Real Estate Analysis - Diagnosis of Vacant Shopping Centers in AZ

Transcription

1 PRÆDIUM Advisors Multi-Tenant NNN Shopping Center Investment Offered at Only $3,950,000 $379,000 Price That s an 8 CAP on In-Place 2016 NOI! REDUCTION! Fiesta Palms Retail Center Phase S. Alma School Road Mesa, AZ Exclusively Marketed by PRAEDIUM Advisors Victor Allison President victor@praedium-advisors.com

2 Metro Phoenix Vicinity Map 2

3 Aerial Photograph SITE 3

4 Offering Summary Location and Physical Characteristics: Fiesta Palms II is south of and contiguous to the larger Fiesta Palms Shopping Center located at the South East Corner of the signalized intersection at Alma School Road and Baseline Road in Mesa, AZ. The site has excellent freeway access being located just 0.5 miles south of US 60 and 2 miles east of AZ Loop 202. This 28,383± s.f. multi-tenant, retail center has excellent visibility with three unobstructed left/right in/out access points. It s leased to national, regional and local tenants. Tenants within the overall Fiesta Palms Shopping Center create a high degree of retail synergy within the entire complex. Some of these tenants include Starbucks, Dunkin Donuts, Applebee s, Lotus Market Grocery, Cricket Wireless and Snap Fitness. Trade Area Highlights: The five mile radius trade area is heavily populated with over 422,000 prospective customers within a dense residential community. Average Household Income withing a one mile radius is $63,842 Over 60,000 vehicles per day pass through the intersection with 33,300± vehicles driving by Fiesta Palms II on Alma School Road. Address: 2111 S. Alma School Road Mesa AZ Tax Assessor s Parcel # and Property Taxes: W $42,203± 4

5 Offering Summary Owner: Zoning: Tenant Mix: Fiesta Palms Shopping Center, LLC 1599 E. Orangewood Avenue Suite 250 Phoenix, AZ LC Mesa s Limited Commercial zoning provides areas for indoor retail, entertainment and service oriented businesses that serve the surrounding residential trade area within a one to ten mile radius. Avalon School of Cosmetology Papa John s Pizza Arthur Murray Dance Studio Has been in business over 40 years 2 locations in AZ and 1 in CA & UT Tenant since ± locations in 36 countries. Tenant since 1998 Tenant since 2006 Massage Hau Kids Play Learning Center Vacant EndCap Church Tenant since 2011 Tenant since ,908± s.f. 900± s.f. 4 year lease signed 9/15 All tenants have annual rental increases and staggered lease terms. Year Built: 1988 Total Leaseable: 28,383± s.f. Occupancy: 86% as of October 2015 Site Area: 3.26± acres 5

6 Offering Summary Existing $1,700,000± current principal balance Assumable 5.95% 10 year term ending July year amortization Financing: $11,920± per month Principal + Interest No Assumption Fee Prepayable w/1% Penalty Personal Guaranty Required 3 Purchase Scenarios: All Cash Cash to New Financing Cash and Assume Existing $1.7M Loan Financial Under a Cash to New Financing purchase scenario assuming Buyer puts 30% down, Analysis secures a new 4.5% loan with a 25 year amortization schedule, and sells the Summary: Property at the end of Year 7 at a 7 CAP, then this Fiesta Palms provides an IRR of 24% and a Cash on-cash return of over 10% increasing to 19%. 10/1/15 As of 10/1/15 the 3,906 s.f. End-Cap space is vacant and for this analysis is Leasing Status: assumed to remain vacant through all of The 2016 estimated NOI of $316,175 is capped at an 8.0% return yielding a Purchase Price of $3,950,000. re e k H UEST g Price: c i n Cl REQ eri to Off ndum Optional LL ora Purchase U F m Scenario: Me 016 In-Place NOI 2 on P A C 8 n a s t a Th Only $3,950,000 cancy Factor Va %.7 13 a s e ud cl in which for all of 2016! With a minimum $1,000,000 down payment, Owner will wrap the existing $1.7M note and carry a second note at 8% interest only for up to a 3 year term. Owner remains as Personal Guarantor on the existing $1.7M note and continues as property manager under this optional scenario. 6

7 Existing Tenant Mix 7

8 Site Photographs Entrance Monument Sign on Alma School Road Vacant Suite & Papa John s Facing Alma School Road Avalon Cosmetology Suite Arthur Murray Suite 8