The. At Talega and 1041 Avenida Pico San Clemente, Ca Offering Memorandum. Exclusively Listed By:

Transcription

1 The Courtyards At Talega Exclusively Listed By: 1011 and 1041 Avenida Pico San Clemente, Ca Offering Memorandum Frank Dinari - Vice President frank.dinari@sperrycre.com BRE: Frank Kosi - Senior Vice President frank.kosi@sperrycre.com BRE#

2 Property Photo

3 Regarding This Investment Offering All materials and information received or derived from Sperry Commercial, its directors, officers, agents, advisors, affiliates and/or any third party sources are provided without representation or warranty by Sperry Commercial or its directors, officers, agents, advisors, or affiliates as to completeness, veracity, or accuracy, condition of the Any estimates of market rents and/or projected rents that may be provided to a party do not necessarily mean that rents can be established at or increased to that level. Parties must evaluate any applicable contractual and governmental limitations as well as market conditions, vacancy factors and other issues in order to determine rents from or for the property. property, compliance or lack of compliance with applicable governmental requirements, developability or suitability, financial performance of the property, projected financial performance of the property for any party s intended use or any and all other matters. Legal questions should be discussed by the party with an attorney. Tax questions should be discussed by the party with a certified public accountant or tax attorney. Title questions should be discussed by the party with a title officer or attorney. Questions regarding the condition of the property and whether the property complies with applicable governmental requirements should be discussed by the party with appropriate engineers, architects, contractors, other consultants and governmental agencies. All properties and services are marketed by Sperry Commercial in compliance with all applicable fair housing and equal opportunity laws. PLEASE UNDER NO CIRCUMASTANCES CONTACT, OR CONVERSE WITH THE PROPERTY MANAGER OR ANY OF THE TENANTS. Neither Sperry Commercial its directors, officers, agents, advisors, or affiliates makes any representation or warranty, express or implied, as to accuracy or completeness of any of the materials or information provided, derived, or received. Materials and information from any source, whether written or verbal, that may be furnished for review are not a substitute for a party s active conduct of its own due diligence to determine these and other matters of significance to such party. Sperry Commercial will not investigate or verify any such matters or conduct due diligence for a party unless otherwise agreed in writing. EACH PARTY SHALL CONDUCT ITS OWN INDEPENDENT INVESTIGATION AND DUE DILIGENCE. Any party contemplating going under contract or in escrow for this transaction is urged to verify all information and to conduct their own inspections and investigations including thorough appropriate third party independent professionals selected by such party. All financial data should be verified by the party including applicable documents and reports and consulting appropriate independent professionals. Sperry Commercial makes no warranties and/or representations regarding the veracity, completeness, or relevance of any financial data or assumptions. Sperry Commercial does not serve as a financial advisor to any party regarding any proposed transaction. All data and assumptions regarding financial performance, including that used for financial modeling purposes, may differ from actual data or performance.

4 Table of Contents 1) Location Overview Subject Property Photos Aerial Views Birdseye View Property Map Plat Map ) Executive Summary Property Description Executive Summary Master Plan of Arterial Highway SR 241 Tesoro Extension 16 3) Market Overview A. Sale Comparables Individual Sales Comparables Location of Sales Comparables Orange County Market Overview B. Rent Comparables Individual Rent Comparables Location of Rent Comparables C. On Market Comparables Individual On Market Comparables Location of On Market Comparables ) Tenant Synopsis 31 5) Property Financials Rent Roll Pricing & Investment Operating Information & Expense ) About The City of San Clemente 7) Demographics 37 41

5 LOCATION OVERVIEW

6 Property Overview - Subject Photos The Courtyards At Talega 1011 and 1041 Avenida Pico, San Clemente, Ca

7 Property Overview - Aerial View Avenida La Pata Lake at Talega Golf Course SUBJECT Avenida Pico B e l l a C o l i n a F u t u r e S i t e o f T o w n & G o l f C l u b 24 H o u r F i t n e s s 7

8 Property Overview - Birds Eye View NAP NAP NAP NAP Avenida Pico Traffic Count 22,000 Avenida La Pata Traffic Count 21,000 Super Sport 45,470 Sq. Ft. 8

