400
SOUTH TRYON
OFFERING MEMOR ANDUM | CHARLOT TE , NORTH C AROLINA
AFFILIATED BUSINESS DISCLOSURE CBRE, Inc. operates within a global family of companies with many subsidiaries and/or related entities (each an “Affiliate”) engaging in a broad range of commercial real estate businesses including, but not limited to, brokerage services, property and facilities management, valuation, investment fund management and development. At times different Affiliates may represent various clients with competing interests in the same transaction. For example, this Memorandum may be received by our Affiliates, including CBRE Investors, Inc. or Trammell Crow Company. Those, or other, Affiliates may express an interest in the property described in this Memorandum (the “Property”) may submit an offer to purchase the Property and may be the successful bidder for the Property. You hereby acknowledge that possibility and agree that neither CBRE, Inc. nor any involved Affiliate will have any obligation to disclose to you the involvement of any Affiliate in the sale or purchase of the Property. In all instances, however, CBRE, Inc. will act in the best interest of the client(s) it represents in the transaction described in this Memorandum and will not act in concert with or otherwise conduct its business in a way that benefits any Affiliate to the detriment of any other offeror or prospective offeror, but rather will conduct its business in a manner consistent with the law and any fiduciary duties owed to the client(s) it represents in the transaction described in this Memorandum.
CONFIDENTIALITY AGREEMENT This is a confidential Memorandum intended solely for your limited use and benefit in determining whether you desire to express further interest in the acquisition of the Property. This Memorandum contains selected information pertaining to the Property and does not purport to be a representation of the state of affairs of the Property or the owner of the Property (the “Owner”), to be all-inclusive or to contain all or part of the information which prospective investors may require to evaluate a purchase of real property. All financial projections and information are provided for general reference purposes only and are based on assumptions relating to the general economy, market conditions, competition and other factors beyond the control of the Owner and CBRE, Inc. Therefore, all projections, assumptions and other information provided and made herein are subject to material variation. All references to acreages, square footages, and other measurements are approximations. Additional information and an opportunity to inspect the Property will be made available to interested and qualified prospective purchasers. In this Memorandum, certain documents, including leases and other materials, are described in summary form. These summaries do not purport to be complete nor necessarily accurate descriptions of the full agreements referenced. Interested parties are expected to review all such summaries and other documents of whatever nature independently and not rely on the contents of this Memorandum in any manner. Neither the Owner or CBRE, Inc, nor any of their respective directors, officers, Affiliates or representatives make any representation or warranty, expressed or implied, as to the accuracy or completeness of this Memorandum or any of its contents, and no legal commitment or obligation shall arise by reason of your receipt of this Memorandum or use of its contents; and you are to rely solely on your investigations and inspections of the Property in evaluating a possible purchase of the real property. The Owner expressly reserved the right, at its sole discretion, to reject any or all expressions of interest or offers to purchase the Property, and/or to terminate discussions with any entity at any time with or without notice which may arise as a result of review of this Memorandum. The Owner shall have no legal commitment or obligation to any entity reviewing this Memorandum or making an offer to purchase the Property unless and until written agreement(s) for the purchase of the Property have been fully executed, delivered and approved by the Owner and any conditions to the Owner’s obligations therein have been satisfied or waived. By receipt of this Memorandum, you agree that this Memorandum and its contents are of a confidential nature, that you will hold and treat it in the strictest confidence and that you will not disclose this Memorandum or any of its contents to any other entity without the prior written authorization of the Owner or CBRE, Inc. You also agree that you will not use this Memorandum or any of its contents in any manner detrimental to the interest of the Owner or CBRE, Inc. If after reviewing this Memorandum, you have no further interest in purchasing the Property, kindly return this Memorandum to CBRE, Inc.
EXCLUSIVE MARKETING AGENTS
FINANCING CONTACTS
PATRICK GILDEA
RYAN CLUTTER
MICHAEL BLUNT
HAL KEMPSON
COMPIE NEWMAN
Vice President CBRE | Capital Markets 201 South College Street Suite 1700 Charlotte, NC 28244 T (704) 331.1217 F (704) 331.1259 patrick.gildea@cbre.com
Executive Vice President CBRE | Capital Markets 750 9th Street NW Suite 900 Washington DC 20001 T (202) 585.5643 F (202) 783.1723 ryan.clutter@cbre.com
Senior Vice President CBRE | Capital Markets 750 9th Street, NW Suite 900 Washington DC 20001 T (202) 585.5672 F (202) 783.1723 michael.blunt@cbre.com
First Vice President CBRE | Capital Markets 201 South College Street Suite 1700 Charlotte, NC 28244 T (704) 927.1453 F (704) 334.0939 hal.kempson@cbre.com
Senior Vice President CBRE | Capital Markets 201 South College Street Suite 1700 Charlotte, NC 28244 T (704) 927.1454 F (704) 334.0939 compie.newman@cbre.com
B | 400 SOUTH TRYON
TABLE OF CONTENTS Investment Summary.................................. ..................... 01 Property Overview.......................................................... 15 Tenant Summary............................................................. 21 Financial Analysis............................................................ 31 Charlotte Economy..................................... .................... 39 Charlotte Office Market Overview.................. .................... 49
INVESTMENT SUMMARY | C
INVESTMENT SUMMARY
D | 400 SOUTH TRYON
INVESTMENT SUMMARY | E
INTRODUCTION & OVERVIEW CBRE, Inc. has been retained as the exclusive sales representative for 400 South Tryon Street, located in the Downtown submarket of Charlotte, North Carolina. Completed in 1974, 400 South Tryon Street (the “Property” or “400 South Tryon”) is a 33-story office building totaling 584,315 square feet. Situated on a well located, 2.17 acre site adjacent to Duke Energy’s world headquarters and in close proximity to Bank of America’s world headquarters, the building features an enviable Tryon Street address. Additionally, 400 South Tryon is positioned across Tryon from the cluster of three Wells Fargo dominated buildings which comprise headquarters for the company’s East Region. 400 South Tryon is positioned just four blocks from the center of the city at Trade and Tryon Streets. On-site building amenities include a Bank of America branch location, sundries shop, parking deck, and a restaurant. The Property is currently 91.95% occupied by high quality tenants that include Duke Energy and Bank of America, N.A. 400 South Tryon represents the premier, Class “B” property in the resilient and historically tight Downtown office market. With Downtown Charlotte achieving vacancies as low as 1.12% in the second quarter of 2008, the market is prone to attractive rent growth. The presence of the world headquarters of the second largest U.S. bank, Bank of America, and the East Region headquarters for Wells Fargo, plus the headquarters of the largest U. S. utility in Duke Energy ensures strong and steady leasing demand in this vibrant submarket. Both Bank of America and Wells Fargo have emerged from the recent recession as profitable corporations and continue to create and move jobs to downtown Charlotte office buildings. 400 South Tryon is well located within the center of all of these economic catalysts ensuring its long-term success. 400 South Tryon is being offered without a stated asking price and is available on an “all cash” basis under the following terms: Projected Year 1 NOI:
$6,925,936
Projected 5 Year Average NOI:
$7,911,108
Projected 10 Year Average NOI:
$9,564,384
Projected 5 Year Average Operating Cash Flow:
$5,407,507
Projected 10 Year Average Operating Cash Flow:
$6,749,106
1 | 400 SOUTH TRYON
INVESTMENT HIGHLIGHTS STABLE INVESTMENT WITH CREDIT RATED TENANCY
ATTRACTIVE CANDIDATE FOR REPOSITIONING
The 400 South Tryon offering provides an investor the opportunity
Through purchasing the building at a discount to replacement cost,
to invest in a well located asset 87.7% leased by tenants with
400 South Tryon is an ideal candidate for a possible repositioning
investment-grade credit ratings. Duke Energy, which occupies
strategy. One of the most viable, near-term strategies involves
520,370 square feet within the building maintains a BBB-
repositioning the asset by making cosmetic changes to the retail
Standard & Poor’s credit rating. Bank of America, N.A. occupies
portions of the building. A portion of the first floor of the building
3,799 square feet and is rated A- by the agency. Additionally,
which fronts South Church Street is a prime location for additional
near-term yield enhancement can be achieved though leasing
retail to be created. The space was formerly used by the FBI as an
the existing vacant space. With 8.05% of the building currently
auto repair center. With considerable new development along the
vacant, and improving market conditions, it is estimated that the
South Church Street corridor which includes Catalyst Residential
existing vacancy will be absorbed in 12 months thereby increasing
Tower, Ally Center, the new city park and baseball stadium there
the NOI by approximately 15% in a relatively short period of time.
is a need for additional restaurant or retail space would boost
Additionally, according to CBRE Economic Advisors, rental rates
the NOI. This strategy could elevate the building to a class “B+”
are projected to grow by 3.5% in 2013 and 4% in 2014. Through
structure, achieving higher rental rates than it currently does, while
leasing the existing vacancy and renewing existing tenants at
competing for cost conscious tenants seeking a Class “A” location.
higher rates significant upside will be achieved.
Select systems could also be upgraded during the repositioning of the building that will create operating efficiencies.
Rendering of potential retail space development along South Church Street.
INVESTMENT SUMMARY | 2
CONSIDERABLE UPSIDE ACHIEVED THROUGH INCREASING PARKING FEES
OPPORTUNITY TO PURCHASE AN IDEALLY LOCATED ASSET WELL BELOW REPLACEMENT COST
400 South Tryon is in position to increase the net operating income
The buyer has the opportunity to purchase the Property well below
by as much as $250,000 through increasing parking revenue. The
replacement cost. With estimated replacement costs of $325 to
520 space parking deck is an ideal building amenity in downtown
$350 per square foot, and very limited opportunities for new CBD
Charlotte, particularly considering the recent development in the
office supply, the offering represents an excellent value for an
immediate area. With a parking ratio of 0.89 spaces per 1,000
investor seeking upside. Furthermore, assets lining Tryon Street are
rentable square feet, demand for parking in the deck should be
very appealing to tenants as this street is downtown Charlotte’s
sufficient to maintain high occupancy levels well into the future.
“Main Street” and therefore has a significant concentration of
Increasing the net operating income generated through parking
restaurants and convenience based retailers.
revenue will be achieved by implementing the following strategies: • Currently 115 or 23% of the parking spaces in the deck is provided to Duke Energy for free per their lease. At current monthly parking rates the free parking spaces could account for an increase of $179,400 per year. • Similarly to the free spaces, Duke Energy has 301 spaces provided at a reduced rate of 85% of the market rate. This discount equates to an additional $70,434 per year of potential revenue enhancement.
3 | 400 SOUTH TRYON
Imagination
1 BofA Center
Courtside
Bobcats Arena
Ritz
BofA Plaza
Epicenter
aLoft
Catalyst
440 S Church
NASCAR Duke Energy Center
INVESTMENT SUMMARY | 4
WELL POSITIONED IN THE PATH OF RECENT GROWTH • 400 South Tryon is located adjacent from the newly constructed
• 400 South Tryon is located within close proximity the light
Duke Energy Corporate Center and Cultural Campus. This
rail line which runs between College and Brevard Streets
mixed use development includes a 1.3 million square foot
with the Convention Center Station positioned just two
office building, the Afro-American Cultural Center, the Bechtler
blocks from the entrance to the building. Furthermore, as
Art Museum, and a future condominium tower. The 35,000
economic conditions improve, a new Amtrak station will be
square foot Bechtler Art Museum holds approximately 1,200
constructed just six blocks northwest of the building. The
works of art assembled by Andreas Bechtler and his family
close proximity to these stations further enhances the long
during the past 75 years. The Afro-American Cultural Center
term leasing potential of 400 South Tryon as the city grows
has four floors, cost $18.5-million, and has 45,000 square feet
and traffic becomes more challenging.
of gallery, classroom, and administrative space. • The Property is also located just six blocks from Time Warner • Located across South Church Street from the parking deck
basketball arena and four blocks from Bank of America
of 400 South Tryon is the Catalyst residential tower, the Ally
Stadium, the home to the NBA’s Bobcats and NFL’s Carolina
Center office tower, and a future apartment tower. Occupying a
Panthers respectively. The close proximity to these sporting
full city block, the three towers and the parking deck represent
venues appeals well to tenants.
a cohesive, well designed, development with public open space located between the buildings creating a pedestrian
EXCELLENT ACCESS
and vehicle friendly atmosphere. The 462-unit Catalyst
Exceptional access is provided to 400 South Tryon from Tryon and
residential tower offers units for lease, while the Ally Center
Church Streets, with pedestrian access available from all sides of the
offers 365,000 square feet of class “A” office space. Childress
building and vehicular access to the parking deck from Church Street.
Klein is currently building an 11 story, 250 unit apartment tower
Located on the prestigious Tryon Street, Charlotte’s ‘main street,’ the
adjacent to the Catalyst.
building is easily accessible from I-277, I-77, I-85, and US-74.
