NORTH TAHOE SELF STORAGE

Transcription

1 EXECUTIVE SUMMARY JANUARY 2017 Accelerating success. NORTH TAHOE SELF STORAGE 590 National Avenue, Tahoe Vista, California The National Self Storage Group of Colliers International THOMAS K. GUSTAFSON, CCIM National Director Self Storage Group GARY R. COOPER, CCIM, JD National Director Self Storage Group TOM DE JONG, MBA Senior Vice President San Jose - Silicon Valley tom.dejong@colliers.com

2 PRESENTED BY: COLLIERS INTERNATIONAL OHIO CONTENTS > COMMUNICATIONS All communications, inquiries and requests should be addressed to: Self Storage Group of Colliers International THOMAS K. GUSTAFSON CCIM National Director MOBILE DIRECT GARY R. COOPER CCIM, JD National Director MOBILE DIRECT TOM DE JONG MBA Sr. Vice President San Jose - Silicon Valley MOBILE DIRECT tom.dejong@colliers.com EXECUTIVE SUMMARY About The Colliers National Self Storage Team...4 The National Colliers Self Storage Practice Group...5 PROPERTY OVERVIEW Overview Map...8 Property Overview...9 Property Summary MARKET OVERVIEW Regional Overview Demographic Report Area Saturation and Demand MARKET RENTAL RATES Summary of Market Rents INCOME & EXPENSE ANALYSIS Income & Expense Analysis...20 Cash Flow Analysis for Expansion Pricing Analysis...22 THE NATIONAL SELF STORAGE GROUP The Colliers Self Storage Listing Team...24 The information contained herein was obtained from sources believed reliable; however, Colliers International makes no guarantees, warranties, or representations as to the completeness or accuracy thereof. The presentation of this property is submitted subject to errors, omissions, change of price or conditions prior to sale or lease, or withdrawal without notice.

3 EXECUTIVE SUMMARY

4 EXECUTIVE SUMMARY About The Colliers National Self Storage Team Comprised of Established in professionals countries 66 16, 000 Colliers International Headquarters - Seattle, Washington Rev enue $2.5B (US$) 2.0B (US$) Law Health Self Multi Firm Care Storage Family $542 Retail Industrial Valuation & Advisory Services 800 million LOI s, Proposals, Closings & Escrows (square feet) Page 4 $112B 19 Practice Groups Investment Sales & Debt Equity Managing Transaction value Appraisals in 2016 >$3.5 Billion Total Value Lease/ sale transactions 80, 000 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

5 The National Colliers Self Storage Practice Group EXECUTIVE SUMMARY Gary R. Cooper CCIM, JD NATIONAL DIRECTOR SELF STORAGE GROUP Colliers International Cleveland, Ohio Thomas K. Gustafson CCIM NATIONAL DIRECTOR SELF STORAGE GROUP Colliers International Cleveland, Ohio Jeffrey R. Shouse MAI EXECUTIVE MANAGING DIRECTOR NATIONAL PRACTICES Colliers International Roseville, California Tom de Jong SENIOR VICE PRESIDENT SAN JOSE-SILICON VALLEY Colliers International San Jose, California Enzennio Mallozzi MANAGING DIRECTOR Colliers International Stamford, Connecticut John Banas SENIOR VICE PRESIDENT, DIRECTOR Colliers International Philadelphia, Pennsylvania Robert S. Jordon, Jr. SENIOR VICE PRESIDENT Colliers International Atlanta, Georgia Richard D. Minker SENIOR VICE PRESIDENT Colliers International Fort Worth, Texas Michael Miggins MANAGING DIRECTOR Colliers International Houston, TX THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG Page 5

6 EXECUTIVE SUMMARY The National Colliers Self Storage Practice Group Tyler Bush ASSOCIATE Colliers International Scottsdale, Arizona Cameron Paktinat ASSOCIATE Colliers International Stamford, Connecticut Brendan C. Green VICE PRESIDENT Colliers International Rosemont, Illinois Adam S. Farber ASSOCIATE Colliers International Charlotte, North Carolina Nate Hansen ASSOCIATE Colliers International Minnetonka, Minnesota Chad Snyder SENIOR ASSOCIATE Colliers International Fort Worth, Texas Russ Williamson INVESTMENT ASSOCIATE Colliers International Columbus, Ohio Mike Plaspohl MBA FINANCIAL ANALYST Colliers International Cleveland, Ohio Amy J. Zmecek CPMC MARKETING SPECIALIST Colliers International Cleveland, Ohio Page 6 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

