long-term leased investment offering …...the offering of 400 university avenue is being...

LONG-TERM LEASED INVESTMENT OFFERING MEMORANDUM

SACRAMENTO, CALIFORNIA

4 0 0 U N I V E R S I T Y

A V E N U E

T R A N S AC T I O N A D V I S O R S

500 Capitol Mall, Suite 2300Sacramento, CA 95814

Tel: +1 916.447.6300www.jll.com/sacramento

Michael StassiSenior Vice President

T +1 916 440 1824RE License #01198564

Daniel BakerVice President

T +1 916 440 1839RE License #01705912

LIMITING CONDITIONS

This Offering Memorandum is provided for the sole purpose of allowing a potential investor to evaluate whether there is interest in proceeding with further discussions regarding a possible purchase of, or investment in, the subject Property (the “Property”).

The potential investor is urged to perform its own examination and inspection of the Property and information relating to same, and shall rely solely on such examination and investigation and not on this brochure or any materials, statements or information contained herein or otherwise provided.

Neither JLL, nor any of its partners, directors, officers, employees and agents (”Sales Agents”), nor the owner its partners or property manager, make any representations or warranties, whether expressed or implied, by operation of law or otherwise, with respect to this brochure or the Property or any materials, statements (including financial statements and projections) or information contained herein or relating thereto, or as to the accuracy or completeness of such materials, statements or information, or as to the condition, quality or fitness of the Property, or assumes any responsibility with respect thereto. Such materials, statements, and information have in many circumstances been obtained from outside sources, and have not been tested or verified. Projections, in particular, are based on various assumptions and subjective determinations as to which no guaranty or assurance can be given.

400 UNIVERSITY AVENUEpage 2

4 0 0 U N I V E R S I T Y

A V E N U EE X E C U T I V E S U M M A R Y 04

I N V E S T M E N T H I G H L I G H T S 05

P R O P E R T Y D E S C R I P T I O N 06

F L O O R P L A N 08

PA R C E L M A P 09

S A C R A M E N T O A R E A O V E R V I E W 10

C A M P U S C O M M O N S O V E R V I E W 12

T E N A N T P R O F I L E 13

INCOME AND EXPENSE 14

OFFERING GUIDELINES 15


EXECUTIVE SUMMARYJLL is pleased to of fer 400 University Avenue as a long-term stabilized leased investment with one of Northern California’s largest and most prominent regional law f irms. This iconic of f ice building has been meticulously maintained and features stunning interiors and timeless architecture.

4 0 0 U N I V E R S I T Y A V E N U E

P R I C E $ 5 , 1 0 0 , 0 0 0 ( $ 3 0 0 / S F )

E S T . N O I $ 3 7 6 , 6 6 0

C A P R A T E 7 . 3 9 %

S Q U A R E F E E T ± 1 6 , 9 9 7

T E N A N T S c h u e r i n g Z i m m e r m a n & D o y l e L L P

L E A S E T E R M 7 - y e a r s ( w i t h t w o ( 2 ) 5 - y e a r o p t i o n s t o r e n e w )

L E A S E T Y P E M o d i f i e d - G r o s s ( T e n a n t p a y s e l e c t r i c a l , a l a r m /s e c u r i t y , i n t e r i o r j a n i t o r i a l , a n d l a n d s c a p i n g )


INVESTMENT HIGHLIGHTS • Unique opportunity to acquire one of Sacramento’s most iconic suburban office

properties

• Highly visible, hard-corner location in one of Sacramento’s most desirable

professional services submarkets, Campus Commons

• Executive housing and high-income household abundant area

• Close proximity to the local trade areas’ finest shopping and dining opportunities

• Centrally located with convenient access to Highway 50 and the Central Business

District

• Meticulously maintained, pride of ownership, and long-term leased investment

• Tenant widely recognized as the largest and most prominent medical malpractice

insurance litigation firm in Northern California


PROPERTY DESCRIPTION: GENERAL INFORMATION Building Square Footage ±16,997

Year Built 1972; Extensive Remodel in 1994

Land Area ±2.65 acres (±115,434 SF)