• Positioned at the corner of South Church Street and West Martin Luther King Boulevard is the site of the Romare Bearden Park which is scheduled to open in September of 2013. This 5.4 acre urban park was inspired by the work of internationally known artist Romare Bearden who grew up in the area. The park has an eclectic mix of urban park elements including two gardens, and a courtyard of moveable tables and chairs on a bed of crushed granite heavily shaded by a strong tree canopy. A formal event green transitions into a large open green for informal play and events, a play area with interactive digital chimes and waterfalls. To the northwest of the park is the site of BB&T Stadium which is currently under construction. The 10,000-seat BB&T Stadium is the future home of the Charlotte Knights AAA baseball team.
5 | 400 SOUTH TRYON
NOTABLE LARGE TENANTS SEEKING DOWNTOWN CHARLOTTE OFFICE SPACE Over the past five years, the Charlotte market has witnessed several high-profile, large-scale, office requirements for companies looking to relocate to the city or significantly expand their operations within Charlotte. While some of the companies ultimately elected to lease or build space outside of the Downtown submarket, the vacant space in 400 South Tryon will compete favorably for large tenants until the existing occupancy is absorbed. Furthermore, should Duke Energy vacate any of their space, with the demand witnessed recently, it’s likely the space will be re-leased quickly. Despite some of the large leases executed in the Downtown submarket in 2012 and 2013 being larger in size than what 400 South Tryon could currently accommodate, the list illustrates the robust demand for large blocks of space in the Downtown submarket. The relocation of Chiquita to NASCAR Plaza, Charlotte School of Law to Charlotte Plaza, and Babson Capital to the Duke Energy Center are prime examples of significant leasing momentum within the submarket. As the market continues to witness renewed demand and occupancies increase, rental rates are expected to escalate as the supply dwindles to pre-recession levels.
2012/2013 LEASES IN THE DOWNTOWN SUBMARKET GREATER THAN 10,000 SQUARE FEET Building
Tenant
Square Feet
Bank of America
408,106
Wells Fargo
300,000
Charlotte School of Law
243,083
SCOR Global American Life
140,000
Chiquita
137,790
Charlotte School of Law
42,000
Babson Capital
35,244
Wake Forest
28,741
CBRE
23,860
Ally Bank Building
Jeld Wen
23,241
NASCAR Plaza
NASCAR
22,588
Navigant Consulting
16,959
Montreat College
15,000
NASCAR Plaza
NASCAR
12,691
525 N Tryon
Embrace
12,078
Heels.com
11,100
Wake Forest University Charlotte Center Duke Energy Center Charlotte Plaza Bank of America Plaza NASCAR Plaza Gateway Center Duke Energy Center Wake Forest University Charlotte Center Charlotte Plaza
Ally Center Johnston Building
NASCAR Plaza
INVESTMENT SUMMARY | 6
1 BANK OF AMERICA CENTER BANK OF AMERICA CORPORATE CENTER
HEARST TOWER
THE VUE
FIFTH & POPLAR
THE CARILLON
BB&T STADIUM (UNDER CONSTRUCTION)
7 | 400 SOUTH TRYON
ROMARE BEARDEN PARK (UNDER CONSTRUCTION)
ONE WACHOVIA CENTER
TIME WARNER CABLE ARENA DUKE ENERGY CENTER
NASCAR PLAZA
ALLY CENTER
WELLS FARGO CULTURAL CAMPUS
NEW APARTMENT TOWER (11 STORIES/250 UNITS UNDER CONSTRUCTION)
BANK OF AMERICA STADIUM
INVESTMENT SUMMARY | 8
MARKET HIGHLIGHTS HISTORICALLY ONE OF THE TIGHTEST CBDS IN THE COUNTRY Downtown Charlotte has historically operated at low vacancy levels as its large corporate citizens have frequently leased large portions of space. In the late ‘90s and into the 2000’s, tremendous growth pushed the vacancy rate down to 1.1% in the second quarter of 2008. While the vacancy rate increased in 2009, 2010 and 2011, the trend reversed course in 2012 and the vacancy rate decreased to the present rate of 10.8%. Furthermore, job growth projections indicate the Downtown submarket will continue to improve over the next three years. Downtown vacancy is expected to decline from the current 10.8% with increased positive absorption expected throughout the remainder of 2013 and into 2014. Charlotte’s inherent competitive advantages described above and the cost to construct new offices will shift the supply/demand equation to the advantage of existing owners. This shift is already being witnessed in the market.
DOWNTOWN CHARLOTTE VACANCY 12.0% 10.0% 8.0% 6.0% 4.0% 2.0% 0.0% 2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2Q 2013
RAPIDLY BECOMING A LEADER IN THE ENERGY SECTOR Duke Energy anchors Charlotte’s energy sector. In July of 2012,
Although Charlotte has a history of attracting companies in the
Duke Energy finalized its merger with Raleigh, NC based Progress
energy sector, the recent interest in alternative or “green energy” has
Energy. Duke Energy, which continues to maintain its headquarters
raised the city’s national visibility in this sector. Sencera International
in Charlotte, now serves more than 7.1 million customers and is the
Corporation (solar), Saertex USA (composite materials used in
nation’s largest utility provider, based on the number of customers,
blades for the wind turbine industry) and Celgard, LLC (rechargeable
servicing six regulated territories – North Carolina, South Carolina,
lithium-ion batteries) are some of the more high profile Charlotte
Florida, Indiana, Kentucky and Ohio.
“green energy ” firms. The “green energy” companies and the energy sector as a whole have benefited from the training and educational
More than 550 firms in the Charlotte area provide energy and
resources available within the region. Among these are: University
technical expertise. An example of this is Charlotte based Piedmont
of North Carolina Charlotte’s Energy Production and Infrastructure
Natural Gas Company, a leader in the natural gas industry. Piedmont
Center, The Electric Power Research Institute (EPRI), and Central
serves over one million customers in North Carolina, South Carolina
Piedmont Community College’s extensive offerings of energy related
and Tennessee. Together the headquarters operations of Duke
technical course work.
Energy and Piedmont Natural Gas have been attracting additional energy related companies to Charlotte for decades.
The effect of this aggregation of energy related companies on 400 South Tryon cannot be understated. With more and more energy
Along with the utilities, other energy industry leading firms such as
sector companies looking to relocate or start new operations
The Shaw Group, AREVA NP, Toshiba, Westinghouse, Fluor, Siemens
in Charlotte, the available space adjacent Duke Energy’s world
and URS have helped Charlotte to become a center for engineering
headquarters will experience sufficient demand, especially from
and design as it relates to the energy industry.
companies who directly service Duke Energy. Additionally, firms such as The Shaw Group have a substantial presence downtown
Charlotte is also home for a number of energy related manufacturing
which could generate additional demand for 400 South Tryon. In the
operations including CoaLogix, SPX (Headquartered in Charlotte),
future if Duke Energy were to downsize, many in the energy sector
Siemens, Strategic Power Systems, Inc. (SPS), and VA Tech Hydro
will likely look to 400 South Tryon to fulfill their office space needs.
USA Corporation. These engineering and manufacturing firms act as a magnet to attract additional energy related companies.
9 | 400 SOUTH TRYON
SECOND LARGEST U.S. FINANCIAL CENTER
CHARLOTTE’S REBOUNDING LOCAL ECONOMY
Charlotte is second only to New York City in housing financial
Charlotte has been known for its ability to weather a recession
and banking operations in the U.S. Bank of America, the country’s
more easily than most. However, the most recent recession which
second largest bank with $2.175 trillion in assets and largest tenant
impacted the financial sector more than ever before, had many
at the Property, is headquartered in Charlotte. Charlotte also
doubting Charlotte’s ability to recover. Nevertheless, Charlotte
houses the East Region headquarters of Wells Fargo. The former
continued to receive good news during the downturn as over 10,000
GMAC Financial Services, now Ally Bank, recently relocated
new jobs were announced in the span of a few months. Many of
key operations to downtown Charlotte. Similarly, Fifth Third
these new jobs are related to the emerging energy sector which now
Bank opened a sizeable regional office in downtown Charlotte.
is emblematic of Charlotte’s focus on economic diversity.
Charlotte has been resilient and is recovering earlier than many expected and will therefore likely maintain its position as a major
With the critical mass from Fortune 500 energy giant, Duke Energy,
city for financial services well into the future.
Charlotte has become focused on changing its “banking only” reputation and now actively embraces previously under-recognized,
DESIRABLE MARKET FOR INVESTMENT CAPITAL
traditional employment sectors such as healthcare, manufacturing,
From an investment perspective, Charlotte typically receives the
and logistics. An example of this diversification is Maersk Line.
highest sales prices and the greatest competition among buyers
Maersk, a global leader in the shipping industry, now maintains its
for investments in the Carolinas. This dynamic is especially evident
headquarters and a significant operation in Charlotte.
in the Downtown submarket which has witnessed several notable office building sales in the past four years including record price per
With low operating costs, limited risk for natural disaster and a
square foot and cap rate records for Charlotte and the Carolinas.
central East Coast location, the Charlotte region has amassed a
The Class “A” sales of the Charlotte Plaza, which included an 834
significant concentration of data centers. There are over four million
space parking deck, set the cap rate record at 5.1% while the
square feet of internet and enterprise data centers in North Carolina
Carillon set the price per square foot record at $293 per square
and about 60% of that space is in the Charlotte region. Additionally
foot. Since November of 2011 there have been seven downtown
over 1.8 million square of data center space is under construction
buildins g to trade including: One Wells Fargo Center, Wake Forest
in North Carolina. Apple, Google, Facebook, AT&T, Disney, and
University Charlotte Center, NASCAR Plaza, 525 North Tryon, Fifth
American Express all operate data centers in the Charlotte region.
Third Center, Hearst Tower and the Ally Center. In aggregate these
As data centers become more critical, especially with Cloud based
six transactions garnered nearly $950 million in total consideration
technologies, the Charlotte region will likely attract additional data
which is a clear indication that Charlotte, especially downtown
centers and related support further diversifying the local economy.
Charlotte, is a desirable market for office investors.
INVESTMENT SUMMARY | 10
A list of the Charlotte area companies looking to add a minimum of 100 jobs between July 2009 and July 2013 are listed in the table below. With employment increasing by more than 18,850 for the MSA during 2010, more than 18,900 in 2011, and more than 17,300 throughout 2012, it’s clear that many of the announced jobs have been filled. This trend is expected to continue with increasing momentum throughout the remainder of 2013 and into 2014 as the overall local economy, especially the energy sector, is poised for growth. Company
Number of Jobs
Industry
Convergys
1,600
Technical Support / Call Center
Connextions Inc.
1,200
Healthcare – Billing Support / Call Center
Red Ventures
1,000
Direct Marketing
Siemens Energy
825
Electrical Engineering; Energy
Electrolux
738
Manufacturer – Appliances
Freightliner
628
Manufacturer – Hybrid & Natural Gas Trucks
RATO North America
600
Manufacturer – Small Gas Engines
Capgemini
550
Consulting; Technology & Outsourcing Services
Fifth Third Bank
500
Banking
Hewitt Associates
463
Consulting - Human Resources
Ally Bank
420
Banking; Finance
Chiquita Brands International
400
Agriculture - Importing of Foods
Bell Lines, Inc.
400
Logistics - Trucking
Red Cross
400
Public Service
United Technologies
325
Aerospace Engineering
Premier, Inc.
300
Healthcare
Citco Fund
258
Hedge Fund
Shaw Power
225
Energy Engineering; Nuclear Power
Celgard
209
Manufacturer – Battery Parts for Electric Cars
SPX
180
Engineered Products & Technologies
Saertex
178
Technologically Advanced Textiles
BAE Systems
176
Human Resources - Payroll & Accounting
HVM, LLC Management Company
170
Headquarters of Extended Stay Hotels
Husqvarna
160
Manufacturer – Outdoor/Yard Power Equipment
Novant
150
Healthcare
Webvisible
150
Marketing; Technology
Talon Systems
150
Manufacturer – Furniture
FCR Recycling
150
Recycling
ICM, Inc.
145
Energy - Gasifier Technology
Jeld-Wen
141
N. American Headquarters - Door & Window Manufacturing
Mitsubishi
135
Nuclear Energy Systems
Driven Brands
131
Auto Repair Franchising
Fluor Corporation
100
Engineering
ABB, Inc.
100
Energy; High-Voltage Cables / Power Transmission
Total:
11 | 400 SOUTH TRYON
13,257
PROJECTED EMPLOYMENT GROWTH, CHARLOTTE SURPASSES THE OVERALL U.S. According to Economy.com’s March 2013 Charlotte MSA report, the Charlotte market is expected to outperform the overall U.S. in job growth over the next four years. Average annual employment growth is projected to be 2.7% for Charlotte and 2.0% for the U.S. As mentioned above, the Charlotte job market is becoming more diverse. Cautious expansion in the financial sector, coupled with growth above the U.S. average in other industries, led to modest job growth in 2011 and 2012. Economy.com is projecting positive job growth for the Charlotte MSA through 2017. The graph below illustrates the projected growth of national employment versus Charlotte.
