OFFERING MEMORANDUM 9705 WASHINGTON BOULEVARD LAUREL, MD 20723 - SINGLE TENANT NET LEASED RETAIL/OFFICE INVESTMENT OPPORTUNITY - LoopNet
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OFFERING MEMORANDUM
9705 WASHINGTON BOULEVARD
LAUREL, MD 20723
Prepared by:
Steve Weiss
Senior Vice President
SINGLE TENANT NET
443.741.4051
sweiss@lee-associates.com
LEASED RETAIL/OFFICE
INVESTMENT OPPORTUNITY
DISCLOSURE &
CONFIDENTIALLY AGREEMENT
This Offering Memorandum has been prepared by Lee & Associates Chesapeake Region LLC and has been reviewed by
the Seller. It contains select information pertaining to the Property and does not purport to be all-inclusive. All financial
projections are provided for general reference purposes only and are based on assumptions relating to the general
economy, competition, and other factors which are subject to material change or variation.
An opportunity to inspect the Property will be made available to qualified prospective purchasers.
This Offering Memorandum contains documents that are described in summary form and do not purport to be
complete nor necessarily accurate descriptions of the full agreements involved; nor do they constitute a legal analysis
of such documents. Interested parties are expected to independently review all documents.
This Offering Memorandum is subject to errors, omissions, changes, or withdrawal without notice and does not
constitute a recommendation, endorsement, or advice as to the value of the Property by Lee & Associates Chesapeake
Region LLC or the Seller. Each prospective purchaser is to rely upon its own investigation, evaluation, and judgment as
to the advisability of purchasing this Property.
Seller and Lee & Associates Chesapeake Region LLC expressly reserve the right, in their sole discretion, to reject any or
all expressions of interest or offers to purchase the Property and/or terminate discussions with any party at any time
with or without notice. Seller shall have no legal commitment or obligation to any purchaser reviewing this offering
memorandum or making an offer to purchase the Property unless a written agreement for the purchase of the Property
has been fully executed, delivered, and approved by the Seller, and any conditions to Seller’s obligations there under
have been satisfied or waived. Lee & Associates Chesapeake Region LLC is not authorized to make any representations
or agreements on behalf of Seller.
This Offering Memorandum is the property of Lee & Associates Chesapeake Region LLC and may be used only by
parties approved by Lee & Associates Chesapeake Region LLC. The Property is privately offered, and by accepting this
Offering Memorandum, the party in possession hereof agrees that this Offering Memorandum and its contents are of
a confidential nature and will be held and treated in the strictest confidence.
No portion of this Offering Memorandum may be copied or otherwise reproduced or disclosed to anyone without the
prior written authorization of Lee & Associates Chesapeake Region LLC and Seller.
PREPARED BY: TABLE OF CONTENTS
STEVE WEISS EXECUTIVE SUMMARY
Senior Vice President
443.741.4051 The Offering............................................................... 5
sweiss@lee-associates.com
Investment Highlights............................................ 5
Offering Summary.................................................. 6
Transaction Guidelines........................................... 7
10480 Little Patuxent Parkway
PROPERTY DESCRIPTION
Suite 210
Columbia, MD 21044 Property Overview................................................... 9
P: 410.712.0888 | F: 410.872.0459
www.lee-associates.com Property Photos......................................................10
Location Map...........................................................13
Aerial Map.................................................................14
Birds Eye Aerial........................................................15
Site Plan.....................................................................16
Zoning........................................................................17
LOCATION & MARKET
Location Overview.................................................26
Market Overview....................................................27
Demographics.........................................................28
TENANT INFORMATION
Tenant Overview.....................................................30
Rent Roll.....................................................................31
EXECUTIVE SUMMARY
THE OFFERING
INVESTMENT HIGHLIGHTS
OFFERING SUMMARY
TRANSACTION GUIDELINES
EXECUTIVE SUMMARY : 5
INVESTMENT
HIGHLIGHTS
» Approx. 6.0 Years of term remaining
(3.0% Annual rent increases)
» Long tenancy history (Renewed Twice)
» High probability of renewal
THE OFFERING » High visibility location
The Chesapeake office of Lee & Associates is pleased to present to investors,
the opportunity to acquire a 100% occupied, single tenanted, long term net
leased, one story retail/office building in highly desirable Laurel, Maryland. » Heavily trafficked frontage
This high visibility, highly trafficked location, directly on Washington Boulevard/
MD Route 1 has proven to be a good fit for the existing tenant who has
operated a For Profit alternative education school from the building since » I n the heart of Baltimore Washington
2006. The Tenant expanded and renewed in 2008 and renewed again in 2013 Industrial Corridor
to its current lease & term that runs until 9/30/2023. The building had previously
served as a retail location for Sunbelt Rentals for many years.
