Lemon Grove Apartments

Transcription

1 OFFERING MEMORANDUM Lemon Grove Apartments 5442 Lemon Grove Ave, Hollywood, Los Angeles, CA LOS ANGELES, CA

2 Presented By GREG AMATO Associate - Multifamily Direct Mobile gregory.amato@matthews.com License No (CA) KYLE MIRRAFATI Senior Associate Direct Mobile kyle.mirrafati@matthews.com License No (CA) DAVID J. HARRINGTON National Director - Multifamily Direct Mobile david.harrington@matthews.com License No (CA)

3 Content 4 PROPERTY OVERVIEW 6 AREA OVERVIEW 12 FINANCIAL OVERVIEW

4 Property Overview Opportunity 5 Units in Prime Hollywood A Majority of Units are Non-Rent Controlled Great Unit Mix of Mainly Two Bedroom Units 24% Potential Rental Upside Property Description Originally a single family dwelling built in 1920 Three units added to the back of property in 1986 Approved by the City as a complete 1986 Construction Property with only One Rent Control Unit Unit Mix - One and Four Parking Spaces On Site Laundry for Additional Income On the corner of Lemon Grove and Wilton, a block away from Paramount Pictures Easy Access to 101 Freeway Extremely close proximity to the various Hollywood Restaurants, Shops and Entertainment Five Units Dense Rental Market Hollywood Sub Market LEMON GROVE AVENUE

5 LOS ANGELES, CA

6 Location Overview Los Angeles MSA Los Angeles is the third largest metropolitan economy in the world, with a population of 13 million and a GDP of over $700 billion. L.A. s rise to global prominence in such a short time is a testament to the can-do spirit of its residents and businesses, and to a culture of thinking big. Los Angeles has always been an incubator of new ideas, and the scale of its economy reflects the impact that L.A. s brand of creativity and innovation has had on the world. And it s a way of thinking that cuts across industries. The Los Angeles economy is exceptionally diversified, with established industry clusters ranging from Aerospace, entertainment, and fashion to biomedical services, consumer products, and tourism. 2 ND Most populous city in the U.S. ±18.6 MILLION CSA Population #1 HIGHEST Percentage of Renters LEMON GROVE AVENUE

7 Hollywood, California Known around the world as the movie capital, the economy of the Los Angeles metropolitan area is famously and heavily based around the entertainment industry. The entertainment industry is primarily focused on television, motion pictures, interactive games and recorded music. Other largely significant sectors of the metropolitans economy include aerospace, technology, petroleum, fashion and apparel, tourism as well as the shipping and international trade business. LOS ANGELES, CA

8 Points of Interest Hollywood and Highland Center Hollywood & Highland is the entertainment center of Los Angeles for tourists and locals alike. Steps away from landmarks like the world famous Walk of Fame and TCL Chinese Theatre, formerly Grauman s, Hollywood & Highland is the perfect place for a Hollywood beginning. The complex has more than 70 retailers, more than 25 dining options, and great nightlife, including a bowling alley and nightclub. The complex has a Metro Rail Red Line station underneath it, as well as affordable parking, making it easy to visit from throughout L.A. Concert Venues The Hollywood Bowl has been the best major outdoor venue for 13 consecutive year according to Pollstar Magazine. It is the largest natural outdoor amphitheater in the United States and the mecca for summer concerts in Southern California. This gorgeous outdoor amphitheater has been hosting concerts since the LA Philharmonic first played here in Nestled in an aesthetically blessed fold in the Hollywood Hills, the 18,000-seat venue can bring out the romantic in the terminally cynical. It s the summer home of the LA Phil, but it s hosted everyone from the Beatles to Big Bird, and today mixes classical concerts with all manner of rock and pop. Museums The Pantages and Fonda Theater has a history as grand and diverse as the stage and screen fare which audiences have flocked to enjoy there for half a century. Both Theaters are conveniently located on Hollywood Blvd close to the subject property. If you want to see more celebrity figures immortalized in wax, be sure to visit the Hollywood Wax Museum. It s the oldest wax museum in the United States Celebrity wax figures of Angelina Jolie, Charlie Chaplin, Elvis and even the Teenage Mutant Ninja Turtles provide a unique and memorable experience for the whole family. Take a trip through history and learn about remarkable feats at the Guinness World Records Museum. Since 1991, the museum has entertained visitors with displays of amazing records in pop culture, sports, nature and human achievements. The Hollywood Museum is a must for movie fans and memorabilia collectors. It s one of the hidden gems of Hollywood, with more than 10,000 props and artifacts from classic and modern movies housed in the three-story building LEMON GROVE AVENUE

