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™1440 S VOSS RD, HOUSTON, TX 77057
TRADER JOE’S - 15 YEAR GROUND LEASE
OFFERING MEMORANDUM
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CONFIDENTIALITY & DISCLAIMER STATEMENT
This Offer ing Memorandum contains select informat ion
pertaining to the business and af fa i rs of Trader Joe’s located
at 1440 S Voss Rd , Houston, TX 77057 (“Property”) . I t has been
prepared by Matthews Retai l Advisors . This Offer ing Memorandum
may not be al l - inclusive or contain a l l of the informat ion a
prospect ive purchaser may desire. The informat ion contained in th
is Offer ing Memorandum is conf ident ia l and furnished solely for
the purpose of a review by a prospect ive purchaser of the
Property. I t is not to be used for any other purpose or made avai
lable to any other person without the wri t ten consent of Sel ler
or Matthews Retai l Advisors . The mater ia l is based in part upon
informat ion suppl ied by the Sel ler and in part upon f inancial
informat ion obtained from sources i t deems rel iable. Owner, nor
their of f icers , employees, or agents makes any representat ion
or warranty, express or impl ied, as to the accuracy or
completweness of th is Offer ing Memorandum or any of i ts contents
and no legal l iabi l i ty is assumed or shal l be impl ied with
respect thereto. Prospect ive purchasers should make their own
project ions and form their own conclusions without rel iance upon
the mater ia l contained herein and conduct their own due di l
igence.
By acknowledging your receipt of th is Offer ing Memorandum for
the Property, you agree:
1 . The Offer ing Memorandum and i ts contents are conf ident ia
l ;
2 . You wi l l hold i t and treat i t in the str ictest of conf
idence; and
3. You wi l l not , d i rect ly or indirect ly, d isclose or
permit anyone else to disclose this Offer ing Memorandum or i ts
contents in any fashion or manner detr imental to the interest of
the Sel ler.
Owner and Matthews Retai l Advisors expressly reserve the r ight
, at their sole discret ion, to reject any and al l expressions of
interest or of fers to purchase the Property and to terminate
discussions with any person or ent i ty reviewing this Offer ing
Memorandum or making an of fer to purchase the Property unless and
unt i l a wr i t ten agreement for the purchase and sale of the
Property has been ful ly executed and del ivered.
I f you wish not to pursue negot iat ions leading to the acquis
i t ion of the Property or in the future you discont inue such
negot iat ions, then you agree to purge al l mater ia ls relat ing
to th is Property including this Offer ing Memorandum.
A prospect ive purchaser ’s sole and exclusive r ights with
respect to th is prospect ive t ransact ion, the Property, or
informat ion provided herein or in connect ion with the sale of the
Property shal l be l imited to those expressly provided in an
executed Purchase Agreement and shal l be subject to the terms
thereof. In no event shal l a prospect ive purchaser have any other
c la ims against Sel ler or Matthews Retai l Advisors or any of
their af f i l iates or any of their respect ive of f icers ,
Directors , shareholders, owners, employees, or agents for any
damages, l iabi l i ty, or causes of act ion relat ing to th is sol
ic i tat ion process or the market ing or sale of the Property.
This Offer ing Memorandum shal l not be deemed to represent the
state of af fa i rs of the Property or const i tute an indicat ion
that there has been no change in the state of af fa i rs of the
Property s ince the date this Offer ing Memorandum.
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TABLE OF CONTENTS
04. Execut ive Summary
06. Property Overv iew
09. Lease Abstract
18 . Tenant Overv iew
20. Area Overv iew
22. Demographics
1440 S VOSS RD HOUSTON, TX 77057
TRADER JOE’S
Mark CohenBroker of Record
License No. 447509
™
Aron ClineVP & Sr. Director
License No. 01904371O 949.432.4509M
[email protected]
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EXECUTIVE SUMMARY
4 I Matthews Retail Advisors
Aron Cline and Matthews Retail Advisors are pleased to
exclusively offer
for sale to qualified investors a prime trophy location net
leased organic
grocery store opportunity located within close proximity to
Downtown
Houston and Uptown Houston. The subject property is a ground
Lease
(Land Fee Simple Ownership) with recent high quality
construction
leased to highly desirable tenant Trader Joe’s. The building is
not
included in the sale but will revert back to the land owner upon
expiration.
The immediate trade area has incredibly high barriers to entry
making it
very difficult for tenants to relocate or for new construction.