High Road Academy began its operation in 1998 as a private, separate day »E
xcellent direct ingress & egress from
school for students with Learning Disabilities and related disorders. High Road Route 1
Academy is licensed by the Maryland State Department of Education (MSDE).
High Road Academy operates as part of the Schools Group of Catapult
Learning, Inc. Catapult Learning is the largest provider of K−12 contracted » Overall lack of like/kind product in
instructional services in the United States. Catapult Learning, Inc. has market
dedicated the past four decades to improving academic achievement for all
students through its research-based programs. Founded in 1976 and
headquartered in Camden, New Jersey, the company reaches over 300,000
students and 25,000 teachers annually. The corporate office is located at Two
»E
stablished business location for
Aquarium Drive, Camden, NJ 08103. Tenant
High Road Academy operates a highly successful school at the property that
caters to public school children in grades 3 through 12 with learning disabilities. »S
trong lease guarantee by parent
The children come from the neighboring seven counties, that include Howard,
Montgomery, Anne Arundel, Baltimore, Carroll, Calvert and also from the
corporation
District of Columbia. This centrally located, easily accessed location was
strategically targeted by the Tenant and meets their requirements to service
surrounding counties who drop off children at the school daily (M-F). The lease »G
ood signage opportunities
is guaranteed by a related company called Specialized Education Services, Inc.
who is owned by Catapult Learning, Inc. The tenant has invested large amounts
of money in the property, has no remaining renewal options but exhibits a » L arge 1.5 acres site (2 Potential Pads)
high probability of wanting to renew at the expiration of their current lease
term due to the prime location and overall lack of additional options in the
marketplace.
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
EXECUTIVE SUMMARY : 6
OFFERING SUMMARY
9705 Washington Boulevard
ADDRESS
Laurel, MD 20723
PROPERTY TYPE Single Tenant Net Leased
OFFERING PRICE $3,412,741 ($270.33/SF)
TERMS All Cash
YEAR BUILT 1970
STORIES One
SQUARE FEET 12,624
SITE SIZE 1.50 AC
PARKING 50 ± spots 4.14/1,000
CE-CLI Corridor Employment Continued
ZONING
Light Industrial Overlay
OCCUPANCY 100%
NUMBER OF TENANTS One
TENANTS Specialized Education of Maryland, Inc.
LEASE GUARANTOR Specialized Education Services Inc. (SESI)
NNN (LL-CAP-EX For Roof & HVAC
LEASE TYPE
Replacement)
LEASE COMMENCEMENT 9/20/2006
LEASE EXPIRATION 9/30/2023
Approx. 6.0 years *Lease & amendments
TERM REMAINING available upon
request
RENEWAL OPTIONS None Remaining
CURRENT ANNUAL RENT $290,083 ($22.97/sf )
ANNUAL RENTAL INCREASES 3.00% annually
IN-PLACE NOI $290,083 - as of 10/1/17
3 YR AVERAGE NOI* $298,822.35
OFFERING CAP RATE 8.5%
3 YR AVERAGE CAP RATE 8.76%
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
EXECUTIVE SUMMARY : 7 TRANSACTION GUIDELINES The Chesapeake office of Lee & Associate is exclusively marketing the single-tenant, net leased property and improvements at 9705 Washington Boulevard, in Laurel, Maryland to a select group of qualified investors. The prospective purchaser will be selected by Seller in consultation with Lee & Associates on the basis of 1) price, 2) financial strength, 3) certainty and probability of closing, 4) level of investment discretion, 5) reputation within the industry, and 6) intended plans/use for the property, among other considerations. The offering terms are all cash, due and payable at closing. Seller reserves the right to select a successful investor based upon their initial bid. Seller also reserves the right, based upon the quality of the offers received, to select a group of investors to proceed to a second round of bids. OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION
PROPERTY OVERVIEW
PROPERTY PHOTOS
LOCATION MAP
AERIAL MAP
BIRDS EYE AERIAL
SITE PLAN
ZONING
PROPERTY DESCRIPTION : 9
PROPERTY OVERVIEW
> PROPERTY ADDRESS
9705 Washington Boulevard
Laurel, Maryland 20723
> LOT SIZE
1.5 ± Acres
> TOTAL SQUARE FEET > LOADING ENTRANCE
