Offering Memorandum
Maysville Marketsquare
Maysville, Kentucky
Owner’s Exclusive Representative:
John May
Chris LaBounty
1515 W. 22nd Street, Suite 1250
Oak Brook, Illinois 60523
630-990-7900
Maysville Marketsquare
Maysville, Kentucky
CONDITIONS, TEAM & CONTENTS
CONDITIONS
Only persons that have executed the appropriate Conditions of Offering are authorized to review
this offering memorandum. Among other things, the Conditions of Offering requires the reviewer to
keep the information contained within the memorandum confidential. The reviewer is prohibited
from unauthorized copying of the memorandum. In the event you elect to not pursue the subject
offering, please return this memorandum to the marketing team.
MARKETING TEAM
1515 W. 22nd Street, Suite 1250, Oak Brook, IL 60523
630-990-7900, f: 630-990-7903, www.may.bz
John May
Chris LaBounty
Sarah Libby (financial analyst)
Gail Moore (marketing assistant)
630-990-7979
630-990-7997
630-990-7996
630-990-7911
Shopping Center Investment Services
www.may.bz
[email protected]
[email protected]
[email protected]
[email protected]
Maysville Marketsquare
Maysville, Kentucky
TABLE OF CONTENTS
Summary & Photos
Offering.....................................................................1
Location & Market.....................................................1
Property Description .................................................2
Tenant Information ...................................................2
Financial Information and Pricing .............................2
Photographs and Aerials ..........................................3
Location & Market
Overview...................................................................1
Regional Map ...........................................................2
Area Map ..................................................................3
Location Overview ....................................................4
Market Overview.......................................................5
Competition Map ......................................................6
Inventory of Competitive Properties .........................7
Maysville...................................................................8
Mason County ..........................................................8
Demographics ..........................................................9
Property Description
Property Description .................................................1
Property Overview ....................................................2
Tenant Information
Tenant Information ...................................................1
Leasing Plan.............................................................2
Rent Roll ...................................................................3
Lease Expiration Report ...........................................8
Selected Tenant Information ....................................9
Financial Information
Financial Information ................................................1
Assumptions .............................................................2
Expenses ..................................................................3
Projected 2007 Net Operating Income ....................5
Stabilized Projected 2007 Net Operating Income ....6
Pricing.......................................................................6
Shopping Center Investment Services
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Maysville Marketsquare
Maysville, Kentucky
SUMMARY & PHOTOS
OFFERING
May Center Advisors has been retained to sell the 100% fee simple interest in Maysville
Marketsquare, Maysville, Mason County, Kentucky. The component of the offering
includes one multi-tenant inline building with 17 tenant suites. The adjacent former WalMart building, Burger King, Michel Tires, Big Boy Restaurant and Taco Bell are not
included as part of this offering.
LOCATION & MARKET
Maysville Market Square in located in the City of Maysville, Mason County, Kentucky.
The subject property is located just south of the intersection of U.S. Route 68 and AA
Highway (Kentucky State Route 9). Maysville Marketsquare is located in the Maysville
Trade Zone, which features Kroger, J. C. Penney, Wal-Mart Supercenter, Big Kmart,
Rite Aid and Big Lots. The Maysville Trade Zone generates significant consumer traffic
from a large geographic area.
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PROPERTY DESCRIPTION
Maysville Marketsquare is a community shopping center consisting of 125,983 rentable
square feet of building space on a 21.16 acre site. This development was constructed
between 1991 and 1993. The subject property includes one multi-tenant inline buildings
consisting of 17 tenant suites. The entire property has excellent visibility from AA
Highway (Kentucky State Route 9).
TENANT INFORMATION
The total subject offering of Maysville Marketsquare consists of 125,983 square feet of
leasable area in 17 tenant suites. Kroger, J.C. Penney and Fashion Bug anchor Maysville
Marketsquare. Kroger continues to be a dominant grocer in the area as there are few
alternative grocery options. In 2005, Kroger reported sales of nearly $27 million. This high
level of sales is being achieved even after the opening of an adjacent Wal-Mart
Supercenter two years ago.