PERCENT CHANGE IN EMPLOYMENT 6.0% 4.0% 2.0% 0.0% -2.0% -4.0% -6.0% -8.0% 2006
2007
2008
2009
2010
Charlotte MSA
2011
2012
2013
2014
2015
2016
United States
SINCE 2009 DOWNTOWN CHARLOTTE HAS SECURED A GLOBAL HEADQUARTERS FOR A FORTUNE 1000 FIRM AND A REGIONAL HEADQUARTERS FOR THREE FORTUNE 500 COMPANIES With a deep and diverse labor force within the financial services sector and an excellent transportation hub and lower cost housing than most Northern markets, Charlotte offers an exceptional location for financial institutions to expand or relocate. Since 2008, three large financial institutions opened their Southeastern hubs in downtown Charlotte. Ally Bank, the namesake tenant of 440 South Church Street opened their Southeastern hub in 2010. BB&T, based in Winston-Salem, North Carolina, recently expanded their large downtown presence and Fifth Third Bank recently relocated its Southeastern headquarters to Charlotte. Chiquita Brands relocated their corporate headquarters to Charlotte from Cincinnati, OH and now occupy approximately 137,000 square feet in the NASCAR Plaza building which also has been branded with Chiquita signage. Chiquita is a Fortune 1000 company that expands the food industry’s presence in the local economy and further rounds out the impressive list of corporate citizens in downtown Charlotte.
INVESTMENT SUMMARY | 12
PROPERTY OVERVIEW
13 | 400 SOUTH TRYON
INVESTMENT SUMMARY | 14
OVERVIEW 400 South Tryon Street is a 33-story office building containing 584,315 rentable square feet, completed in 1974.
RENOVATIONS • 1994 included a new lobby and the creation of an attractive, landscaped marble/granite plaza in front of the building. Cost $600,000
NET RENTABLE AREA Type of space
Square Feet
% Leased
Occupied Office
537,259
91.95
Occupied Retail
8,429
1.44
202
.03
4,933
.857
584,315
100
Vacant SF (shafts) Management Office Total
• 2007 the buildings exterior was waterproofed and painted. Cost $1.7 million
PARKING The building has a four level parking deck attached to the back of the
• 2007 the new entrance was created combining the two small entrances into one grand entrance. Cost $500,000 • 2007/2008 all 16 elevators were completely modernized by Otis. Cost $2.4 million • 2008 the HVAC system was upgraded by adding a plate and frame heat exchanger and a primary /secondary pumping
building with access on Church Street; each level has 125 spaces for a total of 500 spaces; • Duke: 115 free spaces • 301 at 85% of the market rate
STRUCTURE Steel frame with precast concrete
system. Cost $350,000
EXTERIOR FINISH • 2007/2008 floors, 3, 4, 6,7,21 and 23 were updated with new DDC VAV boxes. Cost $200,000 • 2008 Parking deck renovations including new barrier cable
The façade features painted precast panels and Gold reflective glass, double insulated 2225 units.
ROOF
system on the ramps and new waterproofing membrane and
Perforated metal deck with poured concrete and fiberboard
topping slab on level one. Cost $1.5 million
insulation and 60 mil EPDM membrane installed in 1997. Current roof has 20 year warranty.
ADDRESS 400 South Tryon Street, Charlotte, NC 28285
LOBBY FINISH The building contains a two story main lobby, which is highlighted
ARCHITECT
by arched ceilings, a glass 3 bay entrance and chandeliers; walls are
Little & Associates Architects
travertine marble with cherry wainscot, floor is marble and granite.
SITE
FLOOR SIZES
The building is rectangular in shape and is located at the corner of
Column spacing of 24’ by 30’; typical floor plates between 17,500
South Tryon and Martin Luther King, Jr. Boulevard and extends back
– 18,000 square feet. Typical common area load factor for in place
to Church Street. The site has approx. 242 feet of frontage along
leases is 13% multi-tenant and 5% single tenant floor.
South Tryon Street and approximately 292 feet along Martin Luther King, Jr. Boulevard and 242 along Church Street.
FLOOR LOADS The floors can support live loads of 85 pounds per square foot
ZONING UMUD (Uptown Mixed-Use District)
CEILING HEIGHTS The typical slab to slab height is 12 feet, with a typical ceiling height of 8 feet 6 inches.
15 | 400 SOUTH TRYON
FREIGHT A full service single bay loading dock with dock leveler is served by
400 South Tryon Street has one main air handler per floor that
an alley connecting Church Street and South Tryon Street along the
supplies air to the HVAC units. Return air is tempered as it passes
south side of the building.
through a chilled water coil located in the discharge side of the air handler unit. Chilled water is supplied by three (3) Trane centrifugal
In addition there is a loading dock located on the north side of the
chillers of 480 tons capacity each and one 150 ton Trane screw
building accessed off of Martin Luther King, Jr. Boulevard exclusively
chiller. The building is also equipped with a plate and frame heat
for Duke’s use.
exchanger that reduces the chiller run time during winter months.
ELEVATORS
Heating is generated by electric resistance coils located in the
The building is equipped with a total of 16 elevators which are
perimeter HVAC units and is controlled by a wall-mounted
allocated as follows:
thermostat, one per zone.
Type
Floors
Outside air is continually introduced into the system to keep the
6
Otis VIP 260 Passenger Traction
1-17 low rise
interior air fresh and to provide make-up air for normal building
6
Otis VIP 260 Passenger Traction
18-32 high rise
2
Otis collective Passenger Traction
1-4 Parking
1
Otis Traction freight
1-32
1
Otis Traction In house
1-7
Number
losses. This make-up air comprises approximately 10% of the total supply air on a continuous basis. Control of the temperature within 400 South Tryon Street is accomplished by a Powers System 600 Energy Management System.
This Distributed Digital Control System (DDC) provides the building
The low rise elevators operate at 500 FPM and the high rise operate
with the latest in microcomputer technology by using electronic
at 800 FPM; all elevators were modernized in 2007/2008.
components to improve efficiency. The control system continually
HVAC
monitors the operating parameters of the building systems and compensates for changes in inside and outside conditions.
400 South Tryon Street provides consistent indoor temperatures throughout the year with a multi-zone variable-air-volume (VAV) chilled water system with electric re-heat. The perimeter VAV zones
ELECTRICITY Electric service is provided by Duke Power through two 480/277
provide both heating and cooling through a system of overhead
volt, three phase switchboards, each with a capacity of 4000 amps.
ducts and diffusers. The interior VAV zones provide cooling through
There is one master meter and service is distributed through four
a system of overhead ducts and diffusers. Floors 3, 4, 6, 7, 10, 21, &
wire feeder buss ducts and switchgear located on the 1st floor
23 have been updated with new full DDC VAV boxes.
feeding the low rise portion of the building and located on the 33rd floor feeding the high rise portion of the building.
PROPERTY OVERVIEW | 16
FIRE ALARM SYSTEM
FIRE PUMP
The building Fire Alarm system consists of a Honeywell Model XLS
Two fire pumps are provided for the facility, one diesel and one
1000 fire alarm control panel and communication system including
electric. The diesel fire pump is an Aurora Model 6x8x17 horizontal
an audio evacuation / paging system, located behind the security
split case pump rated at 750 GPM and 200 psi. The diesel fire pump
desk in the main lobby of the building adjacent to the Property
is designated as the primary fire pump for the facility. The fire pump
Management office. This system was upgraded in 2000 with the
is provided with a Model 1O8EC Fire Pump Relief Valve manufactured
installation of the new fire alarm control panel, expanded control
by QCV Control Valves.
units and addressable smoke detectors throughout the property. The secondary fire pump is an electric fire pump manufactured by
SPRINKLER SYSTEM
Aurora (Model 4-481-11 C, horizontal split case), rated at 750 GPM
The building is equipped throughout floors 1 through 32 with a
and 190 psi.
combined automatic fire sprinkler and standpipe system. The sprinkler system was installed as a retrofit in 1994. The sprinkler
SMOKE EVACUATION
system is divided into one zone per floor, with the riser located in
Smoke control is provided in the building via the vented vestibule
Stair A, along with the associated tamper and flow alarm monitoring
system provided in Stair A.
devices.
EMERGENCY POWER Sprinklers throughout the property are generally Model A sprinklers
Emergency power is provided by a Caterpillar 175 KW generator;
manufactured by Central, installed with sprinkler cups. Some semi-
in addition the GSA and Duke have their own generators serving
recessed sprinklers are installed on the 1st 3rd and 18th floors. The
tenants’ equipment.
sprinkler system is tested annually.
SECURITY STANDPIPE AND HOSE EQUIPMENT
Security is provided 24/7 by contract security vendor; the building
The standpipe system is a Class I system with six-inch risers and
also is equipped with card accessed security portals that limit access
2¼-inch fire department hose connections located in each exit
to elevators 24/7.
enclosure. Pressure reducing valves are provided on the 26th floor down. A 2-inch drain riser is provided in Stair A.
EXTERIOR LIGHTING The building is illuminated with 160 metal halide 1000-watt lights.
The standpipe system protecting the parking garage consists of 4-inch risers serving 1 ¼-inch fire hose stations in each of the 4 stairs. The building fire pump serves the garage standpipe system and risers are wrapped in protective insulation to maintain temperature.
17 | 400 SOUTH TRYON
Parking Deck
South Tryon Street
South Church Street
Martin Luther King, JR. Boulevard
GROUND FLOOR RETAIL AND BUILDING LOBBY
SINGLE TENANT FLOOR PLATE
MULTI-TENANT FLOOR PLATE
PROPERTY OVERVIEW | 18
TENANT SUMMARY
19 | 400 SOUTH TRYON
INVESTMENT SUMMARY | 20
DUKE ENERGY www.duke-energy.com
COMMERCIAL POWER Headquartered in Charlotte, NC, Duke Energy is the largest
Commercial Power owns, operates and manages power plants and
electric power company in the United States, supplying energy
engages in the wholesale marketing and procurement of electric
to approximately 7.2 million customers. The company has
power, fuel and emission allowances related to these plants, as
approximately 50,000 megawatts of electric generating capacity
well as other contractual positions. Commercial Power’s generation
in the Carolinas and the Midwest, and natural gas distribution
operations, excluding renewable energy generation assets, consist
services in Ohio and Kentucky. Its commercial and international
primarily of coal-fired and gas-fired non-regulated generation
businesses own and operate diverse power generation assets
assets, which are dispatched into wholesale markets. These assets
in North America and Latin America, including a portfolio of
are consists of 6,825 net megawatts of power generation primarily
renewable energy assets. Duke Energy had operating revenues
located in the Midwestern United States. The asset portfolio has a
of $21.35 billion for 2012. The company has $113.7 billion in total
diversified fuel mix with baseload and mid-merit coal-fired units, as
assets and approximately 27,885 employees. On July 2, 2012, the
well as combined cycle and peaking natural gas-fired units.
Company merged with Progress Energy Inc. Duke Energy Retail serves retail electric and gas customers in In addition to energy producing subsidiaries, Duke owns Bison
southwest, west central and northern Ohio with energy and
Insurance Company Limited, Duke Energy’s wholly owned,
other energy services. Through Duke Energy Generation Services,
insurance subsidiary, the Duke Energy Foundation, Duke Energy’s
Inc. (DEGS), Commercial Power engages in the development,
effective 50% interest in DukeNet Communications, LLC, and
construction and operation of renewable energy projects. In
Duke Energy’s effective 60% interest in Duke Energy Trading and
addition, DEGS develops commercial transmission projects. During
Marketing, LLC (DETM).
the year ended December 31, 2012, DEGS has approximately 1,269 net megawatt of renewable generating capacity in operation.
