Shark Tank


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David selberg, Shark Tank

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Shark Tank

  1. 1. Shark TankCapital Connections May 9, 2012
  2. 2. Shark Tank Executive Summary Summary Financials Property Type:   Premium Outlet Center Sources of Funds Amount Per SF GLA:  280,000 SF Debt Financing $36,900,000 $131.79 Investor $14,220,000 $50.79 Location: Southaven, MS  Metro Memphis, TN Sponsor $1,580,000 $5.64 Total Sources $52,700,000 $188.21 Sponsorship: Poag Lifestyle Centers & Simkin Group Key Considerations:  Uses of Funds Land Acquisition $8,300,000  $29.64 • Outlet Centers are currently the favored retail  Construction Costs $32,000,000 $114.29 development Soft/Finance Costs $12,400,000 $44.29 • Cap rates are currently 50bps premium to other  Total Uses $52,700,000 $188.21 retail • Underserved Market/Minimal competition Stabilized NOI $   5,700,000 • High demand from tenants • Traffic Count – 57,000 daily on I‐55 Stabilized Value (7 cap) $81,400,000 • Regional Draw Stabilized Return on Cost: 10.7% • Memphis Metro Population – 1.3 million • 2.0 million within 75 miles radius  Stabilized Debt Yield 15.5% Equity Venture IRR 20.0%+Capital Connections May 9, 2012
  3. 3. Shark Tank SPONSOR OVERVIEW Poag Lifestyle Centers LLC Headquartered in Memphis, TN, Poag Lifestyle Centers has been committed to developing, leasing, and managing some of the country’s finest Lifestyle Centers. Poag and its founders have developed 13 Lifestyle Centers representing over 4,000,000 square foot of space. Today Poag manages 6 Lifestyle Centers encompassing over 3,000,000 square feet. Poag’s success with the lifestyle tenants translates well to outlet centers since some of the tenants found in outlet centers are the same as in Lifestyle Centers, and Poag has teamed up with The Simkin Group because of their long term relationships with the more traditional outlet tenants. In addition, the style of outlet design and construction is moving more toward the style of Lifestyle Centers. Simkin Group • 27 Years experience with developing, leasing, and managing outlet centers. • Ron Simkin spent most of his career with Belz Enterprises, which is considered the founder of the Outlet Factory Centers, where he was the Director of the Factory Outlet Division.Capital Connections May 9, 2012
  4. 4. Shark TankThe Opportunity• Unleveraged operating return of  almost 11%• Equity IRR of more than 20%• Capitalize on trend toward outlet  retail • Successful opening in  Oklahoma City (Sales of  almost $400 psf) • Favorable Cap Rates • Sponsor Strength • Poag brings years of  success in retail  development  • Simkin Group brings years  of success in outlet  development• Strong Growth Area• Minimal CompetitionCapital Connections May 9, 2012
  5. 5. Shark Tank Project Overview • New Outlet Development o 280,000 square foot  development o 43 Acres o 6 pads • Strong Public/Private partnership • Good Location o I‐55 and Church Road o 57,000 cars daily on I‐55 o 20,000 cars daily on  Church Road o No Outlet Competition • Strong Demographics • 2 million people within 75  miles • Southaven has doubled in  size since 2000 • Strong Tenant interest • 80,000 SF in LOI’s under  negotiation • 60% leased prior to  construction startCapital Connections May 9, 2012
  6. 6. Shark Tank Location & Market Overview • Ideally located on I‐55 in Southaven, MS • 4.5 miles from Memphis, TN • Memphis Metro areas only outlet center • Adjacent to Olive Branch, MS which was  the fastest growing city in the country in  2011. • Strong Public/Private partnership with  City of Southaven and State of Mississippi •Located in strong retail hub.  Wal‐Mart,  Home Depot, and Lowes have all opened  up 2nd stores with no meaningful reduction  in sales at the original store 5 Mile 10 Mile 75 MilePopulation 79,333 264,283 1,950,000Households 30,494 98,225 745,500Avg. Income 61,500 56,000 55,300 *Source: CBRE Indianapolis 2011 Market UpdateCapital Connections May 9, 2012
  7. 7. Shark Tank Metro Memphis versus Oklahoma City Metro  Oklahoma  Memphis City35 Mile RingPopulation 1,237,000 1,175,000Households 472,800 471,100Avg. Income 60,900 58,60075 Mile RingPopulation 1,950,000 1,740,000Households 745,500 688,500Avg. Income 55,300 55,300 **OKC sales are almost $400 psf.  At that level, Southaven will generate sales of  over $110,000,000** *Source: CBRE Indianapolis 2011 Market UpdateCapital Connections May 9, 2012
  8. 8. Shark Tank Tenant Profile • Inline space  • Better brands from the  traditional retail concepts • Brands you would typically  find in department stores • Anchors • National Fashion  Department Stores • National Sporting Goods • Unique Restaurants  • 80,000 sf of LOIs currently under  negotiation • Targeting executed leases for 60%  of the space prior to construction  start • Memphis is a major distribution  hub which is opening the door to  unique tenants that do not  typically have outlet stores.Capital Connections May 9, 2012
  9. 9. Shark TankCOMPETITIONShopping Centers/Malls• Southaven Towne Center is 1.8  miles away and contains a  Dillards, Gordmans, JC Penney,  Ashley Furniture and Books‐A‐ Million. Sales of $355 psf• Closest Memphis Mall is 24 miles  away• Dominant Memphis Mall is 33  miles awayOutlet Centers• Casino Factory Outlets is 22 miles  away in Tunica, MS • Poor location • Undersized • Lack of key tenants• Next closest outlet mall is 238  miles away in Birmingham, ALCapital Connections May 9, 2012
  10. 10. Shark Tank May 9, 2012
  11. 11. Shark Tank May 9, 2012
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