7 PROPERTY OVERVIEW

8 National Ave PROPERTY OVERVIEW Overview Map North Ave National Ave Tiger Ave Page 8 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

9 Property Overview PROPERTY OVERVIEW North Tahoe Storage Property Highlights Packing & Moving Supplies Sold Onsite Including Boxes and Locks More than 200 Clean & Affordable Storage Units Dolly & Flatbed Carts for Free Onsite Use Uncovered Outdoor Parking Spaces Car, Boat, Truck, Trailer & RV Storage ClickandStor 24/7 Move-In Online Bill Pay Month to Month Storage Rentals in North Tahoe Electronic Gate Access with Code Recorded Video Surveillance Drive-Up Storage Units Manager Available by Phone After Hours Conveniently located along Hwy 267, off I-80 and I-580 near Kings Beach and Crystal Bay Surrounding Areas Northern California Tahoe City Lake Tahoe Olympic Valley Northern Nevada Carson City Reno Local Area Landmarks Kings Beach University of Reno Sierra Nevada College Northstar California Resort Lake Tahoe State Park Crystal Bay Diamond Peak Ski Resort THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG Page 9

10 PROPERTY OVERVIEW Property Summary LOCATION Location Name North Tahoe Self Storage Address 590 National Avenue City Tahoe Vista, CA SITE DESCRIPTION Number of Buildings: 4 Apartment: No Total Indoor Units: 205 Regular Units: 205 Climate Control Units: 0 Outdoor Spaces: 9 Rentable Square Feet (RSF): 17,895 PRICING SUMMARY Price: $4,000,000 Stabilized Pro Forma NOI (With Expansion) $319,364 Year 1 Pro Forma NOI $251,039 Stabilized Pro Forma Cap Rate: 8.00% Year 1 Projected Cap Rate: 6.25% In-Place Cap Rate 5.5% Projected Stabilized Total Annual Return: 12.85% Self Storage # of Unit Unit Total Occupied Occupancy Average Current Market Vacancy Loss Units Type Sq.Ft. Sq.Ft. Sq.Ft % Rent Ask Rent Loss to Lease 18 5X % $66 $66 $66 $0 $0 84 5X ,200 3,750 89% $87 $87 $95 $855 $ X % $126 $126 $126 $252 $ X ,600 5,100 91% $159 $160 $170 $850 $ X ,900 3, % $207 $207 $211 $0 $ X % $300 $300 $300 $0 $0 5 11X ,265 1, % $341 $341 $341 $0 $0 5 12X ,500 1, % $382 $382 $382 $0 $ ,895 16,795 94% $138 $1,957 $1,308 Parking # of Unit Unit Total Occupied Occupancy Average Current Market Vacancy Loss Units Type Sq.Ft. Sq.Ft. Sq.Ft % Rent Ask Rent Loss to Lease 9 10x % $255 $255 $255 $1,275 $ % $255 $1,275 $0 # of Unit Unit Total Occupied Occupancy Average Current Market Vacancy Loss Units Type Sq.Ft. Sq.Ft. Sq.Ft % Rent Ask Rent Loss to Lease ,895 16,795 94% $3,232 $1, TAX SUMMARY County: Placer Parcel IDs: Assessed Value: $2,797,013 Market Value: $2,797,013 Total 2016 Taxes: $32,177 Page 10 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

11 Property Summary FINANCIAL INDICATORS Physical Occupancy 94% Economic Occupancy 85% T-12 Revenue $337,683 Broker Forecast Revenue $352,627 T-12 NOI $219,000 Broker Forecast NOI $251,039 PROPERTY OVERVIEW Revenue Managment Loss to Lease: $15,696 Vacancy: $38,784 Expansion Potential (SF): 7,200 Current Offering + Estimated Expansion Potential Expansion Subject to Local Government Approval. Current Site = 17,895 net RSF regular storage Approximate Expansion Potential = 7,200 net RSF regular storage Total Site = 025,095 net RSF regular storage A 3,600 net RSF (Two-Story) B 3,600 net RSF (Two-Story) THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG Page 11