U.S. FRANCHISED ELECTRIC AND GAS U.S. Franchised Electric and Gas (USFE&G) generates, transmits,
INTERNATIONAL ENERGY
distributes and sells electricity in portions of North Carolina,
International Energy principally operates and manages power
northern South Carolina, central, north central and southern Indiana,
generation facilities and engages in sales and marketing of electric
west central Florida, and northern Kentucky. USFE&G also transmits,
power, natural gas, and natural gas liquids outside the United States.
distributes and sells electricity in southwestern Ohio. In addition,
It conducts operations through Duke Energy International, LLC (DEI)
USFE&G transports and sells natural gas in southwestern Ohio
and its affiliates and its activities principally target power generation
and northern Kentucky. It conducts operations primarily through
in Latin America. In addition, International Energy owns a 25%
Duke Energy Carolinas, Progress Energy Carolinas, Progress Energy
interest in National Methanol Company (NMC), a regional producer
Florida, Duke Energy Indiana, and the regulated transmission and
of methanol and methyl tertiary butyl ether (MTBE) located in Saudi
distribution operations of Duke Energy Ohio. Its service area covers
Arabia. International Energy owns, operates or has substantial
approximately 104,000 square miles. USFE&G provides regulated
interests in approximately 4,900 gross megawatts of generation
transmission and distribution services for natural gas to 500,000
facilities.
customers in southwestern Ohio and northern Kentucky. Electricity is also sold wholesale to incorporated municipalities, electric
Duke Energy is ranked 145 on the Fortune 500 list and is traded on
cooperative utilities and other load serving entities.
the New York Stock Exchange under the ticker symbol DUK. The company maintains a Standard and Poor’s credit rating of BBB+. Duke Energy occupies 523,370 square feet of the building with a staggered lease structure expiring in December 2015, 2016, 2017 and 2019. Duke Energy has been a tenant in the building since 1992.
21 | 400 SOUTH TRYON
TENANT SUMMARY | 22
BANK OF AMERICA www.bankofamerica.com Bank of America National Association is one of the world's largest financial institutions, serving individual consumers, small- and middle-market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk management products and services. The company provides unmatched convenience in the United States, serving approximately 52 million consumer and small business relationships with approximately 5,400 retail banking offices and approximately 16,300 ATMs and award winning online banking with 30 million active users. Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America N.A. offers industry leading support to approximately 3 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations in more than 40 countries. Bank of America Corporation stock (NYSE: BAC) is a component of the Dow Jones Industrial Average and is listed on the New York Stock Exchange. Bank of America is ranked 21 on the Fortune 500 list and maintains a Standard and Poor’s credit rating of A-. Bank of America National Association occupies 3,799 square feet of the building and their lease extends through November of 2018.
23 | 400 SOUTH TRYON
TENANT SUMMARY | 24
STACKING PLAN Square Feet
End
Duke Energy
150
Dec-2015
Suite 3300
Two Way Radio of Carolinas
325
Dec-2013
Suite 3250
Non-leasable space
101
Suite 3200
Duke Energy
17,774
Dec-2017
Suite 3100
Duke Energy
17,900
Dec-2015
Suite 3000
Duke Energy
17,875
Dec-2017
Suite 2900
Duke Energy
17,875
Dec-2017
Suite 2800
Duke Energy
17,875
Dec-2017
Suite 2700
Duke Energy
17,875
Dec-2015
Suite 2600
Duke Energy
17,875
Dec-2017
Suite 2500
Duke Energy
17,875
Dec-2017
Suite 2400
Duke Energy
17,875
Dec-2017
Suite 2300
Duke Energy
17,875
Dec-2017
Suite 2200
Duke Energy
17,875
Dec-2015
Suite 2100
Duke Energy
17,875
Dec-2015
Suite 2000
Duke Energy
17,875
Dec-2015
Suite 1900
Duke Energy
17,103
Dec-2015
Suite 1800
Duke Energy
17,053
Dec-2015
Suite 1700
Duke Energy
17,445
Dec-2016
Suite 1600
Duke Energy
18,348
Dec-2016
Suite 1500
Duke Energy
18,348
Dec-2016
Suite 1400
Duke Energy
17,580
Dec-2016
Suite 1300
Duke Energy
17,445
Dec-2016
Suite 1200
Duke Energy
17,514
Dec-2016
Suite 1100
Duke Energy
17,514
Dec-2016
Suite 1000
Duke Energy
17,445
Dec-2019
Suite 900
Available
17,445
Suite 800
Available
17,344
Suite 850
Non-leasable space
Suite 700
Duke Energy
17,518
Dec-2015
Suite 600
Duke Energy
17,518
Dec-2019
Suite 500
Duke Energy
17,087
Dec-2019
Suite 400
Duke Energy
17,087
Dec-2019
Suite 300
Duke Energy
15,983
Dec-2015
Suite 200
Building Maintenance
3,273
-
Suite 100
Duke Energy
7,963
Dec-2015
Annex
Duke Energy
19,188
Dec-2015
Dock
Duke Energy
2,782
Dec-2019
Garage
Available
7,974
Suite M1
Over the Rainbow, Inc. (Available)
4,293
Suite M4
Loparo & Roznik
3,267
Feb-2014
Suite M5
Valabh, Inc. (dba Paper & Paper)
1,363
Dec-2014
Suite M7
Bank of America
3,799
Nov-2018
Suite M8
Spectrum Properties
1,660
Dec-2015
Suite
Tenant
Suite 3350
101
Total Occupied
537,259
Total Available
47,056T
Total RSF
584,315 2013
2016
2019
2014
2017
Available
2015
2018
Building Use
25 | 400 SOUTH TRYON
Sep-2013
TENANT SUMMARY | 26
27 | 400 SOUTH TRYON
900
Available
800
Available
850
Non-leasable space
700
Duke Energy
600
Duke Energy
500
Duke Energy
17,445
17,344
101
17,518
17,518
17,087
2.99%
2.97%
0.02%
3.00%
3.00%
2.92%
2.92%
Sep-2005
Sep-2005
Sep-2005
Jan-2014
Dec-2015
Dec-2019
Dec-2019
Dec-2019
Dec-2015
Current
Jan-2015
Current
Begin
$25,873 $26,456 $27,054
Jan-2017 Jan-2018 Jan-2019
Jan-2018 Jan-2019
$27,737
Jan-2018 Jan-2019 Jan-2015
$32,189
$31,255
$27,124
Jan-2017
Current
$25,941 $26,525
Jan-2016
$25,226
Jan-2015
$24,817
$12,329 $12,608
Jan-2017
Current
$11,792 $12,057
Jan-2016
$11,467
Jan-2015
$11,281
$25,303
Jan-2016
Current
$24,605
$24,207
$14,632
$14,207
$14,632
$14,207
Monthly
Jan-2015
Current
400
17,087
Oct-2004
-
Dec-2015
End
Rental Increases
Duke Energy
2.74%
Oct-2003
Jan-2003
Begin
Lease Term
Jan-2015
15,983
0.56%
1.36%
Building
Pro-rata of
300
Duke Energy
200
Building Maintenance
3,273
7,963
Duke Energy
100
Feet
Square
Suite
RENT ROLL
$386,272
$375,060
$332,842
$325,484
$318,302
$311,295
$302,711
$297,806
$151,297
$147,953
$144,688
$141,503
$137,601
$135,371
$324,653
$317,476
$310,471
$303,636
$295,263
$290,479
$175,584
$170,488
$175,584
$170,488
Annually
Rental Rates
$22.05
$21.41
$19.00
$18.58
$18.17
$17.77
$17.28
$17.00
$19.00
$18.58
$18.17
$17.77
$17.28
$17.00
$19.00
$18.58
$18.17
$17.77
$17.28
$17.00
$22.05
$21.41
$22.05
$21.41
PSF
Comments/Options
Base Year See Suite 100 Notes. 2003
Base Year See Suite 400 Notes. 2014
Base Year See Suite 400 Notes. 2014
Base Year Tenant has (1) option as extend the lease for one (1), five (5) year 2014 periods with 9 months prior written notice (i.e. 3/31/2019 ) with the floors it wishes to renew or return. Tenant has the right to expand onto the 8th or 9th Floor building
Base Year See Suite 100 Notes. 2003
Valuation assumes that this will remain a maintenance office for the duration of the valuation.
Base Year Tenant has (2) options to extend the lease for five (5) year periods 2003 with 9 months prior written notice (i.e. 3/31/2015 and 3/31/2019) with the floors it wishes to renew or return. Tenant has right to expand onto the 8th or 9th Floor building.
Type
Recovery
TENANT SUMMARY | 28
2200
Jan-2003
Dec-2015
Jan-2015
Current
3.06%
Jan-2015
17,875
Dec-2015
Duke Energy
Jan-2003
Current
2100
3.06%
Dec-2015
Current
17,875
Jan-2003
Jan-2015
Duke Energy
3.06%
Dec-2015
$14,632
$14,207
$14,632
$14,207
$14,632
$14,207
$14,632
$14,207
$14,632
$14,207
$12,840
Jan-2016 Current
$12,555
Jan-2015
$12,276
$12,840
Jan-2016 Current
$12,555
Jan-2015
$12,276
$12,840
Jan-2016 Current
$12,555
Jan-2015
$12,276
$12,840
Jan-2016 Current
$12,555
Jan-2015
$12,276
$12,840
Jan-2016 Current
$12,555
Jan-2015
$12,276
$12,840
Jan-2016 Current
$12,555
Jan-2015
$12,276
$12,840
Jan-2016 Current
$12,555
Jan-2015
Jan-2015
17,875
Jan-2003
Jan-2019
2000
Duke Energy
2.93%
Dec-2015
Dec-2016
Dec-2016
Dec-2016
Dec-2016
Dec-2016
Dec-2016
$12,608
Jan-2018 $12,276
$12,329
Jan-2017
Current
$11,792 $12,057
Jan-2016
$11,467
$11,281
Monthly
Jan-2015
Current
Begin
Current
1900
17,103
Jan-2003
Jan-2003
Jan-2003
Dec-2006
Jan-2003
Jan-2003
Jan-2003
Dec-2016
Dec-2019
End
Rental Increases
Duke Energy
2.92%
2.99%
3.14%
3.14%
3.01%
2.99%
3.00%
Jan-2003
Jan-2014
Begin
Lease Term
Jan-2015
17,053
17,445
18,348
18,348
17,580
17,445
17,514
3.00%
2.99%
Building
Pro-rata of
1800
Duke Energy
1700
Duke Energy
1600
Duke Energy
1500
Duke Energy
1400
Duke Energy
1300
Duke Energy
1200
Duke Energy
1100
Duke Energy
17,514
17,445
Duke Energy
1000
Feet
Suite
Square
$175,584
$170,488
$175,584
$170,488
$175,584
$170,488
$175,584
$170,488
$175,584
$170,488
$154,084
$150,660
$147,316
$154,084
$150,660
$147,316
$154,084
$150,660
$147,316
$154,084
$150,660
$147,316
$154,084
$150,660
$147,316
$154,084
$150,660
$147,316
$154,084
$150,660
$147,316
$151,297
$147,953
$144,688
$141,503
$137,601
$135,371
Annually
Rental Rates
$22.05
$21.41
$22.05
$21.41
$22.05
$21.41
$22.05
$21.41
$22.05
$21.41
$19.35
$18.92
$18.50
$19.35
$18.92
$18.50
$19.35
$18.92
$18.50
$19.35
$18.92
$18.50
$19.35
$18.92
$18.50
$19.35
$18.92
$18.50
$19.35
$18.92
$18.50
$19.00
$18.58
$18.17
$17.77
$17.28
$17.00
PSF
Comments/Options
Base Year See Suite 100 Notes. 2003
Base Year See Suite 100 Notes. 2003
Base Year See Suite 100 Notes. 2003
Base Year See Suite 100 Notes. 2003
Base Year See Suite 100 Notes. 2003
Base Year See Suite 1100 Notes. 2014
Base Year See Suite 1100 Notes. 2014
Base Year See Suite 1100 Notes. 2014
Base Year See Suite 1100 Notes. 2014
Base Year See Suite 1100 Notes. 2014
Base Year See Suite 1100 Notes. 2014
Base Year Tenant may renew for one (1), five (5) year period for all or part of 2014 space with written notice prior to 3/31/2016. Tenant has right to expand onto the 8th or 9th Floor building.