9 Property Overview - Property Map SUBJECT 9

10 Property Overview - Plat map NAP NAP Avenida La Pata NAP NAP Avenida Pico NAP 10

11 EXECUTIVE SUMMARY

12 Property Description Property Investment Description THIS IS A RARE VALUE ADD OPPORTUNITY WITH ONLY 81% OCCUPANCY AND BELOW MARKET RENTS THAT WERE EXECUTED IN This is a rare opportunity for an investor to purchase two multi-tenant retail buildings totaling approximately 9,216 rentable square feet within a 67,744 square foot established shopping center in Orange County, California. The entire retail center benefits from national tenants and traffic flow, and synergy created by these tenants. The national and regional tenants in the center but are not included in the offering are, UPS Store, Z-Pizza, Starbucks, Quizno and US Bank. The property caters to retail, restaurants and professional office users. 24 Hour Fitness Coming to San Clemente By FRED SWEGLES :32:19 The property has three curb cuts that provide excellent access to the property. The Courtyards at Talega offering is 2 of the 6 buildings in the center. The property includes approximately 6.50 acres of land with reciprocal easements for all owners within the center. CourtYard at Talega Phase I is an office and retail center on approximately acres of land that is in the center and not included in this offering. Property Physical Description The subject offering is a San Clemente, California, SOUTH ORANGE COUNTY pride of ownership Mediterranean designed two building, multi-tenant retail center. The exterior has smooth stucco walls that are accented with stacked stone and a red tile roof. The exterior is further accented with roman arches and smooth roman Column s. The roof line elevation adds to the cohesion of design and the ornate exterior lamps with parking lot lights give ample illumination. The Courtyards at Telega has mature landscaping that includes Palm trees, flowers in the planters and low maintenance bushes. Property Location Description The center is on the SIGNALIZED HARD CORNER of Avenida Pico (with a traffic count of 22,000 per day) and Avenida La Pata (with a traffic count 21, 000 cars) for a total traffic count of 43,000 cars per day. The property has excellent ingress and egress from Avenida La Pata and Avenida Pico. The center is approximately 1.9 miles or 6 minutes to the 5 freeway and draws consumers from Rancho San Clemente Business Park (3,100,000 square feet). The property also caters to the communities of Talega, Marblehead, Rancho San Clemente and Forester Ranch. The Courtyards at Talega is at the entrance of the residential master planned affluent community of TALEGA, one the most exclusive communities in all of California. The Center has two Golf Courses as neighbors; Talega Golf Club and Bella Collina Towne & Golf Club. 24-Hour Fitness is preparing to occupy more than half of a vacant 88,000 square-foot building on a prominant San Clemente street corner, Avenida Pico at Avenida La Pata. City planning commissioners last week approved three of four permits that the fitness chain will need to begin remodeling to convert 45,470 square feet of the building into what Craig Hardy, director of real estate for 24 -Hour Fitness, described as a top-of-the-line executive club known as a super sport Hardy said the facility will include a 25 yard indoor pool, exercise machines with video monitors, a basketball court, executive-style locker rooms with towel service and a Kids Club babysitting service. The Planning Commission approved all the permits that 24-Hour Fitness will need, except for a sign-exception permit that commissioners decided not to vote on until they can discuss it further Sept. 18. It would allow two signs to exceed the city s 64-square-foot limit by 18 square feet each. The hearing on the signs will be at 7 p.m. Wednesday at City Hall, 100 Avenida Presidio. Hardy said 24-Hour Fitness has 410 clubs in 18 states, San Juan Capistrano being the closest one to San Clemente. Contact the writer: fswegles@ocregister.com or Copyright 2013 Freedom Communications. All Rights Reserved. Privacy Policy User Agreement Site Map 12

