Midtown Office Center

Transcription

1 VALUE-ADD INVESTMENT OFFERING Midtown Office Center Multi-Tenant Office Buildings franklin road BOISE, ID Great potential for enhanced value and increased cash flow OFFERED BY: Patrick Shalz, SIOR Grove Hummert

2 OFFERING SUMMARY THE OFFERING PROPERTY SUMMARY Offiering Price: $1,885, for the entire Buisness Park Property Name: Midtown Office Center $46.02 per square foot Property Address: Franklin Road Boise, Idaho Property Description: 4 multi-tenantable office buildings plus a developable parking lot Building Size: 40,963 SF Total Parcel Size: 3.09 Acres Total Strong value add property with great potential for enhanced value and increased cash flow with minor improvements Priced well below market value and replacement cost Multiple exit strategies possible: individual owner-user resale, small investor 1031 exchange, core investor resale after stabilization Recent parcelization provided lot splits each with street access allowing for easy individual building/lot resale HOAs and CC&Rs established INVESTMENT HIGHLIGHTS PROPERTY HIGHLIGHTS Four multi-tenant office building in a professional business park Great visibility at a stop light intersection Functional floor plans allowing for a myriad of tenant options Cross easement for parking Building and street signage possible 15,805 average vehicles per day on Franklin Road C-2 General Commercial zoning [2]

3 Property Name: Property Address: Property Type: Building Area: Vacant Lot: Parcel Size: Midtown Office Center Franklin Road Boise, Idaho LOCATION PROPERTY DESCRIPTION Multi-Tenant Office Buildings 40,963 SF (total of all 4 buildings) 20,038 SF Construction Date: 1974 Construction Type: 5 parcels totaling 3.09 Acres Wood frame with stucco PROPERTY SUMMARY PROPERTY NARRATIVE Built in 1974 on the northwest corner of Phillipi Street and Franklin Road, the Midtown Office Center consists of four multi-tenantable office buildings with a developable parking lot allowing for possible expansion. Each building is situated on individual parcels with street access entry. The exterior of the buildings and parking lot have been well maintained and are in good condition. Property Address Story Building Area Parcel ID Parcel Size 5400 Franklin 1 Story 6,632 SF Parcel A 0.44 Acres 5420 Franklin 1 Story 5,852 SF Parcel D 0.25 Acres 5440 Franklin 2 Story 19,831 SF Parcel C 1.17 Acres 5460 Franklin 1 Story 8,938 SF Parcel B 0.77 Acres 5490 Franklin Developable Parking Lot Parcel E 0.46 Acres Totals 40,963 SF 3.09 Acres Zoning: Parking: C-2 General Commercial 4 per 1,000 SF LEASING STATUS Current Occupancy: 56.00% Current Tenants: All Around Sports Lifewater Dental Office Chiropractic Office Law Office Massage Therapy Average Lease Rates: $9.00 to $11.00 per SF [3]

4 LEASE COMPARABLES MARKET STATISTICS COMPARABLES Building Address S. Cole Road W. Emerald Street W. Clinton Street W. Franklin Road Premises Address Suite 252 Suite 200 Suite 27 Suite 207 Submarket Central Central Central Central Quality Class C Class B Class B Class C Building SF 88,000 40,000 9,000 60,000 Occupancy 78.69% 75.94% 88.89% 47.66% Leased SF 2,228 1,533 1,022 2,447 Rental Rate $10.00 $ % $ % $ % Lease Type Mod Gross FLSV Mod Gross FLSVEJ Lease Term 24 months 36 months 36 months 63 months SALE COMPARABLES Building Address W. Jefferson Street E. Chinden Blvd W. Fairview Ave W. Franklin Road Submarket Downtown Eagle West West Quality Class C Class B Class B Class B Year Built/Reno App Building SF 17,000 52,000 34,000 22,000 Lot Size 1.06 Acres 5.89 Acres 1.95 Acres 1.83 Acres Sale Price $850, $4,100, $1,650, $1,000, App Price per SF $50.00 $78.85 $48.53 $45.45 Sale Date 01/ / / /2014 User Type Investment Investment User Investment [4]

