847 Lincoln Blvd Santa Monica OFFERING MEMORANDUM. 847 Lincoln Blvd SANTA MONICA, CA 90403

Transcription

1 OFFERING MEMORANDUM 847 Lincoln Blvd SANTA MONICA, CA Lincoln Blvd Santa Monica 1

2 Listed By DAVID HARRINGTON EVP & National Director - Multifamily Direct (310) Mobile (310) David.Harrington@matthews.com LIC# (CA)

3 OFFERING MEMORANDUM 847 Lincoln Blvd SANTA MONICA, CA Property Overview Location Overview Financial Overview 3

4 04 PROPERTY OVERVIEW

5 Opportunity 847 Lincoln Blvd is a 6 unit apartment building in prime Santa Monica with proximity to Montana Avenue. This is an extremely rare opportunity for an investor to purchase a value-add multifamily property in this area. The property has a walk score of 91 out of 100 and is a short walk to a variety of dining, shopping and entertainment options along Montana Avenue. The property is also a short 10 to 15 minute walk from the beach. The units consist of all one bedroom, one bathroom floor plans with a current average rent of $1,852 per month. One bedroom units in this immediate area are currently renting from $2,450 to $2,600. A new investor can capitalize on the tight rental market and high rents in this neighborhood by implementing a strategic unit interior renovation plan, which will upgrade the units and allow the buyer to command top of the market rents. Rents at the high end of the range result in 40% rent upside potential. Property Description 6 Units, Built in 1924 Gross Building Square Footage of 5,438 All One Bedroom, One Bathroom Units Two Separate Structures on One Parcel Front Building Consists of Four, 1 Bedroom / 1 Bathroom Units Back Building Consists of Two, 1 Bedroom / 1 Bathroom Units above 5 Garage Parking Spaces Back Building has a Pitched Roof Garage Parking is Accessed Through an Alleyway Well-Landscaped Common Area Between the Two Buildings on the Lot Great Curb Appeal Set Back from the Street with Mature Landscaping Lot Size of 7,511 Square Feet with Santa Monica R2 Zoning Walk Score of 91 out of 100 Steps to Shops, Dining, and Entertainment along Montana Avenue Just a Few Minutes Walk to the Beach 847 Lincoln Blvd Santa Monica 5

6 Surrounding Area Santa Monica Pier 3rd Street Promenade The Bungalow SUBJECT PROPERTY

7 847 Lincoln Blvd Santa Monica 7

8 08 LOCATION OVERVIEW

9 Location Description A popular Santa Monica neighborhood, Wilshire Montana, sometimes referred to by locals just as north of Wilshire, sits north of Wilshire Boulevard, one of the major thoroughfares running the 15 miles from the Pacific Ocean to Downtown Los Angeles. The western edge of the neighborhood runs right up to the Santa Monica palisades that overlook the ocean. Immediately south of the Wilshire Montana neighborhood you ll find the commercial district of Santa Monica with unparalleled shopping and dining opportunities. Demographics POPULATION 1 MILE 3 MILE 5 MILE 2010 Census 37, , , Estimate 39, , , Projection 41, , ,261 POPULATION GROWTH Percent Change: 2010 to % 4.39% 4.53% Percent Change: 2018 to % 3.16% 3.21% HOUSEHOLDS 2010 Census 21,163 82, , Estimate 22,279 86, , Projection 23,054 89, ,148 INCOME Average Household Income $140,246 $143,330 $141,798 Median Household Income $96,265 $96,598 $94, Lincoln Blvd Santa Monica 9

