OFFE RI N G ME MOR A NDUM
3531 Zafarano Drive f Santa Fe, NM 87507
N AT I O N A L R E TA I L PA R T N E R S
DEBT & STRUCTURED FINANCE
CHRIS COZBY Executive Vice President +1 214 979 6579
CHRIS GERARD Senior Vice President +1 214 979 6578
JIM DOUNTAS Vice President +1 505 837 4999
BLAINE DOZIER Associate +1 214 979 6517
SCOTT LEWIS Senior Vice President +1 214 979 5605
chris.cozby@cbre.com
chris.gerard@cbre.com
jim.dountas@cbre.com
blaine.dozier@cbre.com
scott.lewis@cbre.com
Š 2016 CBRE, Inc. This information has been obtained from sources believed reliable. We have not verified it and make no guarantee, warranty or representation about it. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs. TX/OK
3531 Zafarano Drive f Santa Fe, NM 87507
TA B L E O F
Contents
01 Executive Summary
4
02 Property Highlights
16
03 Market Overview 29
04 Financial Analysis 35
Summary
EXECUTIVE
THE OFFERING CBRE’s National Retail Partners is excited to exclusively present the opportunity to acquire Plaza Santa Fe (“Property”). Plaza Santa Fe is a dominant, best-in-class, super-regional power center in Santa Fe, New Mexico. The Property benefits from a coveted location in the retail epicenter of a large trade area catering to 9 counties. The shopping center is 99% occupied and features a strong tenant lineup including Ulta, TJ Maxx, Ross, Best Buy, Michaels, and PetSmart, many of which have had remarkably successful sales histories at the Property. The acquisition of Plaza Santa Fe provides investors with an opportunity to acquire an institutional quality power center with a highly stable income stream and superior tenancy in one of the most visited locations in New Mexico.
Plaza Santa Fe is being offered without an asking price. An Offer Date will be announced by the Brokers via email. Visit the property website at: www.plaza-santa-fe.com I N V E S T M E N T S U M M A RY
SIZE (SF)
YEAR BUILT
LAND AREA
OCCUPANCY
224,223 sf
2000
17.7 acres
99.44%
PRICE
IN-PLACE NOI
DEBT
Unpriced
3,238,253
Free & Clear
ANCHORS
Ulta • TJ Maxx • Ross • Best Buy • Michaels • PetSmart
Executive Summary
5
OFFE RI N G M E M O R A N D U M
INVESTMENT HIGHLIGHTS
Plaza Santa Fe’s immediate surroundings represent 22% of Santa Fe’s Retail Market
H I G H LY C O V E T E D L O C AT I O N
Plaza Santa Fe is located on Cerrillos Road, the main thoroughfare in Santa Fe. An estimated 32,900 vehicles per day pass the Property along Cerrillos Road, with another 30,000 vehicles per day in eyesight on Rodeo Road. The access and visibility has turned the .5 mile radius at Cerrillos and Rodeo Road into the most active and desirable location in Santa Fe. Santa Fe Place Mall
N
RO DE O RO AD AIRPOR
SAM’S CLUB
T ROAD
Found from website Recreate PMS
LL CERRI
AD OS RO
EXISTING SUPPLY (SF)
ZAFARANO DRIVE
6
Executive Summary
AVAILABLE (SF) OCCUPANCY AVERAGE RENTAL RATE
SANTA FE RETAIL MARKET
PLAZA SANTA FE RETAIL MARKET
8,556,570
1,892,467
259,756
46,884
98%
98.4%
$16.55
$25.77
OF F E R ING ME MOR A NDUM
SANTA FE MALL Located directly across from the Property is the largest mall in Northern New Mexico and fourth largest in all of the state.
589,500 square feet on 24 acres Regional magnet for consumers throughout an expansive trade area across New Mexico Anchored by a brand new Bed Bath and Beyond Dillard’s World Market JC Penney
Executive Summary
7
OFFE RI N G M E M O R A N D U M
NATIONAL CREDIT WORTHY TENANCY This regional power center’s tenant lineup is bolstered by an enviable collection of national, credit-worthy retailers including Ulta, TJ Maxx, Ross Dress for Less, Best Buy, Michaels and PetSmart. This tenant lineup provides income security combined with strong drawing power to attract shoppers and other retailers.
