dunkin’ donuts and corporate mattress firm - capital...

Two tenant strip center with drive thru

JOHN [email protected] | (415) 274-2715 CA BRE# 01440360

RICK [email protected] | (415) 274-2709 CA BRE# 01792433

BOB [email protected] | (415) 274-2717 CA BRE# 00869657

For more info on this opportunity please contact:

Capital Pacific collaborates. Click here to meet the rest of our San Francisco team.

Dunkin’ Donuts and corporate mattress firm

2531 East Morris blvd morristown, TN 37813

Actual Photo of Subject Property Currently Under Construction

CHRIS [email protected] | (415) 274-2701 CA BRE# 01002010

In conjunction with TN Licensed Broker: Doug Stanfield, The Stanfield York Company (404) 255-8066 [email protected]

Investment HighlightsTWO TENANT NET LEASED STRIP CENTER WITH DRIVE-THRU ON MAIN RETAIL THOROUGHFARE OF MORRISTOWN, TN AND LOCATED DIRECTLY ACROSS FROM COLLEGE SQUARE MALL

RENTABLE SF. . . . . . . . . . . . . . . 5,704 SF

PRICE PER SF. . . . . . . . . . . . . . . .$392.51

LAND AREA. . . . . . . . . . . . . . . . . 41,207 SF

YEAR BUILT/RENOVATED. . . . . 2008/2014

PRICE: $2,238,875 CAP: 6.75%

INVESTMENT HIGHLIGHTS

Located across the street from College Square Mall which features more than 50 specialty shops and is anchored by Belk, Kohl’s, JCPenney, Goody’s, Carmike Cinema 12, and T.J Maxx

Newer construction building

Dunkin’ Donuts has very rare drive-thru in strip center

Dunkin’ Donuts is paying more than 50% below recently signed Mattress Firm lease

TENANT HIGHLIGHTSMattress Firm had 2013 revenues of $1.2 billion and is the largest bedding retailer in the United States (see page 6 and 7 for more info)

Mattress Firm has $964 million in net assets as of 7/29/14

Dunkin’ Donuts is the world’s leading baked goods and coffee chain

Dunkin’ Donuts has system wide sales in excess of $8.3 billion (see page 6 for info on Dunkin guarantor/franchisee)

LEASE HIGHLIGHTSDunkin’ Donuts extended lease early to run through 2024

Rental increases in the primary term of both leases - 2.75% annual increases for Dunkin Donuts

Brand new 10 year corporate Mattress Firm lease

Landlord responsible for roof and structure

Property Signage

DUNKIN’ DONUTS & MATTRESS FIRM | 2

Rent Roll

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.

Tenant Sq. Ft. Percent of GLAMonthly Base

Rent Monthly Rent/SF

Annual Rent/SF

Annual Rent

Mattress Firm 4,064 71.25% 11/1/2014 10/31/2019 $9,991 $2.46 $29.50 $119,888

11/1/2019 10/31/2024 $10,990 $2.70 $32.45 $131,877

Option 1 11/1/2024 10/31/2029 $12,087 $2.97 $35.69 $145,044

Option 2 11/1/2029 10/31/2034 $13,296 $3.27 $39.26 $159,552

Dunkin' Donuts - Franchisee 1,640 28.75% 12/1/2008 11/30/2009 $1,867 $1.14 $13.66 $22,404

(See page 6 for more info) 12/1/2009 11/30/2010 $2,000 $1.22 $14.63 $24,000

12/1/2010 11/30/2011 $2,134 $1.30 $15.61 $25,608

12/1/2011 11/30/2012 $2,267 $1.38 $16.59 $27,204

12/1/2012 11/30/2013 $2,400 $1.46 $17.56 $28,800

Early Extension 12/1/2013 11/30/2014 $2,534 $1.55 $18.54 $30,408

12/1/2014 11/30/2015 $2,603 $1.59 $19.05 $31,236

12/1/2015 11/30/2024

Option 1 12/1/2024 11/30/2028

Option 2 12/1/2023 11/30/2028

Current Totals: 5,704 100.00% Totals $12,525 $151,124Occupied 5,704 100.00%

Actual Rent

Lease Term

Annual 2.75% Increases




Dunkin’ Donuts Drive Thru

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.

Income & Expense

PRICE $2,238,875

Price Per Square Foot: $392.51

Building Size: 5,704

Capitalization Rate: 6.75%

Lot Size (SF): 41,207

STABILIZED INCOME Per Square Foot

Rent $26.49 $151,124

LESS Per Square Foot

Taxes NN $0.00

Insurance NN $0.00

Total Operating Expenses NN $0.00

EQUALS NET OPERATING INCOME $151,124


Founded in 1950 in Quincy, MA, Dunkin Donuts is one of the world’s most recognized brands and is the world’s leading baked goods and coffee chain, selling almost 2.5 million donuts a day and more than 1 billion cups of coffee each year. The original Dunkin Donuts experience was a single cup of coffee with a donut. Today, Dunkin Donuts offers a wide range of hot and iced coffee, specialty beverages, baked goods and an expanding all-day Oven Toasted menu.