10 Getting Around RIDE THE TRAIN The Expo Line runs from 5am to 1:30am daily every 6 minutes during peak hours and every 12 minutes off-peak. Riders can go almost anywhere for $1.75 with free transfers for 2 hours. TAKE THE BUS Metro Bus: Similar to the Expo Line, you can go almost anywhere for $1.75 with free transfers for 2 hours. The Metro has frequent service on Wilshire Blvd., Santa Monica Blvd., Venice Blvd. and Downtown Santa Monica. Big Blue Bus: There are 20 available BBB routes that range over 53 square miles. Each line connects to the Expo. Popular service throughout Santa Monica with connections to UCLA, LAX, West LA, and Downtown Los Angeles. Santa Monica Free Ride: Free electric shuttle services are offered within the Santa Monica service area which includes rides to and from Loews Santa Monica Beach Hotel, Shutters on the Beach, Doubletree Suites Santa Monica, Santa Monica Pier, Santa Monica Place, and 3rd Street Promenade. The shuttle operates every day from 11:30am to 9pm. GRAB A BIKE Santa Monica offers 113 miles of bike paths, bike lanes, and bikeways along with over 1,000 bike racks throughout the city. Breeze Bike Share: 80+ stations located throughout Santa Monica and Venice provide residents and guests with 500 shared bikes one can pay for by the hour, prorated by the minute. Riders can take a bike and return them to any station throughout the Breeze 15 square mile service area.

11 Santa Monica Pier The Santa Monica Pier is located right on the beach in the well-known Ocean Avenue neighborhood, which offers a variety of accommodations in close proximity to the Pier, as well as other activities and attractions offered along Ocean Avenue and Downtown Santa Monica. The Santa Monica Pier was the first concrete pier on the U.S. West Coast. This iconic spot is host to a variety of restaurants, retail establishments as well the Pacific Park, a family amusement park with a one-of-a-kind solar paneled Ferris wheel. With an iconic entrance, the pier is popular with residents and visitors as a landmark that is over 100 years old. 847 Lincoln Blvd Santa Monica 11

12 Los Angeles MSA The Greater Los Angeles Area is the second-largest urban region in the United States. The Los Angeles Metropolitan Statistical Area has a population of nearly 13 million residents. Los Angeles is a trend-setting global metropolis with an extraordinary history and a rich cultural heritage. It s known as the Entertainment Capital of the World and is home to renowned museums, along with 75 miles of sunny coastline. TOP EMPLOYERS ECONOMY The LA economy is famously and heavily based on the entertainment industry, with a particular focus on television, motion pictures, interactive games, and recorded music - the Hollywood district of Los Angeles and its surrounding areas are known as the Movie Capital of the United States due to the region s extreme commercial and historical importance to the American motion picture industry. Other significant sectors include shipping/international trade - particularly at the adjacent Port of Los Angeles and Port of Long Beach, together comprising the United States busiest seaport - as well as aerospace, technology, petroleum, fashion and apparel, and tourism.

13 BEACHES The Greater Los Angeles Area has 75 miles of sunny coastline and beaches. Sandy beaches from Malibu down to Newport provide respite from busy freeways. South of LA is the vast city of Long Beach, with long sandy beaches along the ocean and on Alamitos Bay. THEME PARKS Two of the most popular destination spots in Los Angeles, especially for those visiting from out of state, are Disneyland and Universal Studios. These two venues, along with Six Flags Magic Mountain, and Knott s Berry Farm, are LA s most attractive and popular amusement parks. SPORTS Los Angeles is home to several professional and collegiate sports teams. Greater Los Angeles has nine major league professional teams; including hockey, baseball, football, basketball, and soccer teams. Avid sports fans and spectators come to watch their favorite teams play at the Staples Center, Dodger Stadium, and StubHub Center amongst others. 847 Lincoln Blvd Santa Monica 13

14 14 FINANCIAL OVERVIEW

15 Investment Summary Offering Price: $2,995,000 Property Address: 847 Lincoln Blvd Santa Monica, CA Price Per Unit: $499,167 Price Per S.F.: $ Cap (current / market): 2.44% / 4.12% GRM (current / market): / Number of Units: 6 Year Built: 1924 APN: Gross Sq. Ft.: 5,438 Average S.F. Per Unit: 906 Lot Size (Acres): 0.17 Unit Mix Total Units Unit Mix Unit Mix % Current Avg Rent Current Monthly Rent Market Rent Market Monthly Rent % $1,852 $11,109 $2,600 $15,600 Scheduled Monthly Rent: $11,109 $15,600 Scheduled Yearly Rent: $133,308 $187, Lincoln Blvd Santa Monica 15