9 Local Developments ICON NETFLIX TOWER Construction is slated to wrap up by the end of year, then Netflix will call the entire tower 14 stories and 323,000 square feet home Developer Hudson Pacific Properties proclaimed, Our Netflix deal remains the largest lease ever signed in Hollywood in terms of square feet. Larchmont Buzz says the Colonial-style building that once served Warner Brothers Studios will be renovated; it s a historic landmark and is listed on the National Register of Historic Places. Icon Tower is just one of many tall buildings that s changing Hollywood s skyline. Academy Square is a huge, 3.5 acre project in Hollywood bordered by Vine, DeLongpre, Ivar and Homewood Streets, Urbanize LA reports. KILROY ACADEMY SQUARE There will be 280,000 square feet set aside for shops and office space split among multiple four-story buildings, then a 23-tower that will either contain 250 apartments or 200 apartments and 100 hotel rooms. There have been some guesses as to what kind of retail the project will contain. Curbed LA reported that there would be a 40,000 square foot supermarket. Site preparation is now underway at 6230 Yucca Street, a vacant lot which Related purchased last year for $10.5 million. According to a grading permit issued last week by the Los Angeles Department of Building and Safety, the half-acre property is being developed with an 18-story tower that will feature 114 apartments, 2,100 square feet of retail space and a five-level, 201-car parking garage. Plans call for a mixture of studio, one- and two-bedroom dwellings, as well as amenities such as a pool deck and a fitness center. HIGH RISE RESIDENTAIL COMPLEX Construction for the $125-million residential-retail complex on the former home of the defunkt postproduction firm Deluxe Laboratories is underway. The project, located on a 3.5-acre site at 1350 N. Western Avenue, will be highlighted by a six-story building featuring 254 apartments - including 21 units of affordable housing. RESIDENTIAL-RETAIL COMPLEX Where there once was a House of Blues, there will someday be Sunset Time, mixed-use project featuring a 149-room hotel, 40 residential units and 16,000 SF of retail/food & beverage space in the heart of West Hollywood on the renowned Sunset Strip. SUNSET TIME LOS ANGELES, CA

10 Regional Map Demographics POPULATION 1-MILE 3-MILE 5-MILE 2022 Projection 78, ,431 1,108, Estimate 76, ,248 1,067,563 Growth % 3.24% 3.86% Growth % 3.54% 4.74% HOUSEHOLDS 1-MILE 3-MILE 5-MILE 2022 Projection 29, , , Estimate 28, , ,945 Growth % 3.75% 4.37% Growth % 4.48% 5.67% 2017 Avg Household Size 2.60% 2.29% 2.37% Local Map INCOME 1-MILE 3-MILE 5-MILE $ 0 - $14, $ 15,000 - $24, $ 25,000 - $34, $ 35,000 - $49, $ 50,000 - $74, $ 75,000 - $99, $100,000 - $124, $125,000 - $149, $150,000 - $199, $200,000 - $249, $250,000 - $499, $500, Avg Household Income 2017 Median Household Income $56,658 $70,074 $73,888 $34,958 $42,490 $43, LEMON GROVE AVENUE

11 LOS ANGELES, CA

12 Financial Overview INVESTMENT SUMMARY Offering Price: $1,395,000 Number of Units: 5 Property: 5442 Lemon Grove Avenue Year Built: 1920 and 1986 Hollywood, Los Angeles, CA APN: Price Per Unit: $279,000 Gross Sq. Ft.: 3,382 Price Per S.F.: $ Average S.F. Per Unit: 676 Cap (current / market): 4.01% / 5.46% Lot Size (Acres): 7,004 GRM (current / market): / Zoning: LAR2 UNIT MIX Total Units Unit Mix Current Avg Rent Current Monthly Rent Market Rent Market Monthly Rent Built in 1986 $1,290 $1,290 $1,600 $1, Built in 1986 $1,669 $3,337 $1,900 $3, Built in 1920** $1,387 $2,774 $1,900 $3,800 Scheduled Monthly Rent: $7,101 $9,200 Scheduled Yearly Rent: $85,212 $110,400 **Only One Unit Operating As Rent Control RENT ROLL # Unit Mix Rent Market Rent A 2+1 $1,389 $1, B 2+1 $1,385 $1, A 1+1 $1,290 $1, B 2+1 $1,437 $1, C 2+1 $1,900 $1,900 Totals $7,401 $9,200 Averages $1,480 $1, LEMON GROVE AVENUE