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13 MARKET OVERVIEW

14 MARKET OVERVIEW Regional Overview Lake Tahoe Large freshwater lake in the Sierra Nevada of the United States Surface elevation of 6,225 ft (1,897 m) Straddles the border between California and Nevada West of Carson City Largest alpine lake in North America Depth = 1,645 ft (501 m), Second deepest in the United States after Crater Lake (1,945 ft (593 m) Sixth largest lake by volume in the United States at 122,160,280 acre ft (150,682,490 dam3), behind the five Great Lakes Formed about 2 million years ago and is a part of the Lake Tahoe Basin with the modern lake being shaped during the ice ages Known for the clarity of its water and the panorama of surrounding mountains on all sides. Area surrounding the lake is also referred to as Lake Tahoe, or simply Tahoe More than 75% of the lake s watershed is national forest land, comprising the Lake Tahoe Basin Management Unit of the United States Forest Service Major tourist attraction in both Nevada and California Home to a number of ski resorts, summer outdoor recreation, and tourist attractions Snow and skiing are a significant part of the area s economy and reputation Mountain and lake scenery are attractions throughout the year Nevada side also includes large casinos Highways provide year-round access to the area Page 14 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

15 Demographic Report MARKET OVERVIEW Demographic and Income Comparison Profile 590 National Ave, Tahoe Vista, California, Prepared by Esri 590 National Ave, Tahoe Vista, California, Latitude: Rings: 3, 5, 10 mile radii Longitude: miles 5 miles 10 miles Census 2010 Summary Population 6,086 11,428 30,255 Households 2,418 4,734 12,310 Families 1,363 2,758 7,509 Average Household Size Owner Occupied Housing Units 1,256 2,787 7,773 Renter Occupied Housing Units 1,162 1,947 4,537 Median Age Summary Population 6,398 12,175 33,052 Households 2,524 5,004 13,355 Families 1,416 2,902 8,127 Average Household Size Owner Occupied Housing Units 1,254 2,809 8,072 Renter Occupied Housing Units 1,270 2,195 5,284 Median Age Median Household Income $50,632 $60,694 $71,190 Average Household Income $79,241 $90,457 $97, Summary Population 6,766 12,976 35,416 Households 2,666 5,318 14,287 Families 1,492 3,077 8,675 Average Household Size Owner Occupied Housing Units 1,299 2,964 8,568 Renter Occupied Housing Units 1,367 2,354 5,718 Median Age Median Household Income $54,236 $70,604 $80,922 Average Household Income $86,858 $99,290 $107,510 Trends: Annual Rate Population 1.12% 1.28% 1.39% Households 1.10% 1.22% 1.36% Families 1.05% 1.18% 1.31% Owner Households 0.71% 1.08% 1.20% Median Household Income 1.38% 3.07% 2.60% THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG Page 15

16 MARKET OVERVIEW Area Saturation and Demand > LEGEND Subject Property - North Tahoe Self Storage 590 National Avenue, Tahoe Vista, CA 1. Airport Self Storage State Highway 267, Truckee, CA 2. Town & Country Self Storage Truckee Tahoe Airport Rd, Truckee, CA 3. Alpine Self Storage 1060 Tahoe Blvd, Incline Village, CA 4. Incline Storage 1074 Taho Blvd, Incline Village, CA 10 MILES 7.17 SF/Person 5 MILES 1.45 SF/Person Saturation Calculations Current Total SF Population Saturation 5 Mile 17,695 12, Mile 236,918 33, Population ,052 Median Household Income 2016 $71,190 Population Growth % Page 16 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

17 MARKET RENTAL RATES

18 MARKET RENTS Summary of Market Rents PROPERTY 5X5 5X10 10X10 10X15 10X20 10X25 10X30 1 Airport Self Storage State Highway 267 Truckee, CA $65 $105 $183 $229 $275 $282 $367 2 Town & Country Storage Truckee Tahoe Airport Rd Truckee, CA $60 $85 $135 $175 $205 $285 3 Alpine Self Storage* 1060 Tahoe Blvd Incline Village, CA *Rental rates currently not available at time of this report. 4 Incline Storage* 1074 Tahoe Blvd Incline Village, CA *Rental rates currently not available at time of this report. SUBJECT PROPERTY - North Tahoe Self Storage 590 National Avenue Tahoe Vista, CA $66 $87 $160 $207 $300 $341 $382 COMPETITOR AVERAGE $63 $101 $171 $211 $252 $282 $326 Page 18 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

