FILE PHOTO
EXCLUSIVE OFFERING | $4,471,000 – 4.25% CAP
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
214.915.8890
JOE CAPUTO
[email protected]
RUSSELL SMITH
[email protected]
ALEX TOWER
[email protected]
Property. New 2,107+ SF building on +0.42 acres.
Tenant. Starbucks Corporation | FY 2016 financials: $21.3 billion in sales and $4.1 billion in net income | Over 26,000 locations worldwide.
Lease structure. New 20-year, corporate ground lease with 10% rent increases every 10 years in primary term and option periods.
Location. Starbucks is situated along Richmond Ave. (25,000 VPD), just north of I-69 (250,000 VPD) in the heart of multiple well known districts of Houston
(River Oaks, Uptown, Midtown, and Montrose). Along with Starbucks, the immediate trade area features notable national credit tenants such as, HEB, Randall's,
Kroger, Whole Foods, CVS, Walgreens, Trader Joes, Academy, Office Depot, PetSmart, Bed Bath & Beyond, Take 5 Oil Change, ZOE’S, Whataburger, Wendy’s,
Raising Cane’s, Chipotle, Taco Bell, and countless others. The immediate trade area features above average demographics and household incomes; within a 3mile radius of the site, the population is 188,974 people, the total number of employees is 491,634, and there is an average household income of nearly $146,000.
Rice University (6,750 Students) is located 1-mile south of the site. The subject property is located approximately 4-miles west of downtown Houston.
Table of contents | Disclaimer
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
PAGE 2:
TABLE OF CONTENTS | DISCLAIMER
PAGE 3:
INVESTMENT | TENANT | LEASE OVERVIEW
PAGE 4:
TENANT OVERVIEW CONTINUED
PAGE 5-6:
AERIAL PHOTOS
PAGE 7:
SITE RENDERINGS
PAGE 8:
SITE PLAN
PAGE 9:
GALLERIA | UPTOWN DISTRICT OVERVIEW
PAGE 10-11:
LOCATION OVERVIEW
PAGE 12-13:
LOCATION MAPS
PAGE 14:
DEMOGRAPHICS
Disclaimer
Trivanta (“Agent”) has been engaged as an agent for the sale of the property located at
Richmond Ave. and Woodhead St., Houston, TX 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
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
Lease overview
PRICE | CAP RATE:
$4,471,000 | 4.25%
Lease Term:
20 Years with (3), 10-year options to extend
Projected Rent Commencement:
September 2017
NET OPERATING INCOME:
$190,000
BUILDING AREA:
2,107+ Square Feet
Projected Lease Expiration:
September 2037
LAND AREA:
0.42+ Acres
Lease Type:
Corporate Ground Lease – Absolute NNN
YEAR BUILT
2017
Rent Increases:
10% Every 10 Years In Primary Term & Options
LANDLORD RESPONSIBILITY:
None
Annual Rent Years 1-10:
$190,000
OCCUPANCY:
100%
Annual Rent Years 11-20:
$209,000
Option 1 | Years 21-30:
$229,900
Option 2 | Years 31-40:
$252,890
Option 3 | Years 41-50:
$278,179
Right Of First Refusal:
Yes
Tenant overview
Starbucks Corporation, a Washington Corporation.
STARBUCKS | www.starbucks.com
Starbuck’s Corporation is an international coffee and coffeehouse chain based in Seattle, Washington, United States. Starbucks is the largest coffeehouse
company in the world, with over 26,000 stores globally, including around 13,000 in the United States, followed by nearly 1,000 in Canada and more than 900 in
Japan. Starbuck’s sells drip brewed coffee, espresso-based hot drinks, other hot and cold drinks, snacks, and items such as mugs and coffee beans. Through the
Starbucks Entertainment division and Hear Music brand, the company also markets books, music, and film. Many of the company’s products are seasonal or
specific to the locality of the store. Starbucks-brand ice cream and coffee are also offered at grocery stores.
Starbucks retail stores are located in high-traffic, high-visibility locations. Its stores are located in or near a variety of settings, including downtown and suburban
retail centers, office buildings and university campuses.
The Company sells whole bean and ground coffees, including the Starbucks and Seattle’s Best Coffee brands, as well as a selection of premium Tazo teas, VIA
and other related products, to institutional foodservice companies that service business and industry, education, healthcare, office coffee distributors, hotels,
restaurants, airlines and other retailers.