Base Year See Suite 400 Notes. 2014
Type
Recovery
29 | 400 SOUTH TRYON
3250
Non-leasable space
101
0.02%
3.04%
Jan-2003
Dec-2017
Dec-2015
Dec-2017
Dec-2017
$12,767
Jan-2017
$12,767
$12,217 $12,489 $12,767
Jan-2015 Jan-2016 Jan-2017
$11,945
$14,632
$14,207
Jan-2017 Current
$12,217 $12,489
Jan-2015 Jan-2016
$11,945
$12,489
Jan-2016 Current
$12,217
Jan-2015
$11,945
$12,767
Jan-2017 Current
$12,489
Jan-2016
Current
3200
17,774
Aug-2003
Jan-2003
Jan-2003
$12,217
$11,945
$14,632
Jan-2015
Duke Energy
3.06%
3.06%
3.06%
Dec-2017
$12,767
Jan-2017 $14,207
$12,489
Jan-2016 Current
$12,217
Jan-2015
Jan-2015
17,900
17,875
17,875
Jan-2003
$12,767
Jan-2017 $11,945
$12,489
Jan-2016 Current
$12,217
Jan-2015
$11,945
$12,767
Jan-2017 Current
$12,217 $12,489
Jan-2015 Jan-2016
3100
Duke Energy
3000
Duke Energy
2900
Duke Energy
3.06%
Dec-2015
Dec-2017
Dec-2017
$12,767
Jan-2017 $11,945
$12,489
Jan-2016 Current
$12,217
$11,945
Monthly
Jan-2015
Current
Begin
Current
2800
17,875
Jan-2003
Jan-2003
Jan-2003
Dec-2017
Dec-2017
End
Rental Increases
Duke Energy
3.06%
3.06%
3.06%
Jan-2003
Jan-2003
Begin
Lease Term
Jan-2015
17,875
17,875
17,875
3.06%
3.06%
Building
Pro-rata of
2700
Duke Energy
2600
Duke Energy
2500
Duke Energy
2400
Duke Energy
17,875
17,875
Duke Energy
2300
Feet
Suite
Square
$153,208
$149,864
$146,599
$143,334
$175,584
$170,488
$153,208
$149,864
$146,599
$143,334
$153,208
$149,864
$146,599
$143,334
$153,208
$149,864
$146,599
$143,334
$175,584
$170,488
$153,208
$149,864
$146,599
$143,334
$153,208
$149,864
$146,599
$143,334
$153,208
$149,864
$146,599
$143,334
$153,208
$149,864
$146,599
$143,334
Annually
Rental Rates
$19.24
$18.82
$18.41
$18.00
$22.05
$21.41
$19.24
$18.82
$18.41
$18.00
$19.24
$18.82
$18.41
$18.00
$19.24
$18.82
$18.41
$18.00
$22.05
$21.41
$19.24
$18.82
$18.41
$18.00
$19.24
$18.82
$18.41
$18.00
$19.24
$18.82
$18.41
$18.00
$19.24
$18.82
$18.41
$18.00
PSF
Comments/Options
Base Year See Suite 2300 Notes. 2014
Base Year See Suite 100 Notes. 2003
Base Year See Suite 2300 Notes. 2014
Base Year See Suite 2300 Notes. 2014
Base Year See Suite 2300 Notes. 2014
Base Year See Suite 100 Notes. 2003
Base Year See Suite 2300 Notes. 2014
Base Year See Suite 2300 Notes. 2014
Base Year See Suite 2300 Notes. 2014
Base Year Tenant may renew for three (3), two (2) year periods with prior 2014 written notice by 3/31/2017, 3/31/20, 3/31/23 for all or a portion of space. Tenant has right to expand into the 8th or 9th Floor of the building.
Type
Recovery
INVESTMENT SUMMARY | 30
537,259
47,056
584,315
Available
Total RSF
1,660
3,799
1,363
3,267
4,293
7,974
Occupied
M8
Spectrum Properties
M7
Bank of America
M5
Valabh, Inc. (dba Paper & Paper)
M4
Loparo & Roznik
M1
Over the Rainbow, Inc. (Available)
Garage
Available
2,782
100.00%
8.05%
91.95%
0.28%
0.65%
0.23%
0.56%
0.73%
1.36%
0.48%
Oct-2003
Nov-2008
Jun-1995
Jan-2001
Sep-2003
Oct-2003
Dec-2015
Nov-2018
Dec-2014
Feb-2014
Sep-2013
Dec-2019
$9,461
$12,654
Nov-2017 Current
$144,514
$12,344
$113,527
$151,846
$148,123
$12,043
Nov-2015 Nov-2016
$137,562
$62,400
$28,076
$0
$213,179
$206,847
$175,584
$170,488
$65,845
Annually
$140,981
$11,463
$5,200
$2,340
$0
$17,765
$17,237
$14,632
$14,207
$5,487
Monthly
Rental Rates
$11,748
Nov-2014
Current
Current
Current
Current
Dock
Duke Energy
Dec-2015
Current
Dec-2004 Jan-2015
3.28%
Current
Current
Begin
Annex
19,188
Dec-2015
Dec-2013
End
Rental Increases
Duke Energy
Jan-2003
Jan-1999
Begin
Lease Term
Jan-2015
0.03%
0.06%
Building
Pro-rata of
3350
Duke Energy
150
325
Two Way Radio of Carolinas
3300
Feet
Suite
Square
$68.39
$39.97
$38.99
$38.04
$37.11
$36.21
$19.10
$6.54
$0.00
$11.11
$10.78
$22.05
$21.41
$202.60
PSF
One (1), three (3) year renewal with 6 months notice at prevailing market rent. Valuation assumes that tenant will remain in the building for the life of the valuation at the existing rental escalations (2.50%).
Comments/Options
Rent = 8% of sales. One (1), three (3) year renewal with 12 months notice. Reduction option - Landlord has one option to reduce the size of the premises by excluding a portion of the premises. Relocation- Landlord has the right at any time during the 3rd extension term and any additional term to relocate premises. New premises shall be within 10% of the size of the premises.
Tenant is vacating space at lease expiration.
Base Year 2006
Base Stop Four (4), five (5) year renewal options at prevailing market rent. 12 2008 months notice is required.
None
Base Year 2012
None
None
Base Year See Suite 100 Notes. 2003
Base Year See Suite 100 Notes. 2003
None
Type
Recovery
FINANCIAL ANALYSIS
31 | 400 SOUTH TRYON
INVESTMENT SUMMARY | 32
METHOD OF ANALYSIS The following cash flow projection is based upon current lease information and assumptions regarding future occupancy, operating expenses, and revenues. The analysis period begins as of November 1, 2013. Both contractual lease terms for existing leases and anticipated lease terms for future lease contracts are projected over a ten-year analysis period. For all current vacancies, or upon expiration of a lease, a market rent is assigned to the space upon commencement of a new lease. The market rent is established for 2013 and increased by the rental growth rate on an annual basis during the analysis period. The assumptions for market rents, tenant improvements, and leasing commissions are based upon current market activity and lease transactions completed at the property and in the submarket. The attached cash flow projections have been prepared by CBRE using Argus software and incorporating appropriate assumptions that are detailed in the Table of Assumptions on the following pages. The projections set forth in this Offering Memorandum do not constitute a representation, warranty or guaranty by CBRE or the Owner of any of the numbers set forth herein or of any economic value attributable to the Property or income that may be derived there from.
33 | 400 SOUTH TRYON
SUMMARY OF FINANCIAL ASSUMPTIONS GLOBAL
SECOND GENERATION LEASING
Analysis Period
Retention Ratio [5]
Commencement Date
January 1, 2014
End Date
December 31, 2023
Term
10 Years
Area Measures
75%
Lease Term - Market
7 Years
Lease Term - Duke Renewal/Second Generation
5 Years
Annual Market Rent - Office (Floors 1 - 6) [6] Annual Market Rent - Office
Building Square Footage (RSF)
584,315 SF
Vacancy and Credit Loss [1]
5.00%
$21.50 PSF
Annual Market Rent - Bank/Potential Restaurant
$25.00 PSF
Annual Market Rent - Retail/Annex
$15.00 PSF
Rent Adjustment
REVENUES Market Rent & Parking Growth 2014 -
3.00%
2019 - 3.00%
2015 -
4.00%
2020 - 3.00%
$20.50 PSF
3.00% Annually
Expense Recovery Type - Office
Base Stop
Expense Recovery Type - Retail
NNN
Initial Tenant Improvements New
$30.00 PSF $10.00 PSF $15.00 PSF
2016 -
4.00%
2021 - 3.00%
Renewal
2017 -
3.00%
2022 - 3.00%
Weighted Average
2018 -
3.00%
2023 + - 3.00%
New Potential Restaurant Space
$100.00 PSF
Commissions PARKING [2] Parking Operating Source
2013 Budget
Total Parking
520 spaces
New
6.00%
Renewal
4.00%
Weighted Average
4.50%
Downtime - Market
6 Month(s)
Duke Parking Spaces (.8/1,000 of RSF)
416 Spaces
Downtime - Duke Space
12 Month(s)
Duke Free Spaces (through 12/2015)
115 Spaces
Rental Abatement [7]
Duke Contract Parking
301 spaces
Market Monthly Parking Rate:
Duke Contract Rate/Month (85% of market)
$130.00
New
6 Month(s)
Renewal
$110.50
4 Month(s)
Weighted Average
4.50 Month(s)
EXPENSES VACANT SPACE LEASING [8]
Growth Rates Operating Expenses
2.50%
Total Vacant as of January 1, 2014
Capital Reserves
2.50%
Absorption Period
Property Taxes
1.50%
Lease Term
Taxes Reassessed upon Sale [3]
No
Management Fee (% of EGR)
2.00%
Operating Expense Source [4]
2013 Budget
Capital Reserves
$0.20 PSF
47,056 SF 18 Month(s) 7 Years
Initial Annual Market Rent
Same as above
Expense Recovery Type
Base Stop
Rent Adjustment
3.00% Annually
Tenant Improvements - Office
$30.00 PSF
Tenant Improvements - Restaurant
$100.00 PSF
Commission
6.00%
Rental Abatement [7]
6 Month(s)
[1] General Vacancy Loss factor includes attributes to projected lease-up, rollover downtime, and fixturing downtime. Bank of America, Duke Energy and Spectrum Properties are excluded from the vacancy and credit loss. [2] Future leasing after Duke's expiration date(s) is an estimate and based off a blended rate of "market", Duke's discounted rate and projected occupancies. It is the responsibility of potential buyers to make their assumptions about parking revenue going forward. [3] CBRE encourages investors to perform their own due diligence regarding tax legislation in Charlotte, NC and its potential impact on future tax assessments. Real Estate Taxes in this analysis are equal to the most recent tax bills (plus estimated inflation). There is brand new legislation (signed July 26, 2013) that will require Mecklenburg County to "re-do" their entire 2011 revaluation. An outside consulting group was hired to perform a review of the 2011 reassessment and it was ultimately deemed to be extremely flawed. Many commercial and residential properties were wildly over-assessed and this will be corrected in the re-do. At this time, there is no way to know if 400 S Tryon would receive a new retro-active assessment notice. However, the current owners have proceeded with the appeal efforts. [4] Operating expenses are based of the Seller's 2013 Budget. [5] For purpose of this valuation it is assumed that Two Way Radio of Carolina, Inc. will continue with 2.5% annual escalations for the life of the valuation. [6] For purpose of this valuation, it is assumed that the lower office floors (1 -7) will receive a reduced rental rate since their have an obstructed view from the parking garage. [7] Abatement for New Tenants is reduced by 1 month each FY. [8] 47,056 RSF of vacant space is assume to be leased up for the first 18 months of the valuation.