13 Property Description Talega Golf Club Talega Golf Club is a challenging course with 3, nine hole courses designed by gary player. This dramatic setting is the site for the first Gary Player signature course in the West. Designed in the tradition of Scottish seaside links, the 27 championship holes wind gently through ravines, lakes and natural foliage, while preserving the rugged environment and special character of the land. Talega event facilities can accommodate over 200 guests for weddings, banquets and tournaments. Stay equipped and stylish at The Shops at Talega, then relax, have a drink and a great meal at the Signature Grille Restaurant while enjoying ocean breezes, lush landscape, and golf course views on a relaxing patio. Bella Collina Towne & Golf Club Established in 2001, Bella Collina features an 18-hole, par 72 Fred Couples Signature championship golf course ranked America s Top Golf Course (by Golf Digest/ESPN/Zagat Survey), a driving range, and Spanish Colonial clubhouse architecture with bell tower and village courtyard setting. The Course... Bella Collina Towne & Golf Club has been designed with three integrated nine-hole layouts, which may be linked to provide an endless variety for even the most demanding golfer. Multiple pin and tee placements allow varying degrees of difficulty and shot challenges to test the skill of all levels of players. The course has been molded to fit the natural contours of the land, twisting through ravines, gorges, hills, and valleys. Carefully sculpted fairways and well-bunkered greens are surrounded by indigenous foliage and wildflowers. The natural environment has been enhanced by trees, shrubs, and shimmering lakes. 13

14 Property Description - Executive Summary The Courtyards at Talega 1011 and 1014 Avenida Pico, San Clemente, CA Physical Description Number of Buildings Lease Types Current Occupancy Parcel Numbers Parking Nearest Cross Streets 2 NNN 81% , 05, 07 Reciprocal Avenida La Pata Existing Loan: Subject property is currently encumbered by an assumable loan with an approximate balance of $1,150,000 and monthly payment of $3,888. The loan is an interest only with 4% rate and it is due in Price Net Rentable Area $3,850,000 9,216 Sq.Ft. within a 67,744 Sq.Ft Shopping Center Approximate Lot Size Year Built No. of Current Tenants 6.37 Acres

15 Executive Summary SR TESORO EXTENSION MASTER PLAN OF ARTERIAL HIGHWAY - South Orange County Avenida La Pata SR Tesoro Extension Subject Avenida Pico 15

16 Executive Summary Transportation Corridor Agencies SR TESORO EXTENSION WORKING TO IMPROVE MOBILITY AND CREATE JOBS In October 2011 engineering and environmental work began on a plan to extend SR 241 from where it now ends at Oso Parkway to the Ortega Highway area to provide an alternative route and improve mobility in a growing part of Orange County. The State Route 241 Tesoro Extension is an important alternative route to I-5 providing additional northern access for communities located inland of I-5 and commuters traveling to Orange County business centers from the Inland Empire via Ortega Highway. Construction of this 5.5 mile extension will create more than 2,000 Orange County jobs and an additional 407 jobs statewide. The 241 Tesoro Extension will extend the 241 Toll Road from its current terminus at Oso Parkway to Cow Camp Road in the vicinity of Ortega Highway (see map). Extending the 241 Toll Road will provide an alternative route to the heavily traveled I-5 and local streets. WHO WILL BENEFIT? 241 Toll Road commuters San Juan Capistrano, Ladera Ranch and Mission Viejo residents Commuters from the Inland Empire traveling to job centers in central and northern Orange County Future communities, job centers and businesses in Rancho Mission Viejo (an approved development not reliant on construction of the 241) San Clemente residents, upon completion of Avenida La Pata. ENVIRONMENTAL ASPECTS & PUBLIC INVOLVEMENT Environmental analysis of the project area was conducted within the Subsequent Environmental Impact Report (SEIR) in 2006 According to the SEIR, all environmental impacts are minimal and can be successfully mitigated Project design features include construction of four wildlife crossings, native habitat restoration and water quality improvements WHY BUILD THIS EXTENTION? It will improve quality of life in the project area and adjacent communities by reducing traffic congestion on adjacent freeways and provide a congestion-free option for drivers. It will provide transportation choices between affordable housing and jobs in Southern California. The project allows for sufficient right of way for future Bus Rapid Transit, rail or high occupancy vehicle lanes. It improves the regional transportation network to ensure redundancy, long-term safety, and reliability, as well as improved air quality. COMPLETING THE SYSTEM: WHAT S GOING ON? TCA is committed to continuing its stakeholder outreach program to find a solution that will improve regional mobility. QUICK FACTS The 241 Tesoro Extension is approximately 5.5 miles long Two lanes will be constructed in each direction with a median wide enough for additional lanes or future transit options FY12 cost of $3.9 million for preliminary engineering, environmental and finance work (estimated construction cost $200 million) Estimated Average Daily Trips (ADT) by year 2035: 41,000 ADT Construction planned for early 2013 Project creates more than 2,000 jobs in Orange County For more information on the project, please visit or 241update@thetollroads.com to receive the latest news and updates. Upon the completion of the technical studies the public will have an opportunity to review the draft environmental document. 16