FINANCIAL INFORMATION & PRICING
Maysville Marketsquare features the stability of a strong community center asset. The
property provides an investor an opportunity to add value via lease-up of currently
vacant space. The excellent financing environment that exists in today’s marketplace
allows a purchaser to place an aggressive financing arrangement on the subject
property, thus boosting yields. The seller has elected to not establish an asking price for
the asset. Please contact the Marketing Team for further pricing discussion.
Projected 2007 Net Operating Income
$713,295
Projected 2007 Stabilized Net Operating Income
$903,404
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Maysville Marketsquare
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Maysville Marketsquare
Maysville, Kentucky
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Maysville Marketsquare
Maysville, Kentucky
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LOCATION & MARKET
Maysville Market Square in located in the City of Maysville, Mason County, Kentucky.
The subject property is located just south of the intersection of U.S. Route 68 and AA
Highway (Kentucky State Route 9). Maysville Marketsquare is located in the Maysville
Trade Zone, which features Kroger, J. C. Penney, Wal-Mart Supercenter, Big Kmart,
Rite Aid and Big Lots. The Maysville Trade Zone generates significant consumer traffic
from a large geographic area.
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REGIONAL MAP
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AREA MAP
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LOCATION OVERVIEW
Location
ƒ 381 – 417 Market Square Drive, Maysville,
Mason County,
Kentucky
ƒ Located along AA (Highway Kentucky State Route 9) south of
U.S. Route 68
ƒ AA Highway features a traffic light entrance into Maysville
Marketsquare
Transportation
Infrastructure
ƒ AA Highway (Kentucky Route 9) is an east-west state highway
that commences near the northeastern border of Kentucky and
proceeds west, passes through Mason County/Maysville, and
terminates south of Cincinnati near Interstate 275.
ƒ 2005 traffic counts along the subject are 15,288 cars daily on AA
Highway (Kentucky Route 9).
ƒ U.S. Route 68, located half of a mile north of the subject, is an
east-west highway that begins in Findlay, Ohio and travels
southwest, through Mason County and terminates in Reidland,
Kentucky.
Surrounding
Area
ƒ Northeast – Downtown Maysville
ƒ Northwest – Tractor Supply, Kmart anchored shopping center
ƒ Southeast – Wal-Mart Supercenter anchored shopping center
Proximate
Cities
ƒ Ripley, OH – 8 miles to the northwest
ƒ Dover, KY – 11 miles to the northwest
ƒ Flemingsburg, KY – 15 miles to the south
ƒ Cincinnati, OH – 60 miles to the northwest
ƒ Lexington, KY – 65 miles to the southwest
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MARKET OVERVIEW
Subject Asset
Description
ƒ Grocery anchored community shopping center
Trade Zone
Description
ƒ The Maysville Trade Zone is anchored by Kroger, J. C. Penney,
Wal-Mart Supercenter, Big Kmart, Rite Aid and Big Lots.
ƒ Trade zone features a 95.5 % occupancy rate.
ƒ The nearest enclosed regional malls are located 60 miles
northwest of the subject in Cincinnati and 65 miles southwest in
Lexington.
Trade Zone
Activity
ƒ Recent investment activity in the trade zone is evidenced by the
new development of a Lowe’s Home Improvement located at the
intersection of AA Highway and Maple Leaf Road. The new
development is one-half mile southeast of Maysville
Marketsquare.
ƒ A Wal-Mart Supercenter anchored shopping center was built in
2004 just south of the subject property. Marketsquare Drive
provides direct access from Maysville Marketsquare to this new
development.
Conclusion
ƒ Maysville Marketsquare is a dominant community center asset
positioned in a trade zone that has a wide geographic draw.
With Kroger as an anchor, tenants looking to identify locations in
the market will certainly consider the subject location.
