OLIVE GARDEN APARTMENTS

OLIVE GARDEN APARTMENTS POTENTIAL CONDO CONVERSATION OFFERING MEMORANDUM 16955 OLIVE STREET HESPERIA, CA 24 Units 3 Bedrooms 2 Baths RAFFAELE SUPRANO DRE # 01972337 COMPASS LAND ADVISORS, INC. PH. (949) 228.4314 EMAIL: RAFFAELE@COMPASSLANDADVISORS.COM 1

TABLE OF CONTENTS Executive Summary 3 The Opportunity Investment Opportunities The Area Aerial Overview Regional Map Property Description 12 Property Amenities Property Summary Floor Plan Financial Analysis 18 Operations Overview Investment Performance Historical Performance vs Investment Performance Market Overview 20 Regional Overview Submarket Overview Comparables 23 Sales Comparables Rent Comparables H E S P E R I A V I L L A G E 2

01 EXECUTIVE SUMMARY E X E C U T I V E S U M M A R Y 3

Property Information THE OPPORTUNITY The property consist of 24 units of 3 bedrooms and 2 baths at 1,310 square feet. 12 units are ADA compliance. The homes feature exquisite interior finishes and each unit include a private car garage, as well hookups for W/D and fire place. The property is 100% occupied. Compass Land Advisors is pleased to present 16955 Olive Street, a 24 units investment opportunity in Hesperia, California. Location The property is located less than a mile from Sultana High School and adjacent to Elementary Christian School. The Village Olive Garden was originally designed and built to be individual condo for sale, but due to the recession Seller opted to manage them as apartments. An investor will have the opportunity to purchase a newer, 100% leased, pride of ownership property at a significant discount to original construction cost. In addition, there will be the opportunity for conversation to for sale condo when market dictate. E X E C U T I V E S U M M A R Y 4

INVESTMENT SUMMARY PROPERTY ADDRESS 16955 OLIVE STREET, HESPERIA, CA NUMBER OF HOMES 24 AVERAGE HOME SIZE 1,310 SF DESCRIPTION 3 BED/2 BATH HOME NET RENTABLE AREA 31,440 SF + CLUB HOUSE YEAR COMPLETED 2009 CURRENT OCCUPANCY 100% PRICE $4,100,000 PRICE PER SF $130 CAP RATE ACTUAL/ PROFORMA 5.50% - 6.46% TERMS ALL CASH / NEW LOAN E X E C U T I V E S U M M A R Y 5

HESPERIA VILLAGE COMMUNITY EVENTS LOCATION Regardless of the season, the growing City of Hesperia offers a centralized location for a wide variety of nearby activities for you and your family to enjoy. The annual Hesperia Days celebration is one example of how our City, Park District and community come together each fall to celebrate our rich heritage. For over 35 years, the City has celebrated with a fabulous fireworks display to cap off the evening. Olive Garden is just minutes from the Cajon Pass, providing a minimal commute time to the nearby Ontario, San Bernardino and Riverside areas. Hesperia is dedicated to enhancing our safe, friendly community, while blending a rural lifestyle with progress and responsible growth. H E S P E R I A V I L L A G E 6

OLIVE GARDEN Hesperia is constantly changing, growing and maturing. The village is recognized as a desirable place to live, work and play. Thus, the population continues to increase with citizens seeking affordable housing in a community that takes pride in its hometown hospitality. P R O P E R T Y D E S C R I P T I O N 7

KEY FACTS - 5 MILE RADIUS 16955 Olive St., Hesperia, California, 92345 (Ring of 5 miles) E X E C U T I V E S U M M A R Y 8

ARIEAL VIEW Small gated community with a pool, half basketball court and residents club house. Each unit has an assigned parking space and a garage. E X E C U T I V E S U M M A R Y 9

REGIONAL MAP E X E C U T I V E S U M M A R Y 10

REGIONAL MAP E X E C U T I V E S U M M A R Y 11

02 PROPERTY DESCRIPTION P R O P E R T Y D E S C R I P T I O N 12

P R O P E R T Y D E S C R I P T I O N 13

PROPERTY AMENITIES 3 Bedrooms 2 Bathrooms Interior Features Exterior Features Community Features Fireplace Jetted Bath Tub Walk-in Closets Cooling System Heating Underground Pool Garage Parking Off-Street Parking Patio Porch Property Manager On Site Gated Community Basketball Court Clubhouse Pool P R O P E R T Y D E S C R I P T I O N 14