17 Executive Summary TESORO EXTENSION EXTENDING THE 241 TOLL ROAD FROM OSO PARKWAY TO COW CAMP ROAD The Foothill/Eastern Transportation Corridor Agency Board of Directors approved the location of the southern terminus for the 241 Tesoro Extension shown below in January An important consideration was how the project will work with the roadway circulation system that is planned for the area (see map): An interim terminus will be constructed at Cow Camp Road, an arterial that parallels Ortega Highway and will be the major east-west arterial roadway with two to three lanes in each direction and will carry 30,000 trips per day in With the construction of Cow Camp Road, Ortega Highway will become a secondary road with one lane in each direction and will carry approximately 6,000 trips a day in Yellow indicates the existing roadway system. Green indicates the planned 241 Tesoro Extension from Oso Parkway to Cow Camp Road. Orange indicates a portion of Cow Camp Road to be built by the County and Rancho Mission Viejo. Cow Camp Road will eventually be a 6 lane arterial that will eventually connecting to Ortega Highway to the east. PA represents approved or entitled areas planned for development by the Rancho Mission Viejo Company. 17

18 RETAIL MARKET OVERVIEW

19 Sales Comparables SUBJECT PROPERTY: Asking Price: $3,795,000 1 The Courtyards at Talega 1041 Avenida Pico San Clemente, Ca Year Built: 2003 Cap Rate: 5.01% Lot Size: 6.50 Acres 450 East 1st Street Sale Price: $2,500,000 Sale Date: 4/1/2013 Tustin, CA Year Built: 1984 Cap Rate: 6.26% Lot Size: 0.36 Acres Property Type Build/SF Price/SF Occupancy 9,216 $ % Bldg Type Build/SF Price/SF Zoning 4,314 $ C1 2 3 Sale Price: $5,450,000 Sale Price: $2,835, th St. Sale Date: 7/10/ W. 17th St. Sale Date: 11/7/2012 Huntington Beach, CA Year Built: 1975 Santa Ana, CA Year Built: 1986 Cap Rate: 5.51% Cap Rate: 5.50% Lot Size: 0.92 Acres Lot Size: 0.52 Acres Bldg Type Build/SF Price/SF Zoning Bldg Type Build/SF Price/SF Zoning 11,540 $ C2 4,314 $ C1 19

20 Sales Comparables 4 5 Sale Price: $3,621,000 Sale Price: $3,700, W. Whittier Blvd. Sale Date: 12/10/ Valley View St. Sale Date: 5/18/2012 La Habra, CA Year Built: 2000 Garden Grove, CA Year Built: 1990 Cap Rate: 5.40% Cap Rate: 5.40% Lot Size: 0.59 Acres Lot Size: 0.52 Acres Bldg Type Build/SF Price/SF Zoning Bldg Type Build/SF Price/SF Zoning 5,650 $ C2 6,275 $ C2 Bank Free Standing 6 7 Sale Price: $3,950,000 Sale Price: $6,725, Placentia Ave. Sale Date: 6/25/ Aliso Creek Rd. Sale Date: 2/28/2013 Fullerton, CA Year Built: 1965 Aliso Viejo, CA Year Built: 1999 Cap Rate: 6.20% Cap Rate: N/A Lot Size: 0.51Acres Lot Size: 1.03 Acres Bldg Type Build/SF Price/SF Zoning Bldg Type Build/SF Price/SF Zoning 9,046 $ C2 16,840 $ CC 20

21 Sales Comparables Riverside Ave. Newport Beach, CA Sale Price: $12,390,000 Sale Date: 8/27/2012 Year Built: 1956 Cap Rate: 5.00% Lot Size: 1.2 Acres Bldg Type Build/SF Price/SF Zoning 24,191 $ SP-5 Free Standing 21

22 Sales Comparables Subject: 1041 Avenida Pico, San Clemente, Ca : 450 East 1st Street, Tustin, Ca : th Street, Huntington Beach, Ca : West 17th Street, Santa Ana, Ca : 1970 West Whittier Blvd., La Habra, Ca : Valley View Street, Garden Grove, Ca : Placentia Avenue, Fullerton, Ca : Aliso Creek Road, Aliso Viejo, Ca : Riverside Avenue, Newport Beach, Ca

