RIDGECREST TOWNHOMES 53 Units. Midlothian, Texas

Transcription

1 RIDGECREST TOWNHOMES 53 Units Midlothian, Texas

2 CONFIDENTIAL OFFERING MEMORANDUM Ridgecrest Townhomes A Newly Built Property Midlothian, Texas OFFERED AS AN INVESTMENT IN TEXAS Exclusively Marketed By: All Star Commercial Realty Cathy Crowe cathy@allstarcommercialrealty.com

3 DISCLAIMER All Star Commercial Realty has been retained as broker to sell Ridgecrest Town Home, a newly built property in Midlothian, Texas. Seller, All Star Commercial Realty or any of their officers, employees, or agents make no representation or warranty, expressed or implied, as to the accuracy or completeness of this confidential information, and no legal liability is assumed or implied with respect thereto. All financial projections are provided for general reference purpose only. The projections are based on assumptions relating to the general economy, competition, and other factors beyond Seller or All Star Commercial Realty's control, subject to variations, and not necessarily indicative of current or future performance of the Property. Information provided has been gathered from sources deemed reliable, but neither Seller nor All Star Commercial Realty warrant the correctness of the information or attest to its accuracy. Seller or All Star Commercial Realty reserve the right to change any information provided, the asking price, or withdraw the Property from the market at any time without notice. Seller reserves the right to reject any or all offers regarding the property or to terminate any discussions with any prospective buyer at any time without notice. All Star Commercial Realty is not authorized to make any representation or agreement on behalf of the owner.

4 TABLE OF CONTENTS 1.0 Executive Summary 1.1 The Property 1.2 Investment Highlights 1.3 Financial Highlights 1.4 Deal Structure 2.0 Property Overview 2.1 Deal Structure 2.2 Management Structure 2.3 Site Plan 2.4 Floor Plan 2.5 Regional Map 2.6 Local Map 2.7 Regional Aerial View 2.8 Local Aerial View 3.0 Financial Information 3.1 Pro Forma P&L 3.2 Cash Flow Analysis 3.3 Rent Roll 4.0 DFW Overview 4.1 DFW Overview 4.2 Area Demographics 4.3 About Midlothian 5.0 Appendix 5.1 Information About Brokerage Services

5 RIDGECREST TOWNHOMES Ridgecrest Townhomes Midlothian, Texas

6 RIDGECREST TOWNHOMES Section 1 INTRODUCTION

7 THE PROPERTY All Star Commercial Realty is pleased to offer for sale 100% fee simple interest in a beautiful and historic Ridgecrest Townhomes. The property consists of 53 new and distinctive three bedroom townhomes, located near the historic downtown area of Midlothian, Texas. The site is improved with one story wood frame buildings with Brick siding, housing 3 bedroom town houses. The net rentable area of the53 homes is approximately 84,800 square feet. In addition, the units have covered porches and covered patios overlooking the fenced yard. Each unit offers a kitchen with dishwasher, disposal, selfcleaning oven, and many other amenities. All units have a nice back yard.

8 INVESTMENT HIGHLIGHTS Prominent Location serving established residential market Property is unencumbered by an existing loan, and qualifies for single family financing at historic low mortgage rates. Proximity to major retail outlets and historic downtown area Deal structured to provide strong leverage with low down payment History of strong demand and leasing in the area Turn key management structure, well suited for investors 5 year investment with strong exit strategy

9 FINANCIAL HIGHLIGHTS PHASE I Offering Price: $10,800,000 # of Units: 53 Rentable Area: 84,800 Square Feet Price Per Square Foot: $ Occupancy: 100% Gross Operating Income: $1,103,460 Expenses: $310,293 Net Operating Income: $793,166 New Loan: $8,640,000 Down Payment: $2,160,000 Payments: $466,818 Cash Flow: $307,348 Cap Rate: 7.5% Cash on Cash: 14% 5 Year Leveraged IRR: 29%

10 DEAL STRUCTURE Ridgecrest Townhomes are offered free and clear. This residential property qualifies for a Fannie Mae Small multifamily loan at current historic low rates with 20% down, amortized over 30 years, due in 5-10 years. The property is under construction scheduled for completion September Leasing is scheduled for completion November The deal will close once leasing is completed.

11 RIDGECREST TOWNHOMES Section 2 PROPERTY OVERVIEW

12 MANAGEMENT STRUCTURE The property is initially managed by the INFINITY. Once sold, INFINITY can provide management services based on 5% of the Gross Income. Services include collecting rents, addressing any repairs that are required, finding potential tenants and showing any vacant apartments to potential tenants, bill paying service and compiling all of the results in monthly reports. Alternatively, the purchaser can manage the property.