19 INCOME & EXPENSE ANALYSIS

20 INCOME & EXPENSE ANALYSIS Income & Expense Analysis Broker Budgeted Stabilized Operating Statement North Tahoe Self Storage Square Footage 17,895 T 12 As- Is, Based on Current Income Total Units 214 Ending in T3 Ann. & Standardized Expenses Year 1 Budget- Underwritten INCOME April '16 PSF Jun '16 PSF Monthly Annually PSF Monthly Annually PSF % PGR Comments Potential Gross Rental Market Annualized Annualized $31,645 $379,740 $21.22 $31,645 $379,740 $ % Loss to Lease & Concessions Loss $0.00 $0.00 $1,308 -$15,696 -$0.88 $1,308 ($15,696) -$ % Vacancy Loss $0.00 $0.00 $3,232 -$38,784 -$2.17 $3,232 ($38,784) -$ % Scheduled Gross Rental Income $337,683 $18.87 $355,085 $19.84 $27,105 $325,260 $18.18 $27,105 $325,260 $ % Gain to Lease $981 $11,772 $ % Absorption $633 $7,595 $ % Effective Gross Rental Income $337,683 $18.87 $355,085 $19.84 $27,105 $325,260 $18.18 $28,719 $344,627 $ % Other Income included included $667 $8,000 $0.45 $667 $8,000 $ % PROJECTED TOTAL INCOME $337,683 $18.87 $355,085 $19.84 $27,772 $333,260 $18.62 $29,386 $352,627 $ % OPERATING EXPENSES Real Estate Taxes $5,327 $0.30 $5,327 $0.30 $2,833 $34,000 $1.90 $2,833 $34,000 $ % underwritten w/ re-assesment Property Insurance $0 $0.00 $0 $0.00 $224 $2,684 $0.15 $224 $2,684 $ % assumed per market stds Utilities $6,662 $0.37 $6,662 $0.37 $555 $6,662 $0.37 $555 $6,662 $ % based off 2015 Maintenance & Repairs $1,193 $0.07 $1,193 $0.07 $432 $5,190 $0.29 $432 $5,190 $ % assumed per market stds Onsite Management $31,125 $1.74 $31,125 $1.74 $1,566 $18,790 $1.05 $1,566 $18,790 $ % assumed per market stds General & Administrative $47,603 $2.66 $47,603 $2.66 $746 $8,948 $0.50 $746 $8,948 $ % assumed per market stds Advertising & Promotion $0 $0.00 $0 $0.00 $417 $5,000 $0.28 $417 $5,000 $ % assumed per market stds Management Fee (5%) $26,775 $1.50 $26,775 $1.50 $1,469 $17,631 $0.99 $1,469 $17,631 $ % underwritten as 5% of income Reserves for Replacements $0 $0.00 $0 $0.00 $224 $2,684 $0.15 $224 $2,684 $ % underwritten as $0.15/sf TOTAL OPERATING EXPENSES $118,684 $6.63 $118,684 $6.63 $8,466 $101,588 $5.68 $8,466 $101,588 $ % $0.00 $0.00 $0.00 NET OPERATING INCOME $218,999 $12.24 $236,400 $13.21 $19,306 $231,672 $12.95 $20,920 $251,039 $ % Page 20 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

21 Cash Flow Analysis for Expansion Expansion Subject to Local Government Approval. INCOME & EXPENSE ANALYSIS IRR Analysis for Expansion For Years ending Year 0 (Construction) Year 1 Year 2 Year 3 Year 4 Net Rentable SF 6,120 Average Rental Rate/SF $1.40 $1.50 $1.53 $1.56 Average Economic Occupancy 25% 60% 85% 88% Rental Income $25,704 $66,096 $95,509 $100,857 Tenant Insurance $432 $1,037 $1,469 $1,521 Total Income $26,136 $67,133 $96,978 $102,378 Expenses ($4.50/sf) $27,540 $28,091 $28,653 $29,226 Net Operating Income ($1,404) $39,042 $68,325 $73,152 NOI psf ($0.02) $0.42 $10.50 $14.36 Debt Service Initial Equity ($765,325) Residual Value $1,269,000 Cash Flow ($765,325) ($1,404) $39,042 $68,325 $1,342,152 Cash on Cash Return 5.10% 8.93% 9.56% IRR 17.82% Distributions -$1,404 $39,042 $68,325 $1,342,152 Cumulative Return $1,448,115 Multiple 1.89 Construction Costs $765,325 Going Out Cap Rate 5.50% Debt (All Cash) $0 Stabilized Expansion Value $1,350,000 Initial Equity $765,325 Debt Payoff $0 Commissions & Closing Costs $81,000 Net Proceeds From Sale $1,269,000 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG Page 21