Trader Joe’s
is a privately owned company with over 460 locations throughout
the
country but has very strong brand recognition nationwide and has
larger
profit margins than traditional grocery stores. Trader Joe’s
has
approximately 11.3 years remaining on a 15-year lease with CPI
increases
every 5 years that are not to exceed 12%. The subject property
is
conveniently located to serve the affluent Uptown Houston
area,
including Tanglewood; The Memorial Villages, which include
Spring
Valley Village, Piney Point Village, Bunker Hill Village, Hedwig
Village,
Hilshire Village and Hunters Creek Village; and the
Woodlake/Briar
Meadow and Briargrove Communities.
Investment Overview
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Matthews Retail Advisors | 5
Investment Highlights
• Trophy Location Net Lease Organic Grocer – incredibly high
barrier to entry
• Long Term Ground Lease providing long term passive income and
security – Trader Joe’s has approximately 11.3 years remaining on
primary term
• Rare 10 Year Renewal Options providing better financing or
refinancing scenarios in the future; Tenant has Three (3), Ten (10)
Year Options to renew with increases
• Excellent location – Subject Property is located at the
intersection of San Felipe Street and Voss Road, which has ±40,000
VPD and along the main retail corridor
• Across the street from Woodway Collection, a Whole Foods
anchored center with national tenants such as Soulcycle,
Francesca’s Collections, Chase Bank, Carrabba’s, amongst others
• Attractive CPI rental increases capped at 12% every 5 years
during primary term and (including options) – Strong hedge against
inflation
• Located in a growing area of upper income households: Average
Household income within a 5-mile radius is $100,257
• Over 18,851 people within a 1-mile radius and an Average
Household Income of $117,125
• Over 192,093 people within a 3-mile radius and an Average
Household Income of $101,544
• Over 480,996 people within a 5-mile radius and an Average
Household Income of $100,257
• Other dominant tenants in this trade area include: Whole
Foods, HEB, Kroger, CVS, Walgreens, Pei Wei, Starbucks, Chase, Five
Guys, Wells Fargo, 24 Hour Fitness, Mod Pizza, Zoe’s Kitchen,
Comerica bank, Whataburger, amongst many others
• Net leased Trader Joe’s ground lease with no management
responsibilities – Absolute NNN true “coupon clipper”
• Approximately 11.3 years of guaranteed income with an
additional 30 years of potential income upon tenant renewing
options
• Trader Joe’s is one of America’s favorite grocery stores that
is family owned and has a history of being incredibly popular and
successful
Rare Net Lease Organic Grocer - Trader Joe’s Strong Infill
Location with Affluent Demographics
Ideal 1031 Exchange Property
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Matthews Retail Advisors | 6
Executive Summary
TRADER JOE’S1440 S Voss Rd Houston, TX 77057
List Price
.........................................................................................$14,545,000
CAP Rate - Current
...................................................................................4.40%Gross
Leasable Area
.....................................................................
± 15,433 SF Lot
Size.......................................................................
± 1.73 Acres (75,357 SF) Year Built
.......................................................................................................
2012
Annualized Operating DataMonthly Rent Annual Rent Increases CAP
Rate
Current - 12/31/17 $53,333.33 $640,000 4.40%
* 1/1/18 - 12/31/22 $58,666.66 $704,000 CPI 4.84%
*1/1/23 - 12/31/27 $64,533.33 $774,400 CPI 5.32%
* Option 1 (10 Years) $70,986.66 $851,840 CPI 5.86%
* Option 2 (10 Years) $78,085.33 $937,024 CPI 6.44%
* Option 3 (10 Years) $85,893.86 $1,030,726 CPI 7.08%
*Increases are based on a CPI formula, not to exceed 12%. The
rental increases assume the CPI increase will be 10% when every
increase takes place.
