Wake Forest University Charlotte Center Charlotte | North Carolina
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WAKE FOREST UNIVERSITY CHARLOTTE CENTER CHARLOTTE | NORTH CAROLINA WAKE FOREST UNIVERSITY CHARLOTTE CENTER | 1 EXECUTIVE SUMMARY | 3 EXECUTIVE SUMMARY Holliday Fenoglio Fowler, L.P. acting by and through Holliday GP Corp. a North Carolina licensed real estate broker (“HFF”) has been retained as the exclusive sales representative for Wake Forest University Charlotte Center (the “Building”), a premier, multi-tenant office building located in the CBD of Charlotte, North Carolina. Wake Forest University Charlotte Center presents a unique opportunity to purchase a 100% leased and occupied CBD office building with in place rents significantly below market. Bank of America (the “Bank”) occupies approximately 90% of the Building with various uses, including operations, support services, and regional conferencing. Wake Forest University operates its graduate business school (28,741 SF on the first floor) serving 290 night and weekend students. Infill real estate investments of this caliber with underlying upside are generational opportunities. The offering, which is being presented to a select group of qualified investors, is an opportunity to purchase the Building subject to a 99-year ground lease (“Ground Lease”) with a remaining term through February 29, 2112. WAKE FOREST UNIVERSITY CHARLOTTE CENTER | 4 EXECUTIVE SUMMARY THE INVESTMENT OPPORTUNITY 100% occupied office opportunity, strategically located in the heart of the Charlotte CBD Wake Forest University Charlotte Center is a 5-story, CBD office building developed in the 1930’s, with significant renovations occurring in 1987 to 1988. Consisting of 455,749 square feet, the asset is currently 100% leased to a number of creditworthy tenants including Bank of America and Wake Forest University. The investment benefits from a broad multi-source revenue base including office and retail rent, significant parking income from the attached 801-space garage, ground rent income and a percentage rent component which provides durable and diversified cash flow. The Building is easily accessible, with proximity to all major thoroughfares and local transit systems, including direct, neighboring access to the Blue Line portion of the light rail, (with two stops in close proximity at the 7th Street Station and the Charlotte Transit System Station). The asset sits in the heart of Charlotte’s Central Business District, within walking distance of Charlotte’s most visible points of interest including Bank of America’s headquarters, Wells Fargo’s East Coast Headquarters, Spectrum Arena, and Bank of America Stadium. INVESTMENT SUMMARY ADDRESS OCCUPANCY 200 North College Street, Charlotte, NC 100% STORIES NET RENTABLE AREA 5 Stories 455,749 RSF (458,169 SF after recent BOMA re-measurement) PARKING The property includes a market leading, 8-story YEAR BUILT parking structure with approximately 801 spaces, with 1930’s, extensively renovated in 1987-1988 a ratio of 1.42 per 1,000 RSF LOCATION FLOOR PLATES Charlotte CBD, at the intersection of North Basement Storage – 3,229 SF College and East 5th Street Floor 1 - 72,333 SF Floor 2 – 90,838 SF ACRES Floor 3 – 96,436 SF 3.46 total acres Floor 4 – 96,796 SF Floor 5 – 96,857 SF AMENITIES Wake Forest University Charlotte Center is connected to the Overstreet Mall and Bank of America Corporate Center through the 1 Bank of America Center parking deck. The Building is also connected to the newly constructed Spring Hill Suites through an adjacent parking deck owned by the hotel and the owners of Spectrum Cable Arena. The Overstreet Mall is connected by one of the most extensive urban pedestrian bridge systems in the country. The sky tunnels provide covered access to nine office buildings, five hotels, The Blumenthal Center for Performing Arts, and a multitude of restaurants, retail, and athletic clubs. The asset is also located directly next to the light rail and Spectrum Arena, the home to the Charlotte Hornets. EXECUTIVE SUMMARY | 5 WAKEWAKE FORESTFOREST UNIVERSITYUNIVERSITY CHARLOTTE CENTER | 6 WAKE FOREST UNIVERSITY EXCELLENT LONG-TERM TENANT In 2014, Wake Forest University decided to refocus how its MBA program is delivered based on the changing needs of the market. To allow the University to focus on emerging opportunities and continue to expand its flexible MBA program, the school no longer offers incoming students at the main campus admission to a traditional daytime MBA program. Rather, the campus located at the Wake Forest University Charlotte Center now serves as the main hub for the MBA program. INVALUABLE LIGHT RAIL ACCESS AT 7TH STREET STATION AND THE CHARLOTTE TRANSIT SYSTEM STATION WAKE FOREST UNIVERSITY CHARLOTTE CENTER IS IMMEDIATELY ADJACENT TO CHARLOTTE’S ECONOMICALLY ESSENTIAL