Main St & nd St Santa Monica, CA 90405

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1 Main St & nd St Santa Monica, CA RARE INVESTMENT OPPORTUNITY IN SANTA MONICA S OCEAN PARK NEIGHBORHOOD INDUSTRY PARTNERS T info@industrypartners.com SCOTT RIGSBY sr@industrypartners.com CA BRE No JIM JACOBSEN jj@industrypartners.com CA BRE No RICH MALOOF rm@industrypartners.com CA BRE No CA BRE NO

2 Table of Contents Pg + + Executive Summary About the Property Property Highlights About the Neighborhood Market Overview 31 The information contained herein has been obtained through sources deemed reliable but cannot be guaranteed as to its accuracy. Any information of special interest should be obtained through independent verification. INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

3 Executive Summary Rare opportunity to acquire a one-of-kind asset FOR SALE $20,000,000 ABOUT THE BUILDING This investment opportunity consists of two properties located on Main Street at the southern end of Santa Monica on the border of neighboring Venice Main Street is a ±9,500 RSF two-story all-brick retail/office building with ground floor retail and 2nd-floor office space, built in The building has remarkable architectural character through its brick construction, design details, and outdoor patio space. Starbucks Coffee anchors the ground floor located in a ±1,960 SF space on the corner of Main & Hill Starbucks provides a $125,597 annual revenue. Next to Starbucks on Main St, is a ±1,000 SF Seamstress shop, and the rest of the ground floor and basement are currently used as storage. The second floor is occupied by the owner and will also be delivered vacant, so will the seamstress shop and storage space. Per the Assessor s map below, nd St Street is a ±4,990 SF parcel of land on the northwest corner of Hill and 2nd Street, presenting the buyer with an excellent ground up development opportunity. (*buyer to verify development requirements with the City*). No warranty or representation is made to the accuracy of the foregoing information. Terms of sale or lease are subject to change or withdrawal without notice INDUSTRY PARTNERS, INC MAIN ST ND ST, SANTA MONICA, CA APN LOT AREA ±4,997 SF ±4,990 SF BUILDING SF ±9,500 RSF - PARKING LOT - STORIES 2 N/A BUILT 1913 N/A ZONING NC Neighborhood Commercial TENANTS Starbucks N/A OP2 Ocean Park 2 Main St Hill St 3

4 The Property in Context WEST LA SANTA MONICA Subject Property CULVER CITY VENICE MARINA DEL REY PLAYA VISTA INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

5 About the Property 5

6 Ground Floor Retail and Patio A B C D E INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

7 A MAIN ST Ground Floor Floor Plan B STARBUCKS WOMEN S DRESS SHOP HILL ST OWNER OCCUPIED STORAGE D BASEMENT BELOW ±1,000 SF UP DN TO BASEMENT E PATIO C Not to scale For informational purposes only. 7

8 Second Floor A B C D INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

9 MAIN ST Second Floor Floor Plan A RECEPTION H D C F HILL ST B E CONFERENCE ROOM KITCHEN PATIO DN MRR WRR G UP Not to scale For informational purposes only. 9

