dollar general [food] market - office locations - cushman · pdf file ·...

The information set forth herein has been received by us from sources we believe to be reliable. We do not warrant its accuracy or completeness.

Net Lease Investment Services

201 California Street, Suite 800 | San Francisco, CA 94111 | tel 415.781.8100 | fax 415.956.3381 | www.ctbtnnn.com | Cassidy Turley Northern California | Lic #00825241

Dollar General [Food] MarketTAMPA AREA

ONE OF THE WORLD’S MOST SUCCESSFUL RETAILERS•

- Credit Rating Increased For the 3rd Time in 20 Months!

Price: $3,690,000 – 7.75% Cap Rate•

$4+ Billion Net Worth - Fortune 500 NYSE Company•

DG 2010 Profi t Up 85%!!•

Polk City, Florida•

File Photographs

The information set forth herein has been received by us from sources we believe to be reliable.



Dollar General Market Polk City, Florida

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LOCATION Carter Boulevard and Commonwealth Ave SW, Polk City, Florida. Forty-fi ve miles

east of Tampa on Interstate 4.

LOT SIZE Approximately 4.10 acres — 178,596+/– square feet

IMPROVEMENTS To be completed March 1, 2012, a 20,707+/– square foot DOLLAR GENERAL

[FOOD] MARKET. Unlike many dollar stores, this is a masonry building. See

“About the Use.”

LEASE Leased to a subsidiary of and guaranteed by DOLLAR GENERAL CORPORATION for

15 years from June 1, 2012 until June 1, 2027 at an annual rent of $285,940.

The lease is absolute net with tenant responsible for taxes, insurance and general

maintenance expenses including roof, structure and parking lot. There are three

5-year options to renew with 10% rental increases each option period.

ANNUAL INCOME YEARS ANNUAL RENT RETURN1-15 $285,940 7.75%

16-20 (Option 1) $314,534 8.52%

21-25 (Option 2) $345,988 9.38%

26-30 (Option 3) $380,587 10.31%

PRICE $3,690,000 — 7.75% Cap Rate

PRICE PER SQUARE FOOT

$178

RENT PER SQUARE FOOT

$13.81 net per year — $1.15 net per month





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ABOUT THE USE This masonry building will be nearly 21,000 sf, about twice the size of a standard

store for Dollar General. This store will carry the usual merchandise of a normal DG

store; in addition, about ½ the square footage will be devoted to food. DG has about

57 such stores currently. These operate under the name “Dollar General Market,”

as opposed to “Dollar General.” The DG web site states: “We took our Dollar

General stores and expanded our selection of grocery, frozen and dairy items, while

adding fresh produce and fresh meat.” As noted elsewhere in this presentation, the

dollar stores have been beating Wal-Mart handily on same store sales in large part

because it is easier to drive three miles to a nearby dollar store than 20 miles to a

Wal-Mart. BUT, Wal-Marts often have a full grocery selection, which does provide a

shopper an incentive to make that 20 mile drive. The tenant, by opening these DG

Market locations, is siphoning off even more of those Wal-Mart shopping trips.

A standard DG store of about 10,000 sf carries no fresh food at all, and limited

amounts of pre-packaged items: cereal, snack foods, milk, condiments, etc.





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ABOUT THE TENANT(QUANTITATIVE INFORMATION)

DOLLAR GENERAL CORPORATION has been in business since 1939 and its stock

is traded on the NYSE (Symbol: “DG”). Headquartered in a suburb of Nashville,

the company is a national discount variety chain operating 9,496 stores in 35

states as of April 29, 2011. Formerly privately held, the chain went public in

November, 2009. Dollar General is ranked #274 among Fortune 500 companies.

DG HAS MORE STORES THAN ANY OTHER RETAILER IN AMERICA.

For the fi rst quarter ended April 29, 2011, sales were $3.5 billion (10.9%

increase) compared to the same period in fi scal 2010) and net income was $157

million (15.4% increase). Net worth was $4.22 billion.

For the fi scal year ended January 31, 2011, Dollar General reported annual

revenues of nearly $13.04 billion with net income of $627.9 million.

For that fi scal year, compared to the previous fi scal year, DG reported the following

% increases:

Total Sales 10.5%

Same-Store Sales 4.9%

Net Income 85.3%

Net Worth 19.6%

In January 2011, DG announced it would add 625 new stores in 2011, with 6,000

new employees. Growth in 2010 added 5,000 new employees.

