WALMART SHADOW ANCHORED CENTER · The Dumes Falk Group of Marcus & Millichap is please to bring to...

WALMART SHADOW ANCHORED CENTER3302 South Belt Hwy • Saint Joseph, MO 64506

OFFERING MEMORANDUM

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WALMART SHADOW ANCHORED CENTER

Saint Joseph, MO

ACT ID Y0360258

N O N - E N D O R S E M E N T A N D D I S C L A I M E R N O T I C E

Non-EndorsementsMarcus & 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 YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

DisclaimerTHIS IS A BROKER PRICE OPINION OR COMPARATIVE MARKET ANALYSIS OF VALUE AND SHOULD NOT BE

CONSIDERED AN APPRAISAL. This information has been secured from sources we believe to be reliable, but we

make no representations or warranties, express or implied, as to the accuracy of the information. References to

square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies.

Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. Â© 2017 Marcus &

Millichap. All rights reserved.

P R E S E N T E D B Y

Ryan Roedersheimer

Associate

Associate Director - National Retail Group

Cincinnati Office

Tel: (513) 878-7700

Fax: (513) 878-7710

[email protected]

License: OH SAL.2015004880

Joel Dumes

Senior Vice President Investments

Senior Director - National Retail Group

Cincinnati Office

Tel: (513) 878-7720

Fax: (513) 878-7710

[email protected]

Licenses: OH SAL.2003013045, KY

63818

Stan Falk

First Vice President Investments


Cincinnati Office

Tel: (513) 878-7721

Fax: (513) 878-7710

[email protected]


Broker of Record: Bradley Barham

TABLE OF CONTENTS


INVESTMENT OVERVIEWSection 1

•

FINANCIAL ANALYSISSection 2

•

MARKET OVERVIEWSection 3

•


5

INVESTMENT

OVERVIEW

#

OFFERING SUMMARY

▪ Walmart Shadow Anchored Strip Center | Internet-Resistant Tenant Mix

▪ Anchored by St. Joseph Veteran Affairs Clinic | Leased through 2022

▪ 27 Percent or 6,450-Square Feet or Realizable Vacancy Upside

▪ Situated Along US-169 | North-South Commuter Corridor

▪ Nearly 68,000 Residents and 100,000 Employees within Five-Miles

▪ Located Approximately Fifty-Miles North of Kansas City, Missouri

INVESTMENT HIGHLIGHTS

The Dumes Falk Group of Marcus & Millichap is please to bring to market St. Joseph Plaza, a Walmart shadow anchored strip center comprised of

24,229-square feet in St. Joseph, Missouri. St. Joseph is the eighth largest city in the state and the county seat of Buchanan County, located

approximately 50-miles north of downtown Kansas City, Missouri – the largest city in Missouri. The center was constructed in 2003 and situated on

roughly 3.11 acres along US-169.

St. Joseph Plaza is currently 73 percent leased and anchored by St. Joseph Veteran Affairs Clinic. The VA Clinic signed a ten-year lease in 2012,

maintains 41 percent of the GLA and represents 73 percent of the gross income. All of the tenants except for the VA Clinic are operating under triple-net

leases. Additionally, there are two vacant units totaling 6,450-square feet of realizable vacancy upside. Leasing up these vacant units at market rents

under triple-net leases could potentially add an additional $65,000 to the NOI. The tenant base consists of a complimentary mix of tenants that supplies

the city’s consumers with a wide range of products and services to meet the needs of its residents. A number of these needs are internet resistant and

include a veteran affairs clinic, veterinary clinic, financial services, pet supplies, liquidation center and electronic entertainment.

The city of St. Joseph is the eighth largest city in the state and the third largest in Northwest Missouri and is best known as the starting point of the Pony

Express. The St. Joseph MSA includes four counties with a population of nearly 130,000 residents. Mosaic Life Care, the largest employer in the city was

recently named one of the nation’s 100 Top Hospitals by Truven Health Analytics. Triumph foods is the second largest employer and is recognized as a

top processor and exporter of premium, fresh pork products worldwide and is expanding further with its 50% ownership of Daily’s Premium Meats.

Surrounding St. Joseph Plaza are more than 51,500 employees within three-miles and nearly 100,000 in five-miles. There are nearly 40,000 residents

within three-miles of the plaza and over 77,000 in five-miles. St. Joseph Plaza benefits from being positioned off of Interstate-29 along US-169

(Southern Belt Highway), a four-lane US highway with a center turn lane into the center. Along with the Walmart Supercenter, additional traffic drivers

within the corridor include retail, education, medical and some industrial which all pull consumers to or around St. Joseph Plaza. The property is just over

two-miles away from Missouri Western State University with more than 5,000 students and four-miles away from Central High School with 1,700

students.

