SUBJECT PROPERTY EXCLUSIVE OFFERING $2,456,000-6.75% CAP EXP DALLAS 214.522.7200 JOE CAPUTO joe@exp1031.com BOB MOORHEAD bob@exp1031.com property. Underwent major renovations in 2013, to include a new roof. Significant improvements contributed by tenant. Top performing location. Brand New Roof & HVAC Units in 2013 tenant. First Choice Emergency Room is based in Lewisville, TX and is the leading freestanding emergency room system. $78.2 million in sales in 2012 lease structure. Brand new, 7-year, net lease with 10% annual rent increases beginning year 6 every 5-years. location. First Choice Emergency Room is located at the intersection of Center Street (26,945 Cars / Day) and Pasadena Boulevard (18,344 Cars / Day) just west of Houston Beltway 8 (78,400 Cars / Day). The population within a 1-mile radius of the subject property is projected to grow by 4.9% over the 5-year period ending in 2017. San Jacinto College (28,549 Students) and the south campus of Deer Park High School (3,811 students) are nearby. The average annual household income within this radius is $76,659. Houston MSA location: with an MSA population of 5,946,800, Houston anchors the 6 th largest metro area in the US. Deer Park is 30 minutes southeast of Houston.
Table of contents Disclaimer PAGE 1: PAGE 2: PAGE 3: PAGE 4: PAGE 5: PAGE 6: PAGE 7-8: PAGE 9: COVER TABLE OF CONTENTS DISCLAIMER INVESTMENT TENANT LEASE OVERVIEW SITE PLAN AERIAL PHOTO LOCATION OVERVIEW LOCATION MAPS DEMOGRAPHICS Disclaimer EXP Realty Advisors, Inc. ( Agent ) has been engaged as an agent for the sale of the property located at by the owner of the Property ( Seller ). The Property is being offered for sale in an as-is, where-is condition and Seller and Agent make no representations or warranties as to the accuracy of the information contained in this Offering Memorandum. The enclosed materials include highly confidential information and are being furnished solely for the purpose of review by prospective purchasers of the interest described herein. The enclosed materials are being provided solely to facilitate the prospective investor s own due diligence for which it shall be fully and solely responsible. The material contained herein is based on information and sources deemed to be reliable, but no representation or warranty, express or implied, is being made by Agent or Seller or any of their respective representatives, affiliates, officers, employees, shareholders, partners and directors, as to the accuracy or completeness of the information contained herein. Summaries contained herein of any legal or other documents are not intended to be comprehensive statements of the terms of such documents, but rather only outlines of some of the principal provisions contained therein. Neither the Agent nor the Seller shall have any liability whatsoever for the accuracy or completeness of the information contained herein or any other written or oral communication or information transmitted or made available or any action taken or decision made by the recipient with respect to the Property. Interested parties are to make their own investigations, projections and conclusions without reliance upon the material contained herein. Seller reserves the right, at its sole and absolute discretion, to withdraw the Property from being marketed for sale at any time and for any reason. Seller and Agent each expressly reserves the right, at their sole and absolute discretion, to reject any and all expressions of interest or offers regarding the Property and/or to terminate discussions with any entity at any time, with or without notice. This offering is made subject to omissions, correction of errors, change of price or other terms, prior sale or withdrawal from the market without notice. Agent is not authorized to make any representations or agreements on behalf of Seller. Seller shall have no legal commitment or obligation to any interested party reviewing the enclosed materials, performing additional investigation and/or making an offer to purchase the Property unless and until a binding written agreement for the purchase of the Property has been fully executed, delivered, and approved by Seller and any conditions to Seller s obligations hereunder have been satisfied or waived. By taking possession of and reviewing the information contained herein, the recipient agrees that (a) the enclosed materials and their contents are of a highly confidential nature and will be held and treated in the strictest confidence and shall be returned to Agent or Seller promptly upon request; and (b) the recipient shall not contact employees or tenants of the Property directly or indirectly regarding any aspect of the enclosed materials or the Property without the prior written approval of the Seller or Agent; and (c) no portion of the enclosed materials may be copied or otherwise reproduced without the prior written authorization of Seller and Agent. 2