National Tenants make up 99% of the Property’s GLA and 98% of its revenue stream ANCHOR TENANTS
*Lease Pending
TOTAL
% OF REVENUE
HISTORICAL OCCUPANCY (YEARS)
$13.00
11%
7
14%
$16.00
13%
15
30,900
14%
$12.07
10%
16
B+
20,280
9%
$15.00
8%
16
NR
20,115
9%
$16.00
9%
0
B+
20,010
9%
$17.30
9%
15
NR
15,407
7%
$20.75
8%
4
169,390
76%
$15.73
68%
11
S&P
SIZE (SF)
% OF GLA
A-
31,452
14%
BBB-
31,226
A+
* Signed LOI by a high-end national retailer with over 145 locations.
8
Executive Summary
RENT PSF
OF F E R ING ME MOR A NDUM
SECURE INCOME STREAM WITH STRONG HISTORICAL OCCUPANCY ›› The Property is 99.4% occupied and features a highly stable rent roll, bolstered by national retailers with strong historical occupancies
›› Over 45% of the Property’s GLA will have rental increases in the next 10 years
›› Collectively, the tenants have called Plaza Santa Fe home for a weighted average of over 10 years
› › Since 2013 the Property has consistently remained more than 98% occupied
› › Staples recently did not exercise their option, the suite was immediately filled by a 10 year lease
RECENT LEASING MOMENTUM As of 1/31/2017, Staples option to renew expired. In anticipation of Staples not exercising their final option, ownership was able to negotiate a backup lease for Suite 011. A high-end national retailer with over 145 locations submitted an LOI in advance of the renewal date for a 10 year lease with higher rents and a future rent bump. The aggressiveness of the LOI speaks to the centers success. See financials and notes for additional details.
9
O FFERI N G M E M O R A N D U M
STRONG RETAILER PERFORMANCES Plaza Santa Fe’s exclusive tenancy and prominent location support exceptional tenant sales performance.
4.22% HEALTH RATIO
$10,500,000.00
18% HIGHER
$10,000,000.00
$1,500,000 $1,450,000 $1,400,000
$9,500,000.00
7.80% HEALTH RATIO
14% HIGHER
$1,350,000
$9,000,000.00
$1,300,000
$8,500,000.00
$1,250,000
$8,000,000.00
(sales PSF)
National Avg
Plaza Santa Fe Avg
$1,200,000
National Avg
(annual sales)
Plaza Santa Fe Avg
PA C I F I C D E N TA L $900 $800
$160
3.03% HEALTH RATIO
$150 $140
79% GROWTH
$700
$120
$600 $500 (sales PSF)
$110 2013
2014
2015
$230
10.5% GROWTH
$210 $205
Executive Summary
2013
2014
2015
12% HIGHER
$1,500,000.00
$215
10
(annual sales)
$1,550,000.00
$220
(sales PSF)
$100
$1,600,000.00
$225
$200
44.5% GROWTH
$130
$1,450,000.00 $1,400,000.00 $1,350,000.00
2014
2015
$1,300,000.00 (annual sales)
National Avg
Plaza Santa Fe Avg
OF F E R ING ME MOR A NDUM
EXPANSIVE TRADE AREA
DESTINATION RETAILERS
Encompassing a wide-ranging, 9 county combined Albuquerque-Santa FeLas Vegas statistical area with a population of over 647,700 people, Plaza Santa Fe is an ideal shopping destination for consumers from well beyond the immediate Santa Fe city limits.
Benefiting from the expansive trade area, The Property’s anchor tenants are strategically spaced throughout Northern New Mexico, significantly increasing the likelihood of buyers choosing Plaza Santa Fe.