Number of Floors One

Parking 64 (3 ADA)

Site Coverage ±15%

BUILDING SYSTEMS

Frame Construction Masonry bearing walls

Roof Type Pitched with composite asphalt shingles

Heating Type Electric forced air unit (split system)

Cooling Type Chiller/cooling tower (with coils in central air handlers)

Electrical 1,200 amp, 277/480 volt 3-phase, 4-wire

Foundation Concrete slab-on-grade

UTILITY PROVIDERS

Electricity Sacramento Municipal Utility District (SMUD)

Gas N/A

Sewer County of Sacramento

Water City of Sacramento


PROPERTY DESCRIPTION:LEGAL DESCRIPTION

Assessor Parcel Number 295-0040-039

Number of Parcels One

County Sacramento

ZONING / RESTRICTIONS

Zoning Designation C-1-R-PUD - Limited Commercial / Review Planned Unit Development

FLOOD ZONE / STATUS

Flood Zone Flood Zone X (shaded area) - Panel No. 06067C0183H


FLOOR PLAN

±16,997 SF


PARCEL MAP


SACRAMENTO AREA OVERVIEW

Sacramento is the capital of the State of California and the seat of Sacramento County. The city is located towards the north of California’s expansive Central Valley and has an estimated population of 495,234, making it the sixth most-populous city in California. The four-county Sacramento MSA has 2.27 million residents, making it the largest MSA in the Central Valley and the fourth largest in California behind greater Los Angeles, the San Francisco Bay Area and San Diego.

Situated approximately 85 miles northeast of San Francisco, Sacramento is at the intersection of two major interstate freeways (I-5 and I-80) and at the confluence of the Sacramento and American rivers. The area is also served by a number of rail lines including the Amtrak Capital Corridor. This, in addition to convenient access to airports, rail and a deep-water port, makes Sacramento well connected both regionally and nationally. Sacramento is increasingly regarded as a leading business location due to its growing, well-educated population, affordable cost of living, plentiful amenities and overall high quality of life.

CAPITAL CITY OF THE WORLD’S SIXTH LARGEST ECONOMY

In 2016, California leapfrogged France and Brazil to move from 8th to 6th place in the IMF world economy rankings with a GDP of $2.46 trillion. California is the only state on the list of nations and currently sits between the United Kingdown in fifth place ($2.85 trillion GDP) and France ($2.42 trillion GDP). As California continues to become more of a global player, Sacramento will continue to grow in significance as a city and the seat of the legislative body that governs the state.


PROXIMITY MAP

8

executive summary

23

35

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c i ty maP

400 University Avenue

LAKE TAHOE

SAN FRANCISCO

SACRAMENTO INTERNATIONAL

AIRPORT

LOS ANGELES


CAMPUS COMMONS OVERVIEW

400 UNIVERSITYAVENUE

SACRAMENTOCOMMUNITY

CENTER THEATER

AMERICAN RIVER

Sacramento State University campus is less than a mile away offering 58

undergraduate and 40 graduate programs

Campus Commons is one of Sacramento’s most desirable and premier submarkets. It is a quiet

residential community located on the banks of the American River, immediately opposite California State University Sacramento. It

features great demographics, proximity to abundant retail and

amenities, beautiful housing, excellent schools, and easy access

to the Central Business District.