PROPERTY SUMMARY PROPERTY ADDRESS 16955 OLIVE STREET, HESPERIA, CA NUMBER OF HOMES 24 AVERAGE HOME SIZE 1,310 SF NET RENTABLE AREA 31,440 SF YEAR COMPLETED 2009 CURRENT OCCUPANCY 100% AVERAGE GROSS POTENTIAL RENT PSF 32,885 SF LAND AREA/DENSITY GROSS MDR NUMBER/TYPE OF BUILDINGS 6 NUMBER OF STORIES 2 LOT SIZE 87,120 PARKING 30 GARAGE 24 CONSTRUCTION & MECHANICAL BUILDING EXTERIORS STUCCO FRAMING WOOD FRAMING ROOFS TILE PITCHED PLUMBING COPPER WIRING COPPER ELECTRICAL INDIVIDUALLY METER GAS INDIVIDUALLY METER HVAC INDIVIDUAL UNITS HOT WATER INDIVIDUAL WATER *MASTER METER * UNITS READY FOR SEPARATE METER ZONING & TAXES UTILITIES & SERVICES ELECTRICITY PROVIDER PAID BY RESIDENT MUNICIPALITY CITY OF HESPERIA VILLAGE ZONING MULTIFAMILY APN 0410-202-41 GAS RESIDENT WATER THE CITY OF HESPERIA VILLAGE OWNER SEWER/TRASH THE CITY OF HESPERIA VILLAGE OWNER APPLIANCES & FINISHES OVEN/RANGE STAINLESS STEEL KITCHENS WOOD CABINETRY SCHOOL BOUNDARIES BATHS TILE FLOORING SCHOOL DISTRICT ELEMENTARY SCHOOL MIDDLE SCHOOL HIGH SCHOOL HESPERIA UNIFIED LIME STREET ELEMENTARY RANCHERO MIDDLE SULTANA HIGH P R O P E R T Y D E S C R I P T I O N 15

FLOOR PLAN PLAN A 24 Homes 3 Bed 2 Bath All Units Include Fire Springlers 1,310 SF P R O P E R T Y D E S C R I P T I O N 16

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03 FINANCIAL ANALYSIS F I N A N C I A L A N A L Y S I S 18

INVESTMENT ACTUAL/PROFORMA ACTUAL PROFORMA HOME COUNT DESCRIPTION SF TOTAL SF AVG RENT MONTHLY AVG RENT MONTHLY 24 3 BED/ 2BATH HOME 1,310 32,855 $1,265 $30,559 $1,450 $34,800 ANNUAL INCOME 366,708 $417,600 INVESTMENT NOTES ACTUAL PROFORMA RENTAL INCOME MARKET RENT $366,708 MARKET RENT FOR HOMES OF THIS SIZE AND AGE SHOULD BE AROUND $1,450. $417,600 OTHER INCOME $197.50 ALL HOME RENTS SHOULD BE INCREASED $500 GROSS POTENTIAL RENT $366,713 $418,100 VACANCY LOSS ( ) 4% VACANCY RATE (16,724) TOTAL INCOME 366,713 $401,376 AVERAGE MONTHLY INCOME $30,559 $33,448 EXPENSES PERSONNEL $12,153 $12,153 ADMINISTRATIVE/MANAGEMENT $21,395 $21,395 REPAIRS & MAINTENANCE $41,486 $41,486 CONTRACT SERVICES / LANDSCAPING $4,168 $4,168 UTILITIES $24,048 TRASH AND WATER SHOULD BE BILLED INDIVIDUALLY TO THE TENANT, BUT IS NOT. $11,323 INSURANCE $4,790 $4,790 REAL ESTATE TAXES $33,023 NEW TAXES $41,000 TOTAL EXPENSES 141,063 $136,315 NET OPERTAING INCOME $225,650 $265,061 F I N A N C I A L A N A L Y S I S 19

04 MARKET OVERVIEW M A R K E T O V E R V I E W 20

SUBMARKET OVERVIEW Olive Garden was originally designed and built to be individual condo for sale, but due to the recession Seller opted to manage them as apartments. An investor will have the opportunity to purchase a newer, 100% leased, pride of ownership property at a significant discount to original construction cost. In addition, there will be the opportunity for conversation to for sale condo when market dictate. HESPERIA VILLAGE M A R K E T O V E R V I E W 21

