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Tenant: Tractor Supply Company (NASDAQ: TSCO) is the largest retail farm and ranch store chain in the United States. With more than 1,300 retail stores in 48 states, the company had a net worth in excess of $1.23B and produced impressive TTM Revenues of more than $5.54B
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Long-Term Net Lease: 8.5 years remaining lease term with four 5-year options to renew
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Attractive Rent Escalation: 10% rent increases every 5 years throughout the initial term and renewal option – Next bump occurs in June 2018
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Strong Average Returns: Average return over initial term is equal to more than 7.40%
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Excellent Visibility: Ideally positioned with excellent frontage on both Old Jesup Highway and New Jesup Highway/Golden Isles Parkway (Traffic Count: 18,512 VPD), just 1.5 miles north of Interstate 95 which provides direct access to both Savannah, GA (70 miles) and Jacksonville, FL (65 miles). New Jesup Highway/Golden Isles Parkway serves as the area’s preeminent north-south thoroughfare which is also widely used to get to the beach and many Golden Isles resorts
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Dominant Retail & Commercial Corridor: Approximately 3.2 MSF of retail, 1,830 multifamily units and a population of 37,995 within a 5-mile radius
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Market: Brunswick, Georgia (MSA Population: 113,807) is a vibrant coastal city located directly on the Atlantic Intracoastal Waterway and supports a progressive economy largely based on tourism and logistics with a metropolitan GDP of $3.9 billion. The Brunswick MSA, which also consists of St. Simons Island, Sea Island, Jekyll Island, Brantley County and McIntosh County, is the twelfth largest MSA in Georgia
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PARENT COMPANY: Fresenius Medical Care North America (FMCNA) is the leading provider of dialysis services and products to more than 166,000 patients suffering from Chronic Kidney Disease in North America. FMCNA is a division of Fresenius Medical Care AG & Co. KGaA (NYSE: FMS) which is the world’s largest integrated provider of dialysis services and products. Headquartered in Germany, the parent company has a net worth of $9.11B and reported $13.6B in sales in 2013
GUARANTOR: Guaranteed by Fresenius Medical Care Holdings, Inc. which is the primary holding company for Fresenius’ North American operations
MARKET: Baton Rouge is the state’s capital and also serves as major industrial, medical, research and technology center. With a current MSA population of 820,159, Baton Rouge is the second largest city in the state
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LONG-TERM NET LEASE: 8 years or primary lease term remaining with three 5-year renewal options
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LONG-TERM NET LEASE: 8 years or primary lease term remaining with three 5-year renewal options
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INITIAL TERM RENT ESCALATIONS: ±0.75% rent increase in November 2018 with annual 0.75% rent increases beginning in January 2020
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INITIAL TERM RENT ESCALATIONS: ±0.75% rent increase in April 2016 with annual 0.75% rent increases beginning in January 2018
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EARLY LEASE EXTENSION: Fresenius agreed to extend the lease by an additional 4+ years in October 2012 signaling their long-term commitment to this location
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EARLY LEASE EXTENSION: Fresenius agreed to extend the lease by an additional 6.75 years in October 2012 signaling their long-term commitment to this location
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BUILD-TO-SUIT: The property was originally constructed as a build-to-suit for Fresenius Medical Care in 2008
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BUILD-TO-SUIT: The property was originally constructed as a build-to-suit for Fresenius Medical Care in 2006
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LOCATION: Property is ideally positioned on hard corner of Howell Blvd and 72nd Ave just 0.3 miles from I-110 (Traffic Count: 56,890 VPD), immediately adjacent to YMCA and just south of Champion Medical Center, a new 25,000-SF specialized surgical hospital that opened in January 2014
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LOCATION: The property is ideally positioned on the hard corner of North Foster Drive and Jackson Avenue just 2.0 miles from Interstate 110 (Traffic Count: 56,890 VPD)
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DOMINANT RETAIL & COMMERCIAL CORRIDOR:
Approximately 1.7 MSF of retail and 1.3 MSF of industrial space within a 3-mile radius
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DOMINANT RETAIL & COMMERCIAL CORRIDOR:
Approximately 7.8 MSF of retail, 6.2 MSF of office and 6.0 MSF of industrial space within a 3-mile radius
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Low Rent per Square Foot - Rite Aid’s rental rate—at less than $12.00 per square foot—represents one of the lowest rental rates among recently sold and on the market Rite Aid properties. California Rite Aid properties (both on the market and recently sold) had rental rates ranging from $13.45 to $25.19.
Quality Real Estate with Great Tenant Mix - The prime location within the Brickyard shopping center reduces the likelihood of an extended vacancy period if Rite Aid decides not to exercise its renewal option. The well-known tenant mix adds to shopping center traffic and will attract potential new tenants.
Low Price per Square Foot - A sale at a 5.75% cap rate represents a price per square foot of $203, which can be easily justified when compared to other Rite Aid properties on the market.
Strong Demographics & Growing Neighborhood- The high average household income ($81,000 +) in the 3 mile radius of the Property, combined with a population in the 3 mile radius approaching 100,000, create excellent demographics. In addition, 30,000 to 40,000 new homes are planned in the area, which could add 120,000 new residents to the city.
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• PROPERTY HIGHLIGHTS
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– Extremely rare 2.5% annual rent increases
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– Corporate guaranty; $75B market cap
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– S&P AA- investment grade credit
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– Long term tenant - over 20 years
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– Considerable upside with no options to renew
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• LOCATION HIGHLIGHTS
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– Pad to newly renovated Ft. Wright Plaza (Christ Hospital Anchor w/ long term lease)
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– Just off I-75/I-71 with 144,000 VPD
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– $75,000+ average household income within 1-mile radius
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♦ Brand New 10-Year Corporate Lease with Increases
♦ 2015 Construction
♦ Surrounded by National Tenants in Prime Retail Corridor
♦ Out Parcel to Home Depot
♦ Tenant Operates Over 800 Locations Across 28 States
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