SAFEWAY // MCMINNVILLE, OR CORPORATE 20-YEAR ABSOLUTE NET LEASE Offering Memorandum EXCLUSIVELY LISTED BY JOSEPH BLATNER // Senior Vice President 503.200.2029 // [email protected] NON-ENDORSEMENT & DISCLAIMER NOTICE CONFIDENTIALITY & 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. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2019 Marcus & Millichap. All rights reserved. Oregon Broker of Record: Adam Lewis | Activity ID: ZAA0210388 NON-ENDORSEMENT NOTICE 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 YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS. SAFEWAY MCMINNVILLE, OREGON TABLE OF CONTENTS EXECUTIVE SUMMARY FINANCIAL ANALYSIS SECTION 1 SECTION 2 01 Investment Overview • Investment Highlights 15 Rent Roll • Rent Schedule Property Details • Aerial Map • Tenant Overview MARKET OVERVIEW SECTION 5 19 Location Overview • Location Highlights • Demographics OFFICES NATIONWIDE AND THROUGHOUT CANADA WWW.MARCUSMILLICHAP.COM 56,379 OCCUPIED SQUARE FEET 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. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Any projections, opinions, as- sumptions or estimates used herein are for example purposes only and do not represent the current or future performance of the property. Marcus & Millichap Real Estate Investment Services is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2019 Marcus & Millichap ACT ID ZAA0210388 EXECUTIVE SUMMARY SAFEWAY | MCMINNVILLE, OR SAFEWAY // EXECUTIVE SUMMARY // SAFEWAY 1 NEW 20-YEAR OFFERING HIGHLIGHTS ABSOLUTE NET LEASE WITH INCREASES SAFEWAY SAFEWAY // EXECUTIVE SUMMARY // SAFEWAY CORPORATE 2490 N, OR-99 WEST | MCMINNVILLE, OR 97128 OFFERING PRICE CAP RATE $14,420,673 5.35% NET OPERATING INCOME $771,506 LEASE TYPE Absolute Net LEASE COMMENCEMENT 6/28/2019 LEASE EXPIRATION DATE 6/30/2039 YEAR BUILT / RENOVATED 1998 / 2013 BUILDING SIZE 56,379 SF LOT SIZE 5.10 Acres 1.5% annual increases at start of Years 2-5 INCREASES 7.5% increases every 5 years after Year 10 OPTIONS (8) 5-Year Options TENANT Safeway, Inc GUARANTOR Albertsons Companies, Inc. 2 (1) Building Size, Lot Size, and Year Built/Renovated are approximate. Buyer will need to verify during their Due Diligence review. NEW 20-YEAR ABSOLUTE NET LEASE WITH INCREASES 20 SAFEWAY // EXECUTIVE SUMMARY // SAFEWAY 3 INVESTMENT OVERVIEW The subject property is a Safeway location guaranteed by their corporate parent company, Albertsons Companies, Inc. A new, 20- year lease was just executed June 2019 and includes 1.5% annual increases at start of years 2-5 then 7.5% increases every five years starting after year 10. There are eight, five-year options to renew, each with 7.50% increases. The property is an anchor in McMinnville Plaza, an 18-acre shopping center directly off Oregon Route 99 in McMinnville, Oregon. The Plaza includes other anchors like JC Penny, Ross Dress For Less, Petco, and a new Marshalls set to open in Fall 2019. SAFEWAY // EXECUTIVE SUMMARY // SAFEWAY The surrounding area is dense with other national retailers like Walmart, WinCo, JoAnn Fabrics, Goodwill, Subway, and more. Directly east of the subject property is the Cascade Steel Rolling Mills, a Schnitzer Steel Industries company, employing over 400 people. Oregon Route 99 is the main highway cutting directly through McMinnville and connecting the city to both Portland to the north and Salem to the south, each within an hour’s drive. NEW, 20-YEAR LEASE DIRECT ACCESS New, 20-year absolute net lease with 1.5% annual increases at start of years 2-5, then 7.5% OFF