Muchas Gracias - Capital Pacific

Muchas Gracias
Salem, or
Sale
m
, OR
DRIVE-THRU NNN ASSET
ON LONG TERM LEASE
710 Wallace Rd NW, Salem OR, 97304
[ www.CapitalPacific.com ]
MUCHAS GRACIAS IS A FREESTANDING NNN-LEASED
ASSET WITH A 10-YEAR REMAINING TERM LOCATED
IN SALEM, OREGON.
Investment Highlights
The offering provides an opportunity to acquire a drive-thru net-leased
Muchas Gracias location with a personal guaranty in place. Muchas
Gracias is a recognized successful regional Mexican restaurant chain with
over 36 locations in operation throughout Oregon and SW Washington.
The Company has been in business for just over 20 years. The Tenant recently
extended their primary term for an additional 10 years, demonstrating their
commitment to the site. The Landlord is provided few responsibilities as the Tenant operates
within the terms of a NNN lease, and responsibilities are limited to building structure and roof
maintenance and repair.
The area surrounding Muchas Gracias is populated with 204,295 residents living within a 5-mile
radius of the Property. Muchas Gracias is situated off Wallace Road, exposing the Property to very
high traffic counts of 41,200 vehicles per day.
PRICE: $1,200,000
CAP: 6.50%
LEASABLE SF. . . . . . . . . . . . . . ±2,334 SF
LAND AREA. . . . . . . . . . . . . . . . ±19,602 SF
LEASE TYPE. . . . . . . . . . . . . . . NNN
LEASE EXPIRATION. . . . . . . . . 7/31/2026
YEAR BUILT. . . . . . . . . . . . . . . . 1980
CURRENT RENT. . . . . . . . . . . . $32.39/SF
PARKING. . . . . . . . . . . . . . . . . . ±21 Spaces or 9.0/1,000 SF
ADDRESS:
710 Wallace Rd NW, Salem, OR 97304
MUCHAS GRACIAS - SALEM | 2
Core Characteristics
NEW 10-YEAR LEASE WITH RENT GROWTH
The Tenant recently executed a brand new lease renewal, extending their lease
term an additional 10 years, demonstrating their commitment to this site, and
personally guaranteed. The lease calls for annual rent increases through the
remaining term, offering an investor yield upside. The lease is personally guaranteed
by the leaseholder.
MINIMAL LANDLORD RESPONSIBILITIES
This investment opportunity has a passive lease structure, as Muchas Gracias operates
within the terms of a NNN lease and is responsible for the reimbursement of all
operating expenses of the Premises, including property taxes, insurance, and utilities.
As such, the Landlord is responsible for only building structure and roof.
CONCENTRATED DEMOGRAPHIC BASE
The area surrounding Muchas Gracias is populated with over 204,295 residents within
a 5-mile radius, providing a dense demographic base to pull from. The city of Salem is
heavily influenced by the state government, the largest public employer in the city.
HIGHLY VISIBLE DRIVE-THRU LOCATION
The Property is equipped with a drive-thru and benefits from its highly visible location with
frontage on Wallace Road, which is the secondary main thoroughfare through west Salem
and boasts high traffic counts of 41,200 vehicles past the Subject per day.
CLOSE PROXIMITY TO NATIONAL RETAILERS
Muchas Gracias is located in close proximity to a dynamic mix of national retailers and
restaurants. The Property is located directly across the street from a Walgreens and 0.1 miles
south of Roth’s grocery store, among others, creating co-tenancy in the immediate trade area.
MUCHAS GRACIAS - SALEM | 3
About Muchas Gracias
36
ABOUT
TOTAL LOCATIONS
Muchas Gracias first opened for business in 1996 in Vancouver,
Washington by entrepreneur Rodolfo Sánchez. Ten years later, there
are 36 locations in operation throughout Oregon and southwest
Washington. The corporate structure provides the opportunity to
open additional locations through their franchise program.