From Starbucks’ founding in later forms as a local coffee bean roaster and retailer, the company has expanded rapidly. In the 1990s, Starbucks was opening a
new store every workday, a pace that continued into the 2000s. The first store outside the United States or Canada opened in the mid-’90s, and overseas stores
now constitute almost one third of Starbucks’ stores. In fiscal 2016, the company reported revenues of $21.3 billion and net income of $3.6 billion
3
Tenant overview continued
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
Source:starbucks.com
4
Aerial photo
Starbucks | Corporate ground lease – Absolute nnn
Shepherd Dr (31,000 VPD)
Hyde Park
Woodhead St (5,000 VPD)
River Oaks
Kirby Dr (42,000 VPD)
Houston Galleria
-2.4 Million SF
-30 Million Annual Visitors
River Oaks Blvd (5,000 VPD)
Richmond ave & Woodhead st, Houston, TX
W Alabama St (15,000 VPD)
Montrose
Rice University
(6,750 Students)
5
Aerial photo
Starbucks | Corporate ground lease – Absolute nnn
Greenbriar Dr (22,000 VPD)
Richmond ave & Woodhead st, Houston, TX
Big Tex Storage
The Fairmont
Ervan Chew Park
FedEx Office
Ship Center
Audi Central
Houston
Rice University
(6,750 Students)
6
Site RENDERINGS
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
7
Site plan
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
8
GALLERIA | UPTOWN DISTRICT – MARKET OVERVIEW
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
Houston’s Uptown District is the 14th-largest business district
in the United States
The subject property is strategically located within
close proximity to the thriving Uptown and Galleria
District of Houston, an area located approximately 4miles of downtown.
Business District
At more than 28 Million SF of commercial office space,
the Uptown District is the 14th largest business district
in the U.S., comparable in size to downtowns of
Denver and Pittsburgh. The district is home to
approximately 2,000 companies and represents more
than 15% of Houston's total office space.
Galleria Snapshot
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4th Largest Retail Complex in U.S.
#1 Shopping & Tourist Attraction in Houston & the
Southwest
30+ Million Annual Visitors
•
Sales of $1,000+ PSF
Retail Snapshot
•
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•
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Annual Gross Sales of $3.63+ Billion in 2014
Accounts for 10%+ of Houston Taxable Sales
5+ Million SF of Retail Space
1,000+Stores & 100+ Restaurants
99.9% Occupancy (Q2 2015)
Uptown Houston’s Major Employers
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Air Liquide
Aon International Energy
Apache Corporation
Bechtel Corporation
BHP Billiton
Blue Cross Blue Shield of Texas
Cameron International Corporation
Christus Health
Clear Channel Communications
GE Energy
GDF SUEZ Energy
Hines REIT
Landry’s Restaurants, Inc.
NetIQ Corporation
Panhandle Energy
Spectra Energy Corporation
Stewart Title Company
Symantec Corporation
Weatherford International Ltd.
Williams
Office Snapshot
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Five-Star, Class A International Community
90.4% Occupancy Rate (Q2 2015)
Home to 2,000 Companies
28+million SF of Commercial Office Space
14th Largest Business District in U.S.
15.25% of Houston’s Total Class A Office Space
Source: Grubb & Ellis
9
Location overview
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
IMMEDIATE TRADE AREA
Starbucks is situated along Richmond Ave. (25,000 VPD), just north of I-69
(250,000 VPD) in the heart of multiple well known districts of Houston (River
Oaks, Uptown, Midtown, and Montrose). The site has excellent access via
several major thoroughfares, including Interstate 610, east of the subject
property and Westpark Tollway, south of the site. Richmond Ave. is a major
arterial east-west road in Houston, TX, while Interstate 610 (abbreviated I-610)
is a freeway that forms a 38-mile-long loop around the downtown sector of city
of Houston, Texas.
Along with Starbucks, the immediate trade area features notable national credit
tenants such as, HEB, Randall's, Kroger, Whole Foods, CVS, Walgreens,
Trader Joes, Academy, Office Depot, PetSmart, Academy, Bed Bath &
Beyond, Take 5 Oil Change, ZOE’S, Whataburger, Wendy’s, Raising Cane’s,
Chipotle, Taco Bell, and countless others. The immediate trade area features
above average demographics and household incomes; within a 3-mile radius of
the site, the population is 188,794 people, the total number of employees is
491,634, and there is an average household income of nearly $146,000. Rice
University (6,750 Students) is located 1-mile south of the site. The subject
property is located approximately 4-miles west of downtown Houston.