ALTERNATIVE TRANSPORTATION SYSTEM The building strategically sits less than 2,000 feet from two light rail stations. “Kick-started” by the 2007 opening of the Blue Line light rail system (which connected south Charlotte neighborhoods with Uptown’s employment concentration) Charlotte has reaped very substantial economic benefits from this very successful project. As seen most strongly in South End and around Uptown’s light rail stops, the Blue Line’s enhanced connectivity set in motion a $2.5+ billion economic frenzy around urban stations which is expected to continue surrounding 7th Street Station. As the region prepares for a 9.3-mile addition to the light rail system in mid- 2017, known as the Blue Line Extension, Uptown will be further linked to such notable North Charlotte areas as the NoDa arts district, UNC-Charlotte’s main campus, and the University area’s 73,000+ employment base. SOUGHT-AFTER TOD APPEAL IN CHARLOTTE’S FROTHY URBAN CORE The future of real estate is intimately intertwined with TOD and walkable urban development in general. What used to be a niche market is now the market. For at least the next generation, the bulk of real estate development will be higher- density, walkable urban places, and much of it will be served by rail transit. There is significant pent-up demand for walkable urban, ideally rail transit–oriented development. CHRIS LEINBERGER MEMBER OF ULI’S TRANSIT-ORIENTED DEVELOPMENT COUNCIL, URBAN LAND MAGAZINE (AUGUST 2012) EXECUTIVE SUMMARY | 7 WAKE FOREST UNIVERSITY CHARLOTTE CENTER | 8 EXECUTIVE SUMMARY | 9 LONG-TERM REDEVELOPMENT POTENTIAL The 3.46 acre parcel that the Building is situated on is a prime location for a long-term redevelopment. With road frontage on three sides and the light rail line on the fourth, this full city block parcel could potentially accommodate a future office tower, residential tower, hotel, or a mixture of uses. As vacant parcels in downtown Charlotte are developed, natural escalating barriers to entry will continue to drive land vales higher. This makes redevelopment increasingly attractive, especially for properties adjacent to stations along the light rail line. Moreover, the site is governed by the Uptown Mixed Use District (UMUD) zoning. UMUD zoning, which has no height restrictions, permits and encourages the coordinated development of retail, offices, hotels, convention and conference centers, high-density residential, and structured parking. LEED GOLD CERTIFIED BUILDING The Building achieved the LEED-Existing Building Gold Certification in 2011. The increasing movement towards LEED certification of buildings and green building practices has been driven by the “triple bottom line” benefits of implementing a sustainable development approach. LEED certified buildings use key resources more efficiently as compared to conventional office buildings. LEED certified buildings offer healthier work and living environments, which contribute to higher productivity and improved employee health and comfort. The US Green Building Council has also compiled a long list of ecological benefits of implementing a LEED strategy which range from improving air and water quality to reducing solid waste. The fundamental reduction in environmental impacts in addition to all of the economic and occupant benefits strongly supports green building. Corporate America has rapidly embraced LEED certified buildings, in fact LEED buildings garner a noticeable competitive advantage over standard construction in the decision making process for tenants. WAKE FOREST UNIVERSITY CHARLOTTE CENTER | 10 6TH STREET 01 A/B OVERSTREET MALL CONNECTIVITY WAKE FOREST UNIVERSITY CHARLOTTE CENTER 5TH STREET 02 TRADE STREET 03 EPICENTER 4TH STREET 04 05 06 3RD STREET 07 08 MLK JR BLVD 09 EXECUTIVE SUMMARY | 11 OVERSTREET MALL AMENITIES WAKE FOREST UNIVERSITY CHARLOTTE CENTER Fitgerald’s Bar and Grill Mert’s Deli OVERSTREET MALL UPTOWN’S SKYWALK AMENITIES 01A HEARST TOWER Wake Forest University Charlotte Center’s connection to the Fuel Pizza Modern Salon Pita Pit Blue Restaurant & Bar Overstreet Mall is through 1 Bank of America Center. The connection Showmars Soho Bistro allows Bank of America employees to move easily under cover Bank of America Gallery Hearst Tower Newstands Jewel Treats between the Corporate Center Headquarters, 1 Bank of America Plaza, Hearst Tower, and the Building. All of these building’s are 01B HEARST PLAZA heavily occupied by Bank of America. The Overstreet Mall offers Port City Java Malabar Spanish Cuisine SOZO Gallery RiRa’s Sandwich Bar tenants a network of 360,000 square feet of enclosed, high-quality Luce Restaurant and Bar Something Classic Café retail amenities, inclusive of over 100 restaurants and retailers. 02 BANK OF AMERICA CORPORATE CENTER/ Historically, buildings with access to the Overstreet Mall consistently