O'REILLY AUTO PARTS (GROUND LEASE) - Offering Memorandum CORPUS CHRISTI, TX - LoopNet
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Downtown
Corpus Christi
O’REILLY AUTO PARTS (GROUND LEASE)
C O R PU S C H R IS T I, T X
Offering Memorandum
NON-ENDORSEMENT NET-LEASED DISCLAIMER
& DISCLAIMER NOTICE
Marcus & Millichap hereby advises all prospective purchasers of Net Leased property as follows:
The information contained in this Marketing Brochure has been obtained from sources we believe to be
reliable. However, Marcus & Millichap has not and will not verify any of this information, nor has Marcus &
N ON- E N D ORS EMENT NOTICE Millichap conducted any investigation regarding these matters. Marcus & Millichap makes no guarantee,
Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this warranty or representation whatsoever about the accuracy or completeness of any information provided.
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, prod- As the Buyer of a net leased property, it is the Buyer’s responsibility to independently confirm the accuracy
uct, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee and completeness of all material information before completing any purchase. This Marketing Brochure
information about this listing to prospective customers. is not a substitute for your thorough due diligence investigation of this investment opportunity. Marcus
& Millichap expressly denies any obligation to conduct a due diligence examination of this Property for
C ONF IDENT IA LITY & DISCLA IMER Buyer.
The information contained in the following Marketing Brochure is proprietary and strictly confi-
dential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap Any projections, opinions, assumptions or estimates used in this Marketing Brochure are for example
and should not be made available to any other person or entity without the written consent of only and do not represent the current or future performance of this property. The value of a net leased
Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unveri- property to you depends on factors that should be evaluated by you and your tax, financial and legal
advisors.
fied information to prospective purchasers, and to establish only a preliminary level of interest
in the subject property. The information contained herein is not a substitute for a thorough due
Buyer and Buyer’s tax, financial, legal, and construction advisors should conduct a careful, independent
diligence investigation. Marcus & Millichap has not made any investigation, and makes no war-
investigation of any net leased property to determine to your satisfaction with the suitability of the property
ranty or representation, with respect to the income or expenses for the subject property, the future for your needs.
projected financial performance of the property, the size and square footage of the property and
improvements, the presence or absence of contaminating substances, PCB’s or asbestos, the com- Like all real estate investments, this investment carries significant risks. Buyer and Buyer’s legal and
pliance with State and Federal regulations, the physical condition of the improvements thereon, or financial advisors must request and carefully review all legal and financial documents related to the
the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to property and tenant. While the tenant’s past performance at this or other locations is an important
continue its occupancy of the subject property. The information contained in this Marketing Bro- consideration, it is not a guarantee of future success. Similarly, the lease rate for some properties,
chure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has including newly-constructed facilities or newly-acquired locations, may be set based on a tenant’s
not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap projected sales with little or no record of actual performance, or comparable rents for the area. Returns
are not guaranteed; the tenant and any guarantors may fail to pay the lease rent or property taxes, or
conducted any investigation regarding these matters and makes no warranty or representation what-
may fail to comply with other material terms of the lease; cash flow may be interrupted in part or in whole
soever regarding the accuracy or completeness of the information provided. All potential buyers
due to market, economic, environmental or other conditions. Regardless of tenant history and lease
must take appropriate measures to verify all of the information set forth herein. Marcus & Millichap
guarantees, Buyer is responsible for conducting his/her own investigation of all matters affecting the
is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. intrinsic value of the property and the value of any long-term lease, including the likelihood of locating
© 2017 Marcus & Millichap. All rights reserved. a replacement tenant if the current tenant should default or abandon the property, and the lease terms
that Buyer may be able to negotiate with a potential replacement tenant considering the location of the
ALL PROPERTY SHOWINGS ARE BY A PPOINTMENT ONLY. property, and Buyer’s legal ability to make alternate use of the property.
PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR By accepting this Marketing Brochure you agree to release Marcus & Millichap Real Estate Investment
MORE DETAILS. Services and hold it harmless from any kind of claim, cost, expense, or liability arising out of your
investigation and/or purchase of this net leased property.
