DaVita Dialysis: Clarksville, TN (Nashville MSA)
CAP RATE INCREASES TO 6.60% IN 2021
The lease provides 10% rent increases every 5 years with the next increase occurring in 2021.
LONG TERM CORPORATE LEASE WITH A FORTUNE 500 COMPANY
There are approximately 12 years remaining on the initial lease term with 10% rent increases every 5 years, which continue through each of the two, 5-year renewal option periods. The lease comes with a corporate guarantee from DaVita Inc., a Fortune 500 company with $11.4 billion in revenue and an estimated net worth of $4.04 billion. As of June 30, 2019, DaVita served 231,700 patients at 2,971 outpatient dialysis centers, of which 2,723 centers were located in the U.S. and 248 centers were located in 9 countries outside the United States. DaVita is recognized as one of “America’s Largest Public Companies” on the 2019 Forbes List and has been part of Fortune Magazine’s List of “World’s Most Admired Companies” for 12 consecutive years.
SUPERIOR DAVITA LEASE WITH MINIMAL LANDLORD RESPONSIBILITIES
The subject property is a well-established, single tenant DaVita Dialysis clinic situated in Clarksville, which is part of the Nashville MSA. The lease has minimal landlord responsibilities, especially when compared to the majority of other DaVita and Fresenius leases that require significantly more Landlord responsibilities such as maintenance of the building structure, roof membrane replacement, HVAC replacement, day-to-day management and replacement of the parking lot areas. The subject property’s lease is modified triple net with Landlord responsibilities limited to the replacement of the structure and structural elements of the roof only.(1)
MAJOR CAPITAL IMPROVEMENTS COMPLETED IN 2016/2017
Estimated $370,000 in major renovations or repairs to three new HVAC units, new flooring, interior and exterior paint, electrical work, landscaping, lighting, ADA upgrades and repairs to the roof.(2)
WELL-ESTABLISHED LOCATION / PART OF THE NASHVILLE MSA
The subject property has a 31-year operational history as a dialysis clinic at this location. It is surrounded by several medical office tenants and situated less than one mile from Maury Regional Hospital, the flagship hospital in the Maury Regional Healthcare system. Columbia is part of the Nashville MSA and located approximately 48 miles south of Downtown Nashville.
WARREN BUFFET’S BERKSHIRE HATHAWAY IS DAVITA INC.’S LARGEST SHAREHOLDER
Berkshire Hathaway owns approximately 38.5 million shares of DaVita Inc. stock, making them the company’s largest shareholder with a 24% stake. Berkshire Hathaway is ranked #4 on the Fortune 500 list of largest publicly traded companies. Warren Buffet has served as the company’s CEO for over 50 years.(3)
(1) Buyer will need to verify the accuracy of this information during their Due Diligence Period. Marcus & Millichap and its affiliates have not verified and will not verify any information contained herein. Buyer must conduct their own due diligence.
(2) Estimated renovation costs provided by Seller. Buyer will be provided a copy of estimated renovation costs during their Due Diligence Period and will need to verify the accuracy of the information. Buyer must conduct their own due diligence.
(3) Source: www.money.cnn.com
TN Broker of Record: Jody McKibben
License: 307629
