728 Loucks Road York, Pennsylvania 17404 - OFFERING MEMORANDUM - LoopNet
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728 Loucks Road York, Pennsylvania 17404 OFFERING MEMORANDUM
TABLE OF CONTENTS
Investment Analysis............4-6
Tenant Overviews................7-9
Location Overview...........10-13
Lead Investment Advisors
Derrick Dougherty
First Vice President Investments
National Retail Group
License: PA RS305854
Ph: (215) 531-7026
Steve Garthwaite
Senior Associate
National Retail Group
License: PA RS332182
Ph: (215) 531-7025
Broker of Record: Sean Beuche
License: PA RM424190
2 La-Z-Boy
Two Guys Shopping Center
West Manchester Town Center
Click Here
For Map View
Maple Village
La-Z-Boy
728 Loucks Road
York, Pennsylvania 17404
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La-Z-Boy 3
INVESTMENT ANALYSIS
LEASE SUMMARY $3,931,075 7.65% $300,727
Tenant La-Z-Boy
PRICE CAP RENT
Guarantor Corporate
Lease Type NN ANNUALIZED OPERATING DATA
Gross Leasable Area 15,340sf Term Dates Base Rent PSF
Lot Size 1.22 Acres Years 1-5 (Current) 10/30/2016 - 10/31/2021 $282,000 $18.38
Year Built 2016 Remodeled Years 6-10 11/1/2021 - 10/31/2026 $296,100 $19.30
Roof and Structure Landlord Option Terms
Base Lease Term 10 Years Years 11-15 (Option 1) 11/1/2026 - 10/31/2031 $310,905 $20.27
Lease Commencement 10/30/2016 Years 16-20 (Option 2) 11/1/2031 - 10/31/2036 $326,450 $21.28
Lease/ Rent Expiration 10/31/2026 Years 21-25 (Option 3) 11/1/2036 - 10/31/2041 $342,773 $22.35
Term Remaining 6+ Years Years 26-30 (Option 4) 11/1/2041 - 10/31/2046 $359,911 $23.46
Rent Increases 5% In Year 6 and Options Billboard Rent
Year 1 8/28/2018 - 8/27/2019 $18,000.00
BILLBOARD LEASE SUMMARY
Year 2 8/28/2019 - 8/27/2020 $18,360.00
Tenant The Lamar Companies
Year 3 (Current) 8/28/2020 - 8/27/2021 $18,727.20
Guarantor Corporate
Year 4 8/28/2021 - 8/27/2022 $19,094.40
Lease Commencement 8/28/2018
Year 5 8/28/2022 - 8/27/2023 $19,476.29
Lease/ Rent Expiration 8/27/2033
Year 6 8/28/2023 - 8/27/2024 $20,000.00
PROPOSED NEW FINANCING (RECOURSE) Year 7 8/28/2024 - 8/27/2025 $20,400.00
Equity (35%) $1,375,876 Year 8 8/28/2025 - 8/27/2026 $20,808.00
Loan Amount (65%) $2,555,198 Year 9 8/28/2026 - 8/27/2027 $21,224.16
Interest Rate 3.50% Year 10 8/28/2027 - 8/27/2028 $21,648.64
Amortization 25 Years Year 11 8/28/2028 - 8/27/2029 $22,000.00
Term 4 Years Year 12 8/28/2029 - 8/27/2030 $22,440.00
Annual Debt Service ($153,503) Year 13 8/28/2030 - 8/27/2031 $22,888.80
Cash Flow After Debt Service (10.70%) $147,224 Year 14 8/28/2031 - 8/27/2032 $23,346.58
Debt Service Coverage Ratio 1.96 Year 15 8/28/2032 - 8/27/2033 $23,813.51
*Loan information is subject to change. Contact your Marcus & Millichap Capital Corporation representative.
4 La-Z-Boy
INVESTMENT HIGHLIGHTS
PRICE: $3,931,075 | CAP: 7.65% | RENT: $300,727
About The Investment:
• La-Z-Boy Corporate Guaranteed Lease with over (6) Years Remaining on Term
• 5% Rental increases throughout the initial term and option periods, generating healthy NOI growth
• Tenant paid full rent throughout Covid shutdown with no deferral
• La-Z-Boy written same-store sales increased 14.8% for the fiscal 2021 first quarter
o Initial decline in May of 13% offset by 30% increase in June & 32% increase in July
• La-Z-Boy ended the quarter with $336.7 million in cash on hand
• Additional Billboard rental income from new Lamar Companies (NYSE: LMAR) 15 year lease.
