,163 60,656 180,601
2010-2016 Annual Rate 4.94% 1.65% 1.35%
2016-2021 Annual Rate 3.66% 1.88% 1.76%
Households
2016 Total Households 1,961 19,801 61,586
2021 Total Households 2,354 21,763 67,578
2010-2016 Annual Rate 5.17% 1.65% 1.42%
2016-2021 Annual Rate 3.72% 1.91% 1.87%
Median Household Income
2016 Median Household Income $45,092 $38,278 $41,710
Average Household Income
2016 Average Household Income $55,324 $50,956 $61,379
Per Capita Income
2016 Per Capita Income $22,785 $19,228 $24,037
Strayer University • Raleigh, NC 12
Demographic Profiles Dominant Profiles within 1-Mile Radius
Esri is an international supplier of Geographic Information System (GIS) software, web GIS and geodatabase management applications. The company was founded in 1969 and has 40% of the global GIS market share. Learn more at www.esri.com.
Dominant Tapestry Map3421 Olympia Dr, Raleigh, North Carolina, 27603 2 Prepared by Esri3421 Olympia Dr, Raleigh, North Carolina, 27603 Latitude: 35.73294Rings: 1, 3, 5 mile radii Longitude: -78.65176
Source: Esri
May 12, 2017
©2016 Esri Page 1 of 2
1 Mile
3 Miles
5 Miles
Tapestry segmentation (as seen below) provides an accurate, detailed description of America’s neighborhoods - U.S. residential areas are divided into 67 distinctive segments based on their socioeconomic and demographic composition - then further classified into LifeMode and Urbanization Groups. The result is a detailed picture of the socioeconomics and demographics as well as attitudes and brand preferences of people in a given area.
Avg. Household Size: 2.02
Median Age: 29.4
Median HHI: $36,000
Gen Y comes of age: Well-educated young workers, someof whom are still completing their education, are employed in professional/technical occupations, as well as sales and office/administrative support roles. These residents are not established yet, but striving to get ahead and improve themselves. This market ranks in the top 5 for renters, movers, college enrollment, and labor force participation rate. Almost 1 in 5 residents move each year.
LifeMode Group: Midtown Singles Young and Restless 11B
Avg. Household Size: 2.74
Median Age: 34.3
Median HHI: $36,000
Down the Road is a mix of low-density, semiruralneighborhoods in large metropolitan areas; half arelocated in the South, with the rest chiefly in the West andMidwest. Almost half of householders live in mobile homes; approximately two-fifths live in single-family homes. These are younger, diverse communities, with the highest proportion of American Indians of any segment. These family-oriented consumers value their traditions. Workers are in service, retail trade, manufacturing, and construction industries, with higher proportions in agriculture and mining, compared to the US.
LifeMode Group: Rustic Outposts Down the Road 10D
Avg. Household Size: 2.63
Median Age: 28.8
Median HHI: $33,000
Metro Fusion is a young, diverse market. Many residentsdo not speak English fluently and have moved intotheir homes recently. They are highly mobile and overthree quarters of households are occupied by renters.Many households have young children; a quarter aresingle-parent families. The majority of residents livein midsize apartment buildings. Metro Fusion is ahard-working market with residents that are dedicatedto climbing the ladders of their professional and sociallives.
LifeMode Group: Midtown Singles Metro Fusion 11C
going beyond
The information contained herein was obtained from sources believed reliable, however, Stan Johnson Company makes no guaranties, warranties or representations as to the completeness thereof. The presentation of this property for sale, rent or exchange is submitted subject to errors, omissions, change of price or conditions, or withdrawal without notices.
Offered Exclusively by
Stan Johnson Co.180 Madison Ave | Suite 1500New York, New York 10016P: +1 646.778.5560 | F: +1 646.778.5561
stanjohnsonco.com
In Association With:Jeff HughesNC Broker License # 101282
