professional office building · jan 2015 year 2 jan 2016 year 3 jan 2017 year 4 jan 2018 year 5 jan...

LAKE WALES, FL

Professional OfficeBuilding

OFFERING MEMORANDUM

CONFIDENTIALITY AND DISCLAIMER

The information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCB's or asbestos, the compliance with State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein.

LAKE WALES, FL

Professional Office Building

Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation’s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONSULT YOURMARCUS & MILLICHAP AGENT FOR MORE DETAILS.

NON-ENDORSEMENT NOTICE

Section 1 PRICING AND FINANCIAL ANALYSIS

Section 2 PROPERTY DESCRIPTION

Section 3 LEASE COMPARABLES

Section 4 DEMOGRAPHIC ANALYSIS

TABLE OF CONTENTS



LAKE WALES, FL

PRICING AND FINANCIAL ANALYSIS

Price $2,826,000

Down Payment 30% $847,800

Rentable Square Feet 22,058

Price/Rentable SF $128.12

Year Built 1989

Parcel Size 1.39

Parking 101 Surface Spaces

VITAL DATA

CAP Rate - Current 9.00%

Net Operating Income - Current $254,420

Net Cash Flow After Debt Service - Current 12.30% / $104,239

Total Return - Current 19.66% / $166,678

1

Tenant Summary


No. of

Units**

Unit

Type

Approx.

Square

Feet

1 Ewing, Blackwelder & Duce 2,553

2 Peterson & Myers P.A. 15,523

3 Elizabeth Steward P.A. 1,286

Total

Professional Office BuildingLAKE WALES, FL

Major Employers

CompanyLocal

Employees

County of Polk 1,365

Floridas Natural Growers 740

Lake Wales Hospital 531

Walmart 500

Lake Wales Hospital Corp 340

Dundee 200

Home Depot The 200

Citrosuco North America Inc 190

Army National Guard 178

Warner University Inc 175

School Board of Polk County 166

Polk County 161

Demographics

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as tothe accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for anyinaccuracies. Marcus & Millichap is a trademark of Marcus & Millichap Real Estate Investment Services of Florida © 2015 W0310336 Marcus& Millichap. All rights reserved.

3-Miles 5-Miles10-

Miles

2014 Total

Population15,894 26,314 85,382

2019 Total

Population16,267 27,227 91,611

2014 Total

Households6,306 10,305 33,260

2019 Total

Households6,478 10,731 36,085

Median HH Income $32,418 $34,266 $40,493

Per Capita Income

(based on Total

Population)

$18,695 $19,426 $22,568

Average (Mean) HH

Income$46,641 $49,116 $57,492

OFFERING SUMMARY

2



Comments

All tenants have a common area factor built into their rent. Peterson & Myers P.A. has a 14% CAF, Elizabeth Steward P.A. has a

30% CAF, and Ewing Blackwelder & Duce has a 32% CAF. The rent roll reflects their rentable SF, not their usable SF.

The vacant space is still built out for a bank (including the vault).


