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Starbucks | Verizon
4515 Lincolnway East, Mishawaka, IN 46544
Mackenzie Wolfgram
Confidentiality and Restricted Use Agreement
Associate This Confidential Offering Memorandum (“COM”) is provided by Stan Johnson Company (“SJC”), solely for your
mwolfgram@stanjohnsonco.com consideration of the opportunity to acquire the commercial property described herein (the “Property”). This COM may
+1 312.777.2454 be used only as stated herein and shall not be used for any other purpose, or in any other manner, without prior written
authorization and consent of SJC.
Matt Spangenberg
This COM does not constitute or pertain to an offer of a security or an offer of any investment contract. This COM
Associate Director contains descriptive materials, financial information and other data compiled by SJC for the convenience of parties who
mspangenberg@stanjohnsonco.com may be interested in the Property. Such information is not all inclusive and is not represented to include all information
+1 312.777.2442 that may be material to an evaluation of the acquisition opportunity presented. SJC has not independently verified any
of the information contained herein and makes no representations or warranties of any kind concerning the accuracy or
completeness thereof. All summaries and discussions of documentation and/or financial information contained herein are
qualified in their entirety by reference to the actual documents and/or financial statements, which upon request may be
made available. An interested party must conduct its own independent investigation and verification of any information
the party deems material to consideration of the opportunity, or otherwise appropriate, without reliance upon SJC.
The Property may be financed or withdrawn from the market without notice, and its owner(s) reserve(s) the right to
negotiate with any number of interested parties at any time. The Property is offered and sold by its owner(s) as is, where
is, and with all faults, without representation or warranty of any kind except for any customary warranties of title.
BY ACCEPTING THIS COM, YOU AGREE THAT: (1) all information contained herein, and all other information you
have received or may hereafter receive from SJC relating to the Property, whether oral, written or in any other form
(collectively, the “Information”), is strictly confidential; (2) you will not copy or reproduce, and claim as your own without
attribution to SJC, all or any part of this COM or the Information; (3) upon request by SJC at any time, you will return and/
or certify your complete destruction of all copies of this COM and the Information; (4) for yourself and all your affiliates,
officers, employees, representatives, agents and principals, you hereby release and agree to indemnify and hold harmless
Stan Johnson Company SJC all of its affiliates, officers, employees, representatives, agents and principals, from and with respect to any and all
claims and liabilities arising from or related to the receipt or use of this COM and/or any other Information concerning
303 East Wacker Drive | Suite 1111 the Property; (5) you will not provide this COM or any of the Information to any other party unless you first obtain such
Chicago, Illinois 60601 party’s acceptance and approval of all terms, conditions, limitations and agreements set forth herein, as being applicable
P: +1 312.240.0127 | F: +1 312.240.0158 to such party as well as to you; and (6) monetary damages alone will not be an adequate remedy for a violation of
these terms and that SJC shall be entitled to equitable relief, including, but not limited to, injunctive relief and specific
performance, in connection with such a violation and shall not be required to post a bond when obtaining such relief.
stanjohnsonco.com
The Offering Investment Summary
Stan Johnson Company (“SJC") is pleased to offer the opportunity to
acquire a freestanding two-tenant building leased to Starbucks and
Price: $2,442,000 Cap Rate: 6.60%
Verizon Wireless. Both Tenants are national companies and leaders in their
Location 4515 Lincolnway East, Mishawaka, IN 46544
respective industries. The site itself consists of a 4,953 sf building on 2.94
acres and is located at the best signalized corner in the local market. County St. Joseph County
Tenancy Multi-Tenant
Lincolnway East is the primary east/west corridor for the area and offers Property Type Retail
16,235 VPD. Bittersweet Road is the primary north/south corridor and
Building Size (SF) 4,953 SF
starts north of the St. Joseph River and ends at the subject property with
excellent visibility. It is one of only three bridges in a 6 mile span that cross Land Area (Acres) 2.94 Acres
the St. Joseph River, making this a heavily traveled corridor with 13,123 Year Built / Renovated 2003 / 2019
VPD. This gives the subject site a total of 29,358 combined VPD and
No. of Tenants 2
makes this site one of the most heavily traveled intersections in the area.
No. of Floors 1
The site also benefits from being near Martin's Supermarkets, which is the
area's dominant grocer. Other tenants at the intersection include CVS and Occupancy 100%
Walgreens, which demonstrates the quality of real estate being best in the Ownership Interest Fee Simple
market.
Encumbrances None
Sales Reporting
Verizon reports both unit level sales and corporate level financials annually, so the Landlord
will know how well the store is doing. Verizon is already open for business and doing well.
Ask broker for more details on store performance.
Best-in-Class Tenants
Starbucks is the number one coffee chain in the world and offers an "A-2" investment-grade
credit rating with $24.7 billion in annual Revenue and $4.5 billion in Net Income. Verizon
is also "A-2" investment-grade credit with $131 billion in Revenue and a $15.5 billion Net
Income.