M A R K E T O V E R V I E W 22

04 COMPARABLES C O M P A R A B L E S 23

SALE COMPARABLES SUMMARY HESPERIA HOME SALES OF SIMILAR AGE AND SIZE PROPERTY NAME CLOSE OF ESCROW SALES PRICE # OF UNITS YEAR BUILT PRICE PER UNIT PRICE PER SF CAP RATE 1 SENECA VILLAGE MARCH 2017 $6,900,000 41 2009 $168,292 $108.01 4.87% 2 HILLCREST COURT APARTMENTS MARCH 2018 $7,425,500 67 1974 $110,828 $161.58-3 BROADSTONE SERRANO JUNE 2018 $44,500,000 254 1987 $175,197 $202.90-4 16221-16239 APPLE VALLEY RD. OCT 2017 $1,455,000 12 1988 $121,250 $93.63 6.25% 5 10578 COCHITI RD. JULY 2017 $425,000 4 1984 $106,250 $116.50 6.10% 6 14934 SEQUOIA AVE SEPT 2017 $1,000,000 10 1984 $100,000 $109.65 4.46% 7 16186 VIHO RD. APPLE VALLEY APRIL 2018 $742,500 5 1992 $148,500 $302.32 - Average Price/Unit $132,903 Average Price/SF $156.30 Average CAP Rate 5.42% F I N A N C I A L A N A L Y S I S 24

SALES COMPARABLES HOMES RENTAL CONDOMINIUMS & APARTMENT HOMES - 3BD & 2BA OVER 1,300 SF PROJECT ADDRESS SF YEAR BUILT SALE DATE SALE PRICE #UNITS PRICE PER SF 1 1422 E 9TH ST SAN BERNARDINO, CA 92410 126,146 1984 6/4/2018 $21,150,000 160 $167.66 2 2011 ARDEN AVE. HIGHLAND, CA 92346 149,760 1985 6/8/2018 $21,350,000 192 $142.56 3 15430 CULEBRA RD HILLCREST COURT APARTMENTS VICTORVILLE, CA 92394 45,953 1974 3/1/2018 $7,425,500 67 $161.59 4 14450 EL EVADO RD THE COLONY AT VICTORVILLE VICTORVILLE, CA 92392 172,160 1988 6/18/2018 $20,625,000 200 $119.80 5 160 E PARKDALE DR COUNTRY CLUB APARTMENTS SAN BERNARDINO, CA 92404 71,428 1986 6/21/2017 $9,750,000 79 $136.50 F I N A N C I A L A N A L Y S I S 25

SALES COMPARABLES HOMES RENTAL CONDOMINIUMS & APARTMENT HOMES - 3BD & 2BA OVER 1,300 SF PROJECT ADDRESS SF YEAR BUILT SALE DATE SALE PRICE #UNITS PRICE PER SF 6 1925 W COLLEGE AVE - RIDGELINE APARTMENTS SAN BERNARDINO, CA 92407 145,440 1986 7/28/2017 $24,250,000 160 $166.74 7 16545 SENECA RD SENECA VILLAGE VICTORVILLE, CA 92395 63,878 2009 3/29/2017 $6,900,000 41 $108.02 8 1930 W COLLEGE AVE BROADSTONE SERRANO SAN BERNARDINO, CA 92407 219,322 1987 6/21/2018 $44,500,000 254 $202.90 F I N A N C I A L A N A L Y S I S 26

Raffaele Suprano President CONTACT US (949) 228.4314 Raffaele@CompassLandAdvisors.com The information contained herein has been provided from sources deemed to be reliable. However, we do not warrant or guarantee the accuracy of any of the information. All information should be independently verified. Terms of the sale and availability are subject to prior sale, change, correction or withdrawal from the market. COMPASS LAND ADVISORS, INC 27

CONTACT US The information contained herein has been provided from sources deemed to be reliable. However, we do not warrant or guarantee the accuracy of any of the information. All information should be independently verified. Terms of the sale and availability are subject to prior sale, change, correction or withdrawal from the market. COMPASS LAND ADVISORS, INC. Raffaele Suprano, President DRE #01972337 (949) 228.4314 Raffaele@CompassLandAdvisors.com RAFFAELE SUPRANO DRE # 01972337 COMPASS LAND ADVISORS, INC. PH. (949) 228.4314 EMAIL:RAFFAELE@COMPASSLANDADVISORS.COM 28