Tenant Summary
Tenant Trade Name Trader Joe’s
Type of Ownership Fee Simple
Lease Guarantor Corporate
Lease Type Ground Lease NNN
Landlord Responsibility None
Lease Dated 12/06/11
Rent Commencement Date 1/04/13
Lease Expiration Date 12/31/27
Term Remaining on Lease ± 11.3 Years
Increases CPI Increases Every Five (5) Years and in Options
Options Three (3), Ten (10) Year Options
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PROPERTY OVERVIEW
6 I Trader Joe’s
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Matthews Retail Advisors | 8
Physical Description
Property Name Trader Joe’s
Property Address 1440 S Voss Rd
Houston, TX 77057
Assessor’s Parcel Number 1294280010001
Site Description
Number of Stories One
Year Built 2012
Gross Leasable Area (GLA) ± 15,433 SF
Lot Size ± 1.73 Acres (75,359 SF)
Type of Ownership Fee Simple
Parking ± 76 Surface Spaces
Parking Ratio 3.70 : 1,000 SF
Landscaping Professional
Topography Generally Level
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9 | Trader Joe’s
Tenant: Trader Joe’s East, Inc., a Massachussetts
Corporation
Tenant Address: 800 South Shamrock, Monrovia, CA 91016
Property Address: 1440 South Voss Road, Houston, TX 77057
Date of Lease: December 16, 2011
Rent Commencement: January 4, 2013
Lease Expiration: December 31, 2027
Lease Term: Fifteen (15) Years
Current Rent: $640,000
Rent Increases: CPI Rental Increases Every Five (5) Years during
the primary term and in options; Not to Exceed 12%
Renewal Options: Three (3), Ten (10) Year Options
Annual Rent: 1/01/13 - 12/31/171/01/18 - 12/31/221/01/23 -
12/31/27Option 1 (16 - 26)Option 2 (26 - 36)Option 3 (36 - 46)
Rental Increases: Rent shall increase by cumulative CPI (all
Urban Consumers, All Items) every Five (5) Years, not to exceed 12%
(refer to p. 6, section 3 of lease)
Real Estate Taxes Tenant Shall Pay (refer to p. 11, section 7 of
lease)
Insurance (Tenant): Tenant Shall Pay (refer to p. 13-14, section
9 of lease)
Utilities: Tenant Shall Pay (refer to p. 17, section 11 of
lease)
Repairs & Maintenance: Tenant, at Tenant’s sole cost and
expense, shall maintain the property and all the improvements
thereon (refer to p. 19, section 16 of lease)
ROFR: None
Lease Abstract - Trader Joe’s
$8.49/SF ; $640,000 per YearBased on CPI IncreaseBased on CPI
IncreaseBased on CPI IncreaseBased on CPI IncreaseBased on CPI
Increase
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Matthews Retail Advisors | 10
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Site Plan
11 | Trader Joe’s
Voss Rd ± 40,0
00
AD
T
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Aerial
12 | Trader Joe’s
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Regional Map
RARE TRADER JOE’S IN A MAJOR TEXAS
CITY
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14 | Trader Joe’s
Tenant Map
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Matthews Retail Advisors | 15 15 | Trader Joe’s
Bird’s Eye
S Vos
s Rd ±
40,00
0 ADT
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16 | Trader Joe’s
Uptown HoustonAerial Tenant Map - North
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Matthews Retail Advisors | 17
Uptown Houston3.3 miles from site
Aerial Tenant Map - South
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TENANT OVERVIEW
18 | Trader Joe’s
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Property Name Trader Joe’s
Property Type Net Leased Grocery Store
Parent Company Trade Name T.A.C.T. HOLDING, INC.
Ownership Private
No. of Locations ±460
No. of Employees (All) ±5,500
Headquartered Monrovia, California
Web Site www.traderjoes.com
Year Founded 1958
Trader Joe’s Stores offer upscale grocery fare such as health
foods, organic produce, and nutritional supplements. Trader Joe’s
stocks about 4,000 items, 80% of which are its own private labels,
including its signature Charles Shaw brand wine that sells for $3 a
bottle, soup, snacks, and frozen items. It is the exotic mix of
private-label and imported specialty products combined with the hip
vibe of their stores that draws shoppers into Trader Joe’s grocery
chains.
Started by Joe Coulombe as a Los Angeles convenience store chain
in 1958, fast-growing Trader Joe’s is owned by German billionaire
Karl Albrecht, who founded the ALDI food chain with his late
brother Theo.
Originally a West Coast company, California is Trader Joe’s
largest market. In recent years, the company has been aggressively
adding stores and expanding into new markets, including Florida,
Texas, and upstate New York.
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Matthews Retail Advisors | 20
Houston, Texas
The city of Houston, Texas is located in southeastern part of
the state near the Gulf of Mexico. It is the most populous city in
Texas and the fourth most populous city in the United States. Alive
with energy and rich in diversity, Houston is a dynamic mix of
imagination, talent and first-class attractions that makes it a
world-class city. It exudes a cosmopolitan and down-home vibe while
being nicknamed the “Space City”. With more than 2.2 million
residents, Houston attracts visitors and transplants with a
wonderful mix of world-class arts, booming business, pro sports and
award-winning cuisine.