Lease Dates
Rent Schedule % of
GLA % of Base Lease Lease Pro-Rata Pro-Rata Admin/ Renewal
Tenant Total
(SF) GLA Start Term (Yrs) Type (CAM) Taxes Mgmt Fee Options
Expiration Monthly Annual Rent/ In- Rent
Date Period Start End
Rent Rent SF crease
1/20/19 - 1/31/24 $5,785 $69,425 $25.00 -
Verizon Base 15%
2,777 56.07% 1/20/19 1/31/29 10 Years 2/1/24 - 1/31/29 $6,364 $76,367 $27.50 10.00% 42.88% NNN 56.07% 56.07% 1, 3-Yr
Wireless Admin Fee
Option 1 2/1/29 - 1/31/32 $7,000 $84,004 $30.25 10.00%
Notes: Tenant pays Admin Fee of 15% of CAM, Taxes, and Insurance; no Management Fee reimbursement
9 Years, 11
Starbucks 2,176 43.93% 2/28/29 $92,480 $42.50 $6,260 $7,073 $1,010 $14,344 $6.59 $582 $0 $107,406
Months
9 Years, 10
Verizon Wireless 2,777 56.07% 1/31/29 $69,425 $25.00 $7,990 $9,027 $1,290 $18,306 $6.59 $2,746 $0 $90,477
Months
Total/Average: 4,953 100.00% $161,905 $32.69 $14,250 $16,100 $2,300 $32,650 $6.59 $3,328 $0 $197,883
Notes:
(1) Starbucks - Tenant pays Admin Fee of 10% of CAM (excluding utilities, taxes, and insurance); no Management Fee reimbursement
(2) Verizon - Tenant pays Admin Fee of 15% of CAM, Taxes, and Insurance; no Management Fee reimbursement
2019
Net Operating Income PSF Annual Net Operating Income PSF Annual
Income Repairs and Maintenance $0.15 $750
Base Rent $32.69 $161,905 Parking Lot Maintenance $0.35 $1,750
CAM Recoveries $2.88 $14,250 Landscaping $0.61 $3,000
Tax Recoveries $3.25 $16,100 Snow Removal $1.06 $5,250
Insurance Recoveries $0.46 $2,300 Trash Removal $0.50 $2,500
Admin Fee Recoveries $0.67 $3,328 Parking Lot Lighting & Water (utilities) $0.20 $1,000
Mgmt Fee Recoveries $0.00 $0 Total CAM Expenses $2.88 $14,250
Total Gross Income $39.95 $197,883
Expenses
CAM $2.88 $14,250
Taxes $3.25 $16,100
Insurance $0.46 $2,300
Mgmt Fee 2.50% $4,048
Total Expenses $36,698
Net Operating Income $161,185
Starbucks locations serve hot and cold beverages, whole-bean coffee, micro-ground Credit Rating: "A-2" (S&P)
instant coffee, full-leaf teas, pastries, and snacks. Most stores also sell packaged food # Locations: 25,000 ±
items, hot and cold sandwiches, and items such as mugs and tumblers. Starbucks Evenings Financials: FYE 2018 FYE 2017 FYE 2016
locations also offer a variety of beers, wines, and small bites after 4 p.m. Total Revenue: $24.7 B $22.4 B $21.3 B
YOY Change: 10.42% 5.02% 11.24%
Many of the company’s products are seasonal or specific to the locality of the store, Net Income: $4.52 B $2.88 B $2.82 B
while Starbucks-brand ice cream and coffee are also offered at grocery stores. Through YOY Change: 56.63% 2.38% 2.19%
Starbucks Entertainment division and Hear Music brand, the company also markets books,
Net Worth: $1.17 B
music, and films.
Founded: 1985
Starbucks has a strong presence both in the U.S. and in the global marketplace due in part Headquartered: Seattle, WA
to its rapid growth over the last few decades. In the 1990s, Starbucks opened a new store Website: www.starbucks.com
every workday, a pace that continued into the 2000s. The first store outside the United
States or Canada opened in the mid-1990s, and overseas stores now constitute almost one
third of Starbucks’ stores.
Financial Analysis
As of September 30, 2018, Starbucks had an annual Revenue of $24.7 billion, a Net Income
of $4.52 billion, and a Net Worth in excess of $1.17 billion. The company currently has an
S&P rating of "A-2" which is top tier investment grade.
Company Highlights
• Annual revenue increased by 29% collectively over the past four years.
• Net income increased by over 56% for 2018 alone and has been up year over year the
past four years.
• Starbucks is one of the most financially stable and highly sought after tenants in
today’s retail marketplace.
• Coffee has been labeled by some as being "Liquid Gold" in today's financial market,
making Starbucks a very stable company to invest in. Representative Photo
and entertainment products and services to fall of 2015 ushered in the acquisition of stores Stock Symbol: VZ
consumers, businesses and governmental in the northeastern U.S to continue the growth Exchange: Nasdaq
agencies. Verizon currently services over 150 model. Stores in New York City, and locations in Credit Rating: "A-2" (S&P)
million subscribers and maintains over 1,600 U.S. central Pennsylvania, marked Russell Cellular’s # Locations: 1,600+
retail locations, while employing nearly 150,000 easterly expansion, and its first growth into Financials: 2018 2017 2016
people. major metropolitan markets.