RIVER OAKS / UPTOWN / MIDTOWN / MONTROSE
River Oaks is a residential community located in the center of Houston, Texas.
Located within the 610 loop between downtown and uptown, the community
spans 1,200-acres. Established in the 1920’s by brothers William and Michael
Hogg, the community became a well-publicized national model for community
planning. Real Estate values range from $1 million to over $20 million.
Shiny chrome rings suspended above intersections welcome visitors to
Houston's premier shopping district. More than 30 million visitors each year
seek the dynamic & fine shopping environment uniquely offered by The
Galleria, Texas’ largest shopping center and fourth largest domain nationally.
Midtown Houston is a model of urban living in the center of Houston.
Residents, businesses, and visitors enjoy a sustainable, walkable community
with a thriving arts and entertainment scene and green oases. Since 2012,
Midtown Houston has experienced 50% population growth with almost 10,000
Houstonians now calling it home. Homes in the Museum District of Houston
and Montrose neighborhood offer the best of both convenience and culture.
With close proximity to some of Houston’s best art, entertainment, dining, and
shopping attractions, this area is also within close proximity from downtown
Houston and the Texas Medical Center.
Recent Houston Accolades Include:
•
The Brookings Institution ranked Houston as the fastest growing economy
in North America; Houston posted 118,200 new jobs in 2012 and added
more than 87,600 new jobs in 2013
•
The Association of Foreign Investors in Real Estate (“AFIRE”), recently
named Houston the 5th best city in the world for commercial real estate
investment
•
Perennial Outperformer: Houston led all other major metropolitan area with
4.7% Gross Metropolitan Product growth (GMP) since 2000
•
With 3,700 energy-related establishments, Houston is known as the
“Energy Capital of the World”
•
Houston ranks number 1 for health care and manufacturing careers,
number 2 for engineering, finance and accounting careers, and number 3 in
green jobs and number 6 in computer science careers
10
Location overview
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
HOUSTON-SUGAR LAND-BAYTOWN METROPOLITAN AREA
The Houston-Sugar Land-Baytown Metropolitan Statistical Area (MSA), colloquially known as Greater Houston, is the 6th 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 5th in the nation in population growth—adding 2.66 million people.
In 2006, Greater Houston ranked 1st in Texas and 3rd 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, 5th 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 2nd 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 Houston-area'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.
11
Location map
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
12
Location map
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
Houston
13
Demographics
Starbucks | Corporate ground lease – Absolute nnn
Richmond ave & Woodhead st, Houston, TX
Richmond Ave & Woodhead St
Richmond Ave & Woodhead St
1 mi radius 2 mi radius 3 mi radius
2010 Census Population
24,450
78,648
161,622
2000 Census Population
Projected Annual Growth 2017 to 2022
23,534
1.9%
70,747
2.0%
140,546
2.1%
Historical Annual Growth 2000 to 2017
1.0%
1.7%
2.0%
2017 Estimated Households
15,769
50,877
102,427
2022 Projected Households
2010 Census Households
17,246
13,335
55,874
41,833
113,055
83,324
2000 Census Households
13,125
36,964
69,545
1.9%
1.2%
2.0%
2.2%
2.1%
2.8%
AGE
2017 Est. Population Under 10 Years
MARITAL STATUS
& GENDER
8.5%
10.1%
2017 Est. Population 10 to 19 Years
7.4%
7.3%
8.0%
2017 Est. Population 20 to 29 Years