12,624 Gross Square Feet Yes
12,079 Rentable Square Feet
>F
IRE & SECURITY
> YEAR BUILT SYSTEMS
1970 Yes, through ADT / Tyco
> TYPE > HVAC
Retail/Office Gas-fired heat with central air
> NO. OF STORIES > SPRINKLER SYSTEM
One story Yes
> VEHICLES PER DAY > UTILITIES
±50,000 Public water, sewer, electric
and natural gas
> PARKING
50 ± spots (4.14/1,000) > ZONING
CE-CLI
> BUILDING EXTERIOR
Masonry/brick > LIBOR/FOLIO
10888/00374
> ROOF
Flat built-up > TAX MAP / GRID /
PARCEL/PLAT
0047 / 0023 / 0542 / 12742
> ELECTION PRECINCT
06-02
>2
014 FEMA REMAPPING
A corner of the property (not
the building) now falls in
FEMA’s 2014 remapped 100
Year Floodplain. Army Corp of
Engineers has just completed
extensive reworking of the
stream bed. Property was
unaffected by the “1 in 1,000
Year Event” that flooded
nearby Ellicott City on July
30, 2016.
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 10 PROPERTY PHOTOS OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 11 OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 12 OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 13
LOCATION MAP
N
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MDPROPERTY DESCRIPTION : 14
AERIAL MAP
SUBJECT
PROPERTY
LY N N
B U F F COURT
D
AR
EV
UL
BO
N
TO
NG
HI
AS
W
G O R M AN RO AD
N
* BOUNDARY REPRESENTATIONS ARE APPROXIMATE
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MDPROPERTY DESCRIPTION : 15
BIRDS EYE AERIAL
SUBJECT
PROPERTY
D
AR
L EV
U
BO
N
GTO
I N
H
AS
W
MA
IER
ROA
D
N
* BOUNDARY REPRESENTATIONS ARE APPROXIMATE
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MDPROPERTY DESCRIPTION : 16 SITE PLAN OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 17 ZONING OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 18 ZONING OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 19 ZONING OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 20 ZONING OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 21 ZONING OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 22 ZONING OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 23 ZONING OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
PROPERTY DESCRIPTION : 24 ZONING OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MD
LOCATION & MARKET
LOCATION OVERVIEW
MARKET OVERVIEW
DEMOGRAPHICSLOCATION & MARKET : 26
LOCATION OVERVIEW
HOWARD COUNTY, MARYLAND
9705 Washington Boulevard is located in prestigious
Howard County, Maryland, one of the most affluent,
advanced and educated communities in the United States.
Howard County is situated in the heart of the dynamic
corridor between Washington, D.C., and Baltimore, the
fourth largest consolidated market in the U.S. The county’s
position at the center of this region provides businesses
and residents prime access to I-95, I-70, three (3) major
airports, and the Port of Baltimore. A diverse business base
thrives in the county and takes advantage of a friendly
business climate, highly educated work force, and superb
quality of life.
Howard County’s 8,700+ businesses employ 127,900+
workers; which include major employers such as The Johns
Hopkins University Applied Physics Laboratory, Howard
County General Hospital, MICROS Systems, Northrop
Grumman, and Verizon Wireless among others. Howard
County offers more than 70 million square feet of
commercial space to businesses.
It is no wonder Money Magazine recently ranked Howard County’s Columbia/
Ellicott City in the Top 10 “America’s Best Places to Live 2012. With 5,300 acres of
DISTANCE TO
open space, the Patuxent River State Park, five (5) lakes, plentiful free recreational Baltimore, MD 19 miles
activities managed by the Columbia Association including an art center, teen
center, three (3) fitness clubs, indoor ice rink, two (2) golf courses, 22 outdoor
Washington, D.C. 20 miles
pools, among others, the B&O Railroad Station Museum & Firehouse, the African
Art Museum of Maryland, the 14,200 seat Merriweather Post Pavilion Concert
venue, Columbia Mall, and plentiful other dining and recreational activities, Annapolis, MD 26 miles
residents and visitors can enjoy and take advantage of the wonderful
POPULATION (5-MI RADIUS)
opportunities within Howard County.