An internet-resistant tenant mix with strong historical occupancy, realizable vacancy upside and a prominent location within a growing market provides

St. Joseph Plaza the ability to remain as an integral part of the community and should continue to serve as an invaluable shopping destination for

residents and travelers alike.

INVESTMENT OVERVIEW

6


PROPERTY PHOTOS

7


PROPERTY PHOTOS

8


PROPERTY PHOTOS

9


SITE PLAN

10


*Site plan is a representation of the property with the number of units, parking spots and relative size of both. It does not show the absolute exact size of the units relative to the other spaces or the exact number of parking spots.

Tenant VA Clinic

(1)Vacant

(2)

Closeout Liquidatorz

(3)

PawsitivelyGreat

(4)

PFC Counter

(5)

Animal Tales

(6)GameStop

(7)Vacant

(8)

Square Footage

9,999 SF 3,650 SF 1,200 SF 1,540 SF 1,440 SF 2,000 SF 1,600 SF 2,800 SF

1 2 3 4 5 6 7 8

LOCAL AERIAL


11

REGIONAL AERIAL


12

13

FINANCIAL

ANALYSIS


#

EXECUTIVE SUMMARY

OFFERING SUMMARY

14

THE OFFERING

Property Walmart Shadow Anchored Strip Center

Property Address 3302 S. Belt Hwy, St Joseph, MO 64503

SITE DESCRIPTION

Built 2003

Gross Leasable Area 24,229 SF

Current Occupancy 73.38%

Lot Size +/- 3.11 Acre

Ownership Fee Simple

MAJOR TENANTS

TENANT GLA LEASE EXPIRATION LEASE TYPE

VA Clinic 9,999 09/26/2022 Gross

GameStop 1,600 01/31/2020 NNN

MAJOR EMPLOYERS

EMPLOYER# OF

EMPLOYEES

Mosaic Life Care 3,471

Triumph Foods 2,767

St. Joseph School District 2,047

139th Airlift Wing Air National Guard 1,494

Boehringer Ingelheim Vetmedica, Inc. 1,191

Missouri Western State University 820

American Family Insurance 767

City of St. Joseph 740

Wal-Mart 712

Johnson Controls 658

DEMOGRAPHICS

1-Miles 3-Miles 5-Miles

2016 Estimate Pop 2,878 38,914 77,621

2010 Census Pop 2,872 38,481 77,208

2016 Estimate HH 1,271 14,370 30,101

2010 Census HH 1,262 14,128 29,839

Daytime Population 3,833 51,520 98,067

Average HH Income $48,157 $53,260 $56,998

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FINANCIAL ANALYSIS

15

TENANT SUMMARY

Tenant Name Square

Feet

%

Bldg

Share

Lease DatesAnnual

Rent per

Sq. Ft.

Total Rent

Per Month

Total Rent

Per Year

Changes

on

Changes

To

Lease

TypeRenewal Options

Comm. Exp.

Pawsitively Great K-9 Salon 1,540 6.36% 06/01/2016 05/31/2019 $8.24 $1,057 $12,690 06/01/2018 $13,070 NNN One, Three-Year

Closeout Liquidatorz 1,200 4.95% 10/01/2017 09/30/2020 $8.00 $800 $9,600 10/01/2020 $10,800 NNN One, Three-Year

Personal Finance Company 1,440 5.94% 03/01/2016 02/28/2021 $10.61 $1,273 $15,277 03/01/2019 $15,735 NNN One, Five-Year

Animal Tales Veterinary Clinic 2,000 8.25% 06/01/2015 05/31/2020 $7.50 $1,250 $15,000 06/01/2020 FMV NNN One, Five-Year

GameStop 1,600 6.60% 02/01/2004 01/31/2020 $12.00 $1,600 $19,200 None None NNN None

U.S. Dept. of Veterans Affairs 9,999 41.27% 03/01/2012 09/26/2022 $24.37 $20,306 $243,676 None None Gross None

Vacant 2,800 11.56%

Vacant 3,650 15.06%

Total Occupied 17,779 73.38%

Total Vacant 6,450 26.62% $0 $0

Total 24,229 100.00% $26,287 $315,442


TENANT SUMMARY

#

U.S. Department of Veteran Affairs (Government)

The United States Department of Veterans Affairs (VA) is a federal Cabinet-level

agency that provides near-comprehensive healthcare services to eligible military

veterans at VA medical centers and outpatient clinics located throughout the country;

several non-healthcare benefits including disability compensation, vocational

rehabilitation, education assistance, home loans, and life insurance; and provides

burial and memorial benefits to eligible veterans and family members at 135 national

cemeteries. While veterans benefits have been provided since the American

Revolutionary War, an exclusively veteran-focused federal agency, the Veterans

Administration, was not established until 1930, and became the cabinet-level

Department of Veterans Affairs in 1989.

