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E X C L U S I V E O F F E R I N G
WENDY’S PORTFOLIO2 7 U N I T S I N N O R T H C A R O L I N A & V I R G I N I A
TABLE OF CONTENTS
04 OFFER & PROCEDURE
05
07 INVESTMENT OVERVIEW
EXECUTIVE OVERVIEW
EXCLUSIVELY LISTED BY:
Braden CrockettFounder & Managing [email protected] #01946071
Devin FlemingAssociate [email protected] #02100483
Dalton Barnes Broker Of [email protected] #0225252293
O F F E R P R O C E D U R E
3WENDY'S | 27 UNIT PORTFOLIO
AREA has been retained as their exclusive agent to facilitate this transaction acting as the primary point of contact and will be available to consult with all qualified prospective Buyers who receive the OM. Any interest in the OM with the intent of making an offer should be communicated directly through AREA.
You have been approved to receive this OM after signing the Non-Disclosure Agreement and will be granted access to the deal room files. However, this does not mean that you have been qualified as a purchaser for this transaction or that your offer to purchase this business will be accepted by the Seller. No asking price listed. Prospective Buyers are encouraged to submit their best offers; however, the Seller reserves the right to accept or reject any offer, for any reason. Buyers are further encouraged to submit their offer as soon as they are fully prepared as the Seller reserves the right to accept an offer prior to the call for offers deadline above. The Seller further reserves the right to negotiate the final purchase price and terms of sale with any prospective Buyer(s).
The deal room files contain the original source documents provided by the Seller to AREA and AREA has standardized the financials provided for a prospective buyers' convenience and expedited review however, mistakes do happen. Thus, AREA makes no representations to the accuracy of the information and advises that this representation shall not be relied upon.
Seller owns some of the real estate in which they hold a fee simple interest however, Seller intends to sell the business assets only. The sale of the business assets will be contingent upon new 20 Year Leases in place at closing at their respective rates.
WARNING: UNDER NO CIRCUMSTANCE SHALL A PROSPECTIVE BUYER VISIT THE LOCATIONS OR DISCUSS WITH EMPLOYEES WITHOUT SELLERS PRIOR WRITTEN AUTHORIZATION AND CONSENT.
While incomplete offer submission may be considered, they will be negatively impacted by lack of detail:
1. A Letter of Intent (“LOI”) along with dates for a closing timeline – see One Drive for a Sample LOI that Buyer may use for this transaction.
2. The Closing Date shall be no later than December 23rd, 2021. Offers with a closing date in 2022 may still be considered, however will be heavily discounted due to potential increased tax implications for the Seller.
3. Valuation: The components of your valuation for this package. Such metrics include, but are not limited to, EBITDA, EBITDA multiples and G&A assumptions. Additionally, Buyer shall separately allocate a price they are willing to offer for the Oak Ridge Building Improvements atop the ground that is leased. Sellers preference is to sell the improvements but will consider leasing back to buyer at $130,000 gross rent.
4. Proof of Funds and Financing Pre-Approval - Documentation indicating buyer has sufficient equity to close the transaction. In addition, a term sheet from your qualified lending institution identifying this transaction and/or a statement confirming that you have sufficient financial resources to complete the transaction in the event you enter a binding written agreement with the Seller.
5. An Indication from Corporate that:
i. For New Franchisee’s: You are in the approval stages to become a franchiseeii. For Existing Franchisee’s: Preliminary approval from Corporate as an operator in good standing.
Y O U R O F F E R M U S T I N C L U D E :
EXECUTIVE OVERVIEW
The franchise locations are largely concentrated in Central & Southern Virginia with 24 locations and the remaining 3 Locations in just across the southern Virginia border in North Carolina.
L O C A T I O N S
27
T O T A L S F
7 8 , 6 0 7 S F
Alpha Real Estate Advisors (“Alpha”) has been retained as the exclusive representative of Seller offering the rare opportunity to acquire a portfolio of 27 Wendy’s Franchise locations (Operating Business Only) across North Carolina and Virginia. The Seller currently owns the franchise rights to 27 Wendy’s franchise business’s, (made up of 26 currently in operation, 1of which is a Relocation Build-to-Suit in development in progress and 1 new greenfield Build-to-Suit location also in development both with an estimated delivery date in Q1 2022).
P R I C E
B E S T O F F E R
A V E R A G E P R O P E R T Y S I Z E
3 , 1 4 4 S F
T O T A L L O T S I Z E
2 6 . 2 7 A C
EXECUTIVE OVERVIEW
GEOGRAPHIC LOCATIONS
REIMAGE REQUIREMENTS
The Seller is currently compliant with all Reimage/Remodel obligations having completed required remodels on 50% of their stores through 2020. Seller is also on-track to remain compliant with the 2021 quota by completing renovations on 16 Stores by year end. By the end of 2022, 3 additional stores will be up for remodel to stay in compliance with 19 remodeled stores required.
INVESTMENT OVERVIEW
RARE OPPORTUNITY TO GAIN ACCESS TO DOMINANT, PREMIER QSR FRANCHISE Ø Stabilized Portfolio of Operations with seasoned in-place Management team
provides an attractive “plug and play” opportunity ripe for Private Equity Investors interested in penetrating an exclusive franchise brand with a critical mass of stores.
CANDIDATE FOR ROLL-UP STRATEGY - RARE FRAGMENTED GEOGRAPHIC REGIONØ Rare opportunity to execute a roll-up strategy that typically does not exist
with an established, mature brand like Wendy’s but the surrounding states of VA, NC, WV, TN, MD, OH, KY, SC, DE, GA, & PA appear to be significantly more fragmented than the rest of the country
Ø 138 Franchise Operators controlling 30 Units or less out of an estimated 160 total Operators.
Ø 138 Operators collectively control 778 Sites
Ø Average of 5.67 Units/Operator -> significantly less than the system-wide average of 22 sites/Operator.
I N V E S T M E N T H I G H L I G H T S
7WENDY'S | 27 UNIT PORTFOLIO
STRONG MOMENTUM WITH ROOM FOR FURTHER AUV GROWTHØ Revenue is up over 7.50% registering AUV’s just under $1.5M providing
capacity for significant further AUV expansion.
Ø Virtuous Cycle – High Volume Stores generate higher margins, resulting in an exponential expansion to the bottom line.
VALUE-ADD PURSUITS & FUTURE GROWTH CATALYSTSØ Return of Dine-In: The vast majority of stores have been limited to drive thru
only, due to the Covid-19 Pandemic, potentially providing future upside to Buyer capturing revenue growth with the return of dine-in customers.
Ø Wendy’s CEO Todd Penegor stated that, [System-wide] Wendy’s restaurants with dining rooms open are getting 10% of their sales through those areas. That’s “a long ways away from where we were pre-COVID at about one-third of our mix being through the dining room,”
Ø Breakfast: Currently makes up 7% of sales mix and Wendy’s anticipates breakfast to account for 10% by the end of 2022.
Ø Digital Sales: 8% of Revenue in US -> Driven by growth in delivery and mobile orders
Ø Q1 2021 US Systemwide Same Store Sales advanced by 13.5% YOY driven triple D’s -> “Digital, Delivery and Drive-Thru” Performance.
EXCLUSIVELY LISTED BY:Braden CrockettFounder and Managing [email protected] #01946071
Devin FlemingAssociate [email protected] #02100483
Dalton Barnes Broker Of [email protected] #01984625 (CA) #738521(TX) #225252293 (VA)
