Houghton Mifflin Harcourt (NASDAQ: HMHC) – Leader in Publishing K-12 Educational Textbooks – Annual Revenues of $1.4 Billion  – The building is leased to Houghton Mifflin Harcourt, a Boston-based educational and trade books publisher. As a leader in textbooks for grades K-12, the company reaches over 50 million students and three million educators in more than 150 countries. Additionally, under HMH Books & Media, the Company publishes award-winning children’s books, novels, non-fiction, and reference titles enjoyed by readers around the world. With the rising demand for technology in the classroom, the Company is seeing an increase in revenue year over year, providing for a growing market base going forward. 

Long Term NNN Lease – New Early 4-Year Lease Extension – Annual Rent Increases – The Tenant has occupied 100 percent of the facility under the in-place lease since September 2007. They have since executed two lease extensions, the most recent executed in January 2020, extending their term another four (4) years and agreeing to 1.5% annual increases in rent. The combination of the newly executed 4-year lease extension and historical long-term tenancy of the tenant provides an investor with mitigated future vacancy risk and a high probability of future lease renewals.

National Distribution Headquarters for Houghton Mifflin – Mission Critical for Distribution of K-12 Textbooks to All 50 States – This facility is the largest of three distribution facilities operated by Houghton Mifflin. It is used as an office and warehouse space by the company’s Education segment, which is the highest grossing division within the company, accounting for 87% of sales in 2019. The facility distributes over 100 million textbooks to schools in all 50 states.   

COVID Resilient – Homeschool Division Coincides with Digital Learning Platform – Houghton Mifflin has a homeschool division that provides textbooks and workbooks that coincides with their digital learning platform, allowing for continued at-home learning support through a combination of products and innovation.

Strategic Location – 6 Miles from Interstate 88 – Proximity to Aurora, St Charles – Just 45 Miles from Downtown Chicago – This facility is ideally located just off Highway 31 and approximately 6 miles from Interstate 88, which connects to Interstate 290 for direct access to Downtown Chicago 45 miles away. The property benefits from its proximity to Aurora, the second-largest city in Illinois, just 9 miles to the south, and St. Charles four miles to the north.

Located in Geneva, Western Suburb of Chicago – Within Chicago Metropolitan Area: 3rd Largest Labor Pool in the U.S. (4.694 Million Workers) – Nearly 1.3 Million SF Industrial Market Attracts Regional and National Logistics Companies – The property is located in Geneva, a city in and the county seat of Kane County, IL, located on the western side of the Chicago suburbs. Geneva is part of the Chicago metropolitan area, which contains the third-largest labor pool in the United States with about 4.694 million workers. The Chicago metro area has one of the highest gross domestic products (GDP) in the world, generating $611.59 billion in 2018. With its central geographic location and proximity to the Great Lakes and the Mississippi River, the Chicago area is served by a well-connected web of national highways and has a 10 million resident population, both of which attract regional and national logistic and retail tenants to its industrial market. This has resulted in continued strong demand for industrial space, with net absorption eclipsing 15.2 million over the past year, the third most of any U.S. metro, behind only the Inland Empire and Dallas. 

Ryan Barr

rbarr@lee-associates.com
O. 760.448.2446
F. 760.929.9977

Ryan Bennett

rbennett@lee-associates.com
O. 760.448.2449
F. 760.929.9977