13 SITE PLAN

14 ELEVATION

15 FLOOR PLAN

16 REGIONAL MAP

17 LOCAL MAP

18 LOCAL AERIAL VIEW

19 REGIONAL AERIAL VIEW

20 RIDGECREST TOWNHOMES Section 3 FINANCIAL ANALYSIS

21 PROFIT AND LOSS STATEMENT Yr 1 Yr 2 Yr 3 Income Property Rental Rents 1,081, ,102, ,124, Total Property Rental 1,081, ,102, ,124, Other Income Late Fees 2, , , Forfeited Security Deposits 13, , , Pet Fee/Rent 6, , , Total Other Income 22, , , Gross Income 1,103, ,125, ,148, Expenses Management 54, , , Repair and Maintenance 33, , , Landscaping 13, , , Property Insurance 37, , , Property Taxes 172, , , Total Expenses 310, , , Net Operating Income 793, , , Purchase Price 10,800, CAP Rate 7.5%

22 CASH FLOW ANALYSIS Purchase Year 1 Year 2 Year 3 Year 4 Year 5 Gross Income 1,103,460 1,125,752 1,148,496 1,182,951 1,218,440 Total Operating Expenses 310, , , , ,872 Net Operating Income 793, , , , ,568 Financing - 30 Year AM - Due in 10 Years Purchase/Sales Price 10,800,000 12,608,108 Down Payment 2,160,000 Loan 8,640,000 8,333,382 8,333,382 8,180,900 8,022,318 Interest Rate 4.00% 4.00% 4.00% 4.00% 4.00% Payments 494, , , , ,988 Cash Flow (2,120,000) 307, , , ,847 4,982,540 Cash On Cash 14% 15% 16% 17% 19% Leveraged IRR 29%

23 RENT ROLL No. Unit Floor Plan Area Tenant Yr 1 Yr 2 Yr BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, BR - 2 Bath 1600 $1, $1, $1, ,800 90,100 91,902 93,740

24 RIDGECREST TOWNHOMES Section 4 OVERVIEW OF DFW

25 DFW OVERVIEW The Dallas/Fort Worth Metroplex (Dallas/Fort Worth, DFW) is a dynamic 12-county region made up of Dallas, Fort Worth and another 150 municipalities. The Dallas area is the fourth-largest metropolitan area in the United States with an area of 384 square miles and a population of approximately 6.5 million people. As the fastest growing metropolitan area, DFW led the nation in population growth over the last decade, adding 1.3 million people for a 25% growth rate between April 2000 and April DFW continued to lead the nation in annual population growth by adding 146,530 people (or more than 400 people each day) from July 2008 to July 2009, for a growth rate of 2.3%. DFW also has the largest, most educated workforce in the state of Texas, totaling three million people, and leads the state in public university and community college students (250,000). Producing one-third of all goods and services in Texas, the DFW area accounts for $60 billion in annual direct imports and exports. The DFW Metroplex has therefore enjoyed a sustained period of economic and population expansion as local companies increase their business capacity and others relocate to this desirable, central U.S. location.

26 DFW OVERVIEW Cont. Strong Job Growth Over the last year, Dallas/Fort Worth has posted the second-highest job growth in the nation. The most recent Texas Workforce Commission statistics indicate that DFW has added 41,500 new jobs during the past year, with eight of the last 12 months reporting positive gains. At the end of November 2010, the DFW unemployment rate of 8.2% remained well below the national rate of 9.3% and is expected to improve throughout Moody s Economy.com also projects positive job growth for the DFW metro over a five-year period ending According to their projections, DFW will add more than 280,491 jobs, making it the nation s sixth-strongest metro area in terms of job growth. Historically a leader with respect to job growth, Dallas/Fort Worth added 43,300 jobs for the 12-month period ending December 2008, trailing only Houston which led the nation in job growth that year. Nationally recognized as one of the best markets for business, Dallas/Fort Worth was recognized in early 2010 as the third-best market in 2009 for companies that wanted to either build new or expand their existing corporate facilities. During 2009, DFW was selected by 135 companies as the site of either a corporate expansion or relocation, topped by only New York and Chicago. DFW was also listed third on a recent Forbes survey of cities where the recession is easing most. The same article projected a three-year, 7% increase in jobs for DFW. Other recent forecasts predict that the DFW area economy will continue to move forward at a healthy pace throughout the rest of the year, particularly relative to the national economy. Additionally, CBRE Econometric Advisors, a business unit of CB Richard Ellis, forecasts positive office employment growth for DFW over the next six years.

