428 Witmer St Los Angeles, CA

Transcription

1 Offering Memorandum Witmer St Los Angeles, CA

2 Offering Memorandum 428 Witmer St Los Angeles, CA NEEMA AHADIAN Senior Vice President Investments Direct LEO LATERZA Senior Associate Investments Direct NON-ENDORSEMENTS Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation's logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee infor-mation about this listing to prospective customers. All property showings are by appointment only. Please consult your Marcus & Millichap agent for more details. DISCLAIMER THIS IS A BROKER PRICE OPINION OR COMPARATIVE MARKET ANALYSIS OF VALUE AND SHOULD NOT BE CONSIDERED AN APPRAISAL. This information has been secured from sources we believe to be reliable, but we make no represen-tations or warranties, express or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc Marcus & Millichap. All rights reserved.

3 Property Description

4 4 Investment Highlights True Value Add Opportunity; Current Loss to Lease of 42% Prime Westlake Location; Excellent Walk Score of 85 Minutes Away from Downtown Los Angeles Premiere L. A. Live, Nokia Theater, Staples Center, and Numerous Shopping and Dining Venues Conveniently Located within Walking Distance to the Metro Purple Line and Red Line at Westlake/ MacArthur Park Station On-Site Parking Spaces No Soft Story Parking Work Required

5 THE NEEMA GROUP AT MARCUS & MILLICHAP Property Summary The Offering Property Property Address 428 Witmer St 428 Witmer St Los Angeles, CA Assessor s Parcel Number Zoning CW Site Description Number of Units 8 Number of Buildings 1 Number of Stories 2 Year Built 1949 Gross Square Feet 4,928 Lot Size 6,551 Type of Ownership Fee Simple Parking 6 Spaces Utililties Water Electric Gas Construction Foundation Framing Exterior Parking Surface Roof Master Metered Seperately Metered Seperately Metered (Individual Water Heaters) Concrete Wood Stucco Asphalt Flat 5

6 6

7 THE NEEMA GROUP AT MARCUS & MILLICHAP 7

8 428 Witmer Street 8 Location Map SITE

9 THE NEEMA GROUP AT MARCUS & MILLICHAP Heart of LA The Subject Property is located in the heart of Los Angeles in an excellent location just minutes away from burgeoning Downtown Los Angeles and adjacent to one of the most sought after neighborhoods, Echo Park. It is deemed very walkable as it earned a walk-score of 85, along with a transit score of 88. It is a 17 minute walk to the Metro Purple Line (805) and the Metro Red Line (802) at the Westlake / MacArthur Park Station stop. This location is in the Westlake neighborhood in Los Angeles. Nearby parks include Echo Park, Vista Hermosa Park, Vista Hermosa Park and MacArthur Park. Located in the center of the new Downtown LA, the area boasts a number of entertainment, museums and dining hot spots in all of Los Angeles. These include L. A. Live, Nokia Theater, Staples Center, Dodger Stadium, Regal Cinemas, the Grammy Museum, the Broad, and MOMA. 9

10 Pricing & Financials

11 THE NEEMA GROUP AT MARCUS & MILLICHAP Unit Mix Rent Roll Number of Units Unit Type Approx. SF Average Rent Monthly Income Proforma Rents Monthly Income 8 1 Bdr 1 Bath 550 $935 $7,482 $1,600 $12,800 8 GROSS ANNUAL RENTS $89,779 $153,600 Unit Number Unit Type Current Rent Potential Rent Bdr 1 Bath $ 623 $1, /2 1 Bdr 1 Bath $1,133 $1,600 Renovated Bdr 1 Bath $1,142 $1,600 Renovated 430 1/2 1 Bdr 1 Bath $ 942 $1, Bdr 1 Bath $ 828 $1, /2 1 Bdr 1 Bath $1,174 $1,600 Renovated 432 1/4 1 Bdr 1 Bath $ 819 $1, /4 1 Bdr 1 Bath $ 820 $1,600 Notes TOTAL Vacant $0 $0 TOTAL Occupied $7,482 $12,800 11

12 12 Income & Expenses Item Current Per Unit Pro Forma Per Unit Gross Scheduled Rent $89,779 $153,600 Less: Vacancy/Collection Allowance (GPR) 3.0% / $2, % / $7,680 Effective Rental Income $87,086 $145,920 Effective Gross Income $87,086 $145,920 Taxes: Rate 1.19% $15,411 $1,926 $15,411 $1,926 Insurance $2,481 $310 $2,481 $310 Utilities: $10,296 $1,287 $10,296 $1,287 Management $4,354 $544 $7,296 $912 Maintenance $4,000 $500 $4,000 $500 Pest Control $420 $53 $420 $53 Landscaping $840 $105 $840 $105 Total Expenses $37,802 $40,744 Expenses per Unit $4,725 $5,093 Expenses per SF $7.67 $8.27 % of EGI 43.4% 27.9% Net Operating Income $49,284 $105,176

13 THE NEEMA GROUP AT MARCUS & MILLICHAP Financial Analysis & Pricing Item Current Price $1,295,000 Down Payment $647,500 First Trust Deed/Mortgage $647,500 Interest Rate/Amortization 4.50% / 30 Years Net Operating Income $49,284 Scheduled Gross Income $89,779 Less Vacancy Rate Reserve $(2,693) Gross Operating Income $87,086 Less Expenses $(37,802) Net Operating Income $49,284 Reserves $(1,600) Less Loan Payments $(39,369) Pre-Tax Cash Flow $8,314 Plus Principal Reduction $10,614 Total Return Before Taxes $18,928 CAP Rate 3.81% GRM Price/Unit $161,875 Price/SF $ Proforma CAP Rate 8.35% GRM