FOUNDED IN
1996
WASHINGTON
STATE
20HR
(IN OR & WA)
MUCHAS
GRACIAS
RESTAURANT
MUCHAS GRACIAS - SALEM | 4
Aerial
MUCHAS GRACIAS IS LESS THAN ONE MILE FROM SALEM’S DOWNTOWN CENTRAL BUSINESS DISTRICT
39,700 VPD
SALEM CENTER
MUCHAS
GRACIAS
Mark
et Str
E
221
22
22
42,3
Union
Street
Mario
n Stre
00 V
PD
NE
et NE
STATE OF
OREGON
99E
22
eet N
Cente
r Stre
et NE
99E
22
State
Bellev
Street
ue Str
Missi
PORTLAND
on St
eet SE
reet S
E
99E
MUCHAS GRACIAS - SALEM | 5
Site
12,150 VPD
Glenn Creek Rd NW
MUCHAS GRACIAS
la
Wal
41,200 VPD
d NW
ce R
41,8
00 V
221
Mar
ion S
t NE
Cent
er St
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ew
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22
MUCHAS GRACIAS - SALEM | 6
Site Plan
TRADITIONAL AUTO BODY AND PAINT
NOT A PART
SITE PLAN KEY
DRIVE THRU
PARCEL OUTLINE:
LAND AREA:
LEASABLE AREA: ±19,602 SF
±2,334 SF
NOT A PART:
PYLON SIGN:
ACE
LL
WA
INGRESS/EGRESS:
W
DN
ROA
PYLON SIGN
39,7
00 D
Y
AIL
MOYER LANE NW
Site Plan Not to Scale
MUCHAS GRACIAS - SALEM | 7
Financial Summary
PRICE
$1,200,000
Capitalization Rate:
Price Per Foot:
NET OPERATING INCOME SUMMARY
SCHEDULED INCOME
Scheduled Rent:
Plus: Management Fee*
Equals: Effective Gross Income
6.50%
2,334 Square Feet
8/1/2016
Less: OPERATING EXPENSES
CAMS
Property Taxes
Insurance
Total Operating Expenses
$514
Per SF
$32.39
$0.97
$33.36
$75,600
$2,268
$77,868
Per SF
NNN
Equals: NET OPERATING INCOME
NNN
NNN
NNN
$77,868
* Tenant pays Landlord management fee of 3% of annual base rent.
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. Buyer must verify the information and bears all risk for any inaccuracies.
MUCHAS GRACIAS - SALEM | 8
Rent Roll
Rent Roll
RENT SUMMARY
TENANT INFO
TERM
Tenant Name
Size
Date
Monthly Rent
Muchas Gracias
2,334
8/1/2016
8/1/2017
$6,300
$6,395
Occupancy Date :
7/12/2012
8/1/2018
Lease Expiration :
7/31/2026
8/1/2019
Percent
Increase
Annual Rent
PSF
Cap Rate
$75,600
$32.39
6.50%
1.5%
$76,734
$32.88
6.39%
$6,490
1.5%
$77,885
$33.37
6.49%
$6,588
1.5%
$79,053
$33.87
6.59%
8/1/2020
$6,687
1.5%
$80,239
$34.38
6.69%
8/1/2021
$6,787
1.5%
$81,443
$34.89
6.79%
8/1/2022
$6,889
1.5%
$82,664
$35.42
6.89%
8/1/2023
$6,992
1.5%
$83,904
$35.95
6.99%
8/1/2024
$7,097
1.5%
$85,163
$36.49
7.10%
8/1/2025
$7,203
1.5%
$86,440
$37.04
7.20%
Lease Notes
Comments: NNN Lease - Tenant is responsible for all property taxes, insurance, and all maintenance and repair needed at the Premises, including utilities, landscaping, and 3%
management fee. Landlord is responsible for building structure and roof. Lease is personally guaranteed.
Current Totals:
2,334
$6,300
$75,600
$32.39
6.50%
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.
Buyer must verify the information and bears all risk for any inaccuracies.
This information has been secured from sources we believe to be reliable but we make no representations or warranties, expressed
7/28/2016
[ www.CapitalPacific.com ]
or implied,
as to the accuracy of the information. Buyer must verify the information and bears all risk for any inaccuracies.