10 Second Floor E F G H INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

11 Property Summary MAIN ST ND ST SUMMARY MAP APN LOT AREA ±4,997 SF ±4,990 SF BUILDING SF ±9,500 RSF - PARKING LOT - STORIES 2 N/A BUILT 1913 N/A ZONING TENANTS IN-PLACE LEASE NC Neighborhood Commercial Starbucks. Women s Apparel Shop OP2 Ocean Park 2 N/A Annual Cash flow from Starbucks $125,597 Commencement Date: 06/01/16 Expiration Date: 5/31/22 6% Rent Bumps Every 2 Years 1 Option to extend the term for 5 years commencing on June 1, 2022 and expiring May 31, 2027 The information contained herein has been obtained through sources deemed reliable but cannot be guaranteed as to its accuracy. Buyer to verify an information of special interest through independent verification Main St: NC: Neighborhood Commercial Zone Permitted uses: Residential, Restaurants (with some restrictions), Business services, General market, Offices (professional, creative, or medical with limitations), Small scale retail (up to 7,500 sf, 40 liner ft street frontage), artist studio, media production support facility (with limitations) FAR: 0.75 base (2/27 height limit) 1.00 with affordable housing (2/27 height limit) % affordable housing (no story limit/32 height limit) nd St: 2nd St nd St APN: OP2 Zone Land: ±4,990 SF Main St APN: OP2 Zone Building: ±9,500 SF Land: ±4,997 SF Main St Hill St N OP-2: Ocean Park Medium Density Zone (low density residential): This Zoning District is intended to provide a variety of low density housing types that reflects the distinct identity of the Ocean Park neighborhood. These types include single unit housing, duplexes and triplexes, townhouses, and courtyard housing with at least 2,000 square feet of parcel area per unit exclusive of City and State density bonuses. In addition to low density residential development, this District provides for uses such as transitional housing or hospice facilities, family day care, and neighborhood serving uses such as childcare, neighborhood grocery stores, and community facilities that may be appropriate in a residential environment. Permitted uses: Single and multi-family, single room occupancy, family day care, supportive/transitional housing, General Market (CUP) Development standards: + + One story and 14 feet in height for the first 15 feet of horizontal distance on the parcel measured from the front parcel line stories and 18 feet for a flat roof or 23 feet for a pitched roof for that portion of the structure located between 15.1 feet and 30 feet from the front parcel line. + + The maximum permitted height for structures beyond 30 feet from the front parcel line shall be 2 stories and 23 feet for a flat roof or 30 feet for structures with a pitched roof. + + The finished grade shall be no more than three feet below or above the theoretical grade line at any point adjacent to a building if excavation occurs. An opening to a garage may remain unexcavated. + + Maximum Parcel Coverage (% of Parcel Area): 50% 11

12 Property Highlights INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

13 DTSM Expo Line Terminus s Santa Monica Pier Main St 0.5 Mile Third Street Promenade 10 Fwy Abbot Kinney Subject Property 13

14 Neighborhood Amenities MAIN STREET, SANTA MONICA Main St. & nd St. location on the southern edge of Santa Monica, bordering Venice, also allows easy access to the collection of amenities along Santa Monica s Main Street. This commercial street features shops like Japanese lifestyle brand Muji and former Abbot Kinney Blvd shops Mona Moore and Pamela Barish. ABBOT KINNEY BLVD Venice s Abbot Kinney Blvd is often considered the coolest block in Los Angeles. In 2012, GQ even proclaimed it the Coolest Block in America The street is home to one-of-a-kind shops alongside major brands. Shops include beachside boutique Aviator Nation, Australian cosmetic brand Aesop, men s shop Gant, American-made watch brand Shinola and colorful sock brand Happy Socks, among others. Mixed in with the retail are some of L.A. s best eateries and cafés that include Gjelina, Tasting Table, Salt & Straw, The Butcher s Daughter, Intelligentsia and Blue Bottle Coffee. Abbot Kinney Blvd is where locals and visitors meet to soak up Venice s bohemian lifestyle and culture. THE BOARDWALK The iconic Venice Beach Boardwalk is a staple attraction in Los Angeles. Through its array of beachside shops, bars and restaurants, along with its sidewalk entertainers and artists, it continues to symbolize the eclecticism that attracted artists and creatives to Venice in the first place. INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

15 Select Local Amenities Stella Barra Pizzeria M Street Kitchen Dogtown Coffee Kafe K Urth Cafe Jinya Ramen The Galley Manchego La Vecchia Cucina Undefeated SaMo Peet s Coffee Brick + Mortar Buffalo Exchange Amelia s Max Studio Lula Cocina Mexicana Sunny Blue Bareburger Groundwork Coffee Circle Bar MUJI M Hanks Gallery Chinois on Main Hiptique Main Squeeze Ashland Hill Rick s Tavern Via Veneto 31Ten Lounge Bulletproof Coffee Chaya Venice Fitness FlakeYAS Venice Alehouse 10 min walk Espresso Cielo Mona Moore Barish Pamela Salt The Firehouse Rose Cafe-Restaurant Cerveteca Venice Alehouse Groundwork Coffee Wallflower Cafe Gratitude Barrique Whole Foods Salt The Otheroom The Butcher s Daughter Greenleaf Gourmet Blue Bottle Coffee Rag & Bone Aesop Tortoise Aviator Nation Lucky Brand Wylie Wilson Intelligentsia Coffee Gebert Gallery Vince Salt & Straw Abbot s Habit TOMS Happy Socks Shima Satine JuiceBox Gjelina Salt Air Lemonade James Perse Shinola Zinque Erewhon Market 15