CAMPUS COMMONS

FAIR OAKS BOULEVARD

AMERICAN RIVER DRIVE

• Boudin • Chipotle• European Wax Center• Jacks Urban Eats• Massage Envy• Noah’s Bagels• Noodles & Co• Pinkberry• Smashburger• The UPS Store

• Cafe Bernardo• Insight Coffee

Roasters• Pure Barre• Ruth’s Chris Steak

House• Wildwood Kitchen

& BarH

OW

E AVENU

E

• Capitol Beer & Tap Room

• Buckhorn BBQ• Drybar• Piology• Poke Noke• Safeway • Starbucks• The Organic Coup• Zocalo

Close proximity to Highway 50

Major retail & Rio Del Oro Raquet Club off of Fair Oaks Boulevard

G u y W e s t B r i d g e

S a c r a m e n t o S t a t e U n i v e r s i t y


TENANT PROFILE

REPRESENTATIVE CLIENTS

Founded in 1989, Schuering Zimmerman & Doyle, LLP (www.szs.com) is the largest law firm of trial attorneys specializing in the complex realm of Medical and Legal Malpractice Defense in Northern

• American Building Maintenance, Inc.• Banner Health Western Region• Beta Heathcare Group• Beta Health Pro • Cambridge Integrated Services Group• The Doctors Company (Medical and Legal)

Fairfield Residential• Fairway Physicians Insurance Company• Farmer’s Insurance Company • Hudson Health Care Infinity

• Leader Insurance Company Insurance Company of the West

• The Mutual Risk Retention Group, Inc.• Med Clinic, Inc.• NCMIC (Chiropractic and Legal) Norcal

Mutual Insurance Company Premier Physicians Insurance Company

• Optima Healthcare Insurance Services• ProAssurance• Professional Underwriters Liability

Insurance Company • The Regents of the University of California• Schools Insurance Authority• Sedgwick CMS• Sutter Medical Foundation• Sutter Medical Group• TIG Specialty Insurance• The Travelers Companies• Unigard Insurance Company• United Services Automobile Association

As the largest and most widely recognized leader in their field of practice, SZD has a depth of partners and associates that possess the skills, experience, and knowledge to handle any number of the most complicated and litigious of issues:

• Medical Malpractice Defense • Medical Professional Advocacy • Legal Malpractice Defense • Elder Abuse • Defense of Public Entities • Insurance Bad Faith

C O U R T R O O M

California. SZD specializes in a wide array of the most complex medical and professional litigation with a diverse practice that encompasses many aspects of the insurance industry. SZD handles cases throughout California and Nevada, in state and federal courts, at both the trial and appellate levels. They pride themselves as being a firm of enormous depth with experienced, dedicated trial attorneys that can handle both the unique and broad litigation needs of their clients.

CLIENT LIST

Schuering Zimmerman & Doyle LLPA T T O R N E Y S A T L A W

S Z& D


http://www.szs.com

INCOME AND EXPENSE

Rentable Square Footage: 16,997

Lease Term: Seven (7) years

Base Rental Rate - $/RSF: $2.56 per RSF

Rent Increases: $0.05 per RSF increases every 24 months

Modified-Gross (Tenant pays electric, alarm/security, landscaping and interior janitorial)

Annual Revenue $ 5 2 2 , 1 4 8

Vacancy & Reserve 3 . 0 0 % ( $ 1 5 , 6 6 4 )

Gross Scheduled Income $ 5 0 6 , 4 8 3

Annual Operating Expenses Per Square Foot

Electrical Repair $ 0 . 1 6 ( $ 2 , 6 8 0 )

Gen. Repair & Maintenance $ 0 . 5 4 ( $ 9 , 2 0 8 )

HVAC - Repair & Service $ 0 . 5 2 ( $ 8 , 7 9 9 )

Tree Maintenance $ 0 . 3 4 ( $ 5 , 7 0 0 )

Prof Svc/Legal/Accounting $ 0 . 0 8 ( $ 1 , 4 0 0 )

Management Fee @ 2.0% $ 0 . 6 1 ( $ 1 0 , 4 4 3 )

Pest Control $ 0 . 1 0 ( $ 1 , 6 8 0 )

Utility - Water $ 0 . 6 6 ( $ 1 1 , 1 9 9 )

Utility - Sewer $ 0 . 1 3 ( $ 2 , 2 2 7 )