Dollar General is rated “BB+” by Standard & Poor’s. When it went public in late 2009, and raised equity at that time, it was upgraded by S&P to “BB–.” It was upgraded for the second time in eight months, in June 2010, to “BB.” Thirteen months later, in July 2011, Dollar General was upgraded yet again, to “BB+.”





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ABOUT THE TENANT(GENERAL BACKGROUND)

The following is paraphrased from a recent company press release:

Dollar General Corporation has been delivering value to shoppers for more than

70 years. Dollar General helps shoppers ‘Save time. Save money. Every day!®’

by offering products that are frequently used and replenished, such as food,

snacks, health and beauty aids, cleaning supplies, basic apparel, housewares and

seasonal items at low everyday prices in convenient neighborhood locations. In

addition to high quality private brands, Dollar General sells products from America’s

most-trusted manufacturers such as Proctor & Gamble, Kimberly-Clark, Unilever,

Kellogg’s, General Mills, Nabisco, Hanes, PepsiCo and Coca-Cola. Learn more

about Dollar General at www.dollargeneral.com





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DOLLAR STORESBEATING UP ON WAL-MART

The four largest “dollar store” chains, by market cap, and annual sales are:

APPROXIMATE MARKET CAP

ANNUAL SALES

Dollar General (tenant) $11.16 Billion $13.04 Billion

Dollar Tree $ 8.14 Billion $ 5.88 Billion

Family Dollar $6.44 Billion $ 7.87 Billion

99¢ Only $1.43 Billion $ 1.42 Billion

All these are beating Wal-Mart handily. For the second quarter of 2010, all had

same-store sales up 6-7%. Wal-Mart sales were down 1.4%. Recent articles have

emphasized this fact. Wal-Mart has asked its suppliers to follow the dollar stores

and “get cheaper” by downsizing the portions. Instead of a single bag of candy at

$2.00, please package it as two bags for $1.00.

From a recent internet article:

“{The• dollar stores} have been revamping up service efforts and offerings

{such as} Kraft brands.”

“An• other [advantage]...is location and operating cost. While Wal-Mart is

mostly suburban and rural-based, {dollar stores} can be tucked into strip

malls with low rent and overhead, {while Wal-Mart} requires giant swaths of

land.”

“The• Dollar General CEO said , ‘our difference is our low price in a convenient location.’”

From a page one article in the NY Times, September 22, 2010, entitled “In Hard

Times, $1 Items Lure Shoppers, and Retailers Scramble”:

“Dollar stores have best been able to capitalize on the downmarket trend because

of the strategies they embraced during the recession, when the stores kept things

cheap and expanded their merchandise...shoppers often could not afford regular-

size detergent [so] the [dollar] stores worked with manufacturers to create smaller

packages which cost less...[a certain Dollar General shopper said the reason she

goes to dollar stores instead of Wal-Mart is] ‘you don’t have the big crowds and it

is cheap’...same store sales at the dollar stores have increased 10 straight quarters

and declined at Wal-Mart fi ve straight quarters...dollar stores have switched out

merchandise like trinkets for necessities like food and detergent because consumers

have really curtailed discretionary spending out of necessity.”





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SITE INFORMATION On State Road 33 (Commonwealth Avenue SW) at Carter Boulevard. The site is

across from the post offi ce and in close proximity to the new 530+ acre University

of South Florida Polytechnic campus (to be constructed) at the intersection of

Interstate 4 and Polk Parkway. The site is only 1.5 miles north of Interstate 4, 35

miles to Disney World.

ABOUT THE AREA Polk City is located approximately in the center of the Florida peninsula, slightly

closer to the west coast. Polk City lies on the Interstate 4 corridor, 45 miles east of

Tampa and 45 miles southwest of Orlando.

DEMOGRAPHICS 2009 ESTIMATE 3-MILE 5-MILE 7-MILE

Population 7,860 11,145 28,948

Average HH Income $58,302 $59,854 $68,993

Growth 2000-2009 24.72% 26.85% 27.31%

The overall growth in the U.S. between 2000-2010 was 9.7%. This is a high

growth area!

NOTE The information set forth herein has been received by us from sources we believe

to be reliable, but we have made no independent investigation of the accuracy or

completeness of the information and make no representations with respect thereto.

The above is submitted subject to errors, prior sale or lease, change in status, or

withdrawal without notice.