A C T I V I T Y I D N O:
S Port Ave
e
t Av
r
Po
S
O’REILLY AUTO PARTS
ANALYSIS
FINANCIAL
O ’ R E I L LY A U T O P A R T S // F I N A N C I A L A N A LY S I S
1
OFFERING HIGHLIGHTS
O ’ R E I L LY
O’REILLY AUTO PARTS (GROUND LEASE)
CORPUS CHRISTI, TX
A U T O
1114 S Port Avenue, Corpus Christi, TX 78405
O F F ERIN G P RIC E CAP RATE
P A R T S
$795,000 4.85%
//
VITAL DATA
F I N A N C I A L
Price $795,000
Cap Price 4.85%
Base Rent $38,520
Gross Square Feet 7,000 SF
A N A LY S I S
Lot Size .94 Acres
Ownership Fee Interest
2
PROPER TY DETAILS
O’REILLY AUTO PARTS (GROUND LEASE)
A N A LY S I S
CORPUS CHRISTI, TX
1114 S Port Avenue, Corpus Christi, TX 78405
F I N A N C I A L
LEASE SUMMARY RENT INCREASES ANNUAL RENT
Property Address 1114 S Port Ave, Corpus Christi, TX Current - 3/31/2020 $38,520
4/1/2020-3/31/2025 $41,220
Lease Type Corporate Ground Lease
//
4/1/2025-3/31/2030 $44,100
Roof & Structure Tenant Responsible
4/1/2030-3/31/2035 (Option 1) $47,184
P A R T S
Tenant O’Reilly Automotive, Inc.
4/1/2035-3/31/2040 (Option 2) $50,496
Original Lease Term 20 years
4/1/2040-3/31/2045 (Option 3) $54,024
A U T O
Rent Commencement Date April 1, 2010 Base Rent ($5.50/SF) $38,520
Lease Expiration Date March 31, 2030 NET OPERATING INCOME 4.85%/$38,520
O ’ R E I L LY
Remaining Lease Term 11.4 years TOTAL RETURN $38,520
Options Three, 5-year
Increases 7% Every 5-years
ROFR Yes - 10 days
3
TENANT SUMMARY
O ’ R E I L LY
A U T O
Current Distribution Centers
P A R T S
TENANT SUMMARY
//
Tenant O’Reilly Automotive, Inc.
P R O P E R T Y
Tenant Trade Name O’Reilly Auto Parts
Ownership Public
Number of Locations 5,147
Headquarters Springfield, MO
D E S C R I P T I O N
Website www.oreillyauto.com
ROFR Yes - 10 days
4
D E S C R I P T I O N
O’REILLY AUTOMOTIVE, INC. REPORTS SECOND QUARTER 2018 RESULTS
July 25, 2018
• Second quarter comparable store sales increase of 4.6%
• 38% increase in second quarter diluted earnings per share to $4.28
• Net cash provided by operating activities increased 23%
P R O P E R T Y
Springfield, MO, July 25, 2018 – O’Reilly Automotive, Inc. (the “Company” or “O’Reilly”) (Nasdaq: ORLY), a leading retailer in the
automotive aftermarket industry, today announced record revenues and earnings for its second quarter ended June 30, 2018.
2nd Quarter Financial Results
Greg Johnson, O’Reilly’s CEO and Co-President, commented, “We are very pleased to report another profitable quarter, highlighted by
a solid 4.6% increase in comparable store sales, which exceeded the top of our guidance range for the second quarter Our top-line
//
performance, driven by Team O’Reilly’s commitment to providing consistent, excellent customer service, and our relentless focus on
P A R T S
profitable growth resulted in a 38% increase in diluted earnings per share to $4.28 for the second quarter. I would like to thank each
of our nearly 80,000 Team Members for their dedication and hard work, which continues to be the catalyst for our long-term success.”
Sales for the second quarter ended June 30, 2018, increased $165 million, or 7%, to $2.46 billion from $2.29 billion for the same
A U T O
period one year ago. Gross profit for the second quarter increased 7% to $1.29 billion (or 52.5% of sales) from $1.20 billion (or 52.4%
of sales) for the same period one year ago. Selling, general and administrative expenses (“SG&A”) for the second quarter increased 9%
to $809 million (or 33.0% of sales) from $743 million (or 32.4% of sales) for the same period one year ago. Operating income for the
O ’ R E I L LY
second quarter increased 5% to $479 million (or 19.5% of sales) from $457 million (or 20.0% of sales) for the same period one year
ago. The Company’s second quarter 2017 operating income included the benefit of a $9 million reduction in its legal accruals following
the expiration of the statute of limitations related to a legacy claim, which decreased second quarter 2017 SG&A and increased second
quarter 2017 operating margin by 40 basis points.
Net income for the second quarter ended June 30, 2018, increased $70 million, or 25%, to $353 million (or 14.4% of sales) from $283
million (or 12.3% of sales) for the same period one year ago. Diluted earnings per common share for the second quarter increased
38% to $4.28 on 83 million shares versus $3.10 on 91 million shares for the same period one year ago.