Insurance $ 0 . 3 6 ( $ 6 , 1 5 9 )

Flood Insurance $ 0 . 2 0 ( $ 3 , 3 2 3 )

Property Taxes @ $5,100,000 $ 3 . 9 4 ( $ 6 7 , 0 0 5 )

$ 7 . 6 4 / y e a r ( $ 1 2 9 , 8 2 3 )

Net Operating Income (NOI) $ 3 7 6 , 6 6 0

CAP RATE PRICE PRICE PER RSF

7.39% $5,100,000 $300

Rent Structure:


The offering of 400 University Avenue is being distributed exclusively by JLL to a select group of investors. The prospective investor will be selected by the Seller in its sole and absolute discretion. JLL will be available to answer questions relative to information contained within this Offering Memorandum.

OFFERING GUIDELINES

We recommend the following information to be submitted with your offer:

• Offer should be in a non-binding letter form• Purchase price• Source(s) of capital (including debt and equity and relative ratios)• Deposit structure, to include timing and amount of non-refundable deposits• Outline of proposed schedule for due diligence and closing• List of contingencies, including buyer’s internal approval process required to close


CONFIDENTIALITY & DISCLAIMERT H I S O F F E R I N G M E M O R A N D U M I S C O N F I D E N T I A L A N D I S F U R N I S H E D T O P R O S P E C T I V E P U R C H A S E R S O F T H E P R O P E R T Y D E S C R I B E D H E R E I N S U B J E C T T O T H E T E R M S O F T H E C O N F I D E N T I A L I T Y A G R E E M E N T P R E V I O U S L Y P R O V I D E D T O A N D E X E C U T E D B Y S U C H P R O S P E C T I V E P U R C H A S E R S . T H I S M E M O R A N D U M I S I N T E N D E D S O L E L Y T O A S S I S T P R O S P E C T I V E P U R C H A S E R S I N T H E I R E V A L U A T I O N O F T H E P R O P E R T Y A N D T H E I R C O N S I D E R A T I O N O F W H E T H E R T O P U R C H A S E T H E P R O P E R T Y . I T I S N O T T O B E U S E D F O R A N Y O T H E R P U R P O S E O R M A D E A V A I L A B L E T O A N Y O T H E R P E R S O N W I T H O U T T H E P R I O R W R I T T E N C O N S E N T O F T H E S E L L E R O F T H E P R O P E R T Y .

T H I S M E M O R A N D U M W A S P R E P A R E D O N T H E B A S I S O F I N F O R M A T I O N A V A I L A B L E T O T H E S E L L E R A N D T O J O N E S L A N G L A S A L L E B R O K E R A G E , I N C . ( J L L ) , T H E S E L L E R ’ S E X C L U S I V E A G E N T I N C O N N E C T I O N W I T H T H E S A L E O F T H E P R O P E R T Y . I T C O N T A I N S P E R T I N E N T I N F O R M A T I O N A B O U T T H E P R O P E R T Y A N D T H E S U R R O U N D I N G A R E A B U T I T D O E S N O T C O N T A I N A L L T H E I N F O R M A T I O N N E C E S S A R Y F O R A C O M P L E T E E V A L U A T I O N O F T H E P R O P E R T Y . T H E C A S H F L O W A N D O T H E R F I N A N C I A L I N F O R M A T I O N C O N T A I N E D H E R E I N A R E F O R R E F E R E N C E O N L Y .