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COMPETITION MAP
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INVENTORY OF COMPETITIVE PROPERTIES
Name/Location
Maysville Market Square
AA Highway and Market Square
1. Gateway Plaza
AA Highway and 68
Year
Built
1991
1993
1980
1993
1999
2. Tractor Supply Co.
AA Highway and Market Square
2004
3. Unnamed Center
AA Highway and Market Square
2004
4. Unnamed Center
AA Highway and Wal-Mart Way
Square
Feet
125,983
Sq. Ft. Occupancy Asking Net
Available
Level
Rental Rate
13,600
90.0%
N/A
Extra
Charges
N/A
120,000
10,000
91.7%
N/A
N/A
30,000
0
100%
N/A
N/A
15,000
0
100%
N/A
N/A
260,000
2,400
99.1%
5. Southgate Plaza
SWC 68 and Boone
1985
8,000
0
100%
6. Blue Grass Center
NEC 68 and Country Club
Heights
Totals
1978
1997
150,000
6,000
96.0%
708,983
32,000
95.5%
Anchors/Comments
Kroger, J.C. Penney, Fashion
Bug, Hallmark, Radio Shack
Big Kmart, Cinema 4, Check
Advance, Subway, Family
Dollar
Freestanding
Sears, Buffalo Trace Wild
Wings
$14.00 p.s.f. $2.00 CAM, Wal-Mart Supercenter,
Insurance Goody’s, Dollar Tree, Cato,
and Taxes Hibbet Sports, Applebee’s
N/A
N/A
Curves, Maysville Family
Chiropractic, Attitude and
Design Hair Salon
$12.50 p.s.f. $1.25 CAM, Big Lots, Rite Aid, Dollar
Insurance General, UHR Rents
and Taxes
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Maysville Marketsquare
Maysville, Kentucky
CITY OF MAYSVILLE
The City of Maysville is located in northern Kentucky along the banks of the Ohio River.
The city was formed in 1787, and has been the Mason County Seat since 1848.
According to 2005 estimates, Maysville has a population of 9,136 people. Historically,
Maysville was a significant stop on the Underground Railroad during the civil war era
and was also home to Daniel Boone. The Maysville-Mason County Recreation Park
offers a variety of sports and recreational opportunities. Maysville also has several golf
courses, wineries and museums within the area.
Source: City of Maysville (www.cityofmaysville.com)
MASON COUNTY
Mason County was formed in 1788 and named in honor of the patriot George Mason.
Located just south of Ohio in Northern Kentucky, Mason County has a population of
approximately 17,000 people. The majority of its economy comes from manufacturing
and retail trade. The three largest employers are Emerson Power Transmission,
Mitsubishi Electric Automotive America and Green Tokai Company. All three companies
deal directly with automotive manufacturing.
Source: Mason County (www.masoncountykentucky.com)
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DEMOGRAPHICS
ONE MILE
THREE MILE
FIVE MILE
Population
2010 Projection
2005 Estimate
2000 Census
1990 Census
Growth 1990 - 2000
1,421
1,347
1,229
930
32.15%
9,160
9,045
8,884
8,587
3.46%
13,565
13,433
13,329
12,972
2.75%
Households
2010 Projection
2005 Estimate
2000 Census
1990 Census
Growth 1990 - 2000
593
555
495
353
40.23%
3,957
3,866
3,722
3,506
6.16%
5,864
5,747
5,595
5,268
6.21%
2005 Est. Population by Single
Classification Race
White Alone
Black or African American
Alone
American Indian and Alaska
Native Alone
Asian Alone
Native Hawaiian and Other
Pacific Islander Alone
Some Other Race Alone
Two or More Races
2005 Est. Population Hispanic or
Latino
Hispanic or Latino
Not Hispanic or Latino
1,347
1,204
89.38%
9,045
7,936
87.74%
13,433
12,042
89.64%
105
7.80%
885
9.78%
1,086
8.08%
1
24
0.07%
1.78%
17
73
0.19%
0.81%
33
93
0.25%
0.69%
5
7
0.00%
0.37%
0.52%
3
44
86
0.03%
0.49%
0.95%
3
59
117
0.02%
0.44%
0.87%
1,347
6
1,341
0.45%
99.55%
9,045
84
8,961
0.93%
99.07%
13,433
120
13,313
0.89%
99.11%
61.08%
38.74%
3,866
2,388
1,478
61.77%
38.23%
5,747
3,653
2,093
63.56%
36.42%
2005 Tenure of Occupied Housing
Units
Owner Occupied
Renter Occupied
555
339
215
2005 Average Household Size
2.18
2.25
2.28
$58,980
$48,128
$47,011
$45,385
$25,265
$34,185
$20,964
$34,290
$20,379
2005 Est. Average Household
Income
2005 Est. Median Household
Income
2005 Est. Per Capita Income
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Maysville, Kentucky
PROPERTY DESCRIPTION
Maysville Marketsquare is a community shopping center consisting of 125,983 rentable
square feet of building space on a 21.16 acre site. This development was constructed
between 1991 and 1993. The subject property includes one multi-tenant inline buildings
consisting of 17 tenant suites. The entire property has excellent visibility from AA
Highway (Kentucky State Route 9). The adjacent former Wal-Mart building, Burger
King, Michel Tires, Big Boy Restaurant and Taco Bell are not included as part of
this offering.