<
>
MUCHAS GRACIAS - SALEM | 9
Lease Abstract
PREMISES/TERM
SQUARE FEET
2,334 SF
LEASE TYPE
NNN LEASE
COMMENCEMENT7/12/2012
CURRENT EXPIRATION 7/31/2026
REMAINING TERM
10 YEARS
OPERATING EXPENSES
TAXES
Tenant is responsible for payment of all Property Taxes for the Premises.
INSURANCE
BASE RENT
Tenant shall pay directly to insurer for a General Liability policy and reimburse Landlord for
Casualty insurance protecting against fire, earthquake, and flood insurance.
1.5% annual increase
Date
8/1/2016 – 7/31/2017 8/1/2017 – 7/31/2018 8/1/2018 – 7/31/2019 8/1/2019 – 7/31/2020 8/1/2020 – 7/31/2021 8/1/2021 – 7/31/2022 8/1/2022 – 7/31/2023 8/1/2023 – 7/31/2024 8/1/2024 – 7/31/2025 8/1/2025 – 7/31/2026 Monthly Payment
Annual Payment
$6,300 $6,395 $6,490 $6,588 $6,687 $6,787 $6,889 $,6,992 $7,097 $7,203 $75,600
$76,734
$77,885
$79,053
$80,239
$81,443
$82,661
$83,904
$85,163
$86,440
UTILITIES
Tenant is responsible for direct payment of all utilities used at the Premises.
TENANT’S OBLIGATIONS
Tenant is responsible for all maintenance and repair to the premises, inclusive of all electrical,
plumbing, and glass, as well as a full reimbursement to Landlord for all common area operating
expenses and a 3% management fee.
LANDLORD’S OBLIGATIONS
Landlord shall maintain all common areas of the property, including ice and snow removal,
parking lot, landscaping etc., to be fully reimbursed by Tenant. Landlord is responsible for
building structure and roof repair/replacement, not to be reimbursed by Tenant.
ASSIGNMENT/SUBLETTING
Tenant may not assign or sublease any interest in the Premises without prior written consent
of the Landlord.
GUARANTY
Lease is Personally Guaranteed.
MUCHAS GRACIAS - SALEM | 10
Area Intel & Demos
POPULATION
2010
2015
2020
1-Mile3-Mile5-Mile
8,252 82,950
198,474
8,369 86,052204,295
8,520 88,649210,264
204K+
CURRENT
POPULATION
2015 HOUSEHOLD INCOMES
1-Mile3-Mile5-Mile
Median $41,788 $43,675 $45,105
Average $63,881$60,981$60,310
5 Miles
portland
MUCHAS GRACIAS
3 Miles
1 Mile
45 Miles
salem
36 Miles
Corvallis
MUCHAS GRACIAS - SALEM | 11
Salem, OR
ABOUT SALEM
Salem is the capital of Oregon, and the county seat of Marion
County. It is located in the center of the Willamette Valley
alongside the Willamette River, which runs north-south through
the city.
99E
MUCHAS GRACIAS
99E
Salem had a population of 198,474 at the 2010 census, making
it the third largest city in the state after Portland and Eugene.
The city is home to Willamette University and Corban University.
The State of Oregon is the largest public employer in the city,
and Salem Health is the largest private employer.
22
22
1.6 MILES
salem
1.4 MILES
oregon state capitol
22
2.0 MILES
Willamette
University
Salem
Hospital
MUCHAS GRACIAS - SALEM | 12
THE CAPITAL PACIFIC EXPERIENCE - OUR DAILY COMMITMENT TO OUR CLIENTS
[ www.CapitalPacific.com ]
PETER DUNN
MICHAEL HORWITZ
SCOTT FRANK
KEVIN ADATTO
SEAN MACK
SEAN TUFTS
pdunn@capitalpacific.com | (503) 607-0197
kadatto@capitalpacific.com | (503) 675-7726
mhorwitz@capitalpacific.com | (503) 675-8381
smack@capitalpacific.com | (503) 675-8378
DAVID GELLNER
dgellner@capitalpacific.com | (206) 913-2842
[ Copyright © 2016 Capital Pacific LLC ]
sfrank@capitalpacific.com | (503) 675-8383
stufts@capitalpacific.com | (206) 743-8468