27 DFW OVERVIEW Cont. Attractive Corporate Location Dallas/Fort Worth is home to more than 10,000 corporate headquarters, the largest concentration in the U.S. The Metroplex is also home to 24 Fortune 500 headquarters, according to Fortune Magazine. This includes Irving-based ExxonMobil, which topped the 2009 list and ranked second on the 2010 list, and AT&T which was ranked seventh on the 2010 list. As a result, the DFW region ranks second among U.S. metropolitan areas for revenue generated from Fortune 500 companies. As the Southwest s leading business and financial center, the area boasts the largest wholesale market in the world. With fundamentals that few other markets can match, DFW has capitalized on its central U.S. location, unparalleled transportation network, competitive operating and living costs, pro-business government, critical mass of existing corporate headquarters and offices, favorable year-round climate, and attractive Sunbelt location. The area boasts a major metropolitan quality of life with amenities including the arts, professional sports organizations and a wide array of entertainment destinations. Among the largest industries in the area are health, tourism, logistics, electronic commerce and financial services. Company Em ploye e s Wal-Mart 35,700 American Airlines 25,457 Bank of America 20,000 Texas Health Resources 17,203 AT&T 16,600 Baylor Health Care System 16,600 Lockheed Martin 14,332 Verizon Communications 14,000 HCA 12,304 Texas Instruments 11,000 Citigroup 11,000 Kroger Food Stores 10,150 JPMorgan Chase & Company 8,900 Brinker Internationl 8,728 Target 8,643 Hew lett-packard 7,500 Albertson s 7,000 Southw est Airlines 6,123

28 DFW OVERVIEW Cont. Economy Forecast Bolstered by positive job growth, Dallas/Fort Worth continues to outperform the national economy. Fueling this job growth is the area s ability to attract a steady stream of companies relocating from across the country. Some of the most recent moves include Advanced H20, Alcon, Cisco, Coaire Corp, Kohler, MoneyGram and Q-Edge. Several of the newly arriving companies cited lower costs of doing business as well as proximity to transportation, including the Dallas/Fort Worth International Airport, the network of interstates and highways, and the area s commuter and freight rail network. The most notable recent corporate relocation was AT&T s move from San Antonio to downtown Dallas, with nearly 700 of the San Antonio-based employees making the move. By revenue, AT&T is now the second-largest company based in the Dallas/Fort Worth area behind ExxonMobil. With the move, AT&T also employs more than 16,000 people in the Dallas area. AT&T s move followed Comerica Bank s corporate headquarters relocation from Detroit to downtown Dallas the previous year. Recent reports published by Economy.com also project that the Dallas and Fort Worth economies will turn in above-average performances over the medium and long terms, fueled by a healthy population growth that will mirror continued growth among the area s corporate residents. Additionally, increasing competition in the airline industry stemming from the end of the Wright-Amendment era should attract companies, as well as business and leisure travelers, throughout North Texas. All of these factors will increase the demand of office space and bolster the performance of well-positioned DFW properties. Population As the nation s fastest growing metropolitan area, Dallas/Fort Worth led the nation in population growth over the last decade, adding 1.3 million people (or 350 each day) for a 25% growth rate between April 2000 and April Previously, DFW added 1.2 million residents, more than 325 people per day, between 1990 and 2000, fueling a growth rate of 29%. DFW also continued to

29 DFW OVERVIEW Cont. lead the nation in annual population growth by adding 146,530 people from July 2008 to July 2009, for a growth rate of 2.3%. Over the previous 12-month period, DFW led the nation with a net gain of 146,532 new residents from July 2007 to July 2008, an increase of 2.4%. This growth rate translates into the addition of more than 400 people each day and places DFW as the fourth largest metropolitan area in the nation, with an estimated population of 6.5 million people. The population growth is also significant considering that the majority of residents (52%) are still in their prime earning years (ages 20-54). By 2020, DFW s population is expected to approach eight million. TRANSPORTATION The DFW Metroplex is served by six interstates and seven other U.S. highways and numerous state highways. Interstate 35 serves as a north and south artery throughout the Metroplex and the nation, while Interstate 20 serves as the east and west artery. Interstate 635 forms a loop around the entire Dallas area, linking commuters to several major Dallas thoroughfares such as the Dallas North Tollway, North Central Expressway and Interstate 30. The George Bush Turnpike (GBT), a recent addition to Dallas, is a 29.2 mile, six-lane, limited access expressway passing through or along the cities of Irving, Farmers Branch, Carrollton, Dallas, Plano, Richardson and Garland. The GBT gives a boost to east-west traffic in the northern half of the Dallas Metroplex, linking commuters to high tech corridors and corporate headquarters. Highway 75 corridor is a hub of high-tech manufacturing ranking amongst the largest technology employment centers in the United States. DFW International Airport, the third largest airport in the world, is served by five international and 18 domestic airlines. These airlines provide service to over 200 worldwide destinations with over 2,500 flights daily. Additional airports including Dallas Love Field and Alliance Airport, the nation s first industrial airport.