2016 168,563
LAUREL, MARYLAND
Strategically positioned off of US Route 1 in Laurel, Maryland, 9705 Washington
Boulevard is ideally located with tremendous access. Although the property is 2021 (estimate) 179,464
situated in Howard County, Laurel pinpoints the conjunction of three (3)
INCOME/HOUSEHOLD
Maryland Counties - Prince George’s, Anne Arundel, and Howard. 9705
Washington Boulevard is located near Laurel’s historic district on Main Street Median Household Income $110,133
and the Laurel MARC train station, making it an ideal location for both residents
and commuters. The property also sits in close proximity to Laurel Park # Households 116,614
Racecourse, and is near Johns Hopkins University’s Applied Physics Laboratory,
Fort Meade Army Base, and the National Security Agency (NSA).
Median Home Price $426,300
Although Laurel was incorporated as a town in 1870, Laurel’s history dates back
to the early 1800’s as a cotton mill town. Today, Laurel is home to 59,531 people Estimated Household Size 2.6
(2010 census) and has many local attractions including Laurel Park Racecourse, a
thoroughbred racetrack which opened in 1911, 222 acres of parkland and 19 Expected Population Growth
14%
park sites, NSA’s National Cryptologic Museum, the Laurel Historical Society and (2035)
Museum (an 1840’s millworkers home that was restored for the public in 1996),
Vehicles Per Day at Location 50,000
National Wildlife Visitor Center, Laurel Mill Playhouse, a community theatre,
schools, and countless antique shops and restaurants.
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MDLOCATION & MARKET : 27
MARKET OVERVIEW
The Washington Boulevard/Route 1 Corridor often referred to as the Baltimore/Washington Corridor or the “Corridor” is a highly
desirable business location. This location preference is due to the abundance of industrial parks that are located in the area that take
advantage of not only the proximity to population centers but also the ease of access to the interstate systems network, and most
prominently, I-95. Institutional Investors from all around the country and world target the Baltimore/Washington Corridor as a preferred
investment location because not only is I-95 within a mile or two of most locations off Route 1 but the location also can easily serve the
entire East Coast offering access to ²/₃ of the country’s population within a 24 hour truck drive. The Corridor is also heavily rail served,
not only to and from the booming Baltimore port, but to the rail systems that serve the entire United States.
The demand for office space in the Corridor to service the thriving industrial marketplace is strong with somewhat limited competing
product and great barriers to entry for any new competing product to be built in the future. This Corridor submarket location within
Laurel is home to 29 office buildings that lie in the 20723 zip code and is currently experiencing a 0.7% vacancy rate which is one of the
lowest vacancies and strongest submarkets within the Greater Baltimore and Washington, D.C. MSA. The twenty nine office buildings
comprise 1,586,845 square feet with 10,523 square feet of direct and sublet vacancy. The entire vacancy in the submarket is comprised
of two spaces, one 3,601 SF space and one 6,922 SF space to lease. The average rental rate per CoStar in the submarket is $25.96/full
service.
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MDLOCATION & MARKET : 28 DEMOGRAPHICS POPULATION 1 MILE 3 MILE 5 MILE 2021 Projection 12,286 87,112 179,464 2016 Estimate 11,327 82,205 168,563 2010 Census 9,817 75,645 151,653 Growth 2016-2021 8.47% 5.97% 6.47% Growth 2010-2016 15.38% 8.67% 11.15% HOUSEHOLDS 2021 Projection 4,612 31,547 65,300 2016 Estimate 4,253 29,703 61,220 2010 Census 3,694 27,281 54,900 Growth 2016 - 2021 8.44% 6.21% 6.66% Growth 2010 - 2016 15.13% 8.88% 11.51% 2015 Average Household Size 2.70 2.60 2.60 EMPLOYMENT 2015 Daytime Population 6,095 42,292 89,721 SUMMARY HOUSING INFORMATION 2015 Occupied Housing 4,253 29,703 61,220 Owner Occupied 2,264 16,758 35,983 Renter Occupied 1,989 12,945 25,237 2015 Median Home Value $325,620 $287,072 $312,624 2015 HOUSEHOLDS BY INCOME
TENANT INFORMATION
TENANT OVERVIEW
RENT ROLLTENANT INFORMATION : 30
TENANT OVERVIEW
Specialized Education of Maryland, Inc. dba High Academy
Located in Howard County, High Road Academy began in 1998 as a tiny program of two students and has now grown to a thriving
school enrolling approximately 90 students in grades 3–12, aged 7–21. Given its location in Laurel, MD, students come not only from
Howard County, but also from Montgomery, Anne Arundel, Baltimore, Carroll, and Calvert Counties, as well as from the District of
Columbia.