Read more at: https://corporate.oreillyauto.com/corporate-information-news-room
5
O’REILLY AUTO PARTS
DESCRIPTION
PROPERTY
O ’ R E I L LY A U T O P A R T S // P R O P E R T Y D E S C R I P T I O N
6INVESTMENT HIGHLIGHTS
O ’ R E I L LY
►► Absolute NNN Ground Lease
►► 7% rent increase in April 2020 & every 5 Years thereafter
A U T O
►► Investment Grade Tenant (NASDAQ: ORLY, S&P: BBB+)
►► 11+ years remaining on current lease term
P A R T S
►► Texas is an income tax-free state
//
P R O P E R T Y
PROPER TY HIGHLIGHTS
►► Infill location (5-mile population exceeds 148,000)
D E S C R I P T I O N
►► Across the street from CHRISTUS Spohn Hospital, with 397 beds is the only Level II
Trauma Center in the Corpus Christi region
►► Highly visible location near the intersection of S Port Ave & Morgan Ave (21,000+ VPD)
►► Surrounding tenants include CVS, Popeyes, AutoZone, Family Dollar & Dollar General
►► Multiple points of ingress/egress to subject property
7LOCATION HIGHLIGHTS
D E S C R I P T I O N
CORPUS CHRISTI, TX
►► County seat of Nueces County (population approx. 340,000)
►► Corpus Christi is the 8th largest city in Texas
P R O P E R T Y
►► The Port of Corpus Christi is the 5th largest in the United States
►► Main hub of the six county Corpus Christi-Kingsville-Alice combined statistical area
►► Home of the Naval Air Station Corpus Christi, which is the largest employer in the city
//
P A R T S
A U T O
O ’ R E I L LY
8O’REILLY AUTO PARTS
Regional
Map
O ’ R E I L LY A U T O P A R T S // P R O P E R T Y D E S C R I P T I O N
9Map
Map
Local
Local
O’REILLY AUTO PARTS
O ’ R E I L LY A U T O P A R T S // P R O P E R T Y D E S C R I P T I O N
10O’REILLY AUTO PARTS
OVERVIEW
MARKET
O ’ R E I L LY A U T O P A R T S // M A R K E T O V E R V I E W
11DEMOGRAPHICS
O ’ R E I L LY
POPULATION 1 MILE 3 MILES 5 MILES INCOME 1 MILE 3 MILES 5 MILES
2022 Projection 20,210 90,866 150,575 Average $38,611 $47,549 $53,829
2017 Estimate 20,319 90,340 148,379 Median $29,296 $32,990 $38,444
A U T O
2010 Census 20,042 87,566 143,421 Per Capita $13,422 $17,208 $19,646
2000 Census 21,191 88,869 141,587
P A R T S
HOUSEHOLDS 1 MILE 3 MILES 5 MILES EMPLOYMENT 1 MILE 3 MILES 5 MILES
//
2022 Projection 7,116 32,927 55,261 2017 Daytime Population 22,727 140,493 206,765
M A R K E T
2017 Estimate 6,945 31,962 53,389 2017 Unemployment 11.77% 8.93% 7.48%
2010 Census 6,801 30,714 51,225 2017 Median Time Traveled 19 20 19
2000 Census 6,611 29,543 48,440
O V E R V I E W
HOUSING
2017 $55,849 $73,116 $86,865
12CORPUS CHRISTI
OVERVIEW
Situated along the Gulf of Mexico in Southeast Texas, the Corpus
Christi metro encompasses three counties: Nueces, Aransas and
METRO HIGHLIGHTS
San Patricio. Nueces is the most populous county and contains the
O V E R V I E W
ENERGY AND PETROCHEMICAL SECTOR
city of Corpus Christi. Offshore, Padre and Mustang islands shelter The Eagle Ford Shale Play and other gas and oil deposits attract major energy
area bays providing beautiful beaches and a thriving tourist indus- and petrochemical companies to the area.
try. The economy is also supported by the Eagle Ford Shale Play, ACCESS TO WORLD MARKETS
which is west of the metro, and trade with Mexico. Corpus Christi International Airport and Port Corpus Christi connect the metro
to markets around the globe.
M A R K E T
MAJOR TOURISM DESTINATION
Beaches along the Gulf of Mexico, w arm winter weather and w ildlife draw
visitors to the area.
//
ECONOMY
P A R T S
►► Corpus Christi’s position on the Gulf of Mexico, access to the Mexican market, location to
the Eagle Ford Shale Play and growing population contribute to the dynamic economy.
►► Thousands of jobs are affiliated with the Eagle Ford Shale Play at companies such as Halli
A U T O
burton, C&J Energy Services and Baker Hughes. Local refinery operators include Flint Hills
and Valero. Also, Susser Holdings Corp., a gas station and store operator, is headquartered
in the metro.
O ’ R E I L LY
►► The area is home to the Naval Air Station Corpus Christi, which has an arrangement to also
house the Corpus Christi Army Depot, the largest helicopter repair facility in the world.
DEMOGRAPHICS
2017 2017 2017 2017 MEDIAN
POPULATION: HOUSEHOLDS: MEDIAN AGE: HOUSEHOLD INCOME:
458K 169K 35.6 $52,400
Growth Growth U.S. Median: U.S. Median:
2017-2022*: 2017-2022*:
3.6% 5.3% 37.8 $56,300
* Forecast
Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody’s Analytics; U.S. Census Bureau
13O’REILLY AUTO PARTS
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