30 ABOUT MIDLOTHIAN See Midlothian Comprehensive Plan at the following link.

31 MIDLOTHIAN DEMOGRAPHICS Population 1-mi. 3-mi. 5-mi Total Population 2,687 10,692 32, Households 1,053 3,816 10,873 Population Change ,142 4,015 Household Change ,199 % Population Change % 11.96% 14.21% % Household Change % 10.90% 12.39% Population Change ,990 14,460 Household Change ,435 4,878 % Population Change 2000 to % 59.53% 81.17% % Household Change 2000 to % 60.27% 81.37% Housing 1-mi. 3-mi. 5-mi Housing Units 778 2,521 6, Occupied Housing Units 718 2,380 5, Owner Occupied Housing Units 405 1,611 5, Renter Occupied Housing Units Vacant Housings Units % 2015 Occupied Housing Units 92.29% 94.41% 96.31% % 2015 Owner occupied housing units 56.41% 67.69% 83.42% % 2015 Renter occupied housing units 43.59% 32.31% 16.58% % 2000 Vacant housing units 7.71% 5.55% 3.69% Income 1-mi. 3-mi. 5-mi Household Income: Median $56,032 $64,443 $78, Household Income: Average $66,930 $76,517 $92, Per Capita Income $26,229 $27,325 $31, Household income: Less than $10, Household income: $10,000 to $14, Household income: $15,000 to $19, Household income: $20,000 to $24, Household income: $25,000 to $29, Household income: $30,000 to $34, Household income: $35,000 to $39, Household income: $40,000 to $44, Household income: $45,000 to $49, Household income: $50,000 to $59, Household income: $60,000 to $74, , Household income: $75,000 to $99, , Household income: $100,000 to $124, , Household income: $125,000 to $149, Household income: $150,000 to $199, Household income: $200,000 or more

32 MIDLOTHIAN DEMOGRAPHICS Cont. Retail Sales Volume 1-mi. 3-mi. 5-mi Children s/infants clothing stores $289,397 $1,083,807 $3,159, Jewelry stores $104,973 $396,721 $1,195, Men s clothing stores $339,261 $1,289,828 $3,837, Shoe stores $344,447 $1,310,519 $3,890, Women s clothing stores $573,919 $2,187,723 $6,570, Automobile dealers $4,504,475 $17,434,797 $52,918, Automotive parts and accessories stores $873,848 $3,355,103 $10,122, Other motor vehicle dealers $121,222 $462,252 $1,393, Tire dealers $392,105 $1,501,359 $4,517, Hardware stores $17,421 $71,856 $228, Home centers $183,069 $720,049 $2,262, Nursery and garden centers $216,868 $848,299 $2,689, Outdoor power equipment stores $100,284 $388,782 $1,194, Paint and wallpaper stores $21,341 $83,898 $258, Appliance, television, and other electronics stores $599,900 $2,326,188 $7,107, Camera and photographic supplies stores $45,214 $181,733 $564, Computer and software stores $1,647,086 $6,215,218 $18,432, Beer, wine, and liquor stores $283,447 $1,080,120 $3,252, Convenience stores $1,287,317 $4,833,985 $14,193, Restaurant Expenditures $1,182,662 $4,534,862 $13,724, Supermarkets and other grocery (except $4,650,285 $17,544,661 $51,903,492 convenience) stores 2015 Furniture stores $428,601 $1,637,101 $4,957, Home furnishings stores $1,472,772 $5,672,404 $17,232, General merchandise stores $7,688,443 $29,713,332 $90,628, Gasoline stations with convenience stores $4,024,267 $15,215,889 $45,011, Other gasoline stations $2,888,035 $10,944,490 $32,448, Department stores (excl leased depts) $7,583,470 $29,316,611 $89,433, General merchandise stores $7,688,443 $29,713,332 $90,628, Other health and personal care stores $300,974 $1,161,692 $3,536, Pharmacies and drug stores $1,200,282 $4,584,539 $13,826, Pet and pet supplies stores $328,004 $1,256,864 $3,788, Book, periodical, and music stores $49,990 $193,320 $595, Hobby, toy, and game stores $144,112 $545,110 $1,629, Musical instrument and supplies stores $14,391 $56,945 $176, Sewing, needlework, and piece goods stores $26,482 $103,769 $314, Sporting goods stores $136,821 $545,439 $1,674,198