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PROPERTY OVERVIEW
Building and
Site
ƒ 125,983 rentable square feet
Access
ƒ Stoplight entrance at Market Square Divide featuring both left- and
ƒ Site size 26.16 acres
right-hand turns onto AA Highway
ƒ Additional entrance along AA Highway on the north side of the
subject property.
ƒ Entrance via Market Square Drive from AA Highway.
Signage
ƒ Pylon sign located near Market Square Divide entrance.
Development
History
ƒ Center developed in 1991 with renovations in 1993.
Zoning
ƒ City of Maysville: B2 – Highway Business
Construction
Features
ƒ Exterior Walls – Masonry block construction with a dryvit façade
overhang
ƒ Floors – Concrete and tile
ƒ Windows – Storefront windows set in aluminum panes
ƒ Parking Lot – Asphalt
ƒ Exterior Lighting – Pole mounted lighting
ƒ HVAC – Roof- mounted HVAC units
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Utilities
Maysville, Kentucky
ƒ Gas – Western Lewis-Rectorville Gas District
ƒ Electricity – Fleming-Mason RECC
ƒ Telephone – Bell South
ƒ Water – Western Lewis-Rectorville Water District
ƒ Sewer – Maysville Utility Commission
ƒ Police – Maysville Police Department
ƒ Fire – Maysville Fire Department
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TENANT INFORMATION
The total subject offering of Maysville Marketsquare consists of 125,983 square feet of
leasable area in 17 tenant suites. Kroger, J.C. Penney and Fashion Bug anchor Maysville
Marketsquare. Kroger continues to be a dominant grocer in the area as there are few
alternative grocery options. In 2005, Kroger reported sales of nearly $27 million. This high
level of sales is being achieved even after the opening of an adjacent Wal-Mart
Supercenter two years ago.
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LEASING PLAN
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RENT ROLL
Note:
Individual lease abstracts for each tenant have been prepared. Please contact the Marketing Team to receive this information.
Suite
Tenant
Square Feet
1
Kroger Limited Partnership I
61,533
Lease Commence
Lease Expire
Term
New to Center In
09/01/93
08/31/13
20 years
1993
Base Rent p.s.f.
Recoveries1
$7.74
01/01/09
$7.97
I
II
III
IV
Options
5 Yrs.
$8.08
5 Yrs.
$8.16
5 Yrs.
$8.24
5 Yrs.
$8.32
Other
Percentage Rent – 1% of gross
sales, excluding liquor and wine
sales, in excess of $29,000,000.
Tenant is currently leasing two
storerooms containing 2,110 s.f.
and 2,650 s.f. The rent associated
with these storerooms has been
included in tenant’s current rent
and option rent.
2
Prospective Tenant
1,600
N/A
3
General Nutrition Corporation
2,600
01/01/02
12/31/06
10 years
1997
C, I, T, A
N/A
N/A
None
$9.08
None
C1, I, T, M, A1
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Suite
Tenant
Square Feet
Maysville, Kentucky
Lease Commence
Lease Expire
Term
New to Center In
01/01/05
12/31/09
15 years
1994
5
Prospective Tenant
3,000
N/A
Base Rent p.s.f.