Total Revenue: $131 B $126 B $126 B
Verizon grew quickly in the early 2000’s, after Then in 2017, Russell Cellular entered in to Net Income: $15.5 B $30.1 B $13.1 B
acquiring several wireless phone companies and Verizon’s “Big 6”, the program for the six Stockholder Equity: $53 B
assets across the United States. In 2008, Verizon largest Verizon Authorized Retailers in the Source: Yahoo! Finance
struck a deal to buy Alltel for $5.9 billion, U.S. This recognition provided the company Founded: 1983
making Verizon Wireless the country’s largest with the opportunity for accelerated growth in Headquartered: New York, NY
cellular network. Fortune Magazine consistently new markets, including the organization’s first
Website: www.verizonwireless.com
ranks Verizon among its top performing locations in California. They have since grown
Tenant Profile
Fortune 500 companies. In 2018, the prestigious to #3 nationwide. The company’s future includes
Company: Russell Cellular
publication ranked the company 16th. Verizon continued growth of same store sales, as well
reported FY 2018 revenue of $130 Billion and net as new locations that strengthen the company’s Doing Business As: Verizon
income of $15 Billion. Verizon Communications nationwide partnership with Verizon. Entity Type: Authorized Retailer
Inc. currently holds an investment grade rating # Locations: 420 ±
of "A-2" from Standard and Poor’s. States Served: 31
Years in Business: 25
Russell Cellular is the 3rd largest exclusive
Employees: 1,900+
Verizon Wireless Premium Retailer in the
country, specializing in wireless communication Website: https://russellcellular.com
Mishawaka is a growing commercial city nestled along the St. Joseph River.
Population growth, business expansion, and record-breaking new construction
demonstrate that people want to live, work, raise their families and retire in the
Mishawaka area. The city is served by two of the largest Class I Freight Railroad
companies, Canadian National and Norfolk Southern. It is also crisscrossed by some
of the country’s largest interstate highways, Interstate 80/90 going east/west and
US Route 31 going north/south. These superhighways connect the area to Chicago
(100 miles west), Indianapolis (140 miles south), and Detroit (200 miles north). This
makes the entire South Bend area an excellent distribution hub with easy access
to all of the Midwest within a day’s drive. This is evidenced by some of the nation’s
largest shipping companies having regional offices in the area. These include FedEx,
USPS, and American International Freightways.
Mishawaka is anchored by a diverse work force including Life Science (St Joseph
Regional Medical Center), Computing and Technology (Metronet Fiber Optics
Network), Advance Manufacturing (Bayer, AM General), Agriculture (4th largest
producer of soybeans in country), Logistics (44 major national truck lines), and
International Business.
South Bend is the fourth-largest city in Indiana and the county seat of St. Joseph
County with a population of approximately 100,000 residents in itself, including
multiple collegiate campuses. It is home to Notre Dame University, Bethel College,
Indiana University South Bend, Saint Mary’s College, Holy Cross College, Goshen
Mishawaka, IN College, Ivy-Tech College, Tri-State University, and many others. The area is most
famous for Notre Dame University which is one of the most prestigious and well
Accolades respected schools in the World. The schools in the area generate substantial
revenues through tourism and taxes and have created over 5,000 jobs, making
300,000 person MSA - 4th largest in state
Mishawaka a highly educated area.
Major Logistics Center - Corporate offices for FedEx, USPS, and American International
Home to Notre Dame University - One of the most prestigious universities in the country Starbucks | Verizon • Mishawaka, IN 11
Highly educated workforce with 10+ colleges and universities in the area
N N One of four bridges to cross St. Joseph River
in seven mile span
HWY 331
1 ( 11 ,7 2
Interchange
V P D) 0
Morning Traffic
Lincolnway (16,235 VPD)
N
29,320 People within 3 miles
funneling to local grocery,
high school and middle
Starbucks school
| Verizon • Mishawaka, IN 13
300,000 Person MSA
29,320 People within 3 Miles
Local High No Cell Stores for 7 Miles
School and Closest coffee competitor is McDonald's > 2 miles away
Middle School
Martin's
Paw Mart
All Star
Carwash
Kendall Aluminum
Electric Metals
4,953 SF Building
2.94 Acres
5 MILES
29K $73K
population avg. HH inc.
(3 miles) (3 miles)
Tom Fritz
Senior Director
going beyond
tfritz@stanjohnsonco.com
+1 312.777.2445
IN Lic. #RB14048630
Brandon Duff
Regional Director
bduff@stanjohnsonco.com
+1 312.240.0162
Mackenzie Wolfgram
Associate
mwolfgram@stanjohnsonco.com
+1 312.777.2454
Matt Spangenberg
Associate Director
mspangenberg@stanjohnsonco.com
+1 312.777.2442
stanjohnsonco.com
The information contained herein was obtained from sources believed reliable, however,
Stan Johnson Company makes no guaranties, warranties or representations as to the
completeness thereof. The presentation of this property for sale, rent or exchange is
submitted subject to errors, omissions, change of price or conditions, or withdrawal
without notices.