23 Orange County - Market Overview Historical Pricing Trends Sales By Total $ (mil) rolling 12-mo. total quarterly vol. 1,200 1, Q1 10 Q1 11 Q1 12 Q % Change in Sales (Year Over Year) 400% 200% 0% -200% Q1 10 Q1 11 Q1 12 Q1 13 Pricing Analysis Price $ per sf Quarterly Distribution Cap Rate (Yield) Quarterly Distribution Bottom Top Bottom Top Bottom 25% Median 25% Top Bottom 25% Median 25% Top Cumulative Monthly Volume $ (mil) ,200 1,000 Orange Co Orange Co. 7.9% 6.2% 5.9% 5.2% 3.1% United States United States 12.6% 7.9% 7.1% 6.2% 2.1% Data based on prior 12 months Data based on prior 12 months 0 J F M A M J J A S O N D Year-to-date volume: $320.7 Year-over-year chg: -43% 23

24 Rent Comparables SUBJECT PROPERTY: 1 The Courtyards at Talega Asking Price: $3,795,000 Gateway Village Plaza Space Availalbe: 674-1, Avenida Pico Year Built: Avenida Pico Year Built: 2004 San Clemente, Ca Lot Size: 6.50 Acres San Clemente, Ca Lot Size: 0.49 Acres Property Type Build/SF Price/SF Occupancy Bldg Type Build/SF Price/SF Leased 9,216 $ % 5,121 $2.75-$ % Asking Rate Property Description: Available for Lease: 2 retail spaces located at The Courtyards at Talega. Join an excellent retail trade area with the I-5 freeway nearby. Property Description: Immediate access to interstate 5 off Avenida Pico. Most conveniently located well established shopping center in trade area. Location Description: Located at the signalized main intersection of Avenida Pico and Avenido Presidio. Adjacent to San Clemente High School. 2 3 Plaza Pacifica Shops Space Available: 2,160-3,500 Talega Village Center Space Available: 986-3, Avenida Pico Year Built: Avenida Pico Year Built: 2007 San Clemente, Ca Lot Size: 2.59 Acres San Clemente, Ca Lot Size: 1.13 Acres Bldg Type Build/SF Price/SF Leased Bldg Type Build/SF Price/SF Leased 3,500 $3.50-$ % 1,300 $2.25-$ % Property Description: WalMart, Lowes, Home Improvement, Albertsons, Michael s, Office Depot anchored center. Restaurants include: IHOP, El Pollo Loco, Taco Bell & Carl s Jr. Location Description: Located on the Avenida Pico corridor servicing Talega, Forester Ranch, Marblehead, The Coast and Rancho San Clemente communities. Property Description: A community center located in the heart of Talega, one of San Clemente s most affluent communities. Location Description: Center has access to Interstate 5 from Vista Hermosa and Avenida Pico. 24

25 Rent Comparables 4 The Courtyards at Talega 1001 Avenida Pico San Clemente, Ca Space Availalbe: 1,033-1,646 Year Built: 2003 Lot Size: 1.0 Acres Bldg Type Build/SF Price/SF Leased 1,033 $ % Property Description: Shop space and office space available at The Courtyards at Talega. Join an excellent retail trade area with the I-5 freeway nearby. Location Description: Neighboring tenants include: Walmart, Lowe s, Ralph s and Albertsons. 25

26 Rent Comparables Subject: 1041 Avenida Pico, San Clemente, Ca : 800 Avenida Pico, San Clemente, Ca : 979 Avenida Pico, San Clemente, Ca : 802 Avenida Talega, San Clemente, Ca : 1001 Avenida Pico, San Clemente, Ca