Recoveries1
$10.82
01/01/07 $11.14
01/01/08 $11.47
01/01/09 $11.82
C2, I, T, M, A2
N/A
6
Prospective Tenant
6,000
N/A
N/A
N/A
7
Prospective Tenant
1,000
N/A
N/A
N/A
8
Prospective Tenant
2,000
N/A
N/A
N/A
9
BellSouth Mobility, LLC
d/b/a Cingular Wireless
1,600
01/01/04
12/31/09
6 years
2004
4
M.F.M. Enterprises
d/b/a Fantastic Sams
2,400
01/01/07
$10.67
$11.42
Options
None
N/A
I 3 Yrs.
II 3 Yrs.
C3, I, T, M, A2
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$12.10
$12.83
Other
Percentage Rent – 5% of gross
sales in excess of $450,000.
Maysville Marketsquare
Suite
Tenant
Square Feet
10
Sally Beauty Company, Inc.
1,293
Maysville, Kentucky
Lease Commence
Lease Expire
Term
New to Center In
09/01/97
08/31/07
10 years
1997
11
C&D Electronics
d/b/a Radio Shack
3,180
06/01/00
02/28/08
8 years
2000
12
CitiFinancial, Inc.
1,600
05/01/06
04/30/11
15 years
1996
13
Kirlin’s Hallmark #248
3,200
03/01/02
02/28/07
1996
11 years
14
Samuels Jewelers, Inc.
1,600
01/01/05
12/31/07
16 years
1992
Base Rent p.s.f.
Recoveries1
$13.75
I
C4, I, T, M, A2
$8.50
C5, I, T, M, A2
$14.45
05/01/07 $14.88
05/01/08 $15.33
05/01/09 $15.79
05/01/10 $16.26
C5, I, T, M, A1
$10.50
C6, I, T, M, A3
$16.74
01/01/07
$17.24
Options
5 Yrs.
$15.81
None
I
Yr. 1
Yr. 2
Yr. 3
Yr. 4
Yr. 5
$16.75
$17.25
$17.77
$18.30
$18.85
None
I
Yr. 1
Yr. 2
Yr. 3
C5, I, T, M, A2
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$17.76
$18.29
$18.84
Other
Maysville Marketsquare
Suite
Tenant
Square Feet
15
J.C. Penney Corporation, Inc.
22,577
Maysville, Kentucky
Lease Commence
Lease Expire
Term
New to Center In
02/23/91
02/28/11
20 years
1991
Base Rent p.s.f.
Recoveries1
$3.84
I
II
III
IV
V
Options
5 Yrs.
$3.84
5 Yrs.
$3.84
5 Yrs.
$3.84
5 Yrs.
$3.84
5 Yrs.
$3.84
Other
Percentage Rent – 1.5% of net
retail
sales
in
excess
of
$4,329,780.
C7
16
Linda Stevenson
d/b/a Touch of Color
2,800
06/01/04
05/30/09
15 years
1994
17
Fashion Bug #2222, Inc.
8,000
02/01/02
01/31/12
20 years
1992
06/01/07
06/01/08
$9.82
$10.12
$10.42
C5, I, T, M, A2
$7.00
02/01/07
$7.50
None
I 5 Yrs.
II 5 Yrs.
C8, I, T, M
Rent Roll Totals Leased Square Feet
Vacant Square Feet
Total
112,383
13,600
125,983
89%
11%
100%
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$8.00
$8.50
Percentage Rent – 4% of gross
sales in excess of $1,500,000.
Maysville Marketsquare
Maysville, Kentucky
Notes to “Rent Roll” Note 1 – The following codes apply to the recovery methodology noted in the Rent Roll.
C –
C1 –
C2 –
C3 –
C4 –
C5 –
C6 –
C7 –
C8
I
T
M
A
A1
A2
A3
–
–
–
–
–
–
–
–
PRS of CAM, excluding electrical maintenance, general building, and utilities expenses.
PRS of CAM. Tenant’s share of CAM expenses for the first lease year, excluding snow removal, shall not exceed $1.48
per square foot and shall not increase by more than 5% per year.
PRS of CAM. Tenant’s share of CAM shall not increase more than 3% annually using 2004 as the base year.