A L T H O U G H T H E I N F O R M A T I O N C O N T A I N E D I N T H I S M E M O R A N D U M I S B E L I E V E D T O B E A C C U R A T E A N D R E L I A B L E , N E I T H E R T H E S E L L E R N O R I T S E X C L U S I V E A G E N T G U A R A N T E E S I T S A C C U R A C Y O R C O M P L E T E N E S S . B E C A U S E O F T H E F O R E G O I N G A N D B E C A U S E T H E P R O P E R T Y W I L L B E S O L D O N A N “ A S I S ” B A S I S , P R O S P E C T I V E P U R C H A S E R S S H O U L D M A K E T H E I R O W N I N D E P E N D E N T A S S E S S M E N T S , I N V E S T I G A T I O N S , A N D P R O J E C T I O N S R E G A R D I N G T H E P R O P E R T Y . A L T H O U G H A D D I T I O N A L M A T E R I A L , W H I C H M A Y I N C L U D E E N G I N E E R I N G , E N V I R O N M E N T A L , O R O T H E R R E P O R T S , M A Y B E P R O V I D E D T O C E R T A I N P R O S P E C T I V E P U R C H A S E R S A S A P P R O P R I A T E , S U C H P A R T I E S S H O U L D C O N F E R W I T H T H E I R O W N E N G I N E E R I N G A N D E N V I R O N M E N T A L E X P E R T S , C O U N S E L , A C C O U N T A N T S A N D O T H E R A D V I S O R S .

T H E S E L L E R E X P R E S S L Y R E S E R V E S T H E R I G H T , I N I T S S O L E D I S C R E T I O N , T O R E J E C T A N Y O F F E R T O P U R C H A S E T H E P R O P E R T Y O R T O T E R M I N A T E A N Y N E G O T I A T I O N S W I T H A N Y P A R T Y A T A N Y T I M E , W I T H O R W I T H O U T N O T I C E . T H E S E L L E R S H A L L H A V E N O L E G A L C O M M I T M E N T O R O B L I G A T I O N T O A N Y P R O S P E C T I V E P U R C H A S E R U N L E S S A N D U N T I L A W R I T T E N P U R C H A S E A N D S A L E A G R E E M E N T H A S B E E N F U L L Y E X E C U T E D A N D D E L I V E R E D A N D A N Y A N D A L L C O N D I T I O N S T O T H E S E L L E R ’ S O B L I G A T I O N S T H E R E U N D E R H A V E B E E N F U L L Y S A T I S F I E D O R W A I V E D .

N O O T H E R P A R T Y , I N C L U D I N G T H E S E L L E R ’ S E X C L U S I V E A G E N T , I S A U T H O R I Z E D T O M A K E A N Y R E P R E S E N T A T I O N A G R E E M E N T O N B E H A L F O F T H E S E L L E R . T H I S M E M O R A N D U M R E M A I N S T H E P R O P E R T Y O F T H E S E L L E R A N D I T S E X C L U S I V E A G E N T A N D M A Y B E U S E D O N L Y B Y P A R T I E S A P P R O V E D B Y T H E S E L L E R A N D I T S E X C L U S I V E A G E N T . N O P O R T I O N O F T H I S M E M O R A N D U M M A Y B E C O P I E D O R O T H E R W I S E R E P R O D U C E D O R D I S C L O S E D T O A N Y O N E E X C E P T A S P R O V I D E D H E R E I N A N D A S P E R M I T T E D B Y T H E E X P R E S S T E R M S O F T H E C O N F I D E N T I A L I T Y A G R E E M E N T .


C O N T A C T D E T A I L S

All inquiries should be directed to the following JLL professionals:

Michael StassiTel: +1 [email protected] License #01198564

Daniel BakerTel: +1 [email protected] License #01705912

Although information has been obtained from sources deemed reliable, Owner, Jones Lang LaSalle, and/or their representatives, brokers or agents make no guarantees as to the accuracy of the information contained herein, and offer the Property without express or implied warranties of any kind. The Property may be withdrawn without notice. If the recipient of this information has signed a confidentiality agreement regarding this matter, this information is subject to the terms of that agreement. ©2018. Jones Lang LaSalle. All rights reserved.

Jones Lang LaSalle Brokerage, Inc., RE License #01856260.

500 Capitol Mall, Suite 2300 | Sacramento, CA 95814www.jll.com

long-term leased investment offering …...the offering of 400 university avenue is being...

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