BERENDO APARTMENTS A 16 UNIT VALUE-ADD INVESTMENT OPPORTUNITY LOCATED IN EAST HOLLYWOOD (LOS ANGELES), CALIFORNIA. hfflp.com

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1 hfflp.com BERENDO APARTMENTS A 16 UNIT VALUE-ADD INVESTMENT OPPORTUNITY LOCATED IN EAST HOLLYWOOD (LOS ANGELES), CALIFORNIA Holliday Fenoglio Fowler, L.P. acting by and through Holliday GP Corp., a real estate broker licensed with the California Department of Real Estate, License Number ( HFF )

2 THE OPPORTUNITY HFF is pleased to present for sale, Berendo Apartments (the Property ), a 16 unit multi-housing property situated within the highly desirable East Hollywood submarket of the City of Los Angeles. This 1928 vintage asset boasts three floor plans that include 3 studio, 12 onebedroom, and 1 two-bedroom units each offering vaulted ceilings in select units. The Property is designated a Walker s Paradise location with a 93 Walkscore, meaning that tenants here enjoy a wealth of walkable attractions, stores, restaurants and bars. Furthermore, the neighborhood of East Hollywood offers a dense concentration of hospitals, such as Kaiser Permanente Medical Center, Children s Hospital Los Angeles, and Hollywood Presbyterian Medical Center, offering a strong built-in tenant and employment base. With the current rent roll 21% below market rents for renovated units, an incoming investor will have the opportunity to add value by renovating the balance of the units to further capture rent premiums. Strategically located in an in demand neighborhood for both tenants and investors, Berendo Apartments is poised to benefit from favorable market fundamentals. Berendo Apartments is being offered in conjunction with the neighboring Fountain Arms (14 units) located at 1234 N Berendo Street, totaling 30 units. As such, the portfolio can be purchased as individual assets, or in its entirety. Please refer to page 9 for a map of the portfolio and contact HFF for more information on the additional offerings. 2 BERENDO APARTMENTS

3 3 20% 20% 1 UNIT MIX 12 80% 80% STUDIO (3) 1 BR / 1 BA (12) 2 BR / 1 BA (1) PROPERTY OVERVIEW PROPERTY ADDRESS 1217 N Berendo Avenue Los Angeles, CA UNITS 16 GROSS SF* ±10,950 (702 sq.ft./unit) YEAR BUILT 1928 OCCUPANCY 88% ACREAGE 0.18 PARKING 3 Spaces APN: ZONING: LAR3 *Based on gross building square footage per public record. BERENDO APARTMENTS 3

4 INVESTMENT HIGHLIGHTS PROXIMATE TO JOBS AND AMENITIES Berendo Apartments benefits from its close proximity to local attractions and employment centers. Within a minute drive, residents can commute to over 750,000 jobs and 101 million square feet of office space within the Downtown, Hollywood, and Mid-Wilshire employment centers. The Property is a short walk from Kaiser Permanente, Children s Hospital and Hollywood Presbyterian Medical Center, which combined employ over 19,000 individuals providing an excellent built-in tenant base. Tenants also enjoy the neighboring Barnsdall Art Park, situated a few blocks north of the Property and home to the Los Angeles Municipal Art Gallery and Frank Lloyd Wright s Hollyhock House. Berendo Apartments is also only a short distance away from other local attractions including Sunset Junction (3.9 miles away) the Hollywood Bowl (3.5 miles away), the Griffith Observatory (3.0 miles away), the Hollywood Sign (3.1 miles away), Dodger s Stadium (3.8 miles away) and Staples Center (5.6 miles away). The neighborhood of East Hollywood has become a destination for a diverse array or popular restaurants, offering cuisine ranging from Filipino food at L.A. Rose Cafe to Middle Eastern dining at Falafel Arax. With several new restaurants and bars slated to open in the coming year, East Hollywood is likely to become one of the more popular dining neighborhoods in Los Angeles. SIGNIFICANT UPSIDE POTENTIAL New ownership has the opportunity to implement a renovation program to achieve rent premiums. Current ownership has renovated 10 of the 16 units, allowing new ownership the opportunity to renovate the balance of the units, as current rents are approximately 21% below renovated market rents. LOCATION CATERS TO THE GROWING TRANSIENT DEMOGRAPHIC Berendo Apartments is considered a Walker s Paradise with a Walkscore of 93, according to Walkscore.com. Daily errands, dining, and entertainment do not require a car, catering to the demographic shift among renters who demand immediate access to amenities and public transportation. Residents benefit from convenience access to the Vermont/Sunset station (0.5 miles away from the Property), which runs from North Hollywood to Union Station in Downtown Los Angeles, connecting to all other lines. From the Property, residents can walk to numerous restaurants, local attractions and nightlife venues along Sunset Boulevard, Hollywood Boulevard, Vermont Avenue and Franklin Avenues. 4 BERENDO APARTMENTS