14 14 Financial Overview WITMER ST LOS ANGELES CA CAP Rate - Current 3.81% CAP Rate - Pro Forma 8.35% Price $1,295,000 GRM - Current Number of Units 8 GRM - Pro Forma 8.43 Price/Unit $161,875 Year Built 1949 Gross SF 4,928 Lot Size 6,551 Price/SF $ Type of Ownership Fee Simple FINANCING Proposed Loan Amount $647,500 Interest Rate 4.50% Amortization 30 Net Operating Income $111,898 EXPENSES INCOME CURRENT PER UNIT PRO FORMA PER UNIT NOTES Real Estate Taxes $15,411 $1,926 $ 15,411 $1,926 Based on Purchase Price Insurance $ 2,481 $ 310 $ 2,481 $ 310 Actual expense from 2017 P&L's Utilities: $10,296 $1,287 $ 10,296 $1,287 Actual expense from 2017 P&L's Management $ 4,354 $ 544 $ 7,296 $ 912 5% of Effective Rental Income Maintenance $ 4,000 $ 500 $ 4,000 $ 500 Estimated at $500/Unit/Year Pest Control $ 420 $ 53 $ 420 $ 53 Actual expense from 2017 P&L's Landscaping $ 840 $ 105 $ 840 $ 105 TOTAL EXPENSES $37,802 $ 40,744 Per Unit $ 4,725 $ 5,093 Per SF $ 7.67 $ 8.27 Percent of EGI 43.4% 27.9% NET OPERATING INCOME $49,284 $105,176 Estimated at $100/Month Actual from Accessor Office CURRENT PRO FORMA % Gross Scheduled Income $ 89,779 $153,600 Loss/Gain to Lease $ 63, % Vacancy $ (2,693) $ (7,680) EFFECTIVE RENTAL INCOME $ 87,086 $145,920 EFFECTIVE GROSS INCOME $ 87,086 $145,920 LOAN Loan Payments $(39,369) $(39,369) Debt Coverage Ratio $ 1.25 $ 1.25 Net Cash Flow After Debt Service $ 8,314 $ 64,207 Principal Reduction $ 10,614 $ 10,614 Total Return Before Taxes $ 18,928 $ 74,820 Reserves $(1,600) $ (1,600)

15 Market Comparables

16 16 Sales Comparables 428 Witmer St S Reno St S New Hampshire Ave Magnolia Ave Arapahoe St Loma Dr

17 THE NEEMA GROUP AT MARCUS & MILLICHAP Sales Comparables Witmer St Los Angeles, CA, S Reno St Los Angeles, CA, S New Hampshire Ave Los Angeles, CA, Offering Price $1,295,000 Number of Units 8 Year Built 1949 Price/Unit $161,875 Price/SF $ CAP Rate 3.81% GRM Sale Price $2,658,681 Close of Escrow 1/29/2018 Number of Units 17 Year Built 1969 Price/Unit $156,393 Price/SF $ Sale Price $1,454,000 Close of Escrow 12/28/2017 Number of Units 10 Year Built 1958 Price/Unit $145,400 Price/SF $ Units Unit Type 8 1 Bdr 1 Bath Units Unit Type 3 Bdr 1 Bath 8 1 Bdr 1 Bath 6 2 Bdr 2 Bath Units Unit Type 10 1 Bdr 1 Bath 17

18 18 Sales Comparables Magnolia Ave Los Angeles, CA, Arapahoe St Los Angeles, CA, Loma Dr Los Angeles, CA, Sale Price $1,365,000 Close of Escrow 12/22/2017 Number of Units 9 Year Built 1959 Price/Unit $151,667 Price/SF $ CAP Rate 4.51% GRM Sale Price $1,725,000 Close of Escrow 12/18/2017 Number of Units 10 Year Built 1963 Price/Unit $172,500 Price/SF $ CAP Rate 5.61% GRM Sale Price $1,365,000 Close of Escrow 6/22/2017 Number of Units 9 Year Built 1953 Price/Unit $151,667 Price/SF $ CAP Rate 3.89% GRM Units Unit Type 8 1 Bdr 1 Bath 1 2 Bdr 1 Bath Units Unit Type 1 Bdr 1 Bath 7 1 Bdr 1 Bath 2 2 Bdr 1 Bath Units Unit Type 8 1 Bdr 1 Bath 1 2 Bdr 1 Bath

19 THE NEEMA GROUP AT MARCUS & MILLICHAP Rent Survey Address Unit Type Number of Units Year SqFt Price Notes 311 Witmer St Los Angeles, CA Witmer St Los Angeles, CA N Toluca St Los Angeles, CA Columbia Ave Los Angeles, CA Union Pl Los Angeles, CA Union Dr Los Angeles, CA Bdr 1 Bath N/A $1, New Renovations 1 Bdr 1 Bath $1, New Renovations 1 Bdr 1 Bath N/A $1, New Renovations 1 Bdr 1 Bath $1, Includes Parking 1 Bdr 1 Bath N/A $1, New Renovations 1 Bdr 1 Bath $1, Includes Utilities AVG $1,

20 Offering Memorandum 428 Witmer St Los Angeles, CA NEEMA AHADIAN Senior Vice President Investments Direct LEO LATERZA Senior Associate Investments Direct