16 Area Creative Tenants SANTA MONICA Main St & nd St 5-mile radius VENICE MARINA DEL REY PLAYA VISTA LAX INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

17 Market Overview 17

18 Silicon Beach THE RISE OF THE CREATIVE SPACE Silicon Beach is the general westside coastal area stretching from Santa Monica to Venice, Culver City, West LA, Marina Del Rey and Playa Vista. Over the last five to eight years, this part of Los Angeles has emerged as the leading concentration of LA s creative economy, focused on tech, media and e-commerce. It s home to over 500 tech firms including Google, Snapchat, TrueCar, Universal Music, Red Bull, Electronic Arts, The Honest Company, Riot Games, YouTube and Yahoo! among others. But it is also a thriving market for startups like Ring, Parachute, Dollar Shave Club and Thrive Market. With over $4 billion in new investment, Silicon Beach has quickly become an innovation force competing with Silicon Valley. As startups and larger established firms have come to call Silicon Beach home, a community and co-location of companies has created a vast network of ingenuity. Starting in the mid-1990s, some Hollywood studios, producers and writers started opening offices in areas of Santa Monica s former industrial buildings. Their high ceilings, raw aesthetic and big windows were far from the studio offices many had worked in for years. And the spaces were definitely far from any traditional Class A building and space. Today s creative firms are looking for space that reflects their company culture and values. Through trends in office layout and design, as well as changes in the way today s creative worker operates, creative office space has emerged as the new Class A. As LA s creative economy continues to grow, creative, nontraditional office space will be FORECAST Rents to remain higher than average with the lack of office inventory and halt of development agreements within the City of Santa Monica Companies will continue to seek out office space in Santa Monica as it continues to be a vital part of Silicon Beach. Recent nearby leases include Snapchat s expansion at 901 Abbot Kinney Blvd, and Vice Media s expansion to 1621 Abbot Kinney previously occupied by Zephyr. Continued improvement of retail on Main Street, Rose Avenue and Abbot Kinney Blvd Increased preference for walkable neighborhoods with close access to amenities (Ocean Park is an exemplary urban neighborhood in Los Angeles) INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

19 About the Neighborhood 19

20 About Ocean Park OCEAN PARK Ocean Park is one of LA s most desirable places to live and work for its access to the beach, world-class retail, unique upscale bohemian culture, restaurants, and an economy strengthened by leading innovators. Ocean Park is a neighborhood of Santa Monica that is home to a diverse population of over 12,500 people. With a land area of 0.75 miles, Ocean Park has a remarkable concentration of standout retail and restaurants, and has gained the reputation of having a laid-back yet upscale population that take full advantage of its walkable streets and the beach. DEMOGRAPHIC INSIGHTS Ocean Park has a dynamic history that includes artists, working class families and today s young professional tech workers. Venice s 12,500 residents have higher education degrees, with 46% having a bachelors degree and 32% having a graduate degrees. This is partly due to the increasing concentration of technology firms moving to Ocean Park and Venice over the last few years. As the community has evolved, so has the housing market. Today s average home value in the Ocean Park/Venice area is $1.5M. Santa Monica ~8.41 Square Miles 10 fwy Main St PACIFIC OCEAN 0.3 mi lincoln blvd INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

21 Demographics POPULATION 12, % by 2022 MEDIAN HOME VALUE $1,400, % by 2018 AVERAGE INCOME $134, % by 2022 EDUCATIONAL ATTAINMENT 78.3% with college or higher degree HOUSING UNITS 7,985 20% occupied by owners 21