Dunkin Brands, based in Canton, MA, is home to two of the world’s most recognized brands: Dunkin Donuts and Baskin Robbins. Dunkin Brands is renowned for its leadership in the QSR segment, with more than 17,000 global points of distribution and total system wide sales of $8.3 billion. Dunkin Brands is traded on the NASDAQ (DUNK).

Fresco Development Group - Guarantor/Franchisee

Fresco Development Group LLC was started in 2004 as a restaurant development and management company, as of today, it operates 8 Dunkin Donuts stores, 5 in Miami and 3 in Jacksonville, Florida. It currently has additional locations under development in Boca Raton and Jacksonville. In addition, Fresco Development Group owns a donut production facility in Miami that produces donuts and baked goods for the South Florida franchise community. In total it employs over 120 people. In 2013, the group had retail sales of over 7.5 million and $3 million in bakery production sales.

The management team includes Scott Ball, Fred Guttenberg and Andrew Faber. Prior to forming FDG, Scott worked in Business Development at Triarc Restaurant Group, a publically held company that owned and operated Arby’s and TJ Cinnamon’s brands. Scott also spent time in the healthcare and sports/entertainment industries. Scott’s current role as CEO is overseeing Finance, Marketing and Human Resources. Mr. Ball has been a member of the Dunkin Donuts Brand Advisory Council, Marketing Steering Committee and Regional Advisory Council.

Prior to forming FDG, Fred Guttenberg, formerly of Johnson & Johnson Pharmaceuticals, spent 13 years in training and sales management positions. As President and CDO, his current management role involves all development, training, legal and information technology. Fred has been a member of Dunkin Donuts Information Technology and People Subcommittees.

DUNKIN’ DONUTS IS RANKED #1 IN

REGULAR/DECAF/FLAVORED COFFEE AND #1 IN DONUTS

Tenant


NASDAQ MFRM# OF LOCATIONS1,480NUMBER OF EMPLOYEES3,861

Mattress Firm (see page 7 for more info)

Mattress Firm currently operates over 1,480 locations across 36 states nationwide, which makes it the largest US bedding retailer. Mattress Firm offers conventional mattresses; specialty mattresses, including viscoleastic foam mattresses and YuMe sleep system, a revolutionary sleep system made of foam produced from coconut oil; and bedding related accessories comprising bed frames, mattress pads, and pillows. The company’s stores carry a broad assortment of national mattress brands and its exclusive brands. In 2011, Mattress Firm Holding Corp went public and has shown very strong sales and profit growth. Mattress Firm, as of July 29th 2014, has assets in excess of $964 million and in 2013, Mattress Firm had net sales in excess of $1.2 billion. In September 2014 Mattress Firm announced that it has entered into an agreement to acquire all of the outstanding equity interests in The Sleep Train, Inc., the leading West Coast based bedding specialty retailer, for an aggregate purchase price of $425 million, subject to working capital and other customary adjustments. As further consideration, the Company has agreed to assume certain additional liabilities totaling approximately $15 million. Sleep Train operates approximately 310 specialty mattress retail stores located in California, Oregon, Washington, Idaho, Nevada and Hawaii, and reported net sales of $471 million for the 2013 fiscal year, according to Furniture Today.

Tenants

Representative Photo


Mattress Firm Article Excerpts

Representative Photo

COMPELLING STRATEGIC RATIONALE•Expands footprint into the West Coast, including key strategic markets Adds over 310 retail store locations in major markets in California, Washington, Oregon, Nevada, Idaho and Hawaii from a leading market share player with limited overlap.

Provides customers with great value, convenience and choice.

•Fortifies Mattress Firm as the leading mattress specialty retailer in the United States

Pro forma sales approaching $2 billion annually and total enterprise locations exceeding 2,000 retail store units.

•Generates significant synergistic opportunities

Over $20 million of identifiable cost and revenue synergy potential by the third year after closing.

•Creates opportunity to begin leveraging national scale benefits

Allows for enhanced nationwide delivery and distribution, advertising efficiencies and exclusive partnership opportunities.

•Adds high-volume, established locations with a strong and experienced leadership team

29 year history of well-positioned, long-term leases in “hard to enter” trade areas.

Immediate scale with a sustained and profitable multi-brand organization.

Experienced and disciplined culture that is highly aligned with Mattress Firm.

•Enhances financial performance and improves growth prospects

Estimated to achieve mid-single digit earnings per diluted share (EPS) percentage accretion, on a generally accepted accounting principles basis before one-time costs, in the first full year after closing.