DISTANCES TO NEXT RETAILERS FROM PLAZA SANTA FE DIRECTION
APPROXIMATE DISTANCE
North
198 miles
South
47 miles
East
228 miles
West
141 miles
Executive Summary
11
O FFERI N G M E M O R A N D U M
HIGH GROWTH DEMOGRAPHICS The area surrounding Plaza Santa Fe continues to grow as the city becomes more popular, since 2000 the population in a 1 mile radius has almost doubled.
1 MILE 10,415
53,827
87,293
2021 Population
11,185
55,810
91,537
2000 Population
6,949
44,830
72,287
Percent Pop Change: 2000 to 2016
49.88%
20.07%
20.76%
Percent Pop Change: 2016 to 2021
1.44%
0.73%
0.95%
Daytime Population
9,102
30,972
72,725
$50,319
$60,615
$67,176
$208,038
$250,847
$323,161
2016 Average Home Value
Executive Summary
5 MILE
2016 Population
2016 Average Household Income
12
3 MILE
OF F E R ING ME MOR A NDUM
SANTA FE ECONOMIC ADVANTAGE Santa Fe serves as the head of an MSA which encompasses all of Santa Fe County and is part of the larger Albuquerque-Santa Fe-Las Vegas combined statistical area. TOURISM
Santa Fe’s economy has been based largely on tourism due to its unique offering of art culture, world renowned cuisine, ancient traditions and close proximity to ski resorts. Santa Fe receives an average of 1.6 million visitors annually, boosting the city’s retail industry by bringing in more than $1 billion annually. Internal tourism is increasing as there is a steady flow of retirees to the area.
#1 U.S City for Shopping
CUISINE
More than 400 restaurants that range from fine dining to uber-casual, and the scene continues to blossom with restaurants embracing artisan and farm-to-table craft foods and beverages
America’s 7th Best Food City – Conde Nast, 2014 Top Ten Farmer’s Market in the US – USA Today 10Best
ACTIVITIES
Skiing, Snowboarding Hiking, Biking, Golf, Horseback riding, and more are all in close proximity
13
O FFERI N G M E M O R A N D U M
ARTS
Country’s 3rd largest art market #4 City for Museums & Galleries – Travel + Leisure Top 25 Small City for Art – American Style Magazine A C C O M M O D AT I O N S
Santa Fe appeals to a wide range of tourists with its wide range of accommodations from high-end resorts and hotels, to charming bed and breakfasts
H E A LT H C A R E
Santa Fe has become the region’s hub for medical advancement; St. Vincent Regional Medical Center is one of the city’s largest employers and serves seven counties.
GOVERNMENT
As the capitol of New Mexico, the government is the largest employer in the area
14
Executive Summary
OF F E R ING ME MOR A NDUM
OFFERING TERMS N AT I O N A L R E TA I L PA R T N E R S
3531 Zafarano Drive f Santa Fe, NM 87507 FREE AND CLEAR
The Property is being offered for sale without financing in place, allowing an investor to pursue its desired leverage levels meeting its fund or investment objectives. The Property’s strong location combined with its highly stable, Class “A” tenancy will make the Property very attractive to the lending community. CBRE’s Debt & Structured Finance group is available for financing quotes and assistance.
CHRIS COZBY Executive Vice President +1 214 979 6579 chris.cozby@cbre.com
CHRIS GERARD Senior Vice President +1 214 979 6578 chris.gerard@cbre.com
JIM DOUNTAS Vice President +1 5058374999 jim.dountas@cbre.com
BLAINE DOZIER Associate +1 214 979 6517 blaine.dozier@cbre.com DEBT & STRUCTURED FINANCE SCOTT LEWIS Senior Vice President +1 214 979 5605 scott.lewis@cbre.com
SALES TERMS
Plaza Santa Fe is being offered on an “as-is” basis with ownership making no representations or warranties with respect to the accuracy or completeness of the offering memorandum or any and all documents delivered to an acquisition prospect for the purpose of performing due diligence. Plaza Santa Fe is offered without an asking price. LEASEHOLD INTEREST
Not a fee simple interest, please refer to the war room for ground lease documents.
Executive Summary
15
PROPERTY
Highlights