Suite Tenant SF % of

Total SF

Lease

Commence

Lease

Expire

Annual

Rent

Rent/

SF

Lease

Type

Options/

Terms

100 Elizabeth Steward P.A. 1,286 5.83% 11/1/15 10/31/17 $9,847 $7.66 NNN 3% rental increase in

year 2

130 Ewing, Blackwelder & Duce 2,553 11.57% 7/1/13 6/30/16 $24,892 $9.75 NNN (3) 3-yr options

7.5% rental increases

in option periods

140 Vacant 2,696 12.22% $0.00

200 Peterson & Myers P.A. 7,762 35.19% 1/9/09 12/31/20 $121,182 $15.61 NNN (2) 5-yr options


in option periods

300 Peterson & Myers P.A. 7,761 35.18% 1/9/09 12/31/20 $121,182 $15.61 NNN (2) 5-yr options


in option periods

TOTAL AVAILABLE 2,696 12%

TOTAL OCCUPIED 19,362 88% $277,103

TOTAL 22,058 100% $277,103

RENT ROLL

3



Existing Financing

Loan Type Free and Clear


Proposed Financing

First Trust Deed

Loan Amount $1,978,200

Loan Type Proposed New

Interest Rate 4.5%

Amortization 20 Years

Program 10 Year Term

Loan to Value 70%

Debt Coverage Ratio 1.69

FINANCING

4



For The Year Beginning Year 1

Jan 2015

Year 2

Jan 2016

Year 3

Jan 2017

Year 4

Jan 2018

Year 5

Jan 2019

Year 6

Jan 2020

Year 7

Jan 2021

Year 8

Jan 2022

Year 9

Jan 2023

Year 10

Jan 2024

Tenant(s) Name Ewing,

Blackwelder

& Duce

Elizabeth

Steward

P.A.

Peterson &

Myers P.A.

Peterson &

Myers P.A.

Total Number of Tenants 1 1 2

Total Square Feet 2,553 1,286 15,523

Total Percentage 11.6% 5.8% 70.4%

Cumulative Percentage 11.6% 17.4% 87.8%


Percentage of SF Expiring Number of Tenants Expiring Cumulative % of SF Expiring

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

To

tal P

roje

ct S

qu

are

Fo

ota

ge

0

1

2

Nu

mb

er

of T

en

an

ts

Jan 20150%

Jan 201612%

Jan 20176%

Jan 20180%

Jan 20190%

Jan 202070%

Jan 20210%

Jan 20220%

Jan 20230%

Jan 20240%

LEASE EXPIRATION SUMMARY

Any projections, opinions, assumptions or estimates used here within are for example purposes only and do not represent the current or future performance of the property.

5



Current Per SF

Management Fee (% of EGI) $11,084 $0.50

Reserves $3,000 $0.14

Other $8,599 $0.39

TOTAL EXPENSES $22,683 $1.03


The "other" expense refers to the pro-rata share of CAM for the vacant

space.

EXPENSES

6





Current Per SF

BASE RENT

Occupied Space $277,103 $14.31

Available Space at Market Rents (2,696 SF) $44,026 $16.33

GROSS POTENTIAL RENT $321,129 $14.56

GROSS POTENTIAL INCOME $321,129 $14.56

Vacancy/Collection Allowance (% of GPI) 13.7% / $44,026 $2.00

EFFECTIVE GROSS INCOME $277,103 $12.56

Total Expenses $22,683 $1.03

NET OPERATING INCOME $254,420 $11.53

NET CASH FLOW BEFORE DEBT SERVICE $254,420 $11.53

INCOME & EXPENSES

2 North 1st Street

Lake Wales, FL 33853

Price $2,826,000

Down Payment 30% / $847,800


Price/Rentable SF $128.12

CAP Rate - Current 9.00%

Parcel Size 1.39

Year Built 1989

Type of Ownership Fee Simple

FIRST TRUST DEED

Loan Amount $1,978,200

Loan Type Proposed New

Interest Rate 4.5%

Amortization 20 Years

Program 10 Year Term

Loan to Value 70%

Annualized Operating Data

Income Current

Base Rent

Occupied Space $277,103

Available Space at Market Rents $44,026

Gross Potential Rent $321,129

Gross Potential Income $321,129

Vacancy/Collection Allowance 13.7% / $44,026

Effective Gross Income $277,103

Total Expenses $22,683

Net Operating Income $254,420

Debt Service $150,181

Debt Coverage Ratio 1.69

Net Cash Flow After Debt Service 12.30% / $104,239

Principal Reduction $62,439

Total Return 19.66% / $166,678

Location

7

Financing



Expenses

Management Fee (% of EGI) $11,084

Reserves $3,000

Other $8,599

TOTAL EXPENSES $22,683

EXPENSES/SF $1.03Loan information is time sensitive and subject to

change. Contact your local Marcus & Millichap Capital

Corporation representative.


FINANCIAL OVERVIEW


LAKE WALES, FL

PROPERTY DESCRIPTION

The subject property is a three-story professional office building located in Downtown Lake Wales, Florida. The office building benefits from its corner location with an entry from Stuart Avenue and Central Avenue. The building was constructed in 1989 and is situated on a 1.21 acre parcel. The sale consists of two parcels totaling 1.39 acres. The .18 acre parcel has 17 parking spaces included in the total 101 parking spaces for a 5.5/1000 parking ratio.