22 INCOME & EXPENSE ANALYSIS Pricing Analysis Price $4,000,000 Assumable Debt Details PSF $224 Loan Name North Lake Tahoe Self Storage Return Analysis Loan Type CMBS Down Payment 40% $1,650,000 Origination Date 4/9/2015 1st Loan Amount (Assuming Existing Debt) 60% $2,350,000 Servicer Midland Stabilized Pro Forma NOI (With Expansion) $319,364 Balance $2,350,000 Annual Debt Service $144,734 Loan Rate 4.61% Rate 4.61% Rate Type Fixed Amortization: In Years 30 Interest Only Period 4/9/15-5/6/17 Cash Flow $174,629 Estimated Monthly Payment (I/O Period) $9,028 Principal Reduction $37,178 Amortization Period 30 Years (Excluding I/O Period) Total Return $211,808 Estimated Monthly Payment (P&I Period) $12,061 Pro Forma Cap Rate (With Expansion) 8.00% Maturity Date 5/6/2025 Year One Projected Cap Rate 6.28% Defeasible Starting On 5/6/2017 In Place Cap Rate 5.50% Open Prepayment Date 2/10/2025 Leveraged Cash on Cash Return 10.58% Total Return on Down Payment 12.84% Page 22 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

23 THE NATIONAL SELF STORAGE GROUP

24 NATIONAL SELF STORAGE GROUP The Colliers Self Storage Listing Team Gary R. Cooper CCIM, JD NATIONAL DIRECTOR SELF STORAGE GROUP AREA OF EXPERTISE Gary R. Cooper is a National Director of the Self Storage Advisory Group at Colliers International. Over the past 33 years, Mr. Cooper has represented a wide variety of major institutions, individuals, and partnerships in the acquisition and disposition of commercial real estate assets. Mr. Cooper has been a featured lecturer at legal, accounting, and real estate continuing education classes on the subjects of investment real estate and taxation. Mr. Cooper has been quoted about the commercial real estate market and transactions in many trade publications including Globe Street, National Real Estate Investor, Real Estate Forum, Midwest Real Estate News, Real Estate News, Crain s Cleveland Business, Columbus Business First, Cleveland Plain Dealer, Columbus Dispatch, and the Dayton Daily News. Thomas K. Gustafson CCIM NATIONAL DIRECTOR SELF STORAGE GROUP AREA OF EXPERTISE Tom Gustafson is Co-Director of the Colliers International Self Storage Practice Group, a Sales Investment/Debt Equity brokerage team. Tom assists owners and sellers in adding value to their properties, determining the best course of action based on Before and After Tax basis. An owner s best value may be to Hold and Do Nothing, Hold and Refinance or Sell and Tom understands that aligning client real estate requirements with their primary business goals is first and foremost in being a solid, service-providing broker. The Self Storage market today is highly capitalized with aggressive investors. Currently, Tom and his team have over $300 million of investment deals in the pipeline, while his partners are self storage industry leaders in appraisals conducted and loans placed. Tom de Jong MBA SENIOR VICE PRESIDENT SAN JOSE - SILICON VALLEY AREA OF EXPERTISE Tom de Jong is a Senior Vice President of Colliers International and a member of the National Self Storage Practice Group. He specializes in the sale, and disposition of Self Storage and other industrial assets in Northern California and Northern Nevada. Over the past two years Tom has completed 44 transactions: ranging from 4,000 square feet to 110,000+ square feet (including owner user and investment sales). Page 24 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG

25 NATIONAL SELF STORAGE GROUP Mike Plaspohl MBA FINANCIAL ANALYST Self Storage Group AREA OF EXPERTISE Mike Plaspohl is a Financial Analyst with the Cleveland office of Colliers International. Mike has spent the past four years specializing in investment sales transactions, helping close over $40 million worth of real estate, and dealing with office, industrial, self-storage, multifamily, manufactured housing and retail properties. ACCELERATING SUCCESS. Amy J. Zmecek CPMC MARKETING SPECIALIST Self Storage Group AREA OF EXPERTISE Amy J. Zmecek is a Marketing Specialist with the Cleveland office of Colliers International. Amy supports the Self Storage, Manufactured Housing and Multifamily teams with various projects and assignments, including the creation and development of Offering Memorandums and Broker Opinions of Value. She shares her high-level of expertise in Adobe Creative Suite to support the office in its marketing efforts. Comprised of 16,000 professionals Established in 66 countries Revenue $2.5B (US$) Transaction value $112B (US$) Managing 2.0B (square feet) Lease/ sale transactions 80,000 THOMAS K. GUSTAFSON GARY R. COOPER TOM DE JONG Page 25

26 Accelerating success. The National Self Storage Group of Colliers International THOMAS K. GUSTAFSON, CCIM National Director Self Storage Group GARY R. COOPER, CCIM, JD National Director Self Storage Group TOM DE JONG, MBA Senior Vice President San Jose - Silicon Valley tom.dejong@colliers.com