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The purpose of this Confidential Investment Offering Overview is to provide a summary of a possible future private investment opportunity that may be made available to a certain limited number of accredited investors. This is not an offer to sell real estate and/or any type of security, partnership interest, public or otherwise.
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15 year triple net lease, with an additional year of interim rental payments. |
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April, 2009 revenues of approximately $8.1 billion with net worth of approximately $650 million. |
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QuikTrip is one of the largest privately owned gasoline/convenience store chains in the nation. |
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The contemplated offering, if made available formally, would provide investors with the opportunity to acquire a partial interest in a 4,555 square foot to-be-built gasoline/retail facility, located in Florissant, Missouri. The building and property will be 100% net leased to QuikTrip Corporation, a nationally recognized gasoline and convenience store chain. Thunderbird Ave, LLC, a SMB Equity, LLC sponsored entity, is acquiring the property from QuikTrip Corporation under a sale-leaseback transaction. The Seller/Tenant will sign a new 15 year, non-cancellable absolute net lease.
The property is being acquired for approximately $3,100,000 with all equity financing, eliminating mortgage debt and risk. The majority of the cash flow generated over the fifteen years of this project will be tax-sheltered. Convenience stores are afforded accelerated depreciation schedules, from the normal thirty-nine years to fifteen years, if fifty-percent or more of the gross revenues are derived from gasoline sales. Thereafter, the project will generate passive income that may be offset by passive losses that an investor has previously carried forward or are currently generated by real estate activity; thereby, deferring the tax burden that this investment may generate.
The purchase of the property will occur in December, 2010 and QuikTrip Corporation will begin constructing the facility in January, 2011. Construction is anticipated to take 18-22 weeks with an estimated store opening in June, 2011. QuikTrip Corporation will begin interim rental payments following the close of the transaction and throughout the construction period. Based on this lease structure, we will receive nearly a full year of rental payments on the land and funding of building improvements before the 15 year lease term begins in November, 2011 which extends to November, 2026.
Since its founding by Chester Cadieux and Burt B. Holmes in 1958, QuikTrip has grown into one of the largest gasoline/convenience store chains in the United States. The family managed firm, currently run by Chester’s son Chet Cadieux, promotes its gasoline as "high-quality" and offers money-back guarantees. In 2004, QuikTrip and Chevron were the first two retailers to earn a "Top Tier" rating from General Motors, BMW, Honda, Volkswagen, Audi, and Toyota. QuikTrip stores are known for a wider-than-average selection of fountain drinks, gourmet sandwiches, and grill items. QuikTrip locations are larger than the average gas station, and offer anywhere from 6 to 24 gas pumps and a large retail space. CNNMoney.com reports that QuikTrip’s sales per store are the highest of any convenience store in the U.S and 3 times the industry average.
QuikTrip operates 558 stores in 10 states, and employs nearly 11,000 people throughout the U.S. In 2010 QuikTrip was ranked as the 41st best company to work for by “Fortune Magazine,” and has been included on the list since 2003. Additionally, QuikTrip is ranked 45th on “Forbes” list of America’s Largest Privately Held Companies.
QuikTrip is a privately held company that generated revenues of approximately $8.1 billion for the year ending April 30, 2010. The company has an approximate net worth of $650 million and is currently rated NAIC2, the S&P equivalent rating of BBB. As a privately held company, QuikTrip Corporation does not publish annual reports. More information regarding QuikTrip can be found in Exhibits B and E as well as by visiting www.quiktrip.com.
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