The office building offers a value-add opportunity with 2,696 square feet vacant. It is currently 88 percent occupied with its largest tenant, Peterson & Myers, P.A., occupying floors two and three totaling 15,523 rentable square feet. Their lease has more than five years remaining through December 31, 2020.

The subject is conveniently located just minutes from Highway 17 and 27, and State Road 60. Highway 27 leads northward to Haines City and Interstate 4 going north and Miami going south. State Road 60 leads eastward to Florida's Turnpike and Vero Beach. Westward the highway leads to Bartow and the Tampa Bay region. State Road 17 runs through the center of Lake Wales, paralleling Highway 27.

Lake Wales is a city in Polk County, Florida. It part of the Lakeland-Winter Haven-Metropolitan Statistical Area. Lake Wales is located in Central Florida, west of Lake Kissimmee and east of Tampa.

Investment Highlights

■ 88 Percent Occupied Professional Office Building Located inDowntown Lake Wales

■ Tenants on Triple-Net (NNN) Leases

■ Corner Location with Two Street Entrances

■ Easy Access to Major Roads: Highway 27, and State Road 17and 60

■ Located Within Walking Distance to DowntownRestaurants / Retail Corridor

■ 5.5/1000 Parking Ratio

■ Population Growth of 30 Percent Since 2000

9




INVESTMENT OVERVIEW

10



The Offering

Property Professional Office Building

Property Address 2 North 1st Street


Property Type Multi-Story Office Building

Assessor's Parcel Number Two Parcels

Site Description

Parcel Size 1.39

Type of Ownership Fee Simple


Parking 101 Surface Spaces

Construction

Year Built 1989


PROPERTY SUMMARY

11




PROPERTY PHOTOS

12




PROPERTY PHOTOS

13




VACANT BANK SPACE

*There is still a drive-thru attached to the vacant bank space

Local Map Regional Map

14




AREA MAPS

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LAKE WALES, FL

LEASE COMPARABLES

1)

2)

3)


1120 Carlton Avenue

22411 Highway 27

2301 Longleaf Boulevard

20

LEASE COMPARABLES



RENT COMPARABLES MAP

0.00

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

9.00

10.00

11.00

12.00

13.00

14.00

15.00

16.00

17.00

18.00

Subject 1120CarltonAvenue

22411Highway

27

2301Longleaf

Boulevard

21

LEASE COMPARABLES



AVERAGE RENT PER SF

2

1

Subject Property


2 North 1st Street


1120 Carlton Avenue


22411 Highway 27


Date Surveyed:

Rentable SF: 22,058

Occupancy: 89%

Year Built: 1989

Rent/SF Available SF Lease Type

$14.31 2,091 NNN

Date Surveyed: 8/12/15

Rentable SF: 23,169

Occupancy: 58%

Year Built: 2004


Rentable SF: 3,349

Occupancy: 32%

Year Built: 1977


$15.00 9,750 NNN


$16.00 2,287 NNN

22

LEASE COMPARABLES



LEASE COMPARABLES

32301 Longleaf Boulevard



Rentable SF: 15,000

Occupancy: 46%

Year Built: 2003


$18.00 8,078 NNN

23

LEASE COMPARABLES



LEASE COMPARABLES


LAKE WALES, FL

DEMOGRAPHIC ANALYSIS

Demographic data © 2012 by Experian.