Understandably, businesses recognize the allure of all Houston
has to offer. Twenty-five companies on the Fortune 500 list call
the Energy Capital of the World home. Once dominated by oil-related
jobs, Houston’s economy has diversified as new, core industries
join energy in the regional employment mix.
Aeronautic research is unsurpassed at NASA headquarters and
Texas Medical Center remains the largest in the world with 47
highly lauded research and treatment institutions.
# Employer
1 Memorial Hermann Healthcare System
2 Continental Airlines, Inc.
3 The University of Texas M.D. Anderson Cancer Center
4 ExxonMobil
5 Shell Oil Company
6 Kroger Company
7 National Oilwell Varco
8 The Methodist Hospital
9 The University of Texas Medical Branch at Galveston
10 Baylor College of Medicine
AREA OVERVIEW
Top Employers
20 | Trader Joe’s
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Discovering HoustonHouston is a city of endless possibilities:
Its history has been marked with achievements from the first word
heard from the moon to the first artificial heart transplant. Known
as the Bayou City for its waterway system, Houston thrives because
it is a great place to work and a great place to live.
The Port of Houston, one of the region’s greatest assets, ranks
as the nation’s largest port in international tonnage and second in
total tonnage. It is an economic engine that produces jobs and
economic prosperity for the local Houston and state economy.
Throughout its history, whenever the port has grown, Houston has
also grown, showing that it has been instrumental in the city’s
development as a center of international trade.
Offering a richly-diverse pool of highly-skilled, multilingual,
multicultural workers, Houston is an attractive city for
businesses. Nearly 25 percent of all adults have completed four
years of college, surpassing the national average, while the median
age is three years younger than the national average.
Houston’s downtown has been revitalized with numerous clubs,
professional sports facilities and musical entertainment that has
helped bring nightlife back to downtown. As one of the few U.S.
cities with resident companies in theater, ballet, symphony and
opera, Houston’s Theater District, located in downtown, offers
visitors and residents alike exciting performances all season long.
The city also shows its devotion to the arts through a full
complement of art museums and critically acclaimed galleries in its
Museum District.
Countless cutting-edge chefs have made a home in Houston, where
diners eat out more than residents of any other city. There are
more than 10,00 restaurants in the Houston area with culinary
choices that represent more than 70 countries and American regions.
This stylish dining scene only provides a glimpse of Houston’s
epicureans offerings, a fact that the city’s culinary masterminds
intent to prove with the Houston Culinary Tours.
Matthews Retail Advisors | 21
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22 | Trader Joe’s
DemographicsPopulation 1-Mile 3-Mile 5-Mile
2021 Projection 19,985 205,686 511,316
2016 Estimate 18,851 192,093 480,996
2010 Census 17,645 175,743 446,433
2000 Census 16,871 159,657 430,200
Growth 2016 - 2021 6.02% 7.08% 6.30%
Growth 2010 - 2016 6.83% 9.30% 7.74%
Growth 2000 - 2010 4.59% 10.08% 3.77%
Households 1-Mile 3-Mile 5-Mile
2021 Projection 10,376 94,310 215,133
2016 Estimate 9,740 87,757 201,364
2010 Census 9,045 79,866 185,407
2000 Census 9,253 75,563 180,652
Growth 2016 - 2021 6.53% 7.47% 6.84%
Growth 2010 - 2016 7.68% 9.88% 8.61%
Growth 2000 - 2010 -2.25% 5.69% 2.63%
Income 1-Mile 3-Mile 5-Mile
Income < $15,000 7.92% 11.61% 11.67%
Income $15,000 - $24,999 7.92% 11.48% 11.79%
Income $25,000 - $34,999 7.60% 9.39% 10.04%
Income $35,000 - $49,999 13.70% 13.38% 12.96%
Income $50,000 - $74,999 15.31% 15.39% 15.11%
Income $75,000 - $99,999 10.99% 9.43% 9.05%
Income $100,000 - $124,999 7.50% 6.64% 6.50%
Income $125,000 - $149,999 6.12% 4.44% 4.51%
Income $150,000 - $199,999 7.07% 5.02% 5.34%
Income $200,000 - $249,999 3.69% 2.81% 3.03%
Income $250,000 - $499,999 6.81% 5.66% 5.54%
Income $500,000+ 5.35% 4.74% 4.48%
2016 Est. Average Household Income $117,125 $101,544
$100,257
2016 Est. Median Household Income $71,000 $56,718 $55,871
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Matthews Retail Advisors | 23
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™
Mark CohenBroker of Record
License No. 447509
Aron ClineVP & Sr. Director
License No. 01904371O 949.432.4509M
[email protected]