PRS of CAM. Tenant’s share of CAM shall not exceed $1.83 for the first calendar year, and shall not increase by more
than 5% per year.
PRS of CAM. Tenant’s share of CAM expenses shall not grow by more than 5% per year.
PRS of CAM.
PRS of CAM. Tenant’s share of CAM shall not exceed $1.00 the first year and shall not increase by more than 5% each
year.
PRS of CAM. Tenant reimburses $0.40 per square foot. Tenant will reimburse $0.45 per square foot for the second
option period, $0.50 per square foot for the third option period, $0.55 per square foot for the fourth option period, $0.60
per square floor for the fifth option period, and $0.65 per square foot for the sixth option period.
PRS of CAM. Tenant’s share of CAM, excluding snow removal, shall not increase by more than 10% per year.
PRS of insurance expense.
PRS of real estate taxes.
PRS of management fee.
3% admin fee on CAM.
15% admin fee on CAM.
15% admin fee on CAM, insurance and real estate taxes.
10% admin fee on CAM.
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LEASE EXPIRATION REPORT
Year
Suite
Tenant
Lease
Expiration
Square
Feet
2007
2
Vacant
N/A
1,600
3
Vacant
N/A
2,600
5
Vacant
N/A
3,000
6
Vacant
N/A
6,000
7
Vacant
N/A
1,000
8
Vacant
N/A
2,000
16,200
2007
13
Kirlin’s Hallmark
02/28/07
3,200
10
Sally Beauty Company
08/31/07
1,293
14
Samuels Jewelers
12/31/07
1,600
4.8%
2.5%
11
Radio Shack
02/28/08
3,180
2009
16
Touch of Color
05/30/09
2,800
4
Fantastic Sams
12/31/09
2,400
4
Cingular Wireless
12/31/09
1,600
6,800
15
J.C. Penney
02/28/11
22,577
12
CitiFinancial
04/30/11
1,600
2012
17
2013
1
12.9%
6,093
2008
2011
% of GLA
Expired
5.4%
24,177
19.2%
Fashion Bug
01/31/12
8,000
6.4%
Kroger
08/31/13
61,533
48.8%
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SELECTED TENANT INFORMATION
Logo
Tenant
Website
Ownership
Exchange-Symbol
Kroger
www.kroger.com
Public
NYSE – KRG
GNC
Financial
Information
Year Ended
01/28/06
Sales
$60.5B
Net Profit
$958.0M
Book Value
$2.2B
Market Cap
$17.25B
Credit Rating
N/A
Retailer
Category
# of Stores
Geography
Grocer
2,507 Supermarket
locations in 33 states
85 Kroger
Supermarkets in
Kentucky
Not Available
Supplement Retail
4,800 locations
nationwide
Not Available
Hair Salon
1,350 locations
nationwide
www.gnc.com
Private
N/A
Fantastic Sams
www.fantasticsams.com
Private
N/A
Cingular Wireless
www.cingular.com
Public
NYSE – T
Financial information
provided for AT&T
Year Ended
Sales
Net Profit
Book Value
Market Cap
Credit Rating
12/31/05
$43.9B
$4.8B
$32.1B
$123.2B
A2
-9-
Shopping Center Investment Services
www.may.bz
Wireless Provider
Comments
The Kroger Company
reported total sales increased
8.2% to $19.4 billion for the
first quarter ended May 20,
2006. This is the eleventh
consecutive positive quarter
for Kroger.
General Nutrition Corporation
reported consolidated
revenues of $382.8 million for
the quarter, a 14.8% increase
over the same quarter in
2005.
Fantastic Sams is one of the
world's largest full service
hair care franchises, with
salons located in four
countries.
Cingular Wireless is the
largest mobile phone
company in the United
States, with more than 57
million subscribers.
