FedEx Ground Distribution Facility

Transcription

1 FedEx Ground Distribution Facility Tallahassee, Florida OFFERING MEMORANDUM Net Lease Investments Douglas Longyear CA LIC # Christina Campanella NY LIC # Andrew Bogardus CA LIC # Christopher Sheldon CA LIC # Paul Carr FL LIC #SL

2 Disclaimer The information contained in this marketing brochure ( Materials ) is proprietary and confidential. It is intended to be reviewed only by the person or entity receiving the Materials from DTZ ( Agent ). The Materials are intended to be used for the sole purpose of preliminary evaluation of the subject property/properties ( Property ) for potential purchase. The Materials have been prepared to provide unverified summary financial, property, and market information to a prospective purchaser to enable it to establish a preliminary level of interest in potential purchase of the Property. The Materials are not to be considered fact. The information contained in the Materials is not a substitute for thorough investigation of the financial, physical, and market conditions relating to the Property. The information contained in the Materials has been obtained by Agent from sources believed to be reliable; however, no representation or warranty is made regarding the accuracy or completeness of the Materials. Agent makes no representation or warranty regarding the Property, including but not limited to income, expenses, or financial performance (past, present, or future); size, square footage, condition, or quality of the land and improvements; presence or absence of contaminating substances (PCB s, asbestos, mold, etc.); compliance with laws and regulations (local, state, and federal); or, financial condition or business prospects of any tenant (tenants intentions regarding continued occupancy, payment of rent, etc). A prospective purchaser must independently investigate and verify all of the information set forth in the Materials. A prospective purchaser is solely responsible for any and all costs and expenses incurred in reviewing the Materials and/or investigating and evaluating the Property. By receiving the Materials you are agreeing to the Confidentiality and Disclaimer set forth herein. FedEx Ground i

3 SUMMIT EAST TECHNOLOGY PARK Net Lease Investments SUMMIT LAKE DR APEX DR SUMMIT LAKE DR

4 Investment Offering & Highlights The Offering A new concrete tilt-up 124,600± sq. ft. distribution building located in Tallahassee, Florida and leased to FedEx Ground Package System, Inc. Price: $15,289,400 Cap Rate: 6.20% Lease / Tenant New 10 year lease FedEx Ground is FedEx Corporation s most profitable division FedEx Corporation s S&P bond rating is BBB FedEx Corporation s bonds trade at yields that are lower than are available for some other companies AA and A rated bonds Real Estate Strategic location at the juncture of Interstate 10 and U.S. Highway 90 The property is situated in the up-scale Summit East Technology Office Park Based upon previous build outs, it is estimated that FedEx will have spent over $8 million on its internal package handling conveyor system Area Strengths Tallahassee is the State Capital of Florida Florida State University and Florida A&M University are located in Tallahassee Tallahassee is the home for the National High Magnetic Field Laboratory FedEx SKF USA, Ground Inc. iii 2i

5 FedEx Ground Distribution Facility Table of Contents Disclaimer Aerial Investment Offering & Highlights i ii iii Investment Overview 1 Possible Financing 2 FedEx Ground 3 Site Plan 4 Interior 5 Location / Aerial / Area Maps 7 Summit East Technology Park 11 Tallahassee 12 Demographics 14 Douglas Longyear doug.longyear@dtz.com CA LIC # Christina Campanella christina.campanella@dtz.com NY LIC # Andrew Bogardus andy.bogardus@dtz.com CA LIC # Christopher Sheldon chris.sheldon@dtz.com CA LIC # Paul Carr paul.carr@dtz.com FL LIC #SL

6 Investment Overview Location 2058 Summit Lake Drive, Tallahassee, Florida Lot Size Approximately acres 696,960± square feet Improvements To be completed April 2015, a new 124,600± square feet FEDEX GROUND distribution building. The construction type is steel frame with a metal standing seam roof and tilt-up concrete exterior. The building has multiple dock-high and van drive-in truck doors. The building is fully sprinklered. Lease Leased to FEDEX GROUND PACKAGE SYSTEMS, INC., for 10 years from May 1, 2015 until April 30, 2025 at the annual net rent of $947,943. FedEx Ground is a subsidiary of FEDEX CORPORATION (NYSE: FDX), which does not guarantee the lease. The tenant is responsible for all property real estate taxes, property insurance, tenant s liability insurance, and maintenance of the yard, parking, drive and hard surfaced areas. The landlord is responsible for maintenance of the structural portions of the building including the foundation, roof, exterior walls and floor slabs. There are two five-year renewal options; the first with a 10% rental increase and the second with a 5% rental increase. Annual Rent Investment Years Annual Rent Return 1 10 $ 947, % (Option 1) $1,042, % (Option 2) $1,094, % Price: $15,289, % Cap Rate Price Per Square Foot $125 FedEx Ground 1