FINANCIAL ANALYSIS | 34
35 | 400 SOUTH TRYON
In-place
FY2014 $/SF/Year
$0.41
(250,884)
(371,580)
(800,004)
Security
General & Administrative
Real Estate Taxes
6,904,260
NET OPERATING INCOME
($1.62)
$8.19
OPERATING CASH FLOW
Capital Reserves ($3.67)
($0.69) ($0.20)
Leasing Commissions
TOTAL CAPITAL COSTS
($2.77)
$11.85
($6.95)
($0.26)
($0.38)
($0.10)
($1.37)
($0.64)
($0.43)
($0.26)
($0.05)
($1.01)
($0.79)
($0.05)
Tenant Improvements
CAPITAL COSTS
(4,046,664)
TOTAL OPERATING EXPENSES
(151,356)
(150,264)
Elevator
(219,024)
(27,324)
Landscaping
Parking
(591,816)
Repairs & Maintenance
Management Fee
(456,156)
Cleaning
(61,068)
(32,136)
After Hours HVAC
Insurance
(935,052)
Utilities
EXPENSES
$18.81
$0.00
0
10,950,924
General Vacancy
EFFECTIVE GROSS REVENUE
$0.97 $18.81
567,348
Parking Income
$0.02
10,950,924
202,320
Expense Reimbursement Revenue
Total Potential Gross Revenue
12,000
Base Rent Abatements
Total Scheduled Base Rent
Retail Sales Percent Revenue
($0.52)
0
10,169,256
Absorption & Turnover Vacancy $17.40
($1.20)
11,180,964
(1,011,708)
Base Rental Revenue
Scheduled Base Rent $19.12
4,783,572
(2,142,364)
(116,863)
(405,336)
(1,620,165)
6,925,936
(4,063,362)
(151,361)
(219,786)
(61,073)
(800,000)
(371,593)
(250,882)
(150,252)
(27,327)
(591,802)
(459,715)
(32,131)
(947,440)
10,989,298
0
10,989,298
567,344
241,450
12,000
10,168,504
($301,504)
($700,309)
$11,170,317
94.49%
Physical Occupancy
REVENUES
91.03%
Dec-2014
Overall Economic Occupancy
Fiscal Year Ending Dec-31
CASH FLOW PROJECTIONS
7,335,013
(599,349)
(119,785)
(49,941)
(429,623)
7,934,362
(4,208,984)
(155,145)
(242,867)
(62,600)
(812,000)
(380,881)
(257,154)
(154,008)
(28,010)
(606,596)
(478,910)
(32,935)
(997,878)
12,143,346
(61,279)
12,204,625
584,364
414,994
0
11,205,267
($230,366)
($20,621)
$11,456,254
99.85%
97.27%
Dec-2015 94.69%
91.02%
Dec-2017 93.83%
92.24%
Dec-2018
2,951,551
(3,839,683)
(122,779)
(794,095)
(2,922,809)
6,791,234
(4,223,471)
(159,024)
(220,294)
(64,165)
(824,180)
(390,404)
(263,583)
(157,859)
(28,711)
(621,761)
(479,486)
(30,769)
(983,235)
11,014,705
0
11,014,705
758,292
335,476
0
9,920,937
($861,882)
($1,026,577)
5,637,958
(2,721,456)
(125,849)
(589,457)
(2,006,150)
8,359,414
(4,367,952)
(162,999)
(254,547)
(65,769)
(836,543)
(400,164)
(270,172)
(161,805)
(29,428)
(637,306)
(495,361)
(32,538)
(1,021,320)
12,727,366
0
12,727,366
815,473
390,142
0
11,521,751
($379,012)
($758,027)
6,329,442
(3,215,150)
(128,995)
(720,147)
(2,366,008)
9,544,592
(4,482,174)
(167,074)
(280,535)
(67,413)
(849,091)
(410,169)
(276,927)
(165,850)
(30,164)
(653,238)
(506,422)
(33,033)
(1,042,258)
14,026,766
0
14,026,766
871,329
412,772
0
12,742,665
($151,908)
($920,836)
$11,809,396 $12,658,790 $13,815,409
92.11%
84.01%
Dec-2016
10,021,734
(229,958)
(132,220)
(33,265)
(64,473)
10,251,692
(4,641,955)
(171,251)
(297,873)
(69,098)
(861,827)
(420,423)
(283,850)
(169,997)
(30,917)
(669,570)
(528,783)
(36,354)
(1,102,012)
14,893,647
(703,784)
15,597,431
882,942
570,888
0
14,143,601
($2,418)
($9,674)
$14,155,693
99.95%
94.94%
Dec-2019
9,322,326
(1,697,798)
(135,525)
(359,607)
(1,202,666)
11,020,124
(4,736,841)
(175,532)
(315,139)
(70,826)
(874,755)
(430,934)
(290,946)
(174,246)
(31,691)
(686,308)
(537,281)
(36,025)
(1,113,158)
15,756,965
(377,756)
16,134,721
925,574
627,792
0
14,581,355
$0
($451,558)
$15,032,913
97.04%
94.48%
Dec-2020
5,316,956
(5,580,979)
(138,913)
(1,639,777)
(3,802,289)
10,897,935
(4,790,387)
(179,921)
(313,766)
(72,597)
(887,876)
(441,708)
(298,220)
(178,602)
(32,484)
(703,467)
(540,705)
(34,813)
(1,106,228)
15,688,322
0
15,688,322
964,991
493,803
0
14,229,528
$0
($1,403,887)
$15,633,415
91.04%
91.02%
Dec-2021 93.84%
93.62%
Dec-2023
7,781,880
(4,043,535)
(142,386)
(1,214,769)
(2,686,380)
11,825,415
(4,940,922)
(184,419)
(335,327)
(74,412)
(901,194)
(452,749)
(305,675)
(183,068)
(33,295)
(721,052)
(559,769)
(36,814)
(1,153,148)
16,766,337
0
16,766,337
993,942
525,355
0
15,247,040
$0
($960,044)
8,010,626
(4,082,505)
(145,946)
(1,228,546)
(2,708,013)
12,093,131
(5,050,742)
(189,029)
(342,877)
(76,272)
(914,712)
(464,068)
(313,317)
(187,644)
(34,127)
(739,079)
(572,982)
(37,374)
(1,179,261)
17,143,873
0
17,143,873
1,023,760
504,806
0
15,615,307
$0
($1,064,796)
$16,207,084 $16,680,103
94.28%
94.08%
Dec-2022
12,524,833
(149,595)
(149,595)
0
0
12,674,428
(5,226,743)
(193,755)
(358,023)
(78,179)
(928,433)
(475,671)
(321,150)
(192,335)
(34,981)
(757,557)
(598,365)
(41,131)
(1,247,163)
17,901,171
(942,167)
18,843,338
1,054,471
640,725
0
17,148,142
$0
$0
$17,148,142
100.00%
94.51%
Dec-2024
EXISTING LEASE EXPIRATIONS Calendar Year
Number of Suites
Net Rentable Square Feet Expiring
Percentage Square Feet Expiring
Cumulative Square Feet Expiring
2014
2
4,630
0.79%
0.79%
2015
13
186,018
31.84%
32.63%
2016
7
124,194
21.25%
53.88%
2017
8
142,899
24.46%
78.34%
2018
1
3,799
0.65%
78.99%
2019
5
71,919
12.31%
91.30%
2020
0
0
0.00%
91.30%
2021
0
0
0.00%
91.30%
2022
0
0
0.00%
91.30%
2022+
1
325
0.06%
91.35%
Subtotal
37
533,784
91.35%
91.35%
Non-leasable
2
202
0.03%
91.39%
Building Maintenance
1
3,273
0.56%
91.95%
Vacant
4
47,056
8.05%
100.00%
TOTAL
44
584,315
100.00%
100.00%
200,000 180,000 160,000
Rentable Square Feet
140,000 120,000 100,000 80,000 60,000 40,000 20,000 0 2014
2015
2016
2017
2018
2019
2020
2021
2022
2022+
FINANCIAL ANALYSIS | 36
CHARLOTTE ECONOMY
37 | 400 SOUTH TRYON
INVESTMENT SUMMARY | 38
THE CHARLOTTE ECONOMY Charlotte is the second leading financial center in the United
930,000 square foot East Coast Operations Center in Charlotte’s
States, following only New York City. Bank of America, the nation’s
University Research Park to house over 2,500 associates. Other
second largest bank with $2.2 trillion in assets is headquartered
significant Charlotte area employment events during this time
in Charlotte. Charlotte is also home to Wells Fargo’s Eastern
frame include, Lowe’s Home Improvement Warehouse relocating
headquarters, formerly Wachovia Bank.
its corporate headquarters to Mooresville, 20 miles outside of Charlotte, Microsoft’s expansion of their East Coast Product Support
Further evidence of Charlotte’s appeal to the banking industry is
Center, Fortune 500 firm SPX, Inc. relocating to Charlotte, the Billy
that GMAC Financial Services, now branded as Ally Bank, recently
Graham Evangelistic Association moving from Minneapolis to
occupied 133,000 square feet in the recently renamed Ally Center
Charlotte, and the culinary school, Johnson & Wales, consolidating
in downtown Charlotte. In June of 2010, Fifth Third Bank, the 23rd
their Charleston, South Carolina and Norfolk, Virginia campuses in
largest U.S. bank by assets expanded and relocated from the
Charlotte’s Gateway Village located downtown.
Charlotte suburbs into the renamed Fifth Third Center. US Bank, the 9th largest bank in the U.S. by assets also established a significant
The North Carolina Research Campus, located 28 miles northeast
presence in Charlotte, relocating two of US Bank’s major divisions to
of Charlotte in Kannapolis, North Carolina is a center for
the city in July of 2010. Complementing these banks are large regional
biotechnological, agricultural, food science, and nutritional research.
operations for major financial services firms including Transamerica,
The campus is a joint venture between the University of North
AXA, The Vanguard Group, Allstate, and TIAA-CREF.
Carolina, NC State University, UNC Charlotte, NC Central University, UNC Greensboro, Appalachian State University, Duke University,
With 7.2 million people living in the Carolina’s “Urban Crescent”
Dole Foods, Castle & Cooke, LabCorp and the David H Murdock
region and over 6.4 million people in a one hundred mile radius,
Research Institute. Current research projects center around the
Charlotte is the largest city within the nation’s fifth largest urban
study of plant-based foods and how compounds produced in plants
region. Only New York City, Chicago, Los Angeles, and Miami
can protect against disease and support human health.
have larger urban regions. Charlotte is also the 5th ranked city in number of Fortune 500 headquarters with eight companies
Apple, Google, Facebook, AT&T, Disney, and American Express all
located in the metropolitan area.
operate data centers in the Charlotte region. The Charlotte region is home to approximately 2.5 million square feet of data center
Since the early 2000’s, several additional employers representing
space. With low operating costs and limited risk from natural
a wide variety of economic sectors have entered the Charlotte
disaster, the region is expected to witness additional data center
business market. Of these recent major corporate relocations to
development in the future.
Charlotte the most notable is TIAA-CREF’s construction of their
FORTUNE 500 FIRMS HEADQUARTERED IN CHARLOTTE Fortune Rank
2013 Revenue in Billions
Bank of America
21
$100.1
Lowe’s
56
$50.5
Duke Energy
145
$19.6
Nucor
146
$19.4
Family Dollar
287
$9.3
Sonic Automotive
307
$8.5
SPX
431
$5.9
Company
Source: Fortune, 2013 Fortune 500 Companies List
Over the
past
three years,
there
have
been
numerous
announcements of international companies opening or moving their U.S. headquarters operations to Charlotte – a testament of the area’s desirability to the business community. The most recent of the international firms to open U.S. headquarters operations include Biotage, DesignLine International, Electrolux (738 jobs), Husqvarna (160 jobs), SmoothWall Ltd, Teknek, and Teupen Maschinenbau GmbH. These firms, as well as Premier, Inc. a health insurance syndicate which plans to add 300 jobs by 2015 continue to prove that Charlotte has broad appeal as a headquarters location for large and small, foreign and domestic companies alike.
39 | 400 SOUTH TRYON
Additional big wins for the Charlotte market include the 1,200 new jobs announced Connections, Inc. a healthcare exchange, technology, consulting and business. Diagnostic Devices, Inc., a Charlotte-based medical device company, will add 100 jobs by 2014 and Zenta, a business outsourcing operation has expanded and is increasing its operation by 500 jobs by 2013. Similarly, IBM’s new loan processing center will add a total of 600 jobs by 2013. Other large Charlotte employers in various industries include US Airways, Carolinas Healthcare System, IBM, and Harris Teeter, Inc. A list of many of the city’s largest employers is shown below. Charlotte also is home to several businesses that have been recognized as some of the fastest-growing private companies in the U.S. including Hospital Partners of America Inc, Red Ventures, Reed F, Holland Transportation Management Services, and TeleSource Inc.
MAJOR CHARLOTTE EMPLOYERS 20,000 – 32,999 EMPLOYEES
1,500 – 2,999 EMPLOYEES
Carolinas Healthcare System*
Accenture & Accenture Credit Services
Wells Fargo & Company*
Adecco Staffing Aerotek, Inc.
10,000 – 19,999 EMPLOYEES
AT&T North Carolina*
Bank of America*
BB&T
Charlotte-Mecklenburg Schools*
Belk*
Novant Health*
Bi-Lo
Wal-Mart & Sam’s Club
Bojangles’ Famous Chicken ‘N Biscuits* Carowinds
5,000 – 9,999 EMPLOYEES
Central Piedmont Community College*
City of Charlotte*
Family Dollar Stores*
Duke Energy Corporation*
FedEx Freight, Ground, Air & Office*
Food Lion LLC*
Hendrick Automotive Group*
Harris Teeter*
Home Depot
Lowe’s*
Ingersoll Rand Co. & Ingersoll Rand Technologies*
North Carolina State Government
JC Penney Corp. Inc.