13 ANNUALIZED OPERATING DATA Current Market Scheduled Gross Income: $88,812 $110,400 Less Vacancy Reserve: 3.0% $2, % $3,312* Laundry Income: $700 $700 Gross Operating Income: $86,848 $107,788 Expenses: 34.7% $30, % $31,683* Net Operating Income: $56,003 $76,105 Loan Payments: $40,561 $40,561 Pre-Tax Cash Flow: 2.2% $15, % $35,544** Plus Principal Reduction: $12,468 $12,468 Total Return Before Taxes: 4.1% $27, % $48,012** * As a percent of Scheduled Gross Income ** As a percent of Down Payment Laundry income is estimated at $15 per unit per month PRO FORMA ANNUAL OPERATING EXPENSES Current Per Unit % of SGI *Taxes 1.250% x Sale Price $17,438 $3,488 20% *Insurance $0.35 x GSF $1,184 $237 1% Off-Site Management 4.0% x GOI $3,474 $695 4% Repairs & Maintenance $500 x Units $2,500 $500 3% Contract Services $250 x Units $1,250 $250 1% Utilities $850 x Units $4,250 $850 5% General Administration $150 x Units $750 $ % Total Expenses $30,845 $6, % Current Per Unit % of SGI Non-controllable expenses: Taxes, Ins., Reserves: $18,621 $3, % Total Expense without Taxes $13,408 $2, % LOS ANGELES, CA

14 Property Photos LEMON GROVE AVENUE

15 LOS ANGELES, CA

16 CONFIDENTIALITY & DISCLAIMER STATEMENT This Offering Memorandum contains select information pertaining to the business and affairs of Lemon Grove Apartments located at 5442 Lemon Grove Ave, Los Angeles, CA ( Property ). It has been prepared by Matthews Retail Advisors. This Offering Memorandum may not be all-inclusive or contain all of the information a prospective purchaser may desire. The information contained in this Offering Memorandum is confidential and furnished solely for the purpose of a review by a prospective purchaser of the Property. It is not to be used for any other purpose or made available to any other person without the written consent of Seller or Matthews Retail Advisors. The material is based in part upon information supplied by the Seller and in part upon financial information obtained from sources it deems reliable. Owner, nor their officers, employees, or agents makes any representation or warranty, express or implied, as to the accuracy or completeness of this Offering Memorandum or any of its contents and no legal liability is assumed or shall be implied with respect thereto. Prospective purchasers should make their own projections and form their own conclusions without reliance upon the material contained herein and conduct their own due diligence. By acknowledging your receipt of this Offering Memorandum for the Property, you agree: 1. The Offering Memorandum and its contents are confidential; 2. You will hold it and treat it in the strictest of confidence; and 3. You will not, directly or indirectly, disclose or permit anyone else to disclose this Offering Memorandum or its contents in any fashion or manner detrimental to the interest of the Seller. Owner and Matthews Retail Advisors expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers to purchase the Property and to terminate discussions with any person or entity reviewing this Offering Memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase and sale of the Property has been fully executed and delivered. If you wish not to pursue negotiations leading to the acquisition of the Property or in the future you discontinue such negotiations, then you agree to purge all materials relating to this Property including this Offering Memorandum. A prospective purchaser s sole and exclusive rights with respect to this prospective transaction, the Property, or information provided herein or in connection with the sale of the Property shall be limited to those expressly provided in an executed Purchase Agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims against Seller or Matthews Retail Advisors or any of their affiliates or any of their respective officers, Directors, shareholders, owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property. This Offering Memorandum shall not be deemed to represent the state of affairs of the Property or constitute an indication that there has been no change in the state of affairs of the Property since the date this Offering Memorandum.

17 Lemon Grove Apartments 5442 Lemon Grove Ave, Hollywood, Los Angeles, CA Listed By GREG AMATO Associate - Multifamily Direct Mobile gregory.amato@matthews.com License No (CA) KYLE MIRRAFATI Senior Associate Direct Mobile kyle.mirrafati@matthews.com License No (CA) DAVID J. HARRINGTON National Director - Multifamily Direct Mobile david.harrington@matthews.com License No (CA) LOS ANGELES, CA