33 RIDGECREST TOWNHOMES APPENDIX INFORMATION ABOUT BROKERAGE SERVICES

34 Information About Brokerage Services Texas law requires all real estate license holders to give the following information about brokerage services to prospective buyers, tenants, sellers and landlords. TYPES OF REAL ESTATE LICENSE HOLDERS: A BROKER is responsible for all brokerage activities, including acts performed by sales agents sponsored by the broker. A SALES AGENT must be sponsored by a broker and works with clients on behalf of the broker. A BROKER S MINIMUM DUTIES REQUIRED BY LAW (A client is the person or party that the broker represents): Put the interests of the client above all others, including the broker s own interests; Inform the client of any material information about the property or transaction received by the broker; Answer the client s questions and present any offer to or counter-offer from the client; and Treat all parties to a real estate transaction honestly and fairly. A LICENSE HOLDER CAN REPRESENT A PARTY IN A REAL ESTATE TRANSACTION: AS AGENT FOR OWNER (SELLER/LANDLORD): The broker becomes the property owner's agent through an agreement with the owner, usually in a written listing to sell or property management agreement. An owner's agent must perform the broker s minimum duties above and must inform the owner of any material information about the property or transaction known by the agent, including information disclosed to the agent or subagent by the buyer or buyer s agent. AS AGENT FOR BUYER/TENANT: The broker becomes the buyer/tenant's agent by agreeing to represent the buyer, usually through a written representation agreement. A buyer's agent must perform the broker s minimum duties above and must inform the buyer of any material information about the property or transaction known by the agent, including information disclosed to the agent by the seller or seller s agent. AS AGENT FOR BOTH - INTERMEDIARY: To act as an intermediary between the parties the broker must first obtain the written agreement of each party to the transaction. The written agreement must state who will pay the broker and, in conspicuous bold or underlined print, set forth the broker's obligations as an intermediary. A broker who acts as an intermediary: Must treat all parties to the transaction impartially and fairly; May, with the parties' written consent, appoint a different license holder associated with the broker to each party (owner and buyer) to communicate with, provide opinions and advice to, and carry out the instructions of each party to the transaction. Must not, unless specifically authorized in writing to do so by the party, disclose: that the owner will accept a price less than the written asking price; that the buyer/tenant will pay a price greater than the price submitted in a written offer; and any confidential information or any other information that a party specifically instructs the broker in writing not to disclose, unless required to do so by law. AS SUBAGENT: A license holder acts as a subagent when aiding a buyer in a transaction without an agreement to represent the buyer. A subagent can assist the buyer but does not represent the buyer and must place the interests of the owner first. TO AVOID DISPUTES, ALL AGREEMENTS BETWEEN YOU AND A BROKER SHOULD BE IN WRITING AND CLEARLY ESTABLISH: The broker s duties and responsibilities to you, and your obligations under the representation agreement. Who will pay the broker for services provided to you, when payment will be made and how the payment will be calculated. LICENSE HOLDER CONTACT INFORMATION: This notice is being provided for information purposes. It does not create an obligation for you to use the broker s services. Please acknowledge receipt of this notice below and retain a copy for your records. All Star Home Group Realty info@allstarhomegroup.com (972) Licensed Broker/Broker Firm Name or Primary Assumed Business Name License No. Phone Herb Clarkson broker@allstarhomegroup.com (972) Designated Broker of Firm License No. Phone Herb Clarkson herb@allstarhomegroup.com (972) Licensed Supervisor of Sales Agent/ Associate License No. Phone Cathy Crowe cathy@allstarhomegroup.com (214) Sales Agent/Associate's Name License No. Phone Buyer/Tenant/Seller/Landlord Initials Date Regulated by the Texas Real Estate Commission Information available at TAR 2501 IABS 1-0 All Star Home Group Realty, 8330 LBJ Frwy Suite 610 DALLAS, TX Phone: Fax: Commercial Buyer Cathy Crowe Produced with zipform by ziplogix Fifteen Mile Road, Fraser, Michigan