• Double Net (NN) structure with limited Landlord responsibilities
• Long term branding of the subject property as a furniture store in the local community (previously a Gish’s Furniture
before La-Z-Boy conversion)
• Over the past 5 years, La-Z-Boy has seen a sales increase of $310 million, an operating income increase of over $60
million and a 65.6% increase in share price.
About The Location:
• Loucks Road serves as the primary retail thoroughfare in the immediate trade area averaging 61,938 vehicles passing daily
• The asset is 1 mile from UPMC Memorial Hospital, one of the largest in York
• Positioned less than half a mile to the NorthWest Plaza whose anchor tenants, Staples, ALDI, Dollar Tree, and Tractor
Supply promote crossover traffic to the site
• Long history being branded as a furniture retailer (prior to La-Z-Boy this location was occupied by Gish’s Furniture)
About The Tenant/Brand:
• La-Z-Boy manufactures, markets, imports, exports, distributes, and retails upholstery furniture products, accessories,
and case goods furniture products in the United States, Canada, and internationally.
• It sells its products directly to La-Z-Boy Furniture Galleries stores, operators of La-Z-Boy Comfort Studio locations,
England Custom Comfort Center locations, dealers, and other independent retailers.
• For the fourth quarter, the company generated $44.5 million in cash from operating activities. La-Z-Boy ended the
quarter with $263.5 million in cash, cash equivalents, and restricted cash, including $75 million in cash proactively
drawn on the company’s credit facility to enhance liquidity in response to COVID-19, and $28.6 million in investments
to enhance returns on cash compared with $131.8 million in cash, cash equivalents and restricted cash, and $31.5
million in investments to enhance returns on cash at the end of fiscal 2019.
La-Z-Boy 5
LEASE ABSTRACT
Tenant La-Z-Boy, York, PA
Guarantor Corporate
Square Footage 15,340 SF
Commencement Date 10/30/2016
Expiration Date 10/31/2026
Initial Term 10 Year Base Term
Option Notice Tenant must exercise option (6) months prior to Lease expiration
Estoppel/SNDA Tenant to provide certificate upon written request of Landlord
Taxes Tenant is responsible for Real Estate taxes
Insurance Tenant is responsible for Insurance expenses
CAM Tenant is responsible for CAM expenses
Utilities Tenant is responsible for Utility expenses
Landlord is responsible for repair & replacement of the Premises'
Roof & Structure structure; Landlord is responsible for the replacement of the roof,
Tenant is responsible for the maintenance of roof
HVAC Landlord is responsible for HVAC replacement, Tenant is
(Maint & Replacement) responsible for HVAC maintenance
Permitted use Premises may be used for any lawful retail purpose
Tenant may cease operation of business w/in Premises, while
Required Occupancy
remaining responsible for Lease obligations
Tenant may assign lease w/ consent of Landlord, however shall
Assignment Note
remain liable for Lease obligations
6 La-Z-Boy
LOCAL COMPETITORS
Miles from
Address Subject
La-Z-Boy (Subject)
Subject
728 Loucks Rd York, PA
Ashley Homestore
0.4
905 Loucks Rd York, PA
Discount King
La-Z-Boy 1231 Roosevelt Ave, York, PA
0.8
728 Loucks Road
York, Pennsylvania 17404
At Home
2.7
855 Town Center Dr, York, PA
Discount Furniture
2.9
504 E Market St, York, PA
Hakes Furnishing
3.9
2200 Carlisle Rd, York, PA
3 Mile Radius 1 Mile Radius
La-Z-Boy 7
TENANT OVERVIEW
Monroe, MI 1927 360± $1.72 www.la-z-boy.com
Headquarters Founded Locations 2019 Revenue Website
La-Z-Boy
La-Z-Boy manufactures, markets, imports, exports, distributes, and retails The Casegoods segment imports, markets, and distributes casegoods (wood)
upholstery furniture products, accessories, and casegoods furniture products furniture, including bedroom sets, dining room sets, entertainment centers,
in the United States, Canada, and internationally. It operates through and occasional pieces, as well as manufactures upholstered furniture. This
Upholstery, Casegoods, and Retail segments. The Upholstery segment segment sells its products to dealers, La-Z-Boy Furniture Galleries stores,
manufactures and imports upholstered furniture, such as recliners and and other independent retailers under the American Drew, Hammary, and
motion furniture, sofas, loveseats, chairs, sectionals, modulars, ottomans, Kincaid brands. La-Z-Boy includes various companies and brands including
and sleeper sofas. It sells its products directly to La-Z-Boy Furniture Galleries La-Z-Boy Residential, La-Z-Boy Kids, La-Z-Boy Hospitality, Lea Furniture,
stores, operators of La-Z-Boy Comfort Studio locations, England Custom American Drew, Kincaid Furniture, Bauhaus USA Furniture, Hammary
Comfort Center locations, dealers, and other independent retailers. Furniture and England Furniture Incorporated.