OREGON increases every five years starting after year 10. ROUTE 99 ABSOLUTE NET LEASE The absolute net lease structure provides owner with a passive investment and no landlord GREAT VISIBILITY maintenance responsibilities. WITH OVER 20,000 VPD ALBERTSONS COMPANIES, INC. • Corporate Guarantee from Albertsons Companies, Inc., the second-largest traditional grocer in the United States ANCHOR OF • $60.5 Billion in revenue for 2018 LARGE, 18-ACRE • Third-largest, private company in the US as of 2018 SHOPPING • Approximately 34 million customers per week CENTER • Over 2,200 stores in 34 states and the District of Columbia under 21 well-known banners • 270,000 employees nationwide 4 INVESTMENT HIGHLIGHTS ► Absolute Net Lease - No Landlord Responsibilities Whatsoever ► Corporate Guarantee from the Second-Largest Traditional Grocer in the United States ► Anchor of Large Shopping Center Along Main McMinnville Highway with Traffic Counts in Excess of 20,400 Vehicles Per Day ► Multiple Points of Ingress/Egress Allowing Easy Access ► Located in Dense Retail Area Surrounded by 25+ National Retailers like Walmart, WinCo, Joann Fabrics, Goodwill, Dollar Tree, and More ► Number of Households in the Area Has Increased by Over 30% Since 2000 and Household Income Increased by Over 20% GUARANTEED BY WELL-LOCATED IN LOCATED ON 2ND-LARGEST U.S. DENSE RETAIL HIGHWAY CONNECTED TRADITIONAL GROCER CORRIDOR TO PORTLAND & SALEM AERIAL VIEW Tice Park McMinnville is located in western Oregon. The subject property is directly on Oregon Route 99, the main highway through McMinnville. By this route, the city is less than an hour’s drive to Portland, the state’s largest city, and only 30 minutes to SAFEWAY // PROPERTY DESCRIPTION PROPERTY // SAFEWAY Salem, the state capital. The majority of all national retail in McMinnville lies along OR-99, making the subject property ideally located. OR-99 WEST Memorial Elementary School Michelbook Country Club Duniway Middle School 106 OR-99 WEST McDonald’s CASCADE STEEL ROLLING MILLS VPD: 20,400* Mac Track Yamhill County SUBJECT PROPERTY Fair & Rodeo OR-99 WEST Great Oregon SAFEWAY Wine Company Oregon 2490 N OR-99 WEST Wine Services MCMINNVILLE, OR 97128 Patton Middle School Cast-Away McMinnville Concrete High School Remy Winery The Eyrie Vineyards Grain Station DESCRIPTION PROPERTY // SAFEWAY Brew Works Joe Dancer Park 7 BIRD’S EYE The subject property is an anchor for McMinnville Plaza, an 18-acre shopping center along Oregon Route 99 West. The Safeway parcel outline is outlined in red and makes up 5.10 acres of the Plaza. The other anchors include JC SAFEWAY // PROPERTY DESCRIPTION PROPERTY // SAFEWAY Penny, Petco, Ross Dress For Less, Famous Footwear, and a Marshalls set to open in fall 2019. VPD: 20,400* OR-99 WEST Aspen Dental Burger King COMING FALL 2019 8 CASCADE STEEL Advanced ROLLING MILLS Mechanical Services The Muffler Mazatlan Doctor Mexican Platt Electric Supply Grow Geek Air Liquide Garden Supply America Corp McMinnville Self Storage Mac Track VPD: NE LAFAYETTE AVE 10,500* Lafayette Place Apartments DESCRIPTION PROPERTY // SAFEWAY *Source: LandVision™ **Subject parcel outline is not exact 9 TENANT OVERVIEW Safeway, Inc. is an American supermarket chain founded in 1915. It is a subsidiary of Albertsons Companies Inc. (Lease Guarantor). Safeway’s primary base of operations is in the western and central United States, with some stores located in the Mid- Atlantic region of the Eastern Seaboard. SAFEWAY // PROPERTY DESCRIPTION PROPERTY // SAFEWAY Safeway began in April