Maysville Marketsquare
Logo
Maysville, Kentucky
Tenant
Website
Ownership
Exchange-Symbol
Sally Beauty
www.sallybeauty.com
Public
NYSE – ACV
RadioShack
www.radioshack.com
Public
NYSE – RSH
CitiFinancial
www.citifinancial.com
Public
NYSE – C
Financial information
provided for Citigroup
Hallmark
Financial
Information
9/30/05
Year Ended
$3.5B
Sales
Net Profit
$210.9M
Book Value
$844.1M
Market Cap
$4.6B
Credit Rating
Baa1
Year Ended
12/31/05
Sales
$5.1B
Net Profit
$267.0M
Book Value
$548.8M
Market Cap
$2.38B
Credit Rating
Baa2
12/31/05
Year Ended
Sales
$120.3B
Net Profit
$24.6B
Book Value
$64.7B
Market Cap
$244.7B
Credit Rating
Aa1
Not Available
www.hallmark.com
Private
N/A
Samuel’s Jewelers
Not Available
www.samuelsjewelers.com
Private
N/A
- 10 -
Shopping Center Investment Services
www.may.bz
Retailer
Category
# of Stores
Geography
Beauty Supply
2,400 location in 48
states
Electronics Specialty
Store
More than 6,000
locations nationwide
Financial Services
2,100 location in the
U.S. and Canada
Greeting Cards
42,000 locations
nationwide
Specialty Retailer
101 stores in
18 states
Comments
Sally Beauty is the world’s
largest distributor of
professional beauty supplies.
Radio Shack reported total
sales in the second quarter of
2006 were up 1% to $1.100
billion, compared to total
sales of $1.092 billion for the
previous year.
Citigroup reports income from
continuing operations up 11%
with international revenues
up 17% for the second
quarter of 2006.
Hallmark Greetings, Inc.
owns Binney & Smith
(Crayola) and a controlling
stake in Crown Media.
Samuel’s Jewelers was found
in the San Francisco area in
1891.
Maysville Marketsquare
Logo
Maysville, Kentucky
Tenant
Website
Ownership
Exchange-Symbol
JC Penney
www.jcpenney.com
Public
NYSE – JCP
Fashion Bug
www.fashionbug.com
Public
NasdaqGS – CHRS
Financial information
provided for Charming
Shoppes, Inc.
Financial
Information
01/28/06
Year Ended
$18.8B
Sales
Net Profit
$1.1B
Book Value
$3.9B
Market Cap
$14.78B
Credit Rating
Baa3
Year Ended
01/28/06
Sales
$2.8B
Net Profit
$99.4M
Book Value
$409.7M
Market Cap
$1.62B
Credit Rating
B2
- 11 -
Shopping Center Investment Services
www.may.bz
Retailer
Category
# of Stores
Geography
Department Store
1,021 locations in
49 states
Women’s Specialty
Retailer
1,000 locations in
45 states
Comments
J. C. Penney Company, Inc.
reported a record second
quarter in 2006 with an
operating profit of $271
million from $213 million last
year.
Charming Shoppes, Inc.
reported net sales for the
second quareter ended July
29, 2006 increased 11% to
$763.4 million, compared to
$689.1 million in 2005.
Maysville Marketsquare
Maysville, Kentucky
FINANCIAL INFORMATION
Maysville Marketsquare features the stability of a strong community center asset. The
property provides an investor an opportunity to add value via lease-up of currently
vacant space. The excellent financing environment that exists in today’s marketplace
allows a purchaser to place an aggressive financing arrangement on the subject
property, thus boosting yields. The seller has elected to not establish an asking price for
the asset. Please contact the Marketing Team for further pricing discussion.
-1-
Shopping Center Investment Services
www.may.bz
Maysville Marketsquare
Maysville, Kentucky
ASSUMPTIONS
Approach
ƒ “As Is” and stabilized analyses have been prepared
ƒ Analysis Period - January 1, 2007 through December 31, 2007
ƒ 3.0% per annum for expenses, market rents, and CPI
ƒ Tenant-by-tenant analysis of current rental agreements
ƒ No percentage rent has been assumed
Tenant Specific
ƒ GNC is leasing Suite 3 (2,600 s.f.) through December 31, 2006.
Ownership does not expect GNC to renew its lease. This analysis
assumes Suite 3 is vacant as of January 1, 2007.
ƒ Sally Beauty has a lease expiration dated of August 31, 2007.
This analysis assumes Sally Beauty exercises its five year option
at a rental rate of $15.81 p.s.f.