Presbyterian Hospital*
The Lash Group*
U.S. Airways
Marriott Hotels McDonald’s
3,000 – 4,999 EMPLOYEES
Robert Half International & Robert Half Technology
Compass Group*
Siemens
Diamler Trucks North America LLC*
UPS/United Parcel Service
Harris Teeter*
Windstream Communications*
Mecklenburg County*
YMCA of Greater Charlotte*
Target Stores TIAA-CREF*
*Corporate Headquarters/U.S. Headquarters in Charlotte Source: Charlotte Chamber of Commerce 4Q 2010
US Postal Service University of North Carolina Charlotte*
CHARLOTTE ECONOMY | 40
ACCOLADES #1 Largest Population Increase (%) 2000-2010 – (of 42 urbanized areas of 1M+) U.S. Census, March 2012 #1 Happiest Young Professionals – (of 20 cities) Forbes, September 2011 #1 Major Market of the Year – Southern Business & Development, September 2011 #1 Lowest Violent Crime Rate – (of 50 Largest Metros) Forbes.com, October 2011 #1 Least Expensive City for Business Travel - Concur Technologies, August 2011 #2 Best Airport – Travel + Leisure, April 2012 #2 Best Value City - Kiplinger.com, July 2011 #2 Top State for Business - ChiefExecutive.net, May 2011 #2 Lowest Manufacturing Costs - American Institute for Economic Research, June 2011 #3 #3 City of The Future - fDi Magazine, April 2011 #3 Potential to Attract Foreign Investments - fDi Magazine, April 2011 #4 Best for Small Business - American City Business Journals, April 2011 #5 Most Desirable Place to do Business - Area Development Special Magazine
41 | 400 SOUTH TRYON
WORKFORCE
EXTENSIVE TRANSPORTATION NETWORK
The Charlotte-Gastonia-Rock Hill MSA labor force totals 860,558
One of the more influential drivers of Charlotte’s tremendous
and had an unemployment rate of approximately 8.9% at of the
growth over the past several years has been the city’s excellent
end of May 2013, reflecting the recent recession’s greater impact
transportation system. Charlotte’s international airport ranks
on financial services firms and the in migration of recent college
as the 8th most active in the country, with over 640 scheduled
graduates choosing Charlotte as the place to launch their careers.
flights leaving Charlotte each day. There are non-stop flights to
The present unemployment rate is higher than the national rate of
179 international cities including London, Frankfurt, Munich, Paris,
7.6% and marginally higher than the state rate of 8.8%. Since the
Rome, Toronto, Rio de Janeiro, the Caribbean and several cities in
late 1980’s, Charlotte’s Mecklenburg County has generally outpaced
Latin America offered by seven major airlines. In 2008, the Charlotte
the national rate of employment while the size of the Charlotte
Douglas International Airport was recognized as the fastest growing
workforce has grown considerably. In absolute and relative terms,
airport in the country. Each year over 34 million passengers travel
the Charlotte economy is emerging from the recession earlier than
through Charlotte’s airport with over 17 million enplanements. The
the national average and has attracted people looking for skilled
Charlotte Douglas International Airport boasts 5 concourses with 97
talent in the banking, transportation and energy sectors. According to
airline gates and plans are in place to add 12 more gates to Terminal
the U.S. Census Bureau, from mid-2010 to mid-2011, the latest data
E as passenger volume increases in the future. The first phase of
available, Charlotte’s population increased by more than 19,600,
the Terminal E expansion, totaling 12 gates, began operation in June
ranking it ninth in gains in raw numbers among all cities nationwide.
2012. The airport is US Airways’ largest hub.
The report also mentioned that the Charlotte market is “attractive, particularly for young people who are out of college and looking for
Charlotte’s immediate access to several major U.S. interstates
new jobs.” Said differently, had the Charlotte region not experienced
further enhances the city’s accessibility and transportation qualities.
substantial in-migration over the past two years, the unemployment
I-85 and I-77 run north-south through Charlotte and I-40 runs east-
rate would be lower than its current rate. However this pool of talent
west forty miles north of the city. These major interstates connect
has served to attract employers. Since 2000 Charlotte employment
Charlotte to the Southeast and the entire country. Presently, the final
has grown by 19.5%, widely exceeding the national increase of 0.4%
segment of Charlotte’s beltway (I-485), on the north side of town, is
and the state wide gain of 10.7% for the same period.
under construction with completion planned for 2016. In May of 2012, Norfolk Southern Corporation broke ground on
ANNUAL UNEMPLOYMENT RATE
the Charlotte Regional Intermodal Facility located at Charlotte
MSA
State
US
2001
5.0%
6.8%
5.7%
2002
6.1%
6.5%
6.0%
of 200,000 lifts per year and will replace Norfolk Southern’s
2003
6.3%
6.0%
5.7%
existing intermodal facility in downtown Charlotte. The 200-acre
2004
5.7%
5.4%
5.4%
facility will allow for future expansion to handle the anticipated
2005
5.3%
4.9%
4.9%
2006
4.8%
4.7%
4.4%
Norfolk Southern Railway and CSX Transportation Systems,
2007
4.7%
8.5%
5.0%
which bring more than 300 trains through Charlotte weekly,
2008
6.3%
9.2%
7.3%
provide freight transportation to and from Charlotte.
2009
11.7%
10.9%
9.9%
2010
10.7%
9.8%
9.4%
2011
10.3%
10.4%
8.5%
light rail and commuter rail system are expected to transport
2012
9.4%
9.2%
7.8%
residents throughout the city originating in Pineville to the south
May - 2013
8.9%
8.8%
7.6%
Source: Bureau of Labor Statistics
EXCELLENT LOCATION Centered in the middle of the United States’ eastern seaboard,
Douglas International Airport. The facility, which will transfer trailers and containers between trucks and trains, will be capable
growth of intermodal traffic. The facility will cost $92 million to construct and is scheduled to be complete in late 2013. Currently,
The first line of Charlotte’s multi-billion dollar light rail system began operation in November 2007. When complete the
of Charlotte and concluding in Mooresville 20 miles north of the city. Additional lines are planned to run to University City in the northeast and along Highway 74 to the eastern expanses of the city. Amtrak provides passenger rail service and Greyhound provides over 250 arrivals and departures weekly.
approximately 56% of the entire U.S. population lives within a 650-mile radius of the city. Within this radius, Charlotte is easily accessible by 24-hour truck delivery or a two-hour flight. As the nation’s 17th largest city, Charlotte is situated 143 miles from Raleigh, 210 miles from Charleston, and 241 miles from Atlanta. Charlotte is a two-hour drive to the Appalachian or Smoky mountains and a three-hour drive to the Carolina coast.
CHARLOTTE ECONOMY | 42
EXCELLENT QUALITY OF LIFE AND EDUCATION Perhaps Charlotte’s most compelling selling point is simply its
only to exceed this growth in the 1990’s by growing at 26.3%.
remarkable quality of life. Though a leading national business
Presently, Charlotte is the nation’s 17th largest city with an estimated
center, Charlotte has been able to maintain a low cost of living, high
772,253 people living within the city limits and 1.8 million living in
quality of life, and the charm and hospitality for which the Carolinas
the metropolitan area. This incredible population growth has been
and the Southeast have come to be known. In fact, in recent years
matched with steady job growth over the past two decades as well.
the U.S. Conference of Mayors acclaimed Charlotte as being the
Since 2000, Charlotte has added an annual average of over 6,540
“Nation’s Most Livable City.” The mild winters and falls coupled with
jobs each year, including more than 18,850 new jobs in 2010, more
the favorable springs and summers create a comfortable climate
than 18,900 in 2011 and more than 14,300 through the first half
proven to be attractive to Charlotte’s numerous new residents.
of 2012. These jobs are supported by Charlotte’s extensive draw
Charlotte residents benefit from being south of the Frost Belt and
of over 137,000 commuters who travel in from the surrounding
inland from the path of hurricanes.
counties each business day.
The Charlotte community offers a diverse menu of entertainment
Despite its recent growth surge, Charlotte and Mecklenburg
opportunities ranging from professional sporting events to the arts
County have maintained low living costs for their residents. The per
and outdoor recreational activities. Charlotte is home to the NFL’s
capita state and local taxes for Charlotte are the 16th lowest in the
Carolina Panthers and the NBA’s Bobcats while hosting the 3rd largest
United States. Furthermore, of 26 American Cities with populations
attended sporting event in the country each year, NASCAR’s Coca-
between 300,000 and 800,000 residents, Charlotte boasts the
Cola 600. Charlotte also plays host to the Wells Fargo Championship,
10th lowest cost of living index; including Atlanta, Minneapolis,
which is played at the prestigious Quail Hollow Country Club. Quail
Denver, Miami, and Washington, D.C. and well below the national
Hollow will also play host to the 2017 PGA Championship.
average. Among the same 26 cities, Charlotte has the 7th lowest health care cost rating as well. In a similar study of U.S. cities with
In addition to Charlotte’s attractive entertainment options, the city
greater than $20 billion in wholesale sales each year, Charlotte
is within a 3 hour drive of several nationally acclaimed universities.
ranks as the 4th most affordable housing market.
Within North Carolina alone, Duke University, the University of North Carolina, and Wake Forest University continually rank academically
HOUSEHOLD & POPULATION COMPOSITION
within the top 30 national universities and Davidson is ranked as the #11 liberal arts college in the nation. The University of North Carolina at Charlotte, a sister school to UNC Chapel Hill, boasts a 100 acre campus and an enrollment of more than 25,000.
Population Population Growth 2000 - 2013
While maintaining a remarkable quality of life, Charlotte has grown
Average Household Size
Charlotte MSA
United States
1,826,146
312,941,961
37.27%
11.26%
2.58
2.57
35.05
36.76
$69,275
$67,303
8.8%
7.6%
significantly over the past two decades. According to the 2010 U.S. Census Charlotte is the 9th fastest growing city in the nation.
Median Age (years)
The Census reports that Charlotte witnessed an annual increase
Average Household Income (2013)
of over 19,000 new residents to the city between 2000 and 2010. Breaking down this growth, Charlotte grew by 25.5% in the 1980’s
Percentage Unemployed (May 2013) Source: Claritas & US BLS
43 | 400 SOUTH TRYON
DOWNTOWN AREA OVERVIEW Downtown Charlotte is the central nerve center for all business activity in the region and comprises the core of the largest city in both North and South Carolina combined. This vibrant area has been in a remarkable growth phase as considerable new construction has occurred over the past two decades. Twelve new office buildings, multiple hotels, restaurants, residential areas, and new NFL and NBA venues have emerged downtown in the past fifteen years. The success of downtown is due in large part to the success of Charlotte’s diverse economy.
DOWNTOWN DEMOGRAPHIC DATA
Population Average Household Size Median Age (Years)
Charlotte
400 South Tryon (1 Mile Radius)
772,273
15,792
2.47
1.54
34.08
31.47
$68,902
$73,497
17.8%
21.8%
35.66%
134.23%
2013 Marital Status
46.4% Married 53.6% Unmarried
24.7% Married 75.3% Unmarried
Top 3 Employment Designations
12.9% Fire 11.3% Retail 11.2% Healthcare
19.2% Fire 15.6% Professional/Technical 8.8% Retail
$253,574
$374,434
Average Household Income (2013) Household Income Above $100,000 By Percentage Population Growth (2000 – 2013)
Average Owner-Occupied Property Values Source: Claritas & US BLS (July 2013)
CHARLOTTE ECONOMY | 44
CURRENT DOWNTOWN DEVELOPMENT TRENDS In addition to the previously discussed office developments,
In response to the wave of residential development and a decade-long
Charlotte has experienced substantial growth in many different
resurgence in downtown Charlotte’s nightlife, EpiCentre, a mixed use
facets in the past four years. The 1.35 million square foot, 98.9%
development was constructed to fill a much needed entertainment
leased Duke Energy Center is a part of a greater mixed use
niche. The development features an Aloft hotel, 60,000 square feet
project that includes the Levine Center for the Performing Arts, a
of office space, and a 260,000 square foot entertainment/retail
cultural destination featuring the 1,200 seat North Carolina Dance
complex complete with bowling alley and a movie theater.
Theatre, the Mint Museum of Art, the Gantt Cultural Center, and Another significant development was the completion of the
the Bechtler Museum of Modern Art.
Carolinas’ first Ritz Carlton in 2009. NASCAR Plaza was completed in the second quarter of 2009
In the summer of 2006, residents moved into Courtside, downtown’s
including the NASCAR Hall of Fame starting operations in May of
Charlotte’s first high-rise condominium tower. Two additional
2010. The 390,000 square foot building delivered at the height
projects delivered soon thereafter, TradeMark and Avenue. The Vue,
of an unstable economy and initially faced difficulties gaining
a 51-story condominium building was delivered in 2010. Currently
leasing momentum. However, Fortune 1000 firm Chiquita Brands
plans are in various stages of planning for up to $3.4 billion of
International recently relocated its headquarters from Cincinnati,
residential development for downtown Charlotte. Many of the
Ohio to NASCAR Plaza, leasing a majority of the remaining vacancy.
announced residential projects have been placed on hold pending financing, however, it is evident that several of these developments
Charlotte is home to more than 80% of NASCAR teams and is
will be constructed in future years.
an ideal location for the organization’s namesake tower and Hall of Fame. The $160 million Hall of Fame features state-of-the-art
Downtown Charlotte boasts the deepest amenity base in the
exhibits and meeting center and is expected to boost tourism for
region with a large concentration of restaurants, hotels, banks,
the Charlotte region.
churches, parks, civic and cultural centers. A list of the amenities is shown below:
The 99.8% leased, 1 Bank of America Center was the final of the four downtown towers to be delivered during 2009 and 2010, and will likely be the last office tower to be developed for many years due to the lack of buildable parcels, uneconomic development costs for new construction in downtown Charlotte and tighter limits on financing for new construction.
