Offering Memorandum
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EXCLUSIVELY LISTED BY: Mitchell Kiven Ryan Stuart James Ziegler Senior Associate Associate First Vice President 312- 624- 7006 312- 624- 7016 312- 624- 7020 OFFERING MEMORANDUM BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK 2445 N Lincoln Ave • Chicago, IL 60614 1 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. © 2018 Marcus & Millichap. All rights reserved. SPECIAL COVID-19 NOTICE All potential buyers are strongly advised to take advantage of their opportunities and obligations to conduct thorough due diligence and seek expert opinions as they may deem necessary, especially given the unpredictable changes resulting from the continuing COVID-19 pandemic. Marcus & Millichap has not been retained to perform, and cannot conduct, due diligence on behalf of any prospective purchaser. Marcus & Millichap’s principal expertise is in marketing investment properties and acting as intermediaries between buyers and sellers. Marcus & Millichap and its investment professionals cannot and will not act as lawyers, accountants, contractors, or engineers. All potential buyers are admonished and advised to engage other professionals on legal issues, tax, regulatory, financial, and accounting matters, and for questions involving the property’s physical condition or financial outlook. Projections and pro forma financial statements are not guarantees and, given the potential volatility created by COVID-19, all potential buyers should be comfortable with and rely solely on their own projections, analyses, and decision-making. 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. BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK Chicago, IL ACT ID ZAC0370224 2 BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK TABLE OF CONTENTS SECTION INVESTMENT OVERVIEW 01 Offering Summary Location Overview Aerial Photo FINANCIAL ANALYSIS 02 Pricing / Model MARKET OVERVIEW 03 Market Analysis Demographic Analysis 3 BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK INVESTMENT OVERVIEW 4 BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK OFFERING SUMMARY INVESTMENT OVERVIEW Marcus & Millichap is thrilled to present the opportunity to purchase two retail condominiums on the ground floor of the Biograph Theater on Lincoln Avenue in Chicago’s Lincoln Park neighborhood. The property is 5,000 square feet, currently vacant, with a built-out kitchen consisting of black iron, an exhaust hood, 2 walk-in coolers, 2 kitchen prep areas, and 4 bathrooms. The other tenant/owner of the Biograph Theater is the Victory Gardens Theater, and the owner of this unit shares responsibilities in the homeowner's association that managers the property. With 65 Feet of prime frontage on Lincoln Avenue, this is irreplaceable real estate located in a historic building in one of Chicago’s most vibrant north side neighborhoods. Over 450,000 people live within a 3-mile radius and average household incomes exceed $140,000. The storied location formed the backdrop of a particularly infamous chapter in Chicago’s gangster past when John Dillinger was gunned down by FBI agents as he was exiting the theater in 1934. Today, the building sits in the middle of one of the most stable neighborhoods in Chicago, home to DePaul University, as well as several generation defining mixed use developments, such as Lincoln Commons – featuring 538 new apartment units, 100,000 square feet of retail, and a 156-room senior living facility on the site of the former Children’s Memorial Hospital. Lincoln Commons is located within 1 block of the Biograph. Priced at $1,100,000, with area rents comfortably in the +$25 per square foot range (NNN), the property is ideal for either a restaurant user, or a developer with designs to add value through an aggressive leasing campaign. We believe that even after a sizable tenant improvement allowance, a budget for soft costs, carrying costs, and leasing commissions, the returns should be highly attractive for real estate professionals with the wherewithal to reposition the asset. Please contact Marcus & Millichap for additional information regarding the financial modeling used to price the property, or with any other questions. INVESTMENT HIGHLIGHTS . Rare opportunity to purchase the ground floor commercial component of the Biograph Theater . Irreplaceable location in Lincoln Park, less than one block from the corner of Lincoln, Fullerton and Halsted . One block from Lincoln Commons, the new 6.04-acre mixed-use development at the corner of Lincoln, Fullerton and Halsted . Adjacent to DePaul University . Property comes with a built-out kitchen, including black iron, exhaust hood, and two walk-in coolers . +450,000 people within a 3-mile radius, average household incomes exceed $140,000 5 BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK AERIAL PHOTO SUBJECT PROPERTY Fullerton Avenue Lincoln Commons: 3.7M Passengers Per Year 534 New Apartment Units 100,000 SF of Retail 156 Room Senior Living 23,539 Students 84,699 People within 1 Mile Average HH Income of $161,971 Average HH Retail Expenditure of $85,163 6 BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK INTERIOR PROPERTY PHOTO Marcus & Millichap closes more transactions than any other brokerage firm. 127 BIOGRAPHPROPERTY THEATERNAME RETAIL CONDO | LINCOLN PARK PRICINGPRICING ANDANDLOCATIONLOCATION VALUATIONVALUATIONTENANT OVERVIEW OVERVIEWSUMMARY MATRIXMATRIX 2445 N Lincoln Ave, Chicago, IL 60614 CLOSE PROXIMITY TO: # 8 BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK FINANCIAL ANALYSIS 9 BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK FINANCIAL ANALYSIS PRICING DETAIL Development Model Purchase Price $ 1,100,000.00 Gross Leasable Area (SF) 5,000 Tenant Improvement Allowance (per SF) $ 50.00 Soft Cost Percentage (Percentage of Budget Net Soft Costs) 30% Exit Cap Rate 6.75% Net Income (Assumes $25/sf Rents) $ 125,000.00 Exit Value $ 1,851,851.85 Budget: Hard Costs $ 250,000.00 Soft Costs (30% of Budget) $ 104,812.00 Carrying Costs $ 24,375.00 Leasing Commissions $ 75,000.00 Total Budget: $ 454,187.00 Purchase Price: $ 1,100,000.00 Total Costs: $ 1,554,187.00 Exit Value $ 1,851,851.85 Profit: $ 297,664.85 Disposition Strategy: Total Profit as a Percentage of Total Costs: 19.15% Hold Strategy: Yield on Stabilized NOI to Total Costs: 8.04% 10 BIOGRAPH THEATER RETAIL CONDO | LINCOLN PARK MARCUS & MILLICHAP ADVANTAGE MARCUS & MILLICHAP CAPITAL WHY MMCC? CORPORATION CAPABILITIES Optimum financing solutions to enhance value MMCC—our fully integrated, dedicated financing arm—is committed to providing superior capital market expertise, precisely managed execution, and unparalleled access to capital sources providing the most competitive rates and Enhanced control through terms. investor qualification support We leverage our prominent capital market relationships with commercial banks, life insurance companies, CMBS, private and public debt/equity funds, Fannie Enhanced control through Mae, Freddie Mac and HUD to provide our clients with the greatest range of MMCC’s ability to qualify financing options. investor finance contingencies Our dedicated, knowledgeable experts understand the challenges of financing and work tirelessly to resolve all potential issues for