7 Possible Financing 10 Year Loan - 50% LTV LOAN TERMS CAPITALIZATION CASH FLOW Amortization (Yrs) 30 Price $15,289,400 Rent $947,943 LTV 50% Loan <7,644,700> Debt Service <432,691> Interest 3.90% Equity $7,644,700 Cash Flow $515,252 Constant 5.66% Cash on Cash 6.74% 10 Year Loan - 60% LTV LOAN TERMS CAPITALIZATION CASH FLOW Amortization (Yrs) 25 Price $15,289,400 Rent $947,943 LTV 60% Loan <9,173,640> Debt Service <581,062> Interest 4.00% Equity $6,115,760 Cash Flow $366,881 Constant 6.33% Cash on Cash 6.00% 10 Year Loan - 75% LTV LOAN TERMS CAPITALIZATION CASH FLOW Amortization (Yrs) 30 Price $15,289,400 Rent $947,943 LTV 75% Loan <11,467,050> Debt Service <693,140> Interest 4.45% Equity $3,822,350 Cash Flow $254,803 Constant 6.04% Cash on Cash 6.67% FedEx Ground 2

8 FedEx Ground FedEx Ground and its subsidiary FedEx SmartPost shipped an average of 6,774,000 packages per day in fiscal year FEDEX GROUND PACKAGE SYSTEM, INC., the Property s tenant, is one of North America s two largest providers of business-to-business and business-toconsumer ground small-package delivery service and FedEx Corporation s secondlargest business segment. FedEx Ground is FedEx Corporation s most profitable division. FedEx Ground has a network of more than 500 distribution hubs and local pickup-and-delivery terminals located throughout the United States and Canada. The FedEx 2014 annual report (May 31, 2014 yearend) indicates that the FedEx Ground segment had revenues of $ billion, which was 9.8% above the 2013 level, and operating income of $1.955 billion, which reflected a 9.3% year over year increase. FEDEX CORPORATION (NYSE: FDX), the tenant s parent, provides customers and businesses worldwide with the broadest portfolio of transportation, logistics and e-commerce services. FedEx Corporation does not guarantee the tenant s lease obligations. For the fiscal year ended May 31, 2014, FedEx reported record revenue of $ billion, net income of $2.097 billion and total stockholder s equity of $ billion. As of this offering s publication, FedEx Corporation had an investment grade S&P bond rating of BBB. Website: FedEx Ground 3

9 Site Plan Net Lease Investments SUMMIT LAKE DRIVE HERITAGE OAK ADMIN OFFICE ACCESS ROAD DECORATIVE SECURITY FENCE ±124,600 SF SOUND WALL INTERSTATE 10 DETENTION POND FedEx Ground 4

10 Floor Plan Net Lease Investments ±124,600 SF LEGEND = PACKAGE HANDLING SYSTEM = DELIVERY VAN

11 FedEx Ground pays for the package sorting and handling conveyor system.

12 Location Panama City Tallahassee Jacksonville Orlando Tampa 4 95 St. Petersburg 75 FedEx Ground 7

13 Location State Capitol Tallahassee Tallahassee Regional Airport FedEx Ground 8

14 10 Net Lease Investments 10 DR APEX DOWNTOWN TALLAHASSEE 90 SUMMIT EAST TECHNOLOGY PARK 90 SUMMIT LAKE DR FedEx Ground 9 SUMMIT LAKE DR LAKE SUMMIT DR

15 Location 8 Mahan Drive Summit Lake Dr Mahan Drive Apex Dr Summit Lake Dr Summit East Technology Park The subject property is located on 16± acres of land in the Summit East Technology Park, a 117-acre commercial development, in the eastern quadrant of Interstate 10 and U.S. State Highway 90. Transportation Tallahassee is located along Interstate 10, which is the southernmost interstate in the U.S. I-10 connects Jacksonville, FL with Los Angeles, CA and passes through Pensacola, FL, Mobile, AL, New Orleans, LA, Baton Rouge, LA, Beaumont, TX, Houston, TX, San Antonio, TX and Phoenix AZ. I-10 bisects Interstate 75, 120 miles east of Tallahassee and connects with Interstate 95 in Jacksonville, 165 miles east of Tallahassee. FedEx Ground 10

16 Summit East Technology Park Net Lease Investments Summit East Technology Park Summit East Technology Park, a 117-acre commercial development, is a technology and amenity driven office park. In addition to cutting edge technology, Summit East offers amenities such as an onsite hotel as well as green space, a nature trail, and a beautiful lake. Located directly off I-10 at Mahan Drive, Summit East offers immediate access to I-10 and is 8½ miles to downtown and only 5 minutes the I-10 / Thomasville Road interchange. Companies at Summit East include First American Title, IBM, Cisco, URS, ACS-Xerox, and Auto-Owners Insurance. Northview Building FedEx Ground 11