16 Annualized Operating Summary Current Market Scheduled Gross Income: $133,308 $187,200 40% Upside Less Vacancy Reserve: 3.0% $3, % $5,616 * Other Income: $864 $864 Gross Operating Income: $130,173 $182,448 Expenses: 42.8% $57, % $59,193 * Net Operating Income: $73,070 $123,255 Loan Payments: $60,867 $60,867 Pre-Tax Cash Flow: 0.6% $12, % $62,387 ** Plus Principal Reduction: $15,227 $15,227 Total Return Before Taxes: 1.4% $27, % $77,614 ** * As a percent of Scheduled Gross Income ** As a percent of Down Payment Other income is estimated at $12 per unit per month Proforma Annual Operating Expenses Current Per Unit % of SGI *Taxes 1.15% x Sale Price $34,443 $5, % Off-Site Management 4.0% x GOI $5,207 $ % *Insurance Actual 2017 $4,483 $ % Repairs & Maintenance $500 x Units $3,000 $ % Turnover $250 x Units $1,500 $ % Utilities Actual 2017 $4,321 $ % Administrative Actual 2017 $1,425 $ % Contract Services Actual 2017 $2,724 $ % Total Expenses $57,102 $9, % Current Per Unit % of SGI Non-controllable expenses: Taxes, Ins., Reserves: $38,926 $6, % Total Expense without Taxes $22,660 $3, %

17 Rent Roll # Unit Mix Rent Market Rent 1 A 1+1 $2,002 $2,600 2 B 1+1 $1,990 $2,600 3 C 1+1 $2,080 $2,600 4 D 1+1 $2,002 $2,600 5 E 1+1 $1,835 $2,600 6 F 1+1 $1,200 $2,600 Totals $11,109 $15,600 Averages $1,852 $2, Lincoln Blvd Santa Monica 17

18 Sales Comparables Address 847 Lincoln Blvd Santa Monica, CA Idaho Ave th Street 624 Lincoln Blvd th Street 820 4th Street th Street Averages

19 Units Yr Built Square Feet Price Price Per Unit Per Foot Cap Rate GRM Sold Date Unit Mix ,438 $2,995,000 $499,167 $ % None All 1 Bedroom Units ,310 $3,500,000 $583,333 $ % /15/17 All 2 Bedroom Units ,978 $4,050,000 $675,000 $ % /22/17 (1) - 4 Bd House (1) - 3/2 (3) - 2/ ,914 $6,000,000 $500,000 $ % /30/17 All 2 Bedroom Units ,220 $2,650,000 $530,000 $ % /19/18 (1) Studio / (3) - 1/1 /(1) - 2/ ,282 $4,255,000 $607,857 $ % /5/17 (4) - 2/1 (2) - 1/ ,812 $4,115,000 $411,500 $ % /29/17 (2)- 3/2 / (5) - 2/ ,586 $4,095,000 $551,282 $ % Lincoln Blvd Santa Monica 19

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21 Rent Comparables Address Number of Units Year Built Floor Plan Asking Rent Square Feet Rent PSF 847 Lincoln Blvd Santa Monica, CA $1, $ Lincoln Blvd Santa Monica, CA $2, $ Washington Ave Santa Monica, CA $2, $ Lincoln Blvd Santa Monica, CA th Street Santa Monica, CA $2, $ $2, $3.31 Average $2, $ Lincoln Blvd Santa Monica 21

22 CONFIDENTIALITY DISCLAIMER AND AGREEMENT This Offering Memorandum contains select information pertaining to the business and affairs of 847 Lincoln Blvd, Santa Monica, CA ( Property ). It has been prepared by Matthews Real Estate Investment Services. 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 Real Estate Investment Services. 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: The Offering Memorandum and its contents are confidential; You will hold it and treat it in the strictest of confidence; and 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 Real Estate Investment Services 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 Real Estate Investment Services 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.

23 Listed By DAVID HARRINGTON EVP & National Director - Multifamily Direct (310) Mobile (310) David.Harrington@matthews.com LIC# (CA) OFFERING MEMORANDUM 847 Lincoln Blvd SANTA MONICA, CA 90403