2017 Est. Population 30 to 44 Years
22.5%
26.8%
20.8%
26.8%
20.8%
25.9%
2017 Est. Population 45 to 59 Years
18.5%
19.2%
18.6%
2017 Est. Population 60 to 74 Years
2017 Est. Population 75 Years or Over
13.7%
3.4%
13.3%
4.1%
12.4%
4.2%
35.6
36.4
35.5
2017 Est. Male Population
2017 Est. Female Population
52.7%
47.3%
52.6%
47.4%
51.4%
48.6%
2017 Est. Never Married
51.1%
45.6%
45.1%
2017 Est. Now Married
34.7%
37.8%
37.9%
2017 Est. Median Age
INCOME
7.6%
2017 Est. Separated or Divorced
2017 Est. Widowed
12.8%
1.5%
13.7%
2.9%
14.0%
3.0%
2017 Est. HH Income $200,000 or More
23.1%
24.7%
23.0%
2017 Est. HH Income $150,000 to $199,999
7.5%
9.6%
9.3%
2017 Est. HH Income $100,000 to $149,999
2017 Est. HH Income $75,000 to $99,999
13.5%
9.6%
15.2%
9.8%
14.8%
10.1%
2017 Est. HH Income $50,000 to $74,999
2017 Est. HH Income $35,000 to $49,999
14.4%
10.5%
14.0%
8.4%
13.9%
8.6%
2017 Est. HH Income $25,000 to $34,999
6.2%
5.5%
5.6%
2017 Est. HH Income $15,000 to $24,999
2017 Est. HH Income Under $15,000
4.9%
10.2%
4.8%
8.1%
6.0%
8.8%
2017 Est. Average Household Income
$133,921
$153,337
$145,953
2017 Est. Median Household Income
2017 Est. Per Capita Income
$95,026
$76,550
$109,874
$86,104
$107,666
$79,383
LABOR FORCE
188,974
209,033
OCCUPATION
90,888
100,002
2017 Est. Labor Population Age 16 Years or Over
2017 Est. Civilian Employed
2017 Est. Civilian Unemployed
24,552
74.6%
79,555
73.8%
161,209
72.2%
2.6%
1.9%
2.2%
2017 Est. in Armed Forces
2017 Est. not in Labor Force
22.8%
0.1%
24.3%
25.6%
2017 Labor Force Males
2017 Labor Force Females
52.8%
47.2%
52.8%
47.2%
51.5%
48.5%
2010 Occupation: Population Age 16 Years or Over
18,614
58,806
116,420
2010 Mgmt, Business, & Financial Operations
24.4%
26.7%
25.7%
2010 Professional, Related
2010 Service
39.8%
10.4%
38.6%
9.7%
39.4%
9.6%
2010 Sales, Office
19.3%
17.9%
17.8%
2.8%
2.6%
2.8%
2010 Farming, Fishing, Forestry
2010 Construction, Extraction, Maintenance
2010 Production, Transport, Material Moving
TRANSPORTATION
TO WORK
27,665
30,282
TRAVEL TIME
2017 Estimated Population
2022 Projected Population
Projected Annual Growth 2017 to 2022
Historical Annual Growth 2000 to 2017
1 mi radius 2 mi radius 3 mi radius
Houston, TX 77098
CONSUMER EXPENDITURE
HOUSEHOLDS
POPULATION
Houston, TX 77098
3.3%
4.5%
4.6%
2010 White Collar Workers
2010 Blue Collar Workers
83.5%
16.5%
83.1%
16.9%
82.9%
17.1%
2010 Drive to Work Alone
73.3%
75.3%
76.1%
2010 Drive to Work in Carpool
4.7%
5.4%
5.3%
2010 Travel to Work by Public Transportation
2010 Drive to Work on Motorcycle
3.3%
0.6%
3.5%
0.3%
4.7%
0.3%
2010 Walk or Bicycle to Work
2010 Other Means
9.3%
1.5%
7.6%
1.0%
6.2%
1.2%
2010 Work at Home
7.3%
6.9%
6.3%
2010 Travel to Work in 14 Minutes or Less
43.7%
45.7%
40.2%
2010 Travel to Work in 15 to 29 Minutes
2010 Travel to Work in 30 to 59 Minutes
52.3%
25.9%
49.6%
26.1%
48.8%
27.0%
2010 Travel to Work in 60 Minutes or More
4.8%
4.0%
4.6%
2010 Average Travel Time to Work
17.5
17.3
18.4
$1.37 B
$48.6 M
$4.92 B
$175 M
$9.52 B
$338 M
2017 Est. Contributions, Gifts
$114 M
$420 M
$808 M
2017 Est. Education, Reading
$65.2 M
$239 M
$461 M
2017 Est. Entertainment
$77.8 M
$280 M
$541 M
2017 Est. Food, Beverages, Tobacco
$199 M
$704 M
$1.37 B
2017 Est. Furnishings, Equipment
2017 Est. Health Care, Insurance
$49.2 M
$114 M
$178 M
$403 M
$343 M
$783 M
2017 Est. Household Operations, Shelter, Utilities
2017 Est. Miscellaneous Expenses
$426 M
$19.6 M
$1.52 B
$69.3 M
$2.95 B
$134 M
2017 Est. Total Household Expenditure
2017 Est. Apparel
2017 Est. Total Businesses
2,870
12,942
24,121
2017 Est. Personal Care
$17.6 M
$63.0 M
$122 M
2017 Est. Total Employees
22,316
219,787
491,634
2017 Est. Transportation
$243 M
$864 M
$1.68 B
14