Investment overview PRICE: $2,456,000 CAP RATE: 6.75% NET OPERATING INCOME: $165,750 BUILDING AREA: 6,500+ Square Feet Lease overview Initial Lease Term: 7-Years, Plus 1, 7-Year Options to Renew Rent Commencement: September 2013 Lease Expiration: September 2020 Lease Type: Net Lease LAND AREA: 0.64+ Acres Rent Increases: 10% in Lease Year 6 & Escalating Every 5-Yrs. YEAR BUILT / RENOVATED: 1994 / 2013 LANDLORD RESPONSIBILITY: Includes Roof & Structure* OWNERSHIP: Fee Simple Interest OCCUPANCY: 100% Year 1-5 Annual Rent (Current): $165,750 Year 6-7 Annual Rent: $182,325 Year 8-10 Annual Rent (Option 1): $182,325 Year 11-14 Annual Rent (Option 1): $200,557 *Brand New Roof & HVAC Units in 2013 Tenant overview Guarantor: First Choice ER, LLC www.fcer.com First Choice Emergency Room is based in Lewisville, TX and is the leading freestanding emergency room system; it is both the largest and the oldest. First Choice Emergency Room is revolutionizing the delivery of emergency medical services for adult and pediatric emergencies, both major and minor. First Choice Emergency Room facilities are innovative, freestanding, and fully equipped emergency rooms with state of the art diagnostic technology (CT Scanners, Ultrasound, Digital X-ray) and on-site labs. All First Choice Emergency Room locations are exclusively staffed with board-certified emergency physicians and emergency trained registered nurses. With locations in Houston, Dallas/Fort Worth, Austin, and Colorado Springs, patients receive high-quality care and have an alternative to today s overburdened hospital system. Inc. Magazine ranked First Choice as one of the fastest growing businesses in the U.S. in 2010, 2011, and 2012. The company SUBJECT was named PROPERTY as one of the 2013 Best Companies to Work for in Texas. The company s current growth plans are backed by Sterling Partners, which has invested PRIOR $59 million TO PANDA in theexpress business. EXPANSION First Choice generated $78.2 million in revenue in 2012, up from $37 million in 2008. First Choice was established in 2002 by Dr. Jack Novak, and Thomas S. Hall is the company s current CEO. First Choice plans to build more Freestanding Emergency Rooms, as stated in 2012. The company has plans to invest over $100 million over the next few years by developing many more facilities. As stated in a Dallas Morning News article in March 2013, CEO Tom Hall stated that First Choice plans to add 6 to 8 new DFW facilities in the next 12 to 18 months. 3
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Aerial photo Abshire Stadium Deer Park High School South Deer Park Elementary School Houston Beltway 8 (78,400 Cars / Day) Bonnette Junior High School Carpenter Elementary School Pasadena Boulevard (18,344 Cars / Day) Providence at Town Square Senior Living 5
Location overview IMMEDIATE TRADE AREA First Choice Emergency Room is located at the intersection of Center Street (26,945 Cars / Day) and Pasadena Boulevard (18,344 Cars / Day) just west of Houston Beltway 8 (78,400 Cars / Day). Center Street is a north-south arterial road that traverses Deer Park and Pasadena Boulevard provides the trade area with direct access to Houston Beltway 8, which is Houston s outer ring road. Numerous national credit tenants have taken advantage of this convenience and accessibility. The subject property shares the southeast corner of the intersection with an HEB grocery store, Starbucks, and Chase Bank. The site is adjacent to the newly constructed Shoppes at Town Square shopping center which includes T-Mobile, Verizon Wireless, Baskin Robbins, Firehouse Subs, and Anytime Fitness in its tenant mix. Other retailers nearby include Walgreens, CVS, Radio Shack, Food Town, Sonic, Shell, Papa John s, Little Caesar s, Church Chicken, and Valero. First Choice also fronts a newly constructed 14-acre senior living development, Providence at Town Square Senior Living. The population within a 1-mile radius of the subject property is projected to grow by 4.9% over the 5-year period ending in 2017. The average annual household income within this radius is $76,659. The subject property has the additional advantage of being surrounded by numerous schools. The south campus of Deer Park High School (3,811 Students) is just north of First Choice Emergency Room. Carpenter Elementary School (910 Students) and Bonnette Junior High School (769 Students) are just west of the site. Deer Park Elementary School (719 Students) is