17 Tallahassee Tallahassee is the State Capital of Florida and is the 128th largest city in the United States. Tallahassee has a population of 186,971. The population for the Tallahassee metropolitan area is 375,371. Tallahassee is the home for two large universities - Florida State (40,000 students) and Florida A&M University (11,000). Tallahassee is a center for trade and agriculture in the Florida Panhandle and is served by Tallahassee Regional Airport. With one of the fastest growing manufacturing and high tech economies in Florida, its major private employers include a General Dynamics Land Systems manufacturing facility (military and combat applications), the Municipal Code Corporation, which specializes in the publication of municipal and county legal references; and a number of national law firms, lobbying organizations, trade associations and professional associations, including the Florida Bar and the Florida Chamber of Commerce. It is recognized as a regional center for scientific research, and is home to the National High Magnetic Field Laboratory, the largest and highest-powered magnet research laboratory in the world. Florida State University (FSU) Florida State University is one of the nation s elite research universities as determined by the Carnegie Foundation s highest designation, Doctoral/Research University Extensive. Florida State University s 16 colleges offer more than 275 undergraduate, graduate, doctoral, professional and specialist degree programs, including medicine and law, covering a broad array of disciplines critical to society today. Each year the University awards over 2,000 graduate and professional degrees. Florida State is home to Florida s only National Laboratory the National High Magnetic Field Laboratory and is the birthplace of the commercially viable anti-cancer drug Taxol. Florida State University also operates The John & Mable Ringling Museum of Art, the State Art Museum of Florida and one of the largest museum/university complexes in the nation. Florida State University is accredited by the Southern Association of Colleges and Schools as a Level VI public institution. Florida State University is home to nationally ranked programs in many academic areas, including the sciences, engineering, social policy, film, music, theater, dance, visual art, business, political science, psychology, social work, medicine, and law. The university is also known for its undergraduate study abroad options: according to Uni in the USA, the large numbers of students that study abroad nicely compliment the students that study here from abroad. Doak Campbell Stadium FedEx Ground 127

18 Tallahassee (Continued) National High Magnetic Field Laboratory at FSU The National High Magnetic Field Laboratory (NHMFL) is the world s highest powered magnet laboratory, located in Tallahassee, Florida. It is property of Florida State University, with branches in University of Florida and at Los Alamos National Laboratory. NHMFL develops and researches magnetic fields for research in physics, biology, bioengineering, chemistry, geochemistry, biochemistry. The largest magnet laboratory in the world, it is the only facility of its kind in the United States, among nine worldwide. The lab is supported by the National Science Foundation and the state of Florida, and works in collaboration with private industry. Florida Agriculture and Mechanical University (FAMU) Florida A&M University (FAMU) is part of the State University System of Florida and is accredited by the Southern Association of Colleges and Schools Commission on Colleges. FAMU s main campus comprises 156 buildings spread over 422 acres atop the highest of Tallahassee s seven hills. The university also has several satellite campuses including a site in Orlando where the College of Law is located and sites in Miami, Jacksonville and Tampa for its pharmacy program. Florida A&M University enrolls nearly 11,000 students from the United States and more than 70 countries such as India, Egypt, Trinidad, Netherlands, China, Bahamas, Jamaica, and Brazil. Florida A&M University offers 54 bachelor s degrees, 28 master s degrees, three professional degrees and 12 doctoral degrees. The three professional degrees include the JD, PharmD, and the Doctor of Physical Therapy. The 12 doctoral degree programs include 11 Ph.D. degrees and one Doctor of Public Health (DrPH). The Ph.D. degrees include the following: biomedical engineering, chemical engineering, civil engineering, electrical engineering, mechanical engineering, industrial engineering, pharmaceutical sciences, physics, educational leadership, environmental science and entomology, engineering, chemical engineering, civil engineering, electrical engineering, mechanical engineering, industrial engineering, pharmaceutical sciences, physics, educational leadership, environmental science and entomology. National High Magnetic Field Laboratory FSU Headquarters Spans 330,000 SF FedEx Ground 13

19 Demographics Census 2010 Summary 10 miles 20 miles 30 miles Population 183, , ,884 Households 73, , ,774 Families 42,146 68,227 93,415 Average Household Size Owner Occupied Housing Units 42,721 68,717 93,496 Renter Occupied Housing Units 31,106 52,834 64,278 Median Age Summary Population 186, , ,623 Households 74, , ,929 Families 42,431 68,554 93,811 Average Household Size Owner Occupied Housing Units 42,052 67,411 92,055 Renter Occupied Housing Units 32,942 55,924 67,873 Median Age Median Household Income $50,297 $42,558 $40,475 Average Household Income $67,332 $59,386 $56, Summary Population 193, , ,318 Households 78, , ,947 Families 44,219 71,262 97,337 Average Household Size Owner Occupied Housing Units 44,465 71,034 96,755 Renter Occupied Housing Units 33,590 57,144 69,193 Median Age Median Household Income $56,559 $50,978 $48,733 Average Household Income $74,955 $66,242 $62,792 Trends: Annual Rate Population 0.77% 0.71% 0.66% Households 0.80% 0.77% 0.74% Families 0.83% 0.78% 0.74% Owner Households 1.12% 1.05% 1.00% Median Household Income 2.37% 3.68% 3.78% Unconquered Statue at Doak Campbell Stadium FedEx Ground 14

20 DTZ Net Leased Investment Services Douglas Longyear CA LIC # Christina Campanella NY LIC # Andrew Bogardus CA LIC # Christopher Sheldon CA LIC # Paul Carr FL LIC #SL