5 PROPERTY PHOTOGRAPHS 5400 FRANKLIN 5420 FRANKLIN 5440 FRANKLIN 5460 FRANKLIN [5]

6 SITE PLANS BUILDING 5420 BUILDING 5440 BUILDING 5460 NOT A PART BUILDING 5400 [6]

7 LOCATOR MAP site [7]

8 Idaho Incentives/Tax Credits: 2016 Tax Reimbursement Incentive (TRI) - New in Companies who bring new value-added jobs to the state of Idaho may be eligible for a tax reimbursement of up to 30% of their payroll, sales and income taxes for a negotiated period of up to 15 years. To qualify, companies must create 50+ jobs in an urban setting with average wages for project at above county wage (Ada County = $43,028, Canyon County = $31,770, Elmore County = $30,097). Must have community match. Idaho Business Advantage For qualifying companies it: Increases the Investment Tax Credit to 3.75% against the corporate income tax. This is for the personal property part of the project (machinery/equipment computers). Real Property Improvement Tax Credit of 2.5% against corporate income tax - $125,000 per taxable year with 14 year carry forward so total of $1,750,000. This is the real property part of the project (land/buildings). New Jobs Tax credit increases the standard $1000/per job corporate income tax credit up to maximum of $3,000/per job, depending on wages paid. Sales & Use Tax Rebate of 25%. This is for any sales & use tax that is paid for the property constructed, located or installed within the project. Small Employer Growth Incentive local county commissions can grant an exemption on all or part of the new investment value from property taxes for a determined period of time. This would have to be petitioned to the commission where the project would be located. To qualify a company must make a minimum $500,000 investment in new facilities and create at least 10 new jobs that pay at least $40,000 annually plus benefits. Average wage for all other jobs created must be $15.50/hr plus benefits. Idaho Opportunity Fund Grant program which allows the Director of Idaho Department of Commerce to direct funds to projects for infrastructure needs within the community. This $3 million fund will be used within this year to help close new projects. Property Tax Exemption Businesses that invest in new manufacturing facilities may receive partial or full property tax exemptions from local county commissioners. To qualify, business must invest a minimum of $3 million in new manufacturing facilities. 80% of investment must be made in one location. Work Force Development Training Fund Grant funds, through Idaho Dept. of Labor, available to help train new employees and/or avoid layoffs by upgrading the skills of existing employees in Idaho. Jobs must be $12/hr or more with benefits and the company must produce a product or service that is mainly marketed outside the region where the business is located. 3% Investment Tax Credit Credit against Idaho Corporate Income tax for qualifying new investment in tangible personal property (machinery & equipment) in Idaho. It can offset up to 50% of a company s liability and may be carried forward 14 years. Personal Property Tax Exemption Businesses are allowed an exemption on the first $100,000 of personal property, such as equipment and furnishings. Effective July % Research and Development Tax Credit 5% tax credit on qualified research expenses as defined by Section 41 of IRS Code that are conducted in Idaho. Boise Valley Economic Partnership Jana Jones, Director Economic Development Services jjones@bvep.org [8]

9 Idaho Incentives/Tax Credits: 2016 Idaho Power Industrial Efficiency Incentive Cash Incentives for Energy- Efficient Designs. The financial incentive is determined on the least of two calculations: 12 cents per kilowatt-hour (KWh) saved per year OR 70 percent of the incremental project cost from a 2006 energy code rated project to a high efficiency project. Additional information: Idaho Power TIF (Tax Increment Financing) can be used in our Cities in Urban Renewal Districts. This money can be used to fund project costs such as utility construction, land costs, pad and compaction, footings, foundations and other improvements. IRB Industrial Revenue Bonds are a means of primarily financing the construction, enlargement, or equipping of manufacturing plants, and a limited number of non-manufacturing facilities. The project must be under $20 million. FTZ Foreign Trade Zone Businesses that locate in a FTZ can lower costs by deferring or reducing customs duties on imported goods. Both Ada and Canyon counties are within the service area of FTZ #280 and any location within those counties are eligible to apply. NMTC - New Market Tax Credits Available to address a gap in capital for projects located in Low-Income Census Tract areas that exceed $4 million, by providing a Federal tax credit to individuals or corporations that invest in Community Development Entities. LOCAL INCENTIVES: Each local Community has options for new and existing business that create new jobs. These can be TIF funds, waiving of Building permit fees or some of our Cities have job creation grants. Let us help you find the incentives available for your business. Idaho Tax Overview: Sales and Use Tax in Idaho of 6%. This would apply to items purchased or consumed in Idaho. Exemptions are available for equipment and raw materials used directly in manufacturing, processing, or fabrication; clean rooms used in semiconductor and semiconductor equipment manufacturing; and any equipment or material used in research and development activities. We do not tax services including telecommunication services, and utilities such as water, gas, electricity, or natural gas. In our region we do not have any local option sales tax or Inventory tax. Property Tax personal (machinery/equipment) and real (land/buildings) based on market value Rates (depending on location of site): Ada County- Avg. Rate: 1.2%-1.5% Canyon County- Avg. Rate: 1.2%-2.0% Elmore County- Avg. Rate: 1.1%-2.2% Corporate Income Tax Computed at 7.4% of the Idaho taxable income of a corporation. Corporations that are taxable in Idaho and another state or country or are part of a unitary group of corporations, use a 3 factor formula to ascertain how much of the business is conducted in Idaho. The apportionment formula is made up of a property factor, a payroll factor, and a sales factor. These three factors, with the sales factor being double weighted for all taxpayers, are totaled and divided by 4 to compute the Idaho apportionment factor. This factor is then applied to the business income of the corporation to compute income assigned to Idaho. Nonbusiness income allocable to Idaho is added to the income apportioned to Idaho to arrive at Idaho taxable income. Boise Valley Economic Partnership Jana Jones, Director Economic Development Services jjones@bvep.org [9]