nearby to the east. Additionally, San Jacinto Junior College (28,549 Students) is close by to the south. DEER PARK, TX Deer Park is a suburb of Houston, TX located to the southeast of the city. The Deer Park population was 12,773 in 1970, and 28,520 in 2000. This growth has been fueled by the growth of the petrochemical industry as well as the growth of business along the Houston Ship Channel. According to a 2012 report, ship channel traffic accounts for more than 1 million Texas jobs and generates more than a $178 billion impact on the state's economy. Deer Park has a school district with 14 campuses, a city library, community theater, municipal court building, three fire stations, numerous city parks and recreational facilities, state-of-the-art water and sewer processing facilities, a post office, several hotels, 14 major industries as well as several light industrial companies. Today, Deer Park has approximately 9,000 homes and 32,010 residents. The vibrant local economy boasted a 5.4% unemployment rate as of April 2013. HOUSTON-SUGAR LAND-BAYTOWN METROPOLITAN AREA The Houston-Sugar Land-Baytown Metropolitan Statistical Area (MSA), colloquially known as Greater Houston, is the 6 th largest in the United States with a population of 5,946,800. From 2000 to 2030, the metropolitan area is projected by Woods & Poole Economics to rank 5 th in the nation in population growth adding 2.66 million people. In 2006, Greater Houston ranked 1 st in Texas and 3 rd in the U.S. within the category of "Best Places for Business and Careers" by Forbes. The Greater Houston Gross Metropolitan Product (GMP) in 2005 was $308.7 billion, up 5.4 percent from 2004 in constant dollars. By 2010, the GMP rose to $384 billion, 5 th in the nation. Only 28 nations other than the United States have a GDP exceeding the Greater Houston GMP. Mining, which in Houston is almost entirely oil and gas exploration and production, accounts for 11 percent of Greater Houston's GMP. Houston is 2 nd to New York City in Fortune 500 headquarters. Galveston Bay and the Buffalo Bayou together form one of the most important shipping hubs in the world, and the Port of Houston, the Port of Texas City, and the Port of Galveston are all major seaports located in Greater Houston. The area is one of the leading centers of the energy industry, particularly petroleum processing, and many companies have large operations in this region. The MSA comprises the largest petrochemical manufacturing area in the world, including for synthetic rubber, insecticides, and fertilizers. Much of metro area's success as a petrochemical complex is enabled by the Houston Ship Channel. The area is also the world's leading center for building oilfield equipment, and is a major center of biomedical research, aeronautics, and high-technology. Houston is home to the Texas Medical Center the largest medical center in the world several universities (including Rice University, Texas Southern University, and The University of Houston), and two of the largest systems of higher learning in the United States (The Houston and Lone Star Community College systems). The University of Houston s annual impact on the Houstonarea's economy alone equates to that of a major corporation: $1.1 billion in new funds attracted annually to the Houston area, $3.13 billion in total economic benefit, and 24,000 local jobs generated. CNN/Money and Money Magazine have recognized 5 cities in the Greater Houston area the past 3-years as part of its 100 Best Places to Live in the United States. 6
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Demographics Demographic snapshot Radius 1 Mile 3 Mile 5 Mile Population: 2017 Projection 16,264 85,860 176,461 2012 Estimate 15,507 82,469 169,362 2010 Census 15,390 82,112 167,942 Growth 2012-2017 4.90% 4.10% 4.20% Growth 2010-2012 0.80% 0.40% 0.80% Households: 2017 Projection 5,786 29,658 59,044 2012 Estimate 5,565 28,652 57,024 2010 Census 5,514 28,448 56,395 Growth 2012-2017 4.00% 3.50% 3.50% Growth 2010-2012 0.90% 0.70% 1.10% Owner Occupied 3,780 20,012 36,845 Renter Occupied 1,785 8,640 20,180 2012 Avg Household Income $76,659 $73,372 $67,097 2012 Med Household Income $60,917 $59,068 $52,552 2012 Per Capita Income $27,235 $25,505 $22,692 2012 Households by Household Inc: Income Less than $15,000 412 2,485 6,633 Income $15,000 - $24,999 474 2,376 5,729 Income $25,000 - $34,999 517 2,340 5,801 Income $35,000 - $49,999 743 3,930 8,490 Income $50,000 - $74,999 1,180 6,786 12,217 Income $75,000 - $99,999 779 4,252 7,403 Income $100,000 - $149,999 1,098 4,721 7,403 Income $150,000 - $199,999 175 962 1,778 Income $200,000+ 188 801 1,571 DOWNTOWN HOUSTON, TX HOUSTON SHIP CHANNEL 9