27 On Market Comparables SUBJECT PROPERTY: 1 The Courtyards at Talega Asking Price: $3,795,000 Cap Rate: 3.38% Office Center Asking Price: $2,795,000 Cap Rate: N/A 1041 Avenida Pico Year Built: 2003 Lot Size: 6.50 Acres 438 Main St. Year Built: 2004 Lot Size: 0.13 Acres San Clemente, Ca Huntington Beach, Ca Property Type Build/SF 9,216 Price/SF $ Occupancy 62% Bldg Type Build/SF 3,755 Price/SF $ Occupancy 100% Property Description: Available for Lease: 2 retail spaces located at The Courtyards at Talega. Join an excellent retail trade area with the I-5 freeway nearby. Property Description: located in downtown Huntington Beach, California. The property consists of a 3,755 square foot retail building that sits on a 5,875 square foot parcel. Location Description: The property was previously entitled for three, one-bedroom, one-bathroom condominium units totaling 3,107 square feet. The three units were designed as spacious loft style condos, each with their own roof top deck 2 The Plaza Asking Price: $9,200,000 Cap Rate: 5.0% Broadway Ave. Laguna Beach, Ca Year Built: 1986 Lot Size: 0.64 Acres Freestanding Property 91 La Plata, San Clemente, Asking Price: $1,499,000 Year Built: 2007 Cap Rate: N/A Lot Size: 0.44 Acres Ca Bldg Type Build/SF Price/SF Occupancy 16,423 $ % Bldg Type Build/SF Price/SF Occupancy 3,100 $ % Property Description: The Plaza and the parking lot extend from Broadway Street to Ocean Avenue making it easily accessible to all of its patrons. The total number of parking spaces for the site is considered to be 80. The parking lot site is developed with 33 on-site parking spaces and sis also allocated 21 grandfathered parking spaces and 26 in-lieu parking certifi-cated. It is one of the few shopping centers in Downtown Laguna Beach to provide parking for its consumers and its tenants. Property Description: Located in the center of 4 major shopping centers. Single level, independent pad with 15 parking spaces. Possible more spaces or drive thru. Currently 7 executive suites, built-ins, private restrooms, break room...or built to tenant suit. Location Description: 1-5 Freeway nearby neighboring tenants: Walmart, Lowes, Ralph's, Albertsons, Target. 27

28 On Market Comparables 4 The Village Plaza Avenida De La Carlota Laguna Hills, Ca Asking Price: $10,475,000 Year Built: 1993 Cap Rate: 5.06 Lot Size: 0.92 Acres Bldg Type Build/SF Price/SF Occupancy 13,301 $ % Property Description: This subject property is a rare South Orange County 100% occupied multi-tenant investment featuring seasoned tenants with strong operational history and NNN leases featuring annual increases. Location Description: Positioned on the signalized hard corner immediately adjacent to the San Diego (I-5) Freeway, the subject property is prominently located directly across from Laguna Hills Mall (anchored by Macy's, JCPenney, and Sears). 5 Freestanding Springdale Street Huntington Beach, Ca Asking Price: $4,885,000 Year Built: 2009 Cap Rate: 5.60% Lot Size: 0.76 Acres Bldg Type Build/SF Price/SF Occupancy 33,100 $ % Property Description: Busy intersection of Edinger & Springdale next to the Vons shopping center & huge senior apartment complex. Across from Hight End apartment buildings and surrounded by single family homes. Good demographics and street visibility. Location Description: 1-5 Freeway nearby Neighboring Tenants: Walmart, Lowes, Ralph' s, Albertson' s, Target. 28

29 On Market Comparables Subject: 1041 Avenida Pico, San Clemente, Ca : 438 Main Street, Huntington Beach, Ca : 303 Broadway Avenue, Laguna Beach, Ca : 91 La Pata, San Clemente, Ca : Avenida De La Carlota, Laguna Hills, Ca : Springdale Street, Huntington Beach, Ca

