For sale. NNN Investment

1.

FOR SALE
NNN INVESTMENT
COACHELLA,CA
12.57% CAP RATE
+/- 101,787 square feet
20-Year Absolute NNN Lease
Cameron Rawlings
Senior Associate
760.534.2584
[email protected]
DRE# 02102158

CONFIDENTIALITY DISCLAIMER
This Offering Memorandum was prepared by Wilson Meade Commercial Real Estate (“broker”) solely for the use of prospective buyers of (“the subject
property”). Neither the broker nor the owner of the property (“owner”) makes any representation or warranty, expressed or implied, as to the
completeness or the accuracy of the material contained in the Offering Memorandum. Prospective buyers of the subject property are advised that
change may have occurred in the physical or financial condition of the subject property since the time this Offering Memorandum or the financial
statements therein made by broker and owner, and therefore may be subject to variation. Other than historical revenue and operating expense figures
for the subject property, owner has not, and will not, provide broker or any prospective buyer with any income or expense figures, budgets, or
projections regarding the subject property. Prospective buyers of the subject property are advised and encouraged to conduct their own comprehensive
review and analysis of the property. The Offering Memorandum is a solicitation of interest only and is not an offer to sell the subject property. The owner
and broker expressly reserve the right, at their sole discretion, to reject any or all expressions of interest or offers to purchase the subject property and
expressly reserve the right, at their sole discretion, to terminate discussions with any entity at any time with or without notice. The owner shall have no
legal commitment or obligations to any entity reviewing the Offering Memorandum or making an offer to purchase the subject property unless and until
such offer for the subject property is approved by owner pursuant to its finance committee authorities and the signature of a vice president or owner is
affixed to a real estate purchase agreement prepared by the owner. This Offering Memorandum is confidential. By accepting the Offering Memorandum,
you agree (i) that you will hold and treat the Offering Memorandum and its contents in the strictest confidence; (ii) that you will not photocopy or
duplicate any part of the Offering Memorandum; (iii) that you will not disclose the Offering Memorandum or any of its contents to any other entity
without the prior written authorization of the owner; and (iv) that you will not use the Offering Memorandum in any fashion or manner detrimental to the
owner or broker. Wilson Meade Commercial Real Estate obtained the information contained in this Offering Memorandum from sources believed to be
true and reliable, however, we make no guarantee on its accuracy for we have not verified. Price, terms, opinions, conditions, prior sales, leases,
possibility of errors or withdrawal without notice. Wilson Meade Commercial Real Estate strongly recommends that you conduct your own investigations
and verify all contained information on your own. Always gain the advice from your tax and legal advisors prior to the submission of a purchase
agreement. Wilson Meade Commercial Real Estate reserves the right to deny commission to all principals that reserve the right to act as the selling broker
within the agreed upon transaction.

3.

TABLE OF CONTENTS
SECTION I.....................................................OVERVIEW
SECTION II................................FINANCIAL OVERVIEW
SECTION III...................................PROPERTY DETAILS
SECTION IV....................................TENANT OVERVIEW

4.

NNN INVESTMENT FOR SALE
SECTION I
OVERVIEW

5.

OVERVIEW
Leased investment sale of a brand new 101,787 square foot, state-of-the-art, sealed, Class “A”
automated light deprivation cannabis greenhouse. Facility will produce upwards of 35,000
pounds of grade “A” cannabis annually and is leased to M.L.A. Horizon, Inc. dba Green Horizons,
a team composed of industry pioneers and luminaries and will be home to the Boast and SOL
cannabis brands.
This is Green Horizons' initial phase within the subject development, Coachella Cann Park, and
the tenant has options to lease an additional +/- 400,000 square feet within this development.
Tenant has a $1,000,000 lease deposit, plus the tenant is prepaying 2-months rent and NNN fees.
Tenant invested an additional +/-$1.7 million, LED flowing and cultivation lights, drying racks
and security equipment for the subject property, demonstrative of a strong commitment to site
and overall campus development.
Subject property is finished construction and should be ready for occupancy November 1, 2022.
Priced to sell at a strong 12.57% CAP rate for year one. Lease is a new 20-year, absolute NNN
lease with 3%annual escalations. Buyer shall own all FF&E within the property as part of the
sale, as the lease is turnkey; and have a UCC-1 filing on the cultivation lights, drying racks and
equipment for additional security. (+/-$5,000,000 equipment value)
101,787 square feet of Class “A” cannabis cultivation.
4.03 acre parcel within 20-acre development. Phase I with completed guard house and all on
and off-site improvements for the entire development.
New 20-year, absolute NNN lease.
Home to Green Horizons, Boast and SOL cannabis brands, strong tenant experience.
Strong annual 3% lease escalations.
Above market 12.57% CAP rate.
Cash on Cash: Year One: 16.40% and Year Four: 34.13% (see proforma for assumptions).
UCC-1 filing on all equipment as additional lease security.
Above market, $1,814,296 in total lease deposits and prepaid rent.
NNN INVESTMENT FOR SALE

6.