PRICING AND VALUATION MATRIX

PROPERTY NAMEOAKLEY STATION BUILDING

PRICING AND VALUATION MATRIX

PROPERTY NAMEWALMART SHADOW ANCHORED

16

TENANT SUMMARY

General Information

Tenant Name U.S. Department of Veteran Affairs

Lease Commencement March 1, 2012

Lease Expiration September 26, 2022

Gross Leasable Area (GLA) 9,999

Original Term Ten Years

Option Term None

Pro Rata Share of Project 41.27%

Headquarters Washington, D.C

Ticker Government

Website www.va.gov

Lease Years Annual Rent Monthly Rent Annual Rent/SF

09/27/2012 – 09/26/2022 $243,626 $20,306 $24.37

Base Rent

Expense Lease Summary

C.A.M. Tenant does not reimburses pro-rata share

Real Estate Tax Tenant does not reimburses pro-rata share

Insurance Tenant does not reimburses pro-rata share

Management Tenant does not reimburse pro-rata share

Co-TenancyTenant has right to terminate lease at anytime after fifth lease

year

Misc.Landlord is required to pay for janitorial and cleaning expenses,

all interior utilities and any general maintenance to the premise

FINANCIAL ANALYSIS

17

PRICING DETAIL & OPERATING DATA

Operating Data Current

Scheduled Base Rental Income $315,442

Expense Reimbursement Income

CAM $10,272

Insurance $1,156

Real Estate Taxes $7,775

Management Fees $0

Total Reimbursement Income $19,203

Effective Gross Income $334,645

Less: Operating Expenses ($100,451)

Net Operating Income $234,194

Debt Service ($143,670)

Net Cash Flow After Debt Service 12.93% $90,525

Principal Reduction $44,888

Total Return 19.34% $135,413

Operating Expenses Current Per/SF

Co

mm

on A

rea

Main

ten

an

ce

(CA

M)

Electric $13,453 $0.56

Gas $2,198 $0.09

Water/Sewer $4,544 $0.19

Landscaping $1,050 $0.04

General R&M $9,296 $0.38

Fire Protection $2,120 $0.09

Total CAM $32,661 $1.35

2016 Insurance Premiums $3,600 $0.15

2017 Real Estate Taxes $24,214 $1.00

Management Fee (4% of EGI) $13,386 $0.55

Owner Expenses* $21,840 $0.90

Reserves $4,750 $0.20

Total Expenses $100,451 $4.15

PRICING & FINANCING

List Price $2,800,000

Cap Rate | Price/SF 8.37% | $116

Net Operating Income $234,194

Loan Type Proposed New

Down Payment 25% / $700,000

Loan Amount $2,100,000

Interest Rate / Amortization 4.75% / 25 Years

Debt Coverage Ratio 1.63


*Owner expenses are for janitorial services and utilities serving the premise for the VA Clinic