Combined business is anticipated to generate significant free cash flow.

Establishes a foundation to execute on our proven relative market share model by opening additional stores in West Coast markets to achieve store penetration levels commensurate with existing Mattress Firm markets.

MATTRESS FIRM TO ACQUIRE SLEEP TRAIN HOUSTON--(BUSINESS WIRE)-- Mattress Firm Holding Corp. (the “Company”) (NASDAQ:MFRM), the leading specialty retailer of mattresses and related products and accessories in the United States today announced that it has entered into an agreement to acquire all of the outstanding equity interests inThe Sleep Train, Inc., the leading West Coast based bedding specialty retailer, for an aggregate purchase price of $425 million, subject to working capital and other customary adjustments. As further consideration, the Company has agreed to assume certain additional liabilities totaling approximately $15 million. Sleep Train operates approximately 310 specialty mattress retail stores located in California, Oregon, Washington, Idaho, Nevada and Hawaii, and reported net sales of $471 million for the 2013 fiscal year, according to Furniture Today.

“This unique and transformational opportunity will meaningfully enhance Mattress Firm’s position within the specialty retail bedding industry,” stated Steve Stagner, Mattress Firm’s president and chief executive officer. “The acquisition of Sleep Train will establish Mattress Firm as the first border to border, coast to coast multi-brand mattress specialty retailer in the United States, with pro forma sales approaching $2 billion a year. It allows us to share best practices and integrate two industry leading management teams, positioning Mattress Firm for accelerated growth.

-Combined Business Will Operate Approximately 2,000 Mattress Specialty Retail Stores and 70 Distribution Centers Across 40 States -

- Expected Mid-Single Digit EPS Percentage Accretion, on GAAP Basis Before One-Time Costs, in the First Full Year After Closing -

- Estimated $20 Million in Annual Run Rate Synergies by Fiscal 2017 -


Fish Hatchery Road

S Cumberland StreetLincoln Avenue

Valley Home Road

W Andrew Johnson Highway

E 1st N Street

N L

iber

ty

HIll

Road

Buffalo Tr

ail

E Morris Boulevard

W Morris Boulevard

34

66

66

66

3434

32

343

343

343 32

32

160160

25E

25E

25E

11E

11E

THE COUNTRY CLUB

MORRISTOWN GOLF AND

COUNTRY CLUB

West Elementary

Lincoln Heights Middle

School

Tennessee Technology

Center

Morristown-Hamblen High School West

Morristown-Hamblen High

School East

College Square Mall

KNOXVILLE

11E

20,420 DAILY

23,220 DA

ILY

KNOXVILLE

11E

College Square Mall

20,420 DAILY23,220 D

AILY

E Morris Boulevard

Close Aerial

THE SUBJECT PROPERTY

IS ACROSS THE STREET

FROM COLLEGE SQUARE

MALL

Surrounding Retail Photos

Site Plan & Elevation

GENERAL REALTYMorristown, TN

Site Plan112-0078

10/31/2012

GENERAL REALTYMorristown, TN

Rendered Elevation10/31/2012

10/05/2012

112-0078

West Exterior Elevation1/8” = 1’ - 0”

South Exterior Elevation1/8” = 1’ - 0”


Regional MapMorristown TN

Location

DUNKIN’ DONUTS

& MATTRESS FIRM

Surrounding Retail


MORRISTOWN TN OVERVIEW

The City of Morristown (27.15 square miles) is located near the northeast corner of Tennessee, within the third smallest county in the state, Hamblen (175 square miles). Like much of Tennessee, Hamblen County is temperate and continental with four distinct seasons and moderate temperatures (roughly 66-87°F in July and 27-47°F in January).

Tennessee ranges from the lowlands of the Mississippi Delta with high rainfall and hot temperatures to the mountains of East Tennessee with high snowfall (and even some temperate rain forests) and cold temperatures across the whole gamut of things in between.

In Morristown, the percentage of population over 18 without a high school degree or General Education Degree (GED) is over twice that of the national figure (31.4% compared to 15.5%). The percentage of those without a high school degree or GED in Hamblen County, overall, is lower than that of Morristown but still substantially higher than the U.S. For those with a 4-year post-secondary degree or certificate, the gap between city and country is smaller—8.8% for Morristown compared to 10.1% for Hamblen County.

Location & Demos

2013 HOUSEHOLD INCOMES

1-Mile 3-Mile 5-Mile

2013 3,286 29,439 42,843

1-Mile 3-Mile 5-Mile

Average $41,960 $42,214 $46,547

POPULATION

Employer Mahle Koch Foods Howmet JTEKT Automotive

TOP EMPLOYERS IN MORRISTOWN, TN


dunkin’ donuts and corporate mattress firm - capital...

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