8 La-Z-Boy
IN THE NEWS
In mid-March, when United States President Donald Trump declared
a national emergency and the coronavirus had infected people in all
50 states, many white-collar Americans began working from home.
According to a survey by analytics and advisory company Gallup,
on March 13 at the beginning of U.S. stay-at-home orders, 31% of
employees in the nation were working remotely. By the end of the
month, that number had doubled to 62%. With an unprecedented
amount of time spent in their domestic spaces, Americans also
Retailers Report That Pandemic Shoppers began shopping to redecorate them.
Are Buying More Home And Design Products In the first week of stay-at-home orders in the United States, luxury
By: Elizabeth Fazzare | June 27, 2020 consignment retailer The RealReal saw a 23% week-over-week
uptick in sales of home items. Over the last three months, retail
website Moda Operandi has seen a 97% increase in the quantity
of homeware items sold. And during the month of March, online
furniture and home renovation shop Wayfair saw strong demand for
kitchen items and soft goods like bedding, towels, and mattresses...
ABSTRACT
Increased Purchase Volume During Quarantine
• Luxury consignment retailer The RealReal saw a 23% week-over-week
uptick in sales of home item; Moda Operandi has seen a 97% increase in
the quantity of homeware items sold; online furniture and home renova-
tion shop Wayfair saw strong demand for kitchen items and soft goods like
bedding, towels, and mattresses. Spending more time indoors this spring
led shoppers to reconsider their home décor
Industry to continue Trending
• Now, as the number of COVID-19 infections rises again in several states,
experts predict these home and design shopping trends will continue.
“We’re expecting that investing and improving the home will be an ongoing
trend through the remainder of 2020,”
Transition to Family & Outdoor Entertainment
https://www.forbes.com/sites/elizabethfazzare/2020/06/27/retailers-re- • Based on the trends experts are seeing, consumers are looking for new
port-that-pandemic-shoppers-are-buying-more-home-and-design-prod- ways to entertain the whole family outdoors, while also elevating their yards
ucts/#2ab62e874436 with decorative accents and more.
La-Z-Boy 9
LOCATION OVERVIEW
#1
POPULOUS IN THE
11th
LARGEST CITY
6 OF 10
MAJOR U.S.
25miles
SOUTH OF THE
150,129
TOTAL POPULATION
$71,397
AVG. HOUSEHOLD
YORK/HANOVER/ IN THE STATE OF MARKETS WITHIN A STATE CAPITAL WITHIN A 5 MILE INCOME WITHIN A
GETTYSBURG CSA PENNSYLVANIA 500 MILE RADIUS HARRISBURG, PA RADIUS 5 MILE RADIUS
York, known as the White Rose City, is the county seat of York County, Pennsylvania, located in the south-central region of the state.
When combined with the adjacent boroughs of West York and North York and surrounding townships, the population of Greater York was
108,386. York is the 11th largest city in Pennsylvania. Revitalization efforts work to build a more vibrant future. The resulting increase
in shops, high-end apartments and special events – along with a flourishing arts community – has led to downtown living verging on
trendy and a growing number of visitors to the WeCo, Market and Royal Square districts that make up York’s major activity centers.
YORK COLLEGE OF PA: SHIPLEY ENERGY: DENTSPLY SIRONA: PENN STATE YORK:
• York College of Pennsylvania is a private, • The heating and cooling giant founded in • Dentsply Sirona is an American dental • Penn State York is a commonwealth campus
coeducational, four-year college located in 1929, has its headquarters in York,Pa. Largest equipment maker and dental consumables of The Pennsylvania State University and it
south central Pennsylvania that offers more locally owned provider of home heating energy, producer that markets its products in over 120 is located in Spring Garden Township, York
than 50 baccalaureate majors in professional including oil, natural gas, electricity and countries. It has factories in 21 countries. The
County, Pennsylvania. It enrolls about 1,000
programs, the sciences, and humanities to its propane, in Central Pennsylvania company is largely the result of a merger in
4,400 full-time undergraduate students. 1993 in which Gendex Corporation acquired students.
Dentsply International Inc. for $590 million.