30 TENANT SYNOPSIS

31 Tenant Synopsis Gracie Barra Gracie Barra Brazilian JIU-JITSU. Carlos Gracie Jr. was born in January 17, 1956 and grew up heavily influenced by his family of fighters. In close synch with the life philosophy and teachings of his father Carlos Gracie Sr., Carlinhos as he s known to friends and family grew up observing and learning from some of the most influential figures his family has ever produced: Carlos, Helio and Rolls. From one school to 300 schools In 1986, Carlos Gracie Jr. founded the first Gracie Barra school, in the city of Barra da Tijuca, Rio de Janeiro. From that one location he created the most expansive BJJ organization there is, with offices in the USA, Brazil, Australia and Europe and around 300 hundred schools spanning the world. He created a structure that could protect the Gracie Barra banner while still offering support to instructors and school owners, to create career opportunities via certification programs and professional training. The aim of the schools is to help their communities by offering Jiu-Jitsu for everyone. Gracie Barra s reputation drew international attention, and Master Carlos created opportunities for hundreds of people to travel abroad and begin international careers. In 2005, Carlos founded his own school outside Brazil, the Gracie Barra US headquarters, located in the city of Irvine, California. His goal now is to bring Jiu-Jitsu to everyone, and he will accomplish that by establishing a school in every city in the world. Property Location Description WaBa Grill opened its first location in Los Angeles, California in 2004 as the premier, quick-casual "Teriyaki" Grill concept. Since franchising its concept just over 6 years ago, WaBa Grill Franchise has grown to one of the most rewarding franchise opportunities for those who are seeking solid, flourishing, and proven business model. WaBa Grill is a neighborhood fast-casual style restaurant specializing in freshly-prepared grilled menu items and other food and beverage products that provide take-out, catering, and on-premises dining services. There are currently 48 stores open, and more locations in development; in both Southern California and Virginia markets. WaBa Grill is taking their concept nationwide through franchising. Their plans include expansion to 2,000 WaBa Grill restaurants across the United States. 31

32 Tenant Synopsis Bellagio Nails & Spa Bellagio Nails & Spa is a full-service salon that specializes in nail care. They offer manicures, pedicures, cuticle treatment and hand and foot massages as well as waxing, hair removal and microdermabrasion. There are periodic specials and the staff is friendly and efficient. One Tiny Idea, Endless Possibilities Pure Barre is the largest, most established barre franchise in the nation, with more than 200 studios across the country, and more opening every month. Pure Barre is a total body workout that utilizes the ballet barre to perform small, isometric movements, which burn fat, sculpt muscles and create long, lean physiques. Map of 200 Locations Pure Barre was founded by dancer, choreographer and fitness guru Carrie Rezabek Dorr. Carrie opened her first studio in the basement of an office building in Birmingham, MI in With no initial clients, staff, signage or even a bathroom, Carrie successfully grew Pure Barre into the dynamic company it is today. In July of 2009, Pure Barre became a franchise and has exploded in popularity, due to its extremely effective technique (which transforms the shape of a woman s body in record-breaking time); friendly, high-energy atmosphere; and fun, motivating music. Pure Barre is more than just a workout; it s a lifestyle. At Pure Barre, women share a sense of community, in which they are inspired and empowered by each other s fitness and lifestyle goals. In addition to classes, Pure Barre also offers DVDs, equipment and exercise apparel. 32

33 PROPERTY FINANCIALS

34 Property Financials - Pricing/Expenses Pricing Square Foot 9,216 Schedule Gross Income List Price Current OCC.81% $242,506 Pro Forma 95% Occupancy Current OCC.95% $260,506 Schedule Gross Cam $88,035 $0.80 $88,035 $0.80 Asso. Mgt. Fee $9,329 $9,329 Total $339,870 $357,870 Vacancy Income $42,048 19% $13,025 5% Vacancy Cam $16,740 $4,402 5% Total $58,788 $17,427 Expenses $88,000 $0.80% $88,000 $0.80% NOI $193,082 $252,443 Cap Rate 5.02% 6.37% Purchase Price $3,850,000 $3,850,000 Price Per Square Foot $418 $418 Expenses Square Foot 9,216 Recoverable Expenses Total Per/Yr Per/Mo Management Fees $6,240 $0.68 $0.056 Utilities $10,416 $1.13 $0.094 Repair and Maintenance $20,748 $2.25 $0.188 Fire Security $3,000 $0.33 $0.027 Insurance $504 $0.05 $0.005 Mello Roos $6,952 $0.75 $0.063 Real Estate Tax $40,140 $4.36 $0.363 Total $88,000 $9.55 $