ƒ Kirlin’s Hallmark has a lease expiration date of February 28, 2007.
This analysis assumes the tenant extends its lease through
December 31, 2007 at its current rental rate.
ƒ To arrive at a stabilized 2007 net operating income, the currently
vacant suites were leased at rental rates provided by ownership.
Suites 2 and 8 have been leased at $10.00 p.s.f., Suites 3, 5 and 7
at $9.00 p.s.f. and Suite 6 at $8.00 p.s.f. All tenants are assumed
to pay their PRS of CAM, insurance, real estate taxes and
management fee. The tenants also pay a 15% admin. fee on
CAM, insurance and real estate taxes.
Other Income
ƒ Ownership projects to receive $5,741 in other income relating to
seasonal promotions.
Reimbursements ƒ Tenants pay a pro rata share of common area maintenance, real
estate tax and insurance expenses.
Exceptions and limitations
may be found on the Rent Roll in the Tenant Information section.
ƒ The denominator used to calculate reimbursements includes the
square footage (524 s.f.) associated with the management office.
Vacancy
Allowance
ƒ As the property is more than 5% vacant, no vacancy allowance has
been applied.
-2-
Shopping Center Investment Services
www.may.bz
Maysville Marketsquare
Maysville, Kentucky
EXPENSES
Common Area
Maintenance
ƒ The 2006 common area maintenance budget was grown at 3% to
arrive at the projected 2007 common area maintenance expense.
2007 common area maintenance expenses are $203,280 ($1.61
per square foot based on 126,507 square feet).
CAM Category
2007 Projected Expense
Cleaning
Electrical Maintenance
Plumbing
Grounds & Maintenance
General Building Expenses
Repairs & Maintenance
Parking Expenses
Snow Removal
Utilities
Total
Real Estate
Taxes
$17,847
750
820
5,582
31,794
83,272
24,026
22,308
16,881
$203,280
ƒ The Mason County 2005 real estate tax calculation is shown
below.
ƒ A full analysis of the real estate tax calculation is available from the
Marketing Team.
ƒ The 2005 real estate taxes were grown twice at 3% to arrive at the
2007 projected real estate taxes of $82,311 ($0.65 per square foot
based on 126,507 square feet).
Parcel # 2421 400-01
Assessed Value
Tax Rate
2005 Real Estate Tax
-3-
Shopping Center Investment Services
www.may.bz
$7,319,434
1.06%
$77,586.00
Maysville Marketsquare
Insurance
Maysville, Kentucky
ƒ The 2007 insurance expense is projected to be $20,097 ($0.16 per
square foot based on 126,507 square feet).
Management
Fees
ƒ 3% of Effective Gross Income
-4-
Shopping Center Investment Services
www.may.bz
Maysville Marketsquare
Maysville, Kentucky
PROJECTED 2007 NET OPERATING INCOME
Base Rents
$825,151
Recoveries
Common Area Maintenance
Insurance
Real Estate Taxes
Management Fee
$134,996
14,159
57,995
12,450
$219,600
Miscellaneous Revenue
$5,747
Effective Gross Revenue
$1,050,498
Operating Expenses
Common Area Maintenance
Insurance
Real Estate Taxes
Management Fee
$203,280
20,097
82,311
31,515
$337,203
Net Operating Income
$713,295
-5-
Shopping Center Investment Services
www.may.bz
Maysville Marketsquare
Maysville, Kentucky
STABILIZED PROJECTED 2007 NET OPERATING INCOME
Base Rents
$968,551
Recoveries
Common Area Maintenance
Insurance
Real Estate Taxes
Management Fee
$164,712
17,118
70,115
20,244
$272,189
Miscellaneous Revenue
$5,747
Effective Gross Revenue
$1,246,487
Operating Expenses
Common Area Maintenance
Insurance
Real Estate Taxes
Management Fee
$203,280
20,097
82,311
37,395
$343,083
Net Operating Income
$903,404
PRICING
The seller of Maysville Marketsquare has elected to not establish an asking price for the
asset. Please contact the Marketing Team for further pricing discussion.
-6-
Shopping Center Investment Services
www.may.bz