10 La-Z-BoyDevers Elementary School
(673 Total Students Enrolled)
La-Z-Boy
728 Loucks Road
York, Pennsylvania 17404
West Manchester Town Center
Maple Village
Manchester Crossroads
D)
ROUTE 30
6 VP
(6 1 ,9 3 8 V
PD)
(9,08
AV E
ANIA
S Y LV
Two Guys Shopping Center
PENN
Brand New 98 Bed Hospital
La-Z-Boy 11LOCATION OVERVIEW
Local Economy - York, PA
Six of the ten major U.S. market areas lie within a 500-mile radius of York. One of the fastest growing Top Employers
counties in Pennsylvania and the fastest growing county attracting 20-35 year-olds in the state, York
Organization/Company Industry Type
features a rich array of medical and educational, manufacturing, agricultural, construction, professional,
and tourism services and jobs. From the American Revolution to the Civil War, America’s second Revolution, York Hospital Healthcare
and through the industrial and high-tech revolutions, York remains a bedrock of the Commonwealth of Federal Government Government
Pennsylvania, currently the 16th largest economy in the world.
WellSpan Medical group Healthcare
Walmart Retail/Distribution
York County Public Works
Giant Food Services Grocery
BAE Systems Aerospace/Arms
Harley Davidson Manufacturing
Kinsley Construction Construction
Interstate 83 offers easy access to Harrisburg International Airport, Route 30, Interstate 95, and Interstate 76 (Pennsylvania
Turnpike). York is nestled between Philadelphia and Washington, D.C. (two-hour drives), Baltimore, the second largest east coast
port (45-minute drive), Harrisburg, the state capital, (30-minute drive), and Delaware and Maryland shore points (three hours)
I-83 is an Interstate Highway in the Eastern US. Its U.S. Route 30 (US 30) runs east–west across the
83 southern terminus is in Baltimore, MD; its northern southern part of the state, passing through Pittsburgh and
terminus is in Harrisburg, Pennsylvania at I-81. Philadelphia on its way from the West Virginia state line.
In Pennsylvania, the highway runs for 194.89 miles U.S. Route 222 Business (US 222 Bus.) is a 12.17-mile
(313.65 km), from the Maryland state line just south of (19.59 km) business route of US 222 located in Reading,
Gettysburg, to the New York state line near Lawrenceville. Pennsylvania.
12 La-Z-BoyLOCATION OVERVIEW
HARRISBURG
La-Z-Boy
30
728 Loucks Road
Mi
York, Pennsylvania 17404
les
115 M PHILADELPHIA
iles to
Phila
delph
60 Mile
ia
s to Balt
imore
BALTIMORE
York, Pennsylvania
RADIUS 1 MILE 3 MILE 5 MILES
Average HH Income $55,282 $60,608 $71,397
Median HH Income $46,899 $46,393 $54,736
Population 8,115 89,617 150,129
Households(#) 3,435 34,360 58,186
La-Z-Boy 13Investment Advisors
Derrick Dougherty Steve Garthwaite
First Vice President Investments Senior Associate
National Retail Group National Retail Group
License: PA RS305854 License: PA RS332182
Ph: (215) 531-7026 Ph: (215) 531-7025
Scott Woodard Mark Krantz
Senior Associate Senior Associate
National Retail Group National Retail Group NON- ENDORSEMENT A ND DISC LA I M ER NOTI CE
License: PA RS329242 Lic: PA RS336064 | NJ 1863254
N ON -EN DORSEMEN TS
Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of
any corporation’s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap,
its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant
lessee information about this listing to prospective customers.
ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.
DISCLAIMER
The information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it
from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure
has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject
Pavan Koneru Nick Geaneotes property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and
Associate Associate makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property,
National Retail Group National Retail Group the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCB's or asbestos, the compliance with
License: PA RS350910 License: PA RS350646 State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s
plans or intentions to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources
we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap
conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the
information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein. Marcus & Millichap is a service mark
of Marcus & Millichap Real Estate Investment Services, Inc. © 2017 Marcus & Millichap. All rights reserved.
Our Locations:
Philadelphia, PA King Of Prussia, PA New York, NY Marcus & Millichap Real Estate Investment Services of Seattle, Inc. Broker of Record: Sean Beuche
2005 Market Street #1510 200 N. Warner Road 260 Madison Avenue
License: RB062197C License: PA RM424190
Philadelphia, PA 19103 King Of Prussia, PA 19406 5th Floor
14 La-Z-Boy
P: 215.531.7000 P: 215.531.7000 New York, NY 10016728 Loucks Road York, Pennsylvania 17404 OFFERING MEMORANDUM
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