35 Property Financials - Rent Roll Property Information Property Type: GLA: Avg. Rent/SF/Mth: Total Spaces Avail: Occupied SF: Year Built: - (Neighborhood Center) 9,216 SF $2.28 SF 1,752 SF 5,669 SF 2004 Rent Roll Square Foot 9,216 Escalation Unit Tenant Sq/Ft % Rent $/Sq Annual Cam $/Sq Total Start End Date Amount C Bellagio Nails & Spa 1,526 17% $3,327 $2.18 $26.16 $1,215 $0.80 $4,541 4/15/2011 7/14/2016 7/15/2015 $3, C Waba Grill 1,239 13% $3,286 $2.65 $31.83 $986 $0.80 $4,272 9/1/2011 8/31/2016 9/1/2014 $3, A+B Gracie Barra 2,904 32% $6,156 $2.12 $25.44 $2,312 $0.80 $8,468 2/2/2012 8/31/2017 2/1/2015 $6, A Pure Barre 1,795 19% $3,590 $2.00 $24.00 $1,429 $0.80 $5,019 8/1/2014 8/1/2019 8/1/2016 $3, B Available 1,752 19% $2.00 $24.00 $1,395 $0.80 $4,899 Total 9, % $19,863 $7,336 $27,200 Occupied 7,464 81% $16,359 $5,941 $22,301 Available 1,752 19% $1,395 $4,899 Total 9, % $19,863 $7,336 $27, Month Rent Roll 2015 Tenant Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total Bellagio Nails & Spa $3,327 $3,327 $3,327 $3,327 $3,327 $3,327 $3,434 $3,434 $3,434 $3,434 $3,434 $3,434 $40,561 Waba Grill $3,385 $3,385 $3,385 $3,385 $3,385 $3,385 $3,385 $3,385 $3,385 $3,385 $3,385 $3,385 $41,023 Gracie Barra $6,156 $6,331 $6,331 $6,331 $6,331 $6,331 $6,331 $6,331 $6,331 $6,331 $6,331 $6,331 $75,794 Pure Barre $3,590 $3,590 $3,590 $3,590 $3,590 $3,590 $3,590 $3,590 $3,590 $3,590 $3,590 $3,590 $43,080 Available $42,048 Total $19,962 $20,136 $20,136 $20,136 $20,136 $20,136 $20,243 $20,243 $20,344 $20,344 $20,344 $20,344 $242,506 Occupied $16,458 $16,632 $16,632 $16,632 $16,632 $16,632 $16,739 $16,739 $16,840 $16,840 $16,840 $16,840 $200,458 Available $42,048 Total $19,962 $20,136 $20,136 $20,136 $20,136 $20,136 $20,243 $20,243 $20,344 $20,344 $20,344 $20,344 $242,506 35

36 CITY OF SAN CLEMENTE

37 San Clemente - California City of San Clemente About The City of San Clemente A unique combination of personality, foresight, luck, and a good dose of marketing savvy transformed this stretch of land. But unlike so many other communities in the region, San Clemente s geographical isolation helped protect its small-town charm from the homogeneous urban sprawl that permeates so much of this region. People indeed love beautiful places and the boom in San Clemente s population, this year reaching 67,892 in this 80 year-old community, reflects the popularity of San Clemente and the development that has transformed all of Orange County in the past century. However, San Clemente started and has evolved differently than many of its neighboring communities. San Clemente was among the first master planned communities built from totally open land in the United States. Before erecting a single structure on the rolling coastal hills, Ole Hanson laid out an expansive plan based on the Spanish Colonial architectural style including restaurants, a clubhouse, residences, public parks, a public pool, a fishing pier, and even equestrian trails. Education The City of San Clemente is located within the Capistrano Unified School District (CUSD), which also includes all or part of the cities of Dana Point, San Juan Capistrano, Laguna Niguel, Aliso Viejo, Mission Viejo, Rancho Santa Margarita, and several unincorporated communities of Orange County. The District offers programs for students from Kindergarten through Adult Enrichment and participates in state and federal student performance evaluation programs. Together with CUSD and private and non-profit organizations, the City offers many lifelong learning opportunities that enrich local youth and adults. For example, Saddleback College offers adult classes at the City s Senior Center and CUSD offers a number of adult courses serving San Clemente residents, including arts and crafts, English as a second language, finance, photography, computer skills, philosophy and music. 37

38 San Clemente - California City of San Clemente City of San Clemente - Employment 1) Success Factors 2) Trader Joe s 3) Keller Williams 4) Collabera 5) Enova 6) PrincetonOne 7) IQ Invision 8) NickCo Hospitality Group 9) Zuma Press Inc. 10) Cameron Health Inc. 38

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