University of Texas Medical Branch 195 N
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UNIVERSITY OF TEXAS MEDICAL BRANCH 195 N. 11th Street, Beaumont, Texas 77702 Exclusively Offered By: ED COLSON, JR. CCIM 619.546.0121 [email protected] CA Lic #01382996 | TX Lic #635820 InvestCoreCommercial.com OFFERING STATEMENT / DISCLAIMER InvestCore Commercial presents this Offering which to the recipient. This Offering does not constitute a limited herein are called the “Contents”), are of a has been prepared by InvestCore Commercial for use representation that there has been no change in the confidential nature. by a limited number of parties and does not purport business or affairs of the Property or the Owner since to provide a necessarily complete summary of the the date of preparation of the package. Analysis By accepting the package, you agree (i) to hold and Property or any of the documents related thereto, nor and verification of the information contained in this treat it in the strictest confidence, (ii) not to photocopy does it purport to be all-inclusive or to contain all of package is solely the responsibility of the prospective or duplicate it, (iii) not to disclose the package the information which prospective investors may need purchaser. Additional information and an opportunity or any of the contents to any other entity (except or desire. All projections have been developed by to inspect the Property will be made available upon to outside advisors retained by you, if necessary, InvestCore Commercial, the Owner, and designated written request to interested and qualified prospective for your determination of whether or not to make a sources and are based upon assumptions relating investors. proposal and from whom you have obtained an to the general economy, competition, and other agreement of confidentiality) without the prior written factors beyond the control of the Owner and, Owner and InvestCore Commercial each expressly authorization of Owner or InvestCore Commercial, therefore, are subject to variation. No representation reserve the right, at their sole discretion, to reject any (iv) not use the package or any of the contents in is made by InvestCore Commercial or Owner as to and all expressions of interest or offers regarding any fashion or manner detrimental to the interest of the accuracy or completeness of the information the Property and/or terminate discussions with any Owner or InvestCore Commercial, and (v) to return it contained herein, and nothing contained herein is, or entity at any time with or without notice. Owner to InvestCore Commercial immediately upon request shall be relied on as, a promise or representation as shall have no legal commitment or obligation to any of InvestCore Commercial or Owner. to the future performance of the Property. Although entity reviewing this Offering or making an offer to the information contained herein is believed to be purchase the Property unless and until a written If you have no further interest in the Property, correct, Owner and its employees disclaim any agreement for the purchase of the Property has been please return this Investment Offering forthwith. responsibility for inaccuracies and expect prospective fully executed, delivered, and approved by Owner purchasers to exercise independent due diligence in and its legal counsel, and any conditions to Owner’s verifying all such information. Further, InvestCore obligations thereunder have been satisfied or waived. Commercial, Owner, and its employees disclaim any InvestCore Commercial is not authorized to make any InvestCore Commercial, Inc. and all liability for representations and warranties, representations or agreements on behalf of Owner. 315 S. Coast Highway 101, Suite U240 expressed and implied, contained in, or for omission This Offering and the contents, except such information Encinitas, CA 92024 from, this Investment Offering or any other written or which is a matter of public record or is provided in oral communication transmitted or made available sources available to the public (such contents as so 195 N. 11th Street, Beaumont, Texas 77702 InvestCoreCommercial.com TABLE OF CONTENTS Investment Summary 4 Executive Summary Income & Expense Investment Highlights Property Description 10 Street Map Aerials Area Overview 13 About UTMB Health About Beaumont About Houston MSA Demographics 195 N. 11th Street, Beaumont, Texas 77702 InvestCoreCommercial.com INVESTMENT SUMMARY Largest Magnet hospital between Houston and Baton Rouge Executive Summary Income & Expense Investment Highlights 11TH STREET - 17,080 CPD SUBJECT PROPERTY 195 N. 11th Street, Beaumont, Texas 77702 InvestCoreCommercial.com INVESTMENT SUMMARY EXECUTIVE SUMMARY Property Information Board of Regents of The University of Texas System, for the use and TENANT benefit