25




DEMOGRAPHIC REPORT

3 Miles 5 Miles 10 Miles

2000 Population 14,579 23,222 65,340

2010 Population 15,237 25,339 82,278

2014 Population 15,894 26,314 85,382

2019 Population 16,267 27,227 91,611

2000 Households 5,833 9,128 25,633

2010 Households 6,028 9,890 31,941

2014 Households 6,306 10,305 33,260

2019 Households 6,478 10,731 36,085

2014 Average Household Size 2.48 2.49 2.53

2014 Daytime Population 7,663 10,804 21,582

2000 Owner Occupied Housing Units 53.02% 56.96% 61.70%

2000 Renter Occupied Housing Units 32.69% 25.22% 17.66%

2000 Vacant 14.28% 17.82% 20.65%



2014 Vacant 14.44% 14.90% 15.43%



2019 Vacant 14.17% 14.34% 14.49%

$ 0 - $14,999 23.7% 20.0% 15.3%

$ 15,000 - $24,999 14.9% 15.4% 13.7%

$ 25,000 - $34,999 15.9% 15.7% 13.7%

$ 35,000 - $49,999 15.9% 16.6% 17.6%

$ 50,000 - $74,999 15.5% 16.6% 17.6%

$ 75,000 - $99,999 6.3% 7.6% 10.5%

$100,000 - $124,999 3.4% 3.7% 5.2%

$125,000 - $149,999 1.1% 1.2% 2.1%

$150,000 - $199,999 1.3% 1.3% 2.0%

$200,000 - $249,999 0.5% 0.6% 1.0%

$250,000 + 1.3% 1.3% 1.5%

2014 Median Household Income $32,418 $34,266 $40,493

2014 Per Capita Income $18,695 $19,426 $22,568

2014 Average Household Income $46,641 $49,116 $57,492


26




SUMMARY REPORT

Geography: 10 miles

Population

In 2014, the population in your selected geography is 85,382. The population has changed by 30.67% since 2000. It is estimated

that the population in your area will be 91,611 five years from now, which represents a change of 7.29% from the current year. The

current population is 48.67% male and 51.32% female. The median age of the population in your area is 42.2, compare this to the

Entire US average which is 37.3. The population density in your area is 272.08 people per square mile.

Households

There are currently 33,260 households in your selected geography. The number of households has changed by 29.75% since 2000.

It is estimated that the number of households in your area will be 36,084 five years from now, which represents a change of 8.49%

from the current year. The average household size in your area is 2.53 persons.

Income

In 2014, the median household income for your selected geography is $40,493, compare this to the Entire US average which is

currently $51,972. The median household income for your area has changed by 16.77% since 2000. It is estimated that the median

household income in your area will be $47,655 five years from now, which represents a change of 17.68% from the current year.

The current year per capita income in your area is $22,568, compare this to the Entire US average, which is $28,599. The current

year average household income in your area is $57,492, compare this to the Entire US average which is $74,533.

Race & Ethnicity

The current year racial makeup of your selected area is as follows: 76.93% White, 12.80% Black, 0.06% Native American and 1.77%

Asian/Pacific Islander. Compare these to Entire US averages which are: 71.60% White, 12.70% Black, 0.18% Native American and

5.02% Asian/Pacific Islander.

People of Hispanic origin are counted independently of race. People of Hispanic origin make up 17.20% of the current year

population in your selected area. Compare this to the Entire US average of 17.13%.

Housing

In 2000, there were 19,930 owner occupied housing units in your area and there were 5,703 renter occupied housing units in your

area. The median rent at the time was $391.

Employment

In 2014, there are 21,581 employees in your selected area, this is also known as the daytime population. The 2000 Census revealed

that 53.35% of employees are employed in white-collar occupations in this geography, and 46.57% are employed in blue-collar

occupations. In 2014, unemployment in this area is 8.56%. In 2000, the average time traveled to work was 26.0 minutes.


Number of people living in a given area per square mile.

27




POPULATION DENSITY


The number of people employed in a given area per square mile.

28




EMPLOYMENT DENSITY


Average income of all the people 15 years and older occupying a

single housing unit.

29




AVERAGE HOUSEHOLD INCOME

LAKE WALES, FL

OFFERING MEMORANDUM


Offices Throughout the U.S. and Canada

www.MarcusMillichap.com

Presented By:

Kirk FeliciBroker

Marcus & MillichapLicense: FL: BK 672851

Tel: (786) 522-7000Fax: (786) 522-7010

professional office building · jan 2015 year 2 jan 2016 year 3 jan 2017 year 4 jan 2018 year 5 jan...

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