1100 Chartiers Avenue Mckees Rocks, PA 15136
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OFFERING MEMORANDUM 1100 Chartiers Avenue McKees Rocks, PA 15136 SALE / LEASEBACK OPPORTUNITY Located in a Qualified Opportunity Zone Exclusively Represented By: GREGG BROUJOS MICHELLE DOMEISEN SIOR, CCIM Regional Principal | Pittsburgh Senior Vice President | Pittsburgh COLLIERS INTERNATIONAL Investment Services Investment Services 525 William Penn Place +1 412 515 8523 +1 412 515 8544 Suite 3510 [email protected] [email protected] Pittsburgh, PA 15219 P: +1 412 321 4200 www.colliers.com/pittsburgh BROCHURE For Sale Pittsburgh International Airport SITE Sale/Leaseback Opportunity Pittsburgh Gregg Broujos Principal | Pittsburgh Jenny Lee Bakery Facility Investment Services +1 412 515 8523 [email protected] 1100 Chartiers Avenue Ovens Michelle Domeisen, SIOR, CCIM McKees Rocks, PA 15136 Senior Vice President | Pittsburgh Investment Services +1 412 515 8544 Located in a Qualified Opportunity Zone [email protected] • Jenny Lee | 5 Generation Bakers will sign an eight year Population Average Number of Household Households triple net lease at closing Income 525 William Penn Place, Suite 3510 Pittsburgh, PA 15219 • 18,279 SF building on 1.43 acres 1 Mile 15,451 $39,046 6,805 P: +1412 321 4200 Freezer • Fully sprinklered / masonry construction F: +1 412 321 4400 3 Miles 88,916 $50,609 39,820 colliers.com/pittsburgh • One (1) rear loading dock for tractor trailer access 5 Miles 215,614 $56,080 95,966 Assembly Line • Zoning - B-2 Commercial District 10 Miles 763,489 $66,323 336,481 • The bakery has been in business for over 135 years Copyright © 2021 Colliers International. Information herein has been obtained from sources • McKees Rocks has experienced a resurgence in the deemed reliable, however its accuracy cannot be guaranteed. The user is required to conduct past few years with projects like the $4.2 million state- their own due diligence and verification. of-the-art Father Ryan Arts Center and the $9.0 million renovation of the Roxian Theatre Accelerating success. 2 TABLE OF CONTENTS Executive Summary ............................................ 5 • Offering Summary ................................. 9 Property Overview ..............................................10 • Property Description ..............................11 • Site Plan ................................................ 13 • Aerial Maps .......................................... 14 • Regional Map ........................................ 15 Area Overview ..................................................... 16 • Demographic Survey .......................... 23 • Sales Comps ....................................... 24 3 EXECUTIVE SUMMARY 4 EXECUTIVE SUMMARY The ownership group of Jenny Lee Swirl Bread/5 Generation Bakers, through their exclusive brokerage firm, Colliers International, is offering their headquarters and production facility for sale through a sale/leaseback transaction. Jenny Lee has strategically decided to unlock the equity in their commercial real estate asset at 1100 Chartiers Avenue in McKees Rocks in order to free up funds to grow their bakery business through diversification of product lines. Jenny Lee will enter into an eight (8) year lease at closing with a projected yearly lease rate of $160,200 under a triple net lease structure. The lease will also include two percent (2%) annual rental rate increases. The sale of the property will be subject to finalizing a mutually acceptable lease between Jenny Lee and the buyer. The contemplated lease calls for Jenny Lee to be responsible for base rent, property taxes, utilities, insurance, and CAM. The new landlord would be responsible for roof, structure, and parking lot. However, all terms and conditions of the leaseback arrangement, including base rent, are negotiable based on a number of factors and upon mutual agreement between the parties. 1100 Chartiers Avenue is located in a Qualified Opportunity Zone. More information can be found on the Pennsylvania Department of Community and Economic Development at: https://dced.pa.gov/programs-funding/federal- funding-opportunities/qualified-opportunity-zones. The federal tax bill passed at the end of December 2017 enables the governor to designate certain census tracts as Opportunity Zones. Investments made by individuals through special funds in these zones would be allowed to defer or eliminate federal taxes on capital gains. The governor was given the opportunity to designate up to 25 percent of census tracts that either have poverty rates of at least 20 percent or median family incomes of no more than 80 percent of statewide or metropolitan area family income. There are nearly 1,200 eligible census tracts and the governor designated 300 tracts based on economic data, recommendations from local partners, and the likelihood of private-sector investment in those tracts. Upon the signing of a Non-Disclosure Agreement, potential investors can access the relevant financial and background information on Jenny Lee. Please contact our office for more details. 