of The University of Texas Medical Branch CREDIT RATING S&P: AAA, Moody’s: Aaa, Fitch: AAA (U.T. System) ADDRESS 195 N. 11th Street, Beaumont, TX 77702 ~13,255 SF (11,172 SF with 2,083 SF of Expansion Space currently BUILDING SIZE used for storage but can be used for expansion upon UTMB growth) LAND SIZE ~38,768 SF (To be confirmed by Buyer) YEAR REMODELED 2018 RENT COMMENCEMENT August 1, 2018 LEASE EXPIRATION July 31, 2028 OPTIONS Four (4) 5-year options LEASE TYPE Fee simple NNN land and building RENT INCREASES 5% increase every 5 years Asking Terms PRICE $5,965,000 NET OPERATING INCOME2 $357,670 CAP RATE 6% 195 N. 11th Street, Beaumont, Texas 77702 InvestCoreCommercial.com INVESTMENT SUMMARY RENT SCHEDULE / INCOME & EXPENSE RENT SCHEDULE Term Years Date of Increase Annual Rent % Increase Primary 1-5 $357,670 Primary 6-10 9/2023 $375,553 5% Option 1 11-15 9/2028 $394,331 5% Option 2 16-20 11/2029 $414,048 5% Option 3 21-25 11/2034 $434,750 5% Option 4 26-30 11/2039 $456,488 5% INCOME & EXPENSE INCOME Base Rent $357,670 Additional Rent $46,125 TOTAL INCOME $403,795 EXPENSES Real Estate Taxes $25,278 Insurance $13,565 CAM $7,282 TOTAL EXPENSES $46,125 (1) - Additional Rent and Expenses are based upon the Operating NET OPERATING INCOME $357,670 Expense estimates per the Lease Agreement. Landlord will notify Tenant of estimated Operating Expenses each calendar year. 195 N. 11th Street, Beaumont, Texas 77702 InvestCoreCommercial.com INVESTMENT SUMMARY LEASE ABSTRACT Operating Expenses: Landlord Responsibilities: Additional rent is to be paid by Tenant in addition to Base Rent and is calculated on Landlord responsible for the roof, foundation and structural soundness of building. Landlord’s best good-faith estimate of Landlord’s Operating Expenses. Within 120 Subject to reimbursement by Tenant, Landlord shall maintain exterior doors, windows days following the close of each calendar year, Landlord shall provide Tenant all and maintain the parking lot to be subject and part of the Operating Expenses for computations of Additional Rent. calculating Additional Rent (collectively Structural and Mechanical Elements). The term Opearting Expenses includes all reasonable costs incurred by Landlord with Tenant Responsibilities: respect to maintaining of the Property, including , but not limited to: maintenance Tenant shall maintain, replace and repair the HVAC, plumbing and the interior of and repair costs, security, window washing, trash and snow and ice removal, the Leased Premises, except the Structural and Mechanical Elements listed above. landscaping, a management fee, not to exceed 5% of base rentals, parking and Common Area, Administrative Fee not to exceed 15% of the operating expenses. Estoppel Certificate: Within 30 days of written request. Funding Contingency: This Lease is made contingent upon the continuation of the availability of funds Right of First Refusal: designated or appropriated to pay for the Lease. In the event the funds become Tenant shall have 20 business days to exercise its ROFR. unavailable, Tenant shall have the right to terminate the Lease upon 30 days prior written notice to Landlord. However, if so terminated, Tenant must pay Landlord a Expansion Space: cancellation fee. INQUIRE WITH BROKER FOR DETAILS. In the event Tenant expands into the Expansion Space and utilizes for its day-to-day operations (and not storage), Base Rent shall be increased based on the 2,083 SF Utilities: at the same rate per square foot (both Base Rent and Additional Rent) Tenant agrees at its sole cost and expense to furnish all utilities. 195 N. 11th Street, Beaumont, Texas 77702 InvestCoreCommercial.com INVESTMENT SUMMARY INVESTMENT HIGHLIGHTS Financially Sound Tenant – Highest Credit Ratings By All 3 Rating Agencies • The U.T. System has the highest possible rating levels by all 3 rating agencies for both long-term and short-term debt. • Over $2.25B in Total Revenue (FY2018) • UTMB has a $3.3 billion annual statewide economic impact • Total Endowments of over $573M (FY2018) COVID-19 & Internet Resistant Tenant • Tenant provides an Essential Service and has remained open for business and paying rent. • UTMB is resistant to ecommerce, like Amazon, providing long term security to any landlord. Newly Redeveloped Building and Improvements • Tenant and Landlord spent over $3M in the redevelopment of the existing building. • Tremendous security with the tenant’s significant investment into the building and tenant improvements Highly Recognized Tenant With 125+ Year History in Texas • Since opening in 1891, UTMB has stood with Texas serving as a major provider of health care for Texans and their families; and innovating the future of how care is delivered. • What began as one hospital and medical school building in Galveston is now a major academic health sciences