High Road Academy specializes in individualized, remedial programs primarily for students with learning disabilities. Staff is trained in
a variety of methodologies designed for students with severe reading disabilities, such as Orton-Gillingham, the Lindamood Phoneme
Sequencing Program (LiPS), Phono-Graphix, LANGUAGE! and others. In addition to implementing specialized strategies, High Road
Academy is committed to the integration of computer technology into all aspects of the program. As a result, High Road Academy
maintains a large repertoire of software programs specific to the remedial program. We’re significantly invested in the Fast ForWord/
Gateway family of products, for example, based on the notable improvements in auditory-processing skills we’ve witnessed among
certain students who have utilized these programs.
Whereas the majority of students attending High Road Academy require intensive reading and language arts remediation, we also
serve a significant number of students with varying LD profiles, as well as those with Nonverbal Learning Disabilities and Asperger’s
syndrome. Still other students are coded with Multiple Disabilities. Since many students with learning disabilities also have coexisting
disabilities (e.g., Other Health Impairments or Speech-Language Impairment), the program includes a strong emphasis on executive
function and language-processing skills.
Each student accepted into the program undergoes an intensive evaluation to determine present levels of performance. A careful
analysis of sight word recognition, word attack skills, comprehension, fluency, written expression, and math skills is conducted on each
student in order to build a remedial plan. Methodologies and strategies are selected based on the student’s profile. Ongoing evaluation
and monitoring of student performance and achievement ensures that adjustments in programming are made as often as needed.
The main focus at High Road Academy is the mission of remediation; and the main goal, whenever possible and applicable, is to return
students to the LRE (least restrictive environment) at their home schools. We take great pride in the fact that we’ve been able to
maintain an average annual return rate of 30% of our total school population—an industry high. Better yet, follow-up data indicates
that HRA students who have returned to their home schools are continuing to achieve and meet the challenges in their mainstream
classrooms.
Staff at High Road Academy are dedicated to educating the wider community on issues related to learning disabilities. The staff actively
presents seminars and trainings at annual conferences, at parent meetings, and for other organizations. Sample training topics include:
Study Skills & Organizational Strategies; Reading Methodologies; Counseling Students with Learning Disabilities; and Strategies for
Written Expression.
High Road Academy is under the direction of Dr. Ellen Gaske (Executive Director), Matt Cooper (Educational Director), and Jordan Pugh
(Educational Director).
Source: https://www.catapultlearning.com/schools/high-road-academy-laurel-md/
OFFERING MEMORANDUM: 9705 WASHINGTON BOULEVARD, LAUREL, MDTENANT INFORMATION : 31
RENT ROLL
TENANT Specialized Education of Maryland, Inc.
LEASE GUARANTOR Specialized Education Services, Inc.
SUITE Occupy Entire Building
LEASE TYPE NNN
LANDLORD
Capital Expenditures for Roof & HVAC Replacement
RESPONSIBILITIES
GSF 12,624
START 9/20/2006
END 9/30/2023
RENTAL RATE INCREASE DATE RENT MONTHLY ANNUAL RATE PSF ANNUAL NET RENT
10/01/2017 $24,173.59 $24.02 $290,083.06
10/01/2018 $24,892.61 $24.72 $298,711.32
10/01/2019 $25,639.39 $25.47 $307,672.68
10/01/2020 $26,408.57 $26.23 $316,902.84
10/01/2021 $27,200.83 $27.02 $326,409.96
10/01/2022 $28,016.85 $27.83 $336,202.20
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