5 EXECUTIVE SUMMARY The property is an 18,279 square foot former Bottom Dollar grocery store just off of the central business district of McKees Rocks. The 1.43 acre site is comprised of four parcels. There is one loading dock and the ceiling height ranges from 15’4” in the finished ceiling area to 20’ in some areas. The building was constructed in 2012 and features masonry construction with exterior block and dryvit. Property taxes are approximately $42,000 per year. Phase I and Phase II reports are available by request. The building is fully sprinklered and is located in the B-2 Commercial District in the borough. McKees Rocks has experienced a resurgence in the past few years with projects like the $4,200,000 state-of-the-art Father Ryan Arts Center and the $9,000,000 renovation of the Roxian Theatre. McKees Rocks has a strong community development corporation, and more information can be found at: www.mckeesrocks.com. Jenny Lee has been in business for over 135 years, with five generations of family members guiding the company. More information can be found on the following pages and on their website at: https://jennyleeswirlbread.com/about. The baking traditions of the Baker family began in the mid 1800’s when Michael A. Baker immigrated to the United States from Germany as a young teen. Originally named “Becker”, Michael changed his name to “Baker” to be more American. It wasn’t too long after this that his lifelong trade would also become “baker.” Michael founded the first bakery, the Michael A. Baker Bakery, in 1875 at 25 Steuben Street in the West End of Pittsburgh. Initially a retail bakery, Michael expanded his services to “door-to-door” delivery. Eventually Michael’s sons joined the business and the name soon evolved to Michael Baker & Sons. Michael’s seven sons had big aspirations. They continued to grow the business throughout the Western Pennsylvania region and soon became the largest bakery wholesaler in the state. Upon their father’s retirement, the bakery name changed again, this time to “The Seven Baker Brothers Bakery.” Their success could be measured by their unique marketing skills establishing the “Wonder Baked” product line (eventually “borrowed” by the baker’s of Wonder Bread), creating Felix the Wonder Cat and Sic’em the Wonder Dog, and flying the maiden voyage of “The Spirit of Pittsburgh” – a great publicity stunt featuring the nation’s only flying bakery vehicle. At the height of their success, the Baker Brothers grew their bakery to 125 delivery vehicles – trucks and horse-drawn carriages – and over 400 employees. A state of the art baking facility was built on Saw Mill Run Boulevard in the West End to house this grand enterprise. They delivered their quality baked products as far away as Youngstown to Erie to Weirton and to the edges of Philadelphia County. During this time, the Seven Brother’s were also busy growing their families. Their great-grandfather, Nick Baker was a twin and the third born son of Michael Baker. Nick had a large family of his own, fathering 9 children with his wife, Theresa May Baker. Nick’s children were a very ambitious lot. The oldest, Paul, founder of Jenny Lee Bakery; Amelia, proprietor of Hartner’s Restaurant for over 50 years; Catherine, two time serving Treasurer of Pennsylvania and our state’s first female Lieutenant Governor; John, a world renowned artist to name just a few. Nick’s children were the third generation of the Baker family in the baking industry and many of their cousins, like them, continued in the family heritage: Karn’s Bakery and McKees Rocks Bread Company and others. This precedent was set by Paul in 1938, when despite the continued success of The Seven Baker Brother Bakery, he and cousin Bernard McDonald founded Jenny Lee Bakery in the heart of Pittsburgh Diamond Market, now known as Market Square. Initially, Paul sold Seven Baker Brother’s products out of his retail store. Within four months of his new business, Paul began baking his own line of quality products 6 EXECUTIVE SUMMARY that eventually required the acquisition of his second store – and main baking location – in McKees Rocks. This expansion took place in 1941. Now operating two successful locations, Paul continued to expand Jenny Lee Bakery. In the 1940’s and 50’s, Jenny Lee added two additional locations in McKees Rocks as well as several stores in neighboring communities. Paul’s success in the 40’s was matched with the demise of The Seven Baker Brother’s Bakery which ceased operations in the mid-1940’s. An operator of tradition, Paul continued to produce and sell many popular Seven Baker Brother’s products, such as Seven Baker Brother’s Raisin-Filled Cookies, Devil Dogs and crimped cinnamon raisin bread. These products remained popular throughout the decades and maintained sales for Jenny Lee as recently as 2008. Jenny Lee maintained successful growth in the ‘60’s and ‘70’s as Paul’s three sons joined him in the business and eventually grew to 14 retail locations throughout the Pittsburgh Region. By early 1974, Jenny Lee had grown to 14 retail locations. Paul would retire in 1978 and hand the business over to his three sons: Jim, Rich and Bernie.