DOWNTOWN CHARLOTTE AMENITIES The Ritz-Carlton Hotel
Blumenthal Performing Arts Center
12+ Places of Worship
The Westin Hotel
The Levine Museum of the New South
Johnson & Wales University
The Omni Hotel
Mint Museum Craft & Design
The Childress Klein YMCA
The Marriott Center City
The Charlotte Symphony
Marshall Park
aLoft Hotel
The Booth Playhouse
Overstreet Mall
Hilton Charlotte Towers
The Belk Theater
Numerous Retail Establishments
Hyatt House
Opera Carolina
125+ Food and Dining Establishments
The Blake Hotel
Discovery Place
City Transit System
Courtyard by Marriott
Spirit Square
EpiCenter
The Charlotte City Club
Bechtler Museum of Modern Art
Central Library
Bank of America Stadium
NASCAR Hall of Fame
Harvey B. Gantt Center
Time Warner Arena
Trinity Episcopal School
Romare Bearden Park
McColl for Visual Art
Knight Theatre
The Green
45 | 400 SOUTH TRYON
CHARLOTTE ECONOMY | 46
CHARLOTTE OFFICE MARKET OVERVIEW
47 | 400 SOUTH TRYON
INVESTMENT SUMMARY | 48
CHARLOTTE OFFICE MARKET OVERVIEW The Charlotte office market totals 39.7 million square feet of multitenant space and reported a 14.8% vacancy rate as of the second quarter of 2013. Including single tenant buildings, the Charlotte market is over 55 million square feet in eleven submarkets. The largest submarket is Downtown with 15.6 million square feet of space followed by the I-77 Corridor, the 51 Perimeter, and SouthPark with 6.6, 4.6, and 3.9 million square feet, respectively. Since 1995 the office market has grown by approximately 92%. Throughout this period of incredible growth, office rents grew steadily as Charlotte recorded a 36% growth in average office rents from the first quarter of 1996 through year-end 2009. Average asking rents climbed $5.99 per square foot from $16.45 to $22.44.
CHARLOTTE OFFICE MARKET OVERVIEW $28.00
12.0%
$27.00
10.0%
$26.00 8.0%
$25.00
$24.47
$23.78
$23.71
$23.72
$25.46
$23.15
$22.51
$22.78
$23.10
$21.00
$23.27
$22.00
$24.27
$23.00
6.0%
$27.14
$24.00
$20.00
4.0% 2.0% 0.0%
2002 2003 2004 2005 2006 2007 2008 2009 *2010 *2011 *2012 *2Q 2013 Downtown Lease Rates
Downtown Vacancy Rate
* In 2010 CBRE Research changed the criteria for calculating average rents to only include asking prices, not existing leased properties.
Starting in the first quarter of 2010, CBRE changed its methodology for calculating average asking direct lease rates nationally. Using the new method we are presenting a number that is thought to more accurately reflect the market. Therefore the first quarter of 2010 is the new benchmark for increases or declines in asking rates. Based on the new methodology, the average weighted lease rate for the Charlotte market is $20.12 for the second quarter of 2013.
49 | 400 SOUTH TRYON
2Q/2013 MARKET STATISTICS – OVERALL MARKET Submarket
Existing Space (SF)
Vacancy Rate
Downtown
15,642,121
10.8%
I-77 Corridor
6,580,620
21.8%
51 Perimeter
4,692,425
SouthPark
YTD 2013 Absorption
2012 Absorption
Under Construction
Average Rental Rate
-199,976
194,840
0
$24.47
22.3%
285,671
156,280
0
$16.63
15.1%
15.2%
81,745
244,974
0
$21.82
3,970,672
11.7%
13.1%
-7,104
116,855
60,000
$21.84
Northeast
3,397,252
15.4%
15.6%
57,546
130,817
0
$17.87
Midtown
1,797,929
7.4%
8.2%
23,422
25,879
0
$21.13
North
1,237,559
23.4%
25.1%
-18,301
42,475
0
$19.05
East
1,044,688
20.3%
20.3%
11,442
19,770
0
$14.46
Park Road Area
625,184
32.4%
32.4%
-3,039
-9,554
0
$16.63
Crownpoint
508,896
34.3%
34.3%
-4,923
-9,505
0
$13.21
224,611
15.4%
18.4%
8,014
47,972
0
$15.84
39,765,957
14.8%
15.2%
111,136
1,090,149
275,000
$20.12
Cotswold Overall Charlotte
Overall Availability
1. Downtown 2. Midtown 3. I-77 Southwest 4. Park Road 5. SouthPark 6. Cotswold
10
7. 51 Perimeter 8. East 9. University 10. North 11. Crown Point/Matthews
9 1
3
8 2 6
4
11
5
7
CHARLOTTE OFFICE MARKET OVERVIEW | 50
Job growth fueled office space absorption throughout the 2000’s as the overall office market absorbed a total of 6.7 million square feet between 2000 and second quarter 2013. Averaging 536,000 square feet per year of annual net absorption since 2000, the Charlotte office market has demonstrated its ability to recover quickly from downturns in the economy. In 2012, Charlotte absorbed 1,090,149 square feet, however, through the first two quarters of 2013 the pace of absorption slowed somewhat with the market witnessing 111,136 square feet of positive absorption. Although the market velocity has slowed in 2013, the market has demonstrated clear signs of an ongoing recovery with positive absorption witnessed in 2011, 2012 and year to date 2013.
CHARLOTTE ANNUAL ABSORPTION 1,500,000 1,000,000 500,000 SF
(500,000)
2Q 2013
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
2002
(1,000,000)
In the development market, 60,000 square feet are presently under construction for the entire city of Charlotte. The building is located in the SouthPark submarket and will have limited effect on 400 South Tryon. Construction is expected to remain limited for the near term as developers are reluctant to build additional multi-tenant office buildings due to the national economy.
51 | 400 SOUTH TRYON
OFFICE MARKET OUTLOOK Currently 0.4% of the office market is available for sublease, representing a negligible impact on the leasing market. With job growth projected to increase throughout the remainder of 2013 and into 2014, the vacancy rate for the broader Charlotte office market is
MAJOR EMPLOYERS LOCATED DOWNTOWN Bank of America Wells Fargo Bank Duke Energy
expected to improve to 13% and achieve a 12% vacancy rate in 2014.
Charlotte Mecklenburg Schools
As construction costs stay high and demand intensifies, the vacancy
ADECCO
rate will drop to 11% by late 2015. As the overall market vacancy rate
AT&T
falls during this time period, renewed upward pressure on rents will
City of Charlotte
take hold, accelerating rent growth between late 2014 and 2015.
Alston & Bird, LLP
DOWNTOWN CHARLOTTE HISTORICAL PERSPECTIVE The Downtown Charlotte skyline has exploded over the past sixteen years with seven new office towers and several mid-rise
Robert Half International Ally Bank BB&T
buildings emerging in the area as the city developed into a major
Charlotte Observer
business hub in the Southeast.
Grant Thornton Kennedy Covington Lobdell Hickman LLP
The office market has benefited greatly from this growth as it has
Hearst Corporation
expanded by 27% in size from the first quarter of 2000 alone.
PricewaterhouseCoopers LLP
This new development and demand pushed area rental rates
Mecklenburg County
upward as the Class “A” market remained at low vacancy rates for the majority of the 2000’s. The growth trends in Downtown Charlotte over the past two decades forced the submarket’s vacancy rate to an extremely low level of 2.2% in early 2000 and
Kilpatrick Stockton LLP Womble Carlyle The C.I.T. Group
a record setting 1.1% in the first quarter of 2008. As the economy
McGuire Woods LLP
cooled during the credit crisis and ensuing recession, vacancies
Parker Poe
increased due to a lack of demand and tenant downsizing along
Source: CoStar - 2012
with new deliveries in the Downtown submarket.
CHARLOTTE OFFICE MARKET OVERVIEW | 52
53 | 400 SOUTH TRYON
CHARLOTTE ANNUAL ABSORPTION $28.00
12.0%
$27.00
10.0%
$26.00 8.0%
$25.00
$24.47
$23.78
$23.71
$23.72
$25.46
$23.15
$22.51
$22.78
$23.10
$21.00
$23.27
$22.00
$24.27
$23.00
6.0%
$27.14
$24.00
$20.00
4.0% 2.0% 0.0%
2002 2003 2004 2005 2006 2007 2008 2009 *2010 *2011 *2012 *2Q 2013 Downtown Lease Rates Downtown Vacancy Rate * In 2010 CBRE Research changed the criteria for calculating average rents to only include asking prices, not existing leased properties.
SUPPLY AND DEMAND
RENTAL RATES
Downtown Charlotte has a total supply of 15.6 million square feet
Based on the new CBRE methodology, the average Downtown
of space and had 1.69 million square feet or 10.8% of the submarket
Charlotte market rental rate was $24.47 per square foot as of second
vacant at the end of the second quarter 2013. Demand in the
quarter 2013. Average Class “A” Downtown Charlotte asking rental
Downtown submarket had declined due to the recent recession,
rates were $25.35 per square foot while Class “B” rates achieved a
however, all indications point toward sustained improving conditions
mark of $20.96 per square foot. Rents for the Class “A” space in the
within the submarket. While Bank of America and Wells Fargo have
new office towers range between $27.00 and $30.00 per square
reduced their Downtown footprint, the reduction in leased space is
foot and are projected to escalate quickly once demand intensifies.
not nearly as great as expected. In fact had the market not witnessed
400 South Tryon will capitalize on the higher rental rates achieved at
the delivery of four new office towers totaling over 2.8 million square
these downtown properties and will be able to increase rents in the
feet since 2009, the vacancy rate would likely be around 5%.
wake of these buildings stabilizing.
DOWNTOWN MARKET OUTLOOK Over the next decade, Downtown Charlotte will continue to emerge as a leading city on the East Coast. The office market will continue to expand as the city’s diversified economy continues to grow and bring more jobs to the area. Vacancy rates will continue to fall over the next two years as demand intensifies with an improving economy. Downtown rents will inevitably experience an increase over the next several years given the significant existing gap between current average market rents of $24.47 per square foot and replacement rents in the mid $40’s per square foot.
CHARLOTTE OFFICE MARKET OVERVIEW | 54
COMPETING PROPERTIES Building: Size:
BB&T CENTER 553,056 SF
Building: Size:
SOUTH TRYON SQUARE 264,067 SF
Rental Rate:
$22.00 - $24.00
Rental Rate:
$23.00
Occupancy:
82%
Occupancy:
71.40%
Year Built:
1977 renovated in 1997
Year Built:
Building:
CARILLON
Building:
Size:
488,910 SF
Size:
1960 renovated in 1999
TWO WACHOVIA CENTER 758,508 SF
Rental Rate:
$26.50
Rental Rate:
$24.00
Occupancy:
75.90%
Occupancy:
99.90%
Year Built:
Building: Size:
1989
CHARLOTTE PLAZA 625,026 SF
Year Built:
Building: Size:
1971 renovated in 2006
NASCAR PLAZA 390,000 SF
Rental Rate:
$24.50 - $26.50
Rental Rate:
$24.50 - $26.50
Occupancy:
97%
Occupancy:
86.40%
Year Built:
Building: Size:
1981 renovated in 1994
FIRST CITIZENS 476,981 SF
Year Built:
Building: Size:
2009
ALLY CENTER 368,092 SF
Rental Rate:
$22.00
Rental Rate:
$25.00
Occupancy:
90.20%
Occupancy:
85.60%
Year Built:
Building: Size:
1885 renovated in 1992
200 SOUTH TRYON 210,426
Year Built:
Building: Size:
2009
DUKE ENERGY CENTER 1,300,000 SF
Rental Rate:
$21.00
Rental Rate:
$32.00
Occupancy:
47.70%
Occupancy:
98.90%
Year Built:
55 | 400 SOUTH TRYON
1962 renovated in 2001
Year Built:
2010
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CHARLOTTE OFFICE MARKET OVERVIEW | 56
400
SOUTH TRYON
EXCLUSIVE MARKETING AGENTS
FINANCING CONTACTS
PATRICK GILDEA
RYAN CLUTTER
MICHAEL BLUNT
HAL KEMPSON
COMPIE NEWMAN
Vice President CBRE | Capital Markets 201 South College Street Suite 1700 Charlotte, NC 28244 T (704) 331.1217 F (704) 331.1259 patrick.gildea@cbre.com
Executive Vice President CBRE | Capital Markets 750 9th Street NW Suite 900 Washington DC 20001 T (202) 585.5643 F (202) 783.1723 ryan.clutter@cbre.com
Senior Vice President CBRE | Capital Markets 750 9th Street, NW Suite 900 Washington DC 20001 T (202) 585.5672 F (202) 783.1723 michael.blunt@cbre.com
First Vice President CBRE | Capital Markets 201 South College Street Suite 1700 Charlotte, NC 28244 T (704) 927.1453 F (704) 334.0939 hal.kempson@cbre.com
Senior Vice President CBRE | Capital Markets 201 South College Street Suite 1700 Charlotte, NC 28244 T (704) 927.1454 F (704) 334.0939 compie.newman@cbre.com