18

MARKET

OVERVIEW

8


DEMOGRAPHICS

19

Walmart Shadow Anchored Center

1 Mile

3 Miles

5 Miles

PROPERTY NAME

MARKETING TEAM


DEMOGRAPHICS

Source: © 2016 Experian

Created on October 2017

POPULATION 1 Miles 3 Miles 5 Miles

▪ 2021 Projection

Total Population 2,880 39,390 78,654

▪ 2016 Estimate


▪ 2010 Census


▪ 2000 Census


▪ Current Daytime Population

2016 Estimate 3,833 51,520 98,067

HOUSEHOLDS 1 Miles 3 Miles 5 Miles

▪ 2021 Projection

Total Households 1,280 14,639 30,649

▪ 2016 Estimate


Average (Mean) Household Size 2.22 2.47 2.43

▪ 2010 Census


▪ 2000 Census


▪ Occupied Units

2021 Projection 1,280 14,639 30,649

2016 Estimate 1,345 15,789 33,266

HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles

▪ 2016 Estimate

$150,000 or More 1.80% 2.06% 3.16%

$100,000 - $149,000 6.89% 7.60% 8.27%

$75,000 - $99,999 11.61% 10.30% 10.40%

$50,000 - $74,999 17.33% 22.47% 21.05%

$35,000 - $49,999 13.29% 16.17% 15.18%

Under $35,000 48.79% 40.99% 41.25%

Average Household Income $48,157 $53,260 $56,998

Median Household Income $36,093 $43,341 $43,532

Per Capita Income $21,286 $20,460 $22,799

HOUSEHOLDS BY EXPENDITURE 1 Miles 3 Miles 5 Miles

Total Average Household Retail Expenditure

$55,312 $58,324 $58,839

▪ Consumer Expenditure Top 10 Categories

Housing $14,875 $15,562 $15,656

Transportation $9,580 $10,193 $10,253

Shelter $8,104 $8,423 $8,473

Food $6,231 $6,571 $6,623

Health Care $4,633 $4,693 $4,768

Personal Insurance and Pensions $4,085 $4,626 $4,681

Utilities $3,692 $3,865 $3,872

Entertainment $2,397 $2,547 $2,558

Cash Contributions $1,577 $1,598 $1,665

Household Furnishings and Equipment

$1,573 $1,711 $1,720

POPULATION PROFILE 1 Miles 3 Miles 5 Miles

▪ Population By Age

2016 Estimate Total Population 2,878 38,914 77,621

Under 20 23.53% 25.79% 25.64%

20 to 34 Years 21.11% 24.41% 22.70%

35 to 39 Years 5.43% 6.38% 6.12%

40 to 49 Years 10.48% 11.82% 11.99%

50 to 64 Years 20.13% 18.43% 19.25%

Age 65+ 19.34% 13.17% 14.30%

Median Age 39.94 34.86 36.30

▪ Population 25+ by Education Level

2016 Estimate Population Age 25+ 2,011 25,479 51,560

Elementary (0-8) 3.22% 2.80% 3.08%

Some High School (9-11) 7.96% 9.14% 8.49%

High School Graduate (12) 45.94% 41.91% 39.16%

Some College (13-15) 19.74% 23.10% 23.34%

Associate Degree Only 5.63% 4.82% 4.86%

Bachelors Degree Only 10.33% 11.89% 13.09%

Graduate Degree 5.36% 5.25% 6.75%

20

Income

In 2016, the median household income for your selected geography is

$43,532, compare this to the US average which is currently $54,505.

The median household income for your area has changed by 31.44%

since 2000. It is estimated that the median household income in your

area will be $52,380 five years from now, which represents a change

of 20.33% from the current year.

The current year per capita income in your area is $22,799, compare

this to the US average, which is $29,962. The current year average

household income in your area is $56,998, compare this to the US

average which is $78,425.

Population

In 2016, the population in your selected geography is 77,621. The

population has changed by 4.40% since 2000. It is estimated that the

population in your area will be 78,654 five years from now, which

represents a change of 1.33% from the current year. The current

population is 50.34% male and 49.66% female. The median age of

the population in your area is 36.30, compare this to the US average

which is 37.68. The population density in your area is 986.89 people

per square mile.

Households

There are currently 30,101 households in your selected geography.

The number of households has changed by 3.66% since 2000. It is

estimated that the number of households in your area will be 30,649

five years from now, which represents a change of 1.82% from the

current year. The average household size in your area is 2.43 persons.

Employment

In 2016, there are 98,607 employees in your selected area, this is also

known as the daytime population. The 2000 Census revealed that

54.49% of employees are employed in white-collar occupations in

this geography, and 45.60% are employed in blue-collar occupations.

In 2016, unemployment in this area is 4.80%. In 2000, the average

time traveled to work was 18.00 minutes.

Race and Ethnicity

The current year racial makeup of your selected area is as follows:

85.63% White, 6.79% Black, 0.37% Native American and 1.31%

Asian/Pacific Islander. Compare these to US averages which are:

70.77% White, 12.80% Black, 0.19% Native American and 5.36%

Asian/Pacific Islander. People of Hispanic origin are counted

independently of race.

People of Hispanic origin make up 6.90% of the current year

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

17.65%.

PROPERTY NAME

MARKETING TEAM


Housing

The median housing value in your area was $99,442 in 2016, compare

this to the US average of $187,181. In 2000, there were 18,973 owner

occupied housing units in your area and there were 10,064 renter

occupied housing units in your area. The median rent at the time was

$349.

Source: © 2016 Experian

DEMOGRAPHICS

21

MARKET OVERVIEW

KANSAS CITYOVERVIEW

The Kansas City metro consists of 14 counties: Clay, Bates, Cass,

Platte, Clinton, Caldwell, Jackson, Lafayette and Ray counties in

Missouri; and Johnson, Linn, Miami, Leavenworth and Wyandotte

counties in Kansas. The area sits close to both the geographic and

population centers of the United States and serves as a major regional

commercial, industrial and cultural hub. The metro has nearly 2.1

million residents. Jackson is the most populous county with 690,000

people, followed by Johnson with 583,800 residents. Kansas City,

Missouri, is the largest city with 475,000 citizens, followed by Overland

Park, Kansas, with 185,000 people.