5 GRIFFITH OBSERVATORY PARU S ZANKOU CHICKEN BERENDO APARTMENTS HOLLYWOOD/WESTERN METROLINK SUNSET BLVD. CHURCH OF SCIENTOLOGY SQUARE ONE DINING HOLLYWOOD BLVD. BARSDALL ART PARK HOLLYHOCK HOUSE KAISER PERMANENTE LOS ANGELES MEDICAL CENTER FOUNTAIN AVE PUBLIC HOUSE VERMONT/SUNSET METROLINK HOLLYWOOD PRESBYTERIAN MEDICAL CENTER LA ROSE CAFE LOS FELIZ THEATER THE DRESDEN STARBUCKS CHILDREN S HOSPITAL HOMESTATE LOS FELIZ HILLHURST AVE. VISTA THEATER VONS VERMONT AVE. HOLLYWOOD HOTEL RITE AID BERENDO APARTMENTS 5

6 STRONG ECONOMIC DRIVERS WITH HISTORIC INTEGRITY Berendo Apartments is surrounded by a number of new commercial and residential projects, which will continue to reshape an already burgeoning location. East Hollywood and the surrounding neighborhoods of Hollywood and Los Feliz have retained an aura of historic prestige while maintaining a constant inflow of new developments. The local area has either recently completed, ongoing, or planned development totaling over $4.8 billion. These include projects such as Olive Hill, Cen Fed s 200 unit mixed use project, Hollywood Presbyterian Medical Center s $200 million expansion, CIM s Paseo Plaza, which will offer 370,000 square feet of premier retail and restaurants as well as 375 units, and the Icon at Sunset Bronson Studios which is the Los Angeles headquarters for Netflix. APARTMENT FUNDAMENTALS REMAIN IN LANDLORD S FAVOR According to AXIOMetrics, rent has grown in the submarket to $2,497, outperforming the Los Angeles average by 11.4% year-over-year. Average effective rent growth in the submarket is forecast to average 4.1% per year over the next five years. Vacancy in the Property s submarket is currently 5.06% and is expected to average 4.89% over the next five years. With very limited new multifamily construction in the immediate area, market fundamentals here should remain in the landlord s favor (AXIOMetrics). PASEO PLAZA 6 BERENDO APARTMENTS

7 RENTERS PRICED OUT OF HOME OWNERSHIP Currently, the median home value within a one mile radius of Berendo Apartments is $658,442, equating to a monthly cost of ownership at $2,588 after tax and interest savings. The current asking rent for marketrate units at Berendo Apartments represents a +/- 54% discount to ownership. This assumes a buyer can produce a 20% down payment and qualify for a mortgage. BERENDO APARTMENTS 7

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9 Berendo Apartments is being offered in conjunction with the neighboring Fountain Arms (14 units) located at 1234 N. Berendo Street, totaling 30 units. As such, the portfolio can be purchased as individual assets, or in its entirety. Please see below for a map of the portfolio, and contact HFF for more information. FOUNTAIN ARMS BERENDO APARTMENTS BERENDO APARTMENTS 9

10 BERENDO APARTMENTS INvestment Contacts FINANCING BERENDO APARTMENTS BLAKE A. ROGERS Managing Director T CA License # ALEXANDRA CANIGLIA Associate acaniglia@hfflp.com T CA License # STEVEN PASKOVER Director spaskover@hfflp.com T CA License # hfflp.com ATLANTA AUSTIN BOSTON CAROLINAS CHICAGO DALLAS DENVER HOUSTON INDIANAPOLIS LOS ANGELES MIAMI NEW JERSEY NEW YORK CITY ORANGE COUNTY (CA) ORLANDO PHILADELPHIA PHOENIX PITTSBURGH PORTLAND (OR) SAN DIEGO SAN FRANCISCO TAMPA WASHINGTON, D.C. LONDON