NNN INVESTMENT FOR SALE
SECTION II
FINANCIAL OVERVIEW

7.

NNN INVESTMENT FOR SALE
FINANCIAL OVERVIEW
PURCHASE PRICE:
$34,000,000
PRICE PSF:
$334.03/SF
NET OPERATING INCOME:
$4,275,054
LEASE:
LEASE TERM:
OPTIONS:
ESCALATION:
Absolute NNN
20-years
Three (3), Ten (10) year options to extend
3% annual
LEASE DEPOSIT:
One Million ($1,000,000) USD
PREPAID RENT:
Equal to 2-months plus NNN
CAP RATE:
12.57%
CASH ON CASH:
16.40%
TENANT:
M.L.A. Horizon, Inc. dba Green Horizons

8.

PRO FORMA
48-459 HARRISON STREET, COACHELLA, CALIFORNIA 92236
Green Horizons x Boast - Cultivation Facility
48459 Harrison, Coachella, California
Rental Rates:
Project
Property Size:
Size
M.L.A. Horizon dba
101,787 sqft
$334.03 sqft
Rent psf
101,787
$0.00 sqft
$0.00
TOTAL:
$334.03 sqft
Annual
$356,254.50
$4,275,054.00
0
$356,254.50
$34,000,000.00
$4,275,054.00
Expenses
$
(0.50) $
-
$
NNN Contribution:
$
0.50
-
$
$
Net Operating Inc.
TOTAL Cost:
Monthly
Green Horizons
$34,000,000.00
TOTAL
Commission:
$3.50
Loan Expense:
$
-
$356,254.50
$4,275,054.00
(123,958.00)
$ (1,487,496.00)
$232,296.50
$2,787,558.00
$34,000,000.00
TOTAL Cost / sqft:
$334.03
Cash:
NET INCOME (Fully Leased);
$17,000,000.00
Loan Amount:
50% LTV
$17,000,000.00
Pro Forma
M.L.A. Horizon dba
Refi, 20% take out at 70% LTV, 5.5% interest,
Year 1
Year 2
$4,275,054.00
$4,403,305.62
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
$
4,535,404.79
$
4,671,466.93
$
4,811,610.94
$
4,955,959.27
$
5,104,638.05
$
5,257,777.19
$
5,415,510.50
$
4,535,404.79
$
4,671,466.93 $
4,811,610.94
$
4,955,959.27
$
5,104,638.05 $
5,257,777.19
$
5,415,510.50
Green Horizons
Total
$
Vacancy Rate
NOI
LOAN EXPENSE
$
INTEREST RATE
NET INCOME
$
4,275,054.00 $
4,403,305.62
0%
0%
0%
0%
0%
0%
0%
0%
0%
$4,275,054.00
$4,403,305.62
$4,535,404.79
$4,671,466.93
$4,811,610.94
$4,955,959.27
$5,104,638.05
$5,257,777.19
$5,415,510.50
(1,190,000.00) $
(1,190,000.00) $
(1,190,000.00) $
(1,020,000.00)
(1,487,496.00) $ (1,487,496.00)
8.75%
8.75%
$
7.00%
$
3,345,404.79
7.00%
$
3,481,466.93
7.00%
$
3,621,610.94
$ (1,020,000.00) $ (1,020,000.00) $ (1,020,000.00)
6.00%
$
3,935,959.27
6.00%
$
4,084,638.05
6.00%
$
4,237,777.19
6.00%
2,787,558.00
$2,915,809.62
CAP RATE
12.57%
12.95%
13.34%
13.74%
14.15%
14.58%
15.01%
15.46%
$
4,395,510.50
15.93%
CASH ON CASH
16.40%
17.15%
19.68%
34.13%
35.51%
38.59%
40.05%
41.55%
43.09%
-This information above is outlined from cost estimates and lease terms. Purchase is based on a 35%, third party loan; 7% P&I, 25 yr. term, with new loan in year four of term to 5.5%; P&I, 25-year term, allowing for a
cash out of $5.1M.
-Wilson Meade Commercial does not guarantee any current or future figures as outlined within this Pro Forma; Buyers are advised to conduct their own underwriting. Purchase at your own risk. Pro forma does not
include Buyer closing costs.

9.