MARKET OVERVIEW

METRO HIGHLIGHTS

CENTRAL LOCATION

A large portion of North America can be reached

within a 12-hour drive, making the metro a natural

transportation and distribution hub.

EXPANSIVE TRANSPORTATION SYSTEM

The region is the second-largest rail center in the

United States and features an efficient and well-

connected airport. BNSF Railway also has an

intermodal facility in the area.

AFFORDABLE COST OF LIVING

Kansas City offers a lower cost of living than many

other large Midwestern markets.

22


MARKET OVERVIEW

ECONOMY▪ Its central location, extensive transportation network and intermodal facilities make the

metro an important logistics and distribution hub. The increased flow of goods from

Mexico will drive intermodal growth in the region.

▪ Lower costs of living and doing business as well as an educated workforce attract

corporations and job seekers to the metro. Fortune 500 company headquarters include

Seaboard and Lansing Trade Group.

▪ Other expanding industries in the metro include finance and insurance, engineering, life

sciences, manufacturing and information technology.

SHARE OF 2016 TOTAL EMPLOYMENT

MAJOR AREA EMPLOYERS

Sprint Corp.

DST Systems

Hallmark Cards Inc.

University of Kansas Healthcare

Cerner Corp.

St. Luke’s Health System

HCA Midwest Health System

AT&T

BNSF Railway

Children’s Mercy Hospital* Forecast

MANUFACTURING

7%GOVERNMENT

HEALTH SERVICES

EDUCATION AND

+OTHER SERVICES

4%

LEISURE AND HOSPITALITY FINANCIAL ACTIVITIES

19%

AND UTILITIES

TRADE, TRANSPORTATION CONSTRUCTION

PROFESSIONAL AND

BUSINESS SERVICES

2%INFORMATION

18%

4%

14% 10% 7%

14%

23


MARKET OVERVIEW

DEMOGRAPHICS

SPORTS

EDUCATION

ARTS & ENTERTAINMENT

▪ The metro is expected to add nearly 100,000 people through 2021, resulting in the

formation of approximately 40,000 households.

▪ A median home price below the U.S. median has produced a homeownership rate of

66 percent, which is slightly higher than the national rate of 64 percent.

▪ Roughly 33 percent of residents age 25 and older have bachelor’s degrees; of those

residents, 12 percent have also earned a graduate or professional degree.

Kansas City has a variety of entertainment options. Two major professional sports

franchises, the Kansas City Chiefs of the NFL and MLB’s Kansas City Royals, play in the

metro. The city boasts a rich jazz music history and houses the American Jazz Museum.

Kansas City also features a downtown entertainment district that combines restaurants and

retail, including the Sprint Center. Cultural venues include the Kemper Museum of

Contemporary Art, Nelson-Atkins Museum of Art, the Lyric Opera of Kansas City and the

Starlight Theatre. The metro maintains an exceptional education system with nationally

ranked school districts, colleges, universities, and institutions of advanced learning and

research, including the University of Missouri-Kansas City.

37

2016MEDIAN AGE:

U.S. Median:

37.7

$58,500

2016 MEDIAN HOUSEHOLD INCOME:

U.S. Median:

$57,200

2.1M

2016POPULATION:

Growth2016-2021*:

4.6%

822K

2016HOUSEHOLDS:

5%

Growth2016-2021*:

QUALITY OF LIFE

2016 Population by Age

0-4 YEARS

7%5-19 YEARS

20%20-24 YEARS

6%25-44 YEARS

27%45-64 YEARS

26%65+ YEARS

13%

* Forecast

Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody’s

Analytics; U.S. Census Bureau

24


www.MarcusMillichap.com

Ryan Roedersheimer

Associate

Associate Member - National Retail Group

Cincinnati Office

Tel: (513) 878-7700

Fax: (513) 878-7710

[email protected]


Joel Dumes

Senior Vice President Investments


Cincinnati Office

Tel: (513) 878-7720

Fax: (513) 878-7710

[email protected]

Licenses: OH SAL.2003013045, KY 63818

Stan Falk

First Vice President Investments

Director - National Retail Group

Cincinnati Office

Tel: (513) 878-7721

Fax: (513) 878-7710

[email protected]


P R E S E N T E D B Y

Broker of Record: Bradley Barham

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