FLORIDA





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AERIAL – SITE PLAN

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COMMONWEALTH AVENUE SWCOMMONWEALTH AVENUE SW

FUTURE DRIVEWAY FUTURE DRIVEWAY SPRING, 2012SPRING, 2012





LOWER LEVEL AERIAL

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CLEARWATER CLEARWATER LAKELAKE

LAKE AGNESLAKE AGNES

MUD LAKEMUD LAKE

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POLK CITY POLK CITY ELEMENTARYELEMENTARY

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POLK CITY POLK CITY PARKPARK

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UNIVERSITY OF SOUTH UNIVERSITY OF SOUTH FLORIDA POLYTECHNICFLORIDA POLYTECHNIC(TO BE CONSTRUCTED)(TO BE CONSTRUCTED)





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RCS:dkw:0711:07

Updated Summary Report (%) June 28, 2011

Coordinates Longitude: -81.829980

Latitude: 28.179120

3.0 Mile 4.0 Mile 7.0 Mile Ring Ring Ring

28.27 sq/mi 50.27 sq/mi 153.94 sq/mi

POPULATION 1990 Total Population 3,395 4,868 14,192 2000 Total Population 6,302 8,786 22,7382009 Total Population 7,860 11,145 28,9482014 Total Population 8,216 11,640 29,551% Population Change 1990-2000 85.63% 80.48% 60.22%% Population Change 2000-2009 24.72% 26.85% 27.31%% Population Change 2009-2014 4.53% 4.44% 2.08%

HOUSEHOLDS 1990 Total Households 1,176 1,677 4,933 2000 Total Households 2,068 2,902 7,8442009 Total Households 2,429 3,533 9,9362014 Total Households 2,580 3,770 10,492% Households Change 1990-2000 75.85% 73.05% 59.01%% Households Change 2000-2009 17.46% 21.74% 26.67%% Households Change 2009-2014 6.22% 6.71% 5.60%

2009 RACE % 2009 White Population 85.93% 86.20% 88.53%% 2009 Black Population 6.58% 6.15% 5.09%% 2009 American Indian/Alaska Native 0.61% 0.58% 0.34%% 2009 Asian/Hawaiian/Pacific Islander 0.98% 1.09% 1.36%% 2009 Other Population (Incl 2+ Races) 5.90% 5.98% 4.68%

% 2009 Hispanic Population 11.55% 11.47% 8.89%% 2009 Non-Hispanic Population 88.45% 88.53% 91.11%





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Updated Summary Report (%) June 28, 2011

Coordinates Longitude: -81.829980

Latitude: 28.179120

3.0 Mile 4.0 Mile 7.0 Mile Ring Ring Ring

28.27 sq/mi 50.27 sq/mi 153.94 sq/mi

INCOME2009 Per Capita Income $18,017 $18,974 $23,6812009 Median Household Income $43,072 $44,580 $51,8372009 Average Household Income $58,302 $59,854 $68,993

% 2009 Household Income < $10,000 4.20% 3.77% 3.26%% 2009 Household Income $10,000-$14,999 4.20% 3.77% 3.42%% 2009 Household Income $15,000-$19,999 6.13% 5.52% 4.41%% 2009 Household Income $20,000-$24,999 5.35% 5.24% 4.59%% 2009 Household Income $25,000-$29,999 5.56% 5.18% 4.20%% 2009 Household Income $30,000-$34,999 9.34% 8.64% 6.19%% 2009 Household Income $35,000-$39,999 9.71% 9.06% 6.30%% 2009 Household Income $40,000-$44,999 8.97% 9.63% 6.27%% 2009 Household Income $45,000-$49,999 9.22% 10.00% 8.41%% 2009 Household Income $50,000-$59,999 12.26% 14.39% 16.07%% 2009 Household Income $60,000-$74,999 12.92% 12.49% 15.04%% 2009 Household Income $75,000-$99,999 8.11% 7.93% 15.50%% 2009 Household Income $100,000-$124,999 1.56% 2.15% 3.49%% 2009 Household Income $125,000-$149,999 1.56% 1.53% 2.09%% 2009 Household Income $150,000-$199,999 0.33% 0.25% 0.35%% 2009 Household Income $200,000-$249,999 0.12% 0.11% 0.08%% 2009 Household Income $250,000-$499,999 0.45% 0.34% 0.32%% 2009 Household Income $500,000+ 0.00% 0.00% 0.00%

2009 Average Household Size 2.6 2.6 2.7% 2009 Total Owner Occupied Housing Units 87.03% 86.67% 87.48%% 2009 Total Renter Occupied Housing Units 12.97% 13.33% 12.52%

2009 Total Daytime Population 5,723 8,657 23,6912009 Total Daytime Work Population 1,946 3,081 9,1512009 Total Establishments 282 398 1,185

dollar general [food] market - office locations - cushman · pdf file ·...

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