22 Living in Ocean Park OCEAN PARK With all the amenities that Ocean Park has to offer along with a network of creative and tech companies in the area, it is no wonder that many want to live in Venice. Firms like Snapchat are even starting to rent entire buildings in Venice for their employees to live in. MOBILITY Walkable and Bikeable. Ocean Park is Santa Monica s most walkable neighborhood with a walk score of 95. It s streets and bike lines also make it one of the most bikefriendly places with a bike score of 93. Other ways of getting to and from Ocean Park include Lincoln and Main St; the 10 and 405 freeways, as well as the 90 freeway. Bus Lines. Ocean Park is served by major bus lines on LA Metro and the Santa Monica Big Blue Bus, connecting the neighborhood to the rest of LA. Rail Transit. In May 2016 the second phase of the Metro Expo rail line opened with 7 new stations on the Westside Main St & nd St are just one mile south of the Expo Line terminus at Colorado and 4th Street in Santa Monica. Increasingly, Expo Line commuters use rideshare services to connect them from their metro stop to a nearby destination. LAX. Directly south of the Venice and The Property is Los Angeles International Airport (LAX). Just 4.5 miles away, the airport is an easy and direct ride. TOTAL HOUSING UNITS 24, % Owner Occupied RENTAL VACANCY RATE 6.5% MEDIAN RENT PER ROOM $2, (July 2017, Trulia.com) Occupied Renter 73.6% Occupied Vacant Sources: Trulia.com, ESRI 2017 INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

23 Prime Location TWO BLOCKS AWAY FROM THE BEACH The Property is situated in Ocean Park, a place that has it all. The beach is steps away, and countless eateries and retail options are literally around the corner. But what makes the neighborhood so special is the artsy and beachy atmosphere that is shared with Venice Beach although cleaner, safer and upscale. Not surprisingly Street Advisor ranked Ocean Park the second best place to live in Santa Monica. In addition, Main St & nd St are very well connected to the region. The closest freeway access ramp is less than a mile away, and LAX is just within a 20-minute drive. 23

24 Ocean Park Walkability 5 min walk 10 min 15 min Walkscore: 95/100 Source: Walkscore.com 100% Dining & Drinking 50% 0% INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO Groceries Shopping Errands Parks Schools Culture

25 Superior Market Fundamentals THE SILICON BEACH DIFFERENCE Silicon Beach is a coveted location for both established and startup technology, media and advertising tenants, with some of the highest rents and occupancy rates in all of Southern California. At the second quarter of 2017, creative office occupancy in the area was above 93%, while achieving double-digit rental growth over the last two years. Some notable tenants in the area include Google, Snapchat, Buzzfeed, Muckerlab, Vice Media, Enervee, and PSYOP. The area has continuously drawn tech and creative companies because of a rare combination of exceptional walkability, access to high-quality amenities, close proximity to the beach, and easy access to freeways and the Los Angeles International Airport, and most importantly, a strong demographic base of welleducated, young professionals. 25

26 Surrounded by Amenities MAIN ST + OCEAN PARK BLVD + VENICE ADJACENT A walk along Main Street or Ocean Park Boulevard offers endless options for a meal, a cocktail, or a sip of organic juice. The possibilities are so diverse and close to Main St & nd St that everything can be done without a car. In addition to the abundant restaurants, bars, and shopping places, The Property is located just a third of a mile from the edge of the ocean. Only a handful of neighborhoods in the city have the beach as its own backyard. Because Ocean Park has an even access to the beach in contrast to the cliffs in the rest of Santa Monica, a short walk or bike ride, will take you to the sand within minutes. Some of Main Street s high-quality retailers include fashion-forward brands such as Muji, Pamela Marish, and Mona Moore. On the restaurant side, Via Veneto offers classic italian dishes, and Joe Jonas Hinterland is the place to go for people watching and a selection of new american seasonal coastal cuisine. Main Street is an ever-evolving commercial strip that has a lot to offer for anyone who favors walking to expore new restaurants and shops. INDUSTRY PARTNERS T INDUSTRYPARTNERS.COM CA BRE LIC NO

27 Walking and Biking PEDESTRIAN/BIKER S PARADISE Main St & nd St are located in the most walkable neighborhood in Santa Monica according to a study by Walk Score. The Property is at the top of the list (with a score of 96/100), thanks to its proximity to restaurants, grocery markets, shopping, open space, schools and cultural centers. Additionally, the study shows that the block length and street intersections in the area are optimal for pedestrians. The Property sits in one of the most bike-friendly areas in the region as well. With an exceptional 91/100 score, Ocean Park features an extraordinary number of dedicated bike lanes, a flat topography, road connectivity and presence of bike share programs. Moreover, Main St & nd St is located within an extraordinary biking community that benefits from the safety in numbers. Thanks to the high bike traffic in the area commuters feel safe biking on the streets of Ocean Park, where everyday errands can be accomplished by pedaling a few blocks. 27

28 INDUSTRY PARTNERS T info@industrypartners.com CA BRE NO