10 SIGN AND RETURN VIA OR FAX TO: CONFIDENTIALITY AGREEMENT Patrick Shalz or Grove Hummert - Thornton Oliver Keller Commercial, 250 S. 5th 2nd Floor, Boise, ID Phone: Fax: pat@ grove@ In connection with the offering of the Midtown Office Center, W Franklin Road, Boise Idaho (the Property ) for sale, the undersigned ( Interested Party ) has requested copies of the investment offering package (the Investment Package ) and certain other information for purposes of evaluating the potential purchase of the Property (the Potential Transaction ). The Investment Package together with all other documents, communications, or information furnished by the owner of the Property ( Owner ) or its agent, Thornton Oliver Keller Commercial ( TOK ), to the Interested Party regarding the Property, including without limitation, rent rolls, expenses, tax returns, marketing plans, surveys, and service contracts shall be collectively referred to herein as Protected Information ). In consideration of the foregoing and other good and valuable consideration, Interested Party hereby agrees that the Protected Information when received in whatever form or media shall be deemed confidential. Interested Party shall not directly or indirectly disclose Protected Information to any person or entity; provided Interested Party may disclose the Protected Information to the Interested Party s legal counsel and prospective lender, and, if applicable, the Interested Party s partners, members, or shareholders, for purposes of evaluating the Potential Transaction, so long as such persons have agreed in writing to be bound by the terms hereof or are subject to a confidentiality and nondisclosure agreement, the terms of which are at least as restrictive as the terms hereof. The Interested Party shall (i) treat such Protected Information as strictly confidential, (ii) use the information solely for the purpose of evaluating the Potential Transaction, and (iii) exercise the same degree of care in the protection of such Protected Information as the Interested Party exercises with respect to its own confidential or proprietary information, but in no event may such degree of care be less than reasonable given the nature of Protected Information. Notes, documents, summaries and reports referencing or relating to Protected Information may be made and kept by Interested Party; provided they continue to be subject to the confidentiality, non-disclosure, and destruction provisions set forth herein. The undersigned shall not make copies of Protected Information except for those copies required for use by the Interested Party in the Potential Transaction. In the event Interested Party elects not to proceed with the Potential Transaction, Interested Party shall immediately destroy all Protected Information, including any copies thereof. Neither Owner nor TOK makes any representations or warranties, express or implied, as to the accuracy or completeness of the Protected Information or any other information provided to Interested Party and Interested Party hereby assumes all risks associated with any reliance on the same and waives any and all claims or recourse Interested Party may have against Owner or TOK with respect to the same. Interested Party hereby agrees to defend, indemnify and hold Owner, TOK, Patrick Shalz, Grove Hummert and their respective affiliates, agents, employees, successors and assigns, harmless from and against and all claims, causes of action, damages, losses, liabilities, and expenses, including, without limitation, reasonable attorneys fees, arising out of or related to Interested Party s breach of the terms and conditions of this agreement. This document may be executed in counterparts, each of which together shall constitute one and the same document. Provided, further, this document may be executed electronically and delivered by facsimile or electronic mail, and any such signature shall have the effect of an original signature. The undersigned has/have caused this document to be executed as of the date set forth below. INTERESTED PARTY (POTENTIAL PURCHASER): By: Date: Address: Print Name: Title: Telephone: Company: INTERESTED PARTY (BROKER): By: Date: Address: Print Name: Title: Telephone: Company: [10]