NNN INVESTMENT FOR SALE
SECTION III
PROPERTY DETAILS

10.

NNN INVESTMENT FOR SALE
PROPERTY DETAILS
48-459 HARRISON STREET, COACHELLA, CALIFORNIA 92236

11.

NNN INVESTMENT FOR SALE
PHOTOS
48-459 HARRISON STREET, COACHELLA, CALIFORNIA 92236

12.

NNN INVESTMENT FOR SALE
PROPERTY OVERVIEW
High-tech, best in class fully enclosed cultivation facility, totaling 101,787 square feet. Building includes 2,376 LED flowing lights and 264 rolling tables, with an
estimated output of 35,000 lbs. of dried cannabis annually. Gross revenue for the subject phase is estimated to be $33M+ annually. Cultivation area is fully
enclosed to ensure 5-6 cycles annually; with top of line automatic shades, wet wall and massive center corridor flow exhaust fans, clearing the air every two
minutes and ensuring an ambient temperature of 20-30 degrees less than outdoor climate. The natural light, fresh area and dry desert climate will ensure highquality cannabis product at low COGS.
Facility also includes full HVAC areas to include, state-of-the-art drying and curing rooms, a full irrigation room, nursery and cloning room, restrooms,
conference/break room, and managers office. Situated as the first phase of CCP (Coachella Cann Park), a 20-acre master-planned development with onsite
gated entrance and guard facilities. Desert scape landscaping and abundant parking throughout. Facility is connected to city water and sewer, as well as directly
connected to the local electrical company (IID) for 3Mw of electrical service. IID is 25% less in electrical costs when compared to neighboring cities that are on
the Edison service.
Located in Coachella, CA, the CCP park also includes an 11.27 acres development and 6.06-acre development on neighboring parcels. The 6.06 acre is fully
leased to Green Horizons and construction is set to commence shortly on another 125,000 sq. ft., which will be Green Horizons' second phase. Green Horizons
has secured first option rights to the entire remaining square footage, which in total equates to approximately one million (1,000,000) square feet; allowing
the company to strategically grow as they penetrate the market with their low-priced, high-quality flower and premium brand SKU’s.
ADDRESS
48-459 HARRISON STREET, COACHELLA, CALIFORNIA 92236
APN
603-232-010, new parcel map in process of being recorded
ZONED
Conditional Use Permit approved for Cannabis Cultivation, i.e. (6)
10,000 sq. ft. Mixed Light, tier 2 cultivation; (1) Nursery; (1)
Processing.
COMPLETION DATE
March 1, 2022
PARCEL
4.03 acres within master planned cannabis development (20 acres),
known as CCP
FLOWING LIGHTS
2,376 LED California Light Works
FERTIGATION
HE Anderson Injection System
IRRIGATION
Rivulis Drip Irrigation System
CONTROLS
Link 4 environmental control system
STRUCTURE
NextG3N Systems

13.

NNN INVESTMENT FOR SALE
SITE PLAN
SUBJECT PROPERTY

14.

NNN INVESTMENT FOR SALE
SECTION IV
TENANT OVERVIEW

15.

NNN INVESTMENT FOR SALE
TENANT OVERVIEW
Green Horizons is a team of industry leaders launching a meticulously curated house of brands
platform in Coachella, California. Green Horizons’ house of brands debut is the cannabis crossover of
the iconic Boast brand. (www.boastusa.com)
Green Horizons is launching the first 226,787 sq. ft. of its state-of-the-art campus with options to scale
to 1,000,000 sq. ft. as market conditions dictate. Phase I of the Green Horizons campus will consist of
101,787 sq. ft. of state-of-the-art, sealed, Class “A” automated light deprivation greenhouse. Phase II
adds an additional 125,000 sq. ft. that will serve as the company’s corporate headquarters, as well as
its brand incubator, and an additional 101,787 sq. ft. of light deprivation greenhouse.
Green Horizons’ mission is to fuel a portfolio of in-house brands with in-house supply to guarantee
consistency and uniformity. With over 100 years of combined cultivation experience, the company’s
high-tech sun powered cultivation facilities are designed to redefine the cultivation landscape to
create a blue ocean of top shelf flower at below $300 per pound cost basis.
Green Horizons was co-founded by Carlos “Los” Arias and Michael C. Meade. Arias and Meade are
joined by founding partner Tommy Hilfiger, who brings his global entrepreneurial prowess to Green
Horizons, drawing on his success in building global brands and experience in a wide range of operational
matters. Synchronized together, Green Horizons and its principals have the requisite capabilities inhouse to build and scale a profitable cultivation and CPG enterprise: Real estate development; facility
operations; global brand prowess.
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