DOWNTOWN OFFICE PORTFOLIO 1527 – 1539 Greenup Avenue & 131 16Th Street, Ashland, KY 41100 NON - ENDORSEMENT and DISCLAIMER NOTICE
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OFFERING MEMORANDUM DOWNTOWN OFFICE PORTFOLIO 1527 – 1539 Greenup Avenue & 131 16th Street, Ashland, KY 41100 NON - ENDORSEMENT AND DISCLAIMER NOTICE 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. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. © 2017 Marcus & Millichap. All rights reserved. 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. DOWNTOWN ASHLAND GOVERNMENT OFFICE Ashland, KY ACT ID Y0360263 2 DOWNTOWN OFFICE PORTFOLIO TABLE OF CONTENTS SECTION INVESTMENT OVERVIEW 01 MARKET OVERVIEW 02 FINANCIAL ANALYSIS 03 MAKET COMPARABLES 04 MARKET DEMOGRAPHICS 05 3 DOWNTOWN OFFICE PORTFOLIO INVESTMENT OVERVIEW 4 DOWNTOWN OFFICE PORTFOLIO OFFERING SUMMARY INVESTMENT OVERVIEW INVESTMENT HIGHLIGHTS ▪ Five Story Government Office | Two Story Mixed-Use Building | 80+ Parking Spaces ▪ Turn Key Class B Office Spaces | Low Average Rent $10.47 Per Square Foot ▪ 93.84 Percent Economic Occupancy | Strong Credit Tenancy | State of Kentucky Rated: Aa3 (Moody’s) ▪ Strong Historical Occupancy | 63 Percent of GLA Leased Since 2001 ▪ Strong Leasing Activity | 14% of GLA Leased Since 2014 | Recent Tenant Extensions and Expansions ▪ Limited Rollover Risk | Only Five Percent of Income Expires Prior to 2020 ▪ Priced Below Replacement Cost | $61.49 Per Square Foot ▪ Located on Greenup Avenue Which Sees 13,200+ Vehicles Per Day Marcus & Millichap is pleased to present the Office Portfolio, located on the corner of Greenup Avenue and 16th Street in Ashland, Kentucky. This portfolio consists of three adjoining buildings with a combined gross leasable area of 60,089-square feet, situated on approximately 0.59 acres, encompassing an entire city block within the epicenter of downtown Ashland. The main structure is a 51,691- square foot, five story office building built in 1930 and completely renovated in 1997, leased to various State Government entities. Adjacent to that is a 7,104-square foot, two story mixed-use building with two Lamar billboards and over 80 parking spaces. The third building is a 700 square-foot structure, located behind the five story office building. The city of Ashland is located in Boyd county Kentucky and is the second largest city in the Huntington-Ashland MSA. The Huntington- Ashland MSA consists of seven counties throughout Kentucky, Ohio and West Virginia with a 2015 population of 361,580 residents. Ashland is also the eighteenth largest community in the Commonwealth of Kentucky. Ashland serves as the main employment hub on the Kentucky side of the tri-state area, while also providing a regional shopping, restaurant and entertainment hub for the county and other municipalities in the region. The subject property is centrally located in a region with strong demographics. There are over 120,700 residents with average incomes exceeding $55,500 within ten-miles. The market area boasts over 131,000 employees with over 23 percent of those employees having an Associate Degree or higher education. The offering sits between 15th street and 16th street on the main thoroughfare of Greenup Avenue, which sees over 13,200 vehicles per day. 5 DOWNTOWN OFFICE PORTFOLIO OFFERING SUMMARY INVESTMENT OVERVIEW MARKET HIGHLIGHTS ▪ Central Government Office Market | Multiple County, State and Federal Agencies ▪ 120,700+ Population | Average Household Income $55,500 | 131,000+ Employees | Ten Mile Radius ▪ Near the New Delta Hotel by Marriot Development | $12 Million Renovations ▪ Near Braidy Industries HQ | 2018 Groundbreaking on $1.3B State of the Art Aluminum Mill (Boyd County) There are multiple complementary offices nearby that create drivers for the tenants occupying the subject property such as The Mayor’s Office, Social Security Administration, Ashland City Finance Department, Ashland City Police Department, City of Ashland and more are located within blocks of the property. There are several schools and universities in the area, within one-mile is Fairview High School, Ashland Independent Schools, Russell High School, Morehead State University with 200 students enrolled, Ashland Community Technical College with more than 2,700 students enrolled. Ohio University Southern sits within four-miles. The subject property is located within close proximity of two of Ashland’s largest employers. One being King’s Daughters Medical Center which has 465 beds and over 3,700 employees. The second is Our Lady of Bellefonte Hospital, an 214-bed facility, which has more than 1,250 employees. Other major employers in the area are Marathon Petroleum and Boyd County Schools, with more than 3,000 combined employees. The region boasts a 650-acre refining facility that produces more than 242,000 barrels per day and is the 31st largest American refining facility less than eight miles away in Catlettsburg, Kentucky. There are four major shopping centers nearby. The major of the four being the 425,000-square foot Ashland Town Center with major tenants such as TJ Maxx, JC Penney and Belk. The other three make up more than 500,000-square feet of retail space with major tenants such Kroger, Walmart Supercenter, Dick’s Sporting Goods, Big Lots, Lowe’s and Hobby Lobby, all within ten minutes of the subject property. In September 2017, the Ashland Plaza Hotel, which is 800 feet from the subject property, sold for $3,600,000. The hotel will undergo $12,000,000 in renovations and will be rebranded as a Delta Hotel by Marriott, it will also include a convention center and parking garage. Another major local and regional impact will be created by Braidy Industries, which recently located their headquarters nearby the subject property. Braidy Industries was created by Craig T. Bouchard to lead a national transformation in the use of efficient, eco-friendly aluminum alloys that are also lighter and stronger. The goal of the company is to lead the generational shift in materials science that is currently underway. Braidy plans to break ground on a revolutionary, one of a kind 2.5M-square foot $1.3B Aluminum Mill, which is expected to create 1,000 construction jobs and 500 full-time positions upon completion. The expected ground breaking is late 2018 and completion projected for 2020. (www.braidyindustries.com) This Office Portfolio provides an incoming investor the ability to acquire a stabilized asset with minimal rollover and prominent location within a complimentary market. 6 DOWNTOWN OFFICE PORTFOLIO PROPERTY PHOTOS 7 DOWNTOWNPROPERTY NAMEOFFICE PORTFOLIO SURROUNDINGMARKETING PROPERTY TEAM Looking East from Greenup Avenue at Subject Property East of the Subject Property North of the Subject Property Northeast of the Subject Property 8 DOWNTOWN OFFICE PORTFOLIO LOCAL AERIAL 9 DOWNTOWN OFFICE PORTFOLIO REGIONAL AERIAL 119 Miles to Columbus, OH 294 Miles to Pittsburgh 136 Miles to Subject Property Cincinnati, OH Ashland, Kentucky Huntington, West Virginia $1.3B Aluminum Mill Brand New Development 68 Miles to Charleston, WV 10 DOWNTOWN OFFICE PORTFOLIO MARKET OVERVIEW 11 DOWNTOWN OFFICE PORTFOLIO MARKET OVERVIEW ASHLAND PROFILE LIVING IN ASHLAND Ashland is the second-largest city in the Huntington-Ashland metropolitan area, which serves as an important economic and medical center for northeast Kentucky and is part of the fifth-largest