Offering Memorandum WEST 9 APARTMENTS 3046 SW Avalon Way Exclusively offered by Paragon Real Estate Advisors 1
Offering Summary The West 9 Apartments are located at the gateway of West Seattle, one of the hottest neighborhoods and fastest growing rental markets in the city. They offer convenient access to the heart of the city and the updated comforts of fresh renovation, which include new paint, updated units, sleek new landscaping, fencing, and more. Name West 9 Apartments Address 3046 SW Avalon Way, Total Units 9 Built 1978 Net Rentable Square Feet 5,164 Price $2,350,000 Price Per Unit $261,111 Price Per Foot $455.07 Current GRM/CAP 18.05/4.09% Market GRM/CAP 13.99/5.27% Expense Per Unit $3,491 /Year Terms Cash Out Lot Size 7,200 Sq Ft Zoning MR 2
Investment Highlights Convenient West Seattle Location Major exterior and interior renovation New exterior paint, windows/sliders, landscaping, frosted balcony panels and more 4 Renovated units: Updates include new cabinets, quartz counters, stainless steel appliances, and modern flooring Midrise Zoning within the Junction Hub Urban Village Upper floor units have wonderful city, bay and territorial views Secure entry building with intercom access Turn-key, low-maintenance property double paned vinyl windows/ sliders, copper plumbing Efficient one-bedroom units with modern floor-plans and complete appliance packages Stacked washer/dryers in every home Off-street parking with 9 stalls off the alley Significant upside in rent and value-add opportunity Less than 10 minutes from downtown Seattle 3
Neighborhood Aerial QUEEN ANNE ALKI BEACH NORTH ADMIRAL WEST 9 APARTMENTS ELLIOTT BAY PORT OF SEATTLE SEATTLE CBD WEST SEATTLE BRIDGE CALIFORNIA AVENUE SW ALASKA JUNCTION WEST SEATTLE GOLF COURSE MORGAN DISTRICT 4
Location Highlights Excellent West Seattle location 1/2 mile to Trader Joe s, LA Fitness and New Whole Foods Waking distance to Alaska Junction commercial district Low market vacancy rate of 3.1% (Dupre + Scott) Average West Seattle 1Bd/1Bth rent is $1,460 (Dupre + Scott) 500 feet from Rapid Ride C Line, close to West Seattle Bridge, I-5, 99 5 Miles to Seattle s central business district 5
West Seattle The West 9 Apartments are located along SW Avalon Way at the entrance to West Seattle. This dynamic location is rapidly changing and is currently undergoing significant redevelopment from the Alaska Junction to the West Seattle Bridge. West Seattle s unique amenities, slower-paced lifestyle, natural beauty, outdoor recreation and proximity to Seattle s Central Business District make it a prime location to live, work and play. This is an excellent location providing immediate access to everything that makes West Seattle distinct and exciting while being only a short distance to Downtown Seattle and many other attractive city amenities. Residents at the West 9 enjoy being within walking distance of the recently renovated West Seattle Athletic Club, the West Seattle Golf Course, Trader Joe s, the new Whole Foods, LA Fitness, Starbucks Coffee, Shack Coffee, Luna Park Café, and the shops, entertainment and amenities offered in the Alaska Junction. Nearby public transportation options include the Rapid Ride C Line Station located across the street, and the Water Taxi, both offering expedited service to Seattle s CBD. This gateway location also provides residents with direct access to many spectacular outdoor and recreational amenities located along Alki Beach, including a 2.5-mile pedestrian trail, parks, kayaking, paddle boarding and West Seattle s Water Taxi to downtown Seattle. 6
Neighborhood Amenities SHOP: HEALTH + WELLNESS: EAT + DRINK: > > Buddha Ruksa > > Talaricos > > Jak s Grill > > Pico > > Bang Bar Thai > > The Matador > > Chaco Canyon > > Fresh Bistro > > Pecado Bueno > > Bakery Nouveau > > Fiddlehead Fine Foods > > Mashiko > > Capers Home > > NW Art & Frame > > Easy Street Records > > Radio Shack > > Click! > > Bartell Drugs > > Arts West Gallery > > Bin 41 > > True Value > > Curious Kidstuff > > Pegasus Books > > Twilight Gallery > > Thunder Road Guitars > > W.S. Farmer Market GROCERY: > > Trader Joe s > > Whole Foods (coming soon!) > > QFC > > Safeway > > Thriftway > > W.S. Farmers Market > > Huski Deli > > West Seattle Produce Co. > > Pellegrini Italian Market > > Breath Hot Yoga > > Bikram Hot Yoga > > LA Fitness > > GNC > > West Seattle Health Club > > Seattle Integrated Martial Arts > > Limber Yoga > > Whole Foods > > Fitness Together > > West Seattle Family YMCA PARKS + RECREATION: > > Camp Long > > West Seattle Golf Course > > Fairmount Park > > Lincoln Park > > Alki Beach > > Delridge Playfield > > Elliot Bay Brewery > > Starbucks > > Uptown Espresso > > Pagliacci > > Chipotle > > A la Mode Pies 7
Improvements Built in 1978, the West 9 Apartments is a three-story, wood-framed building with stucco exterior cladding and a flat/sloped roof. In the past year, the property has undergone a major renovation to give the property a fresh and contemporary feel. The renovation included new designer exterior paint, new double-paned vinyl windows and sliders, frosted balcony panels, new contemporary horizontal fence, attractive new landscaping and more. The building sits above the street, offering seclusion, on a large, 7,200 square foot lot zoned Mid Rise. and more. Building mechanical systems include individual hot-water heaters and electric meters, breaker panels, copper wiring, copper plumbing, and electric baseboard heating. Amenities include private balconies and off-street parking with nine stalls accessed off the alley. As a convenience for the owner/ manager, there is a large storage room on the ground floor that can be used for management related supplies. The building has a secure entry with intercom access on both the north and west sides of the building offering safety and security to residents. The design of the building is well thought with a staggered design and two interior stairwells which help to create separation and privacy between units. Additionally, the building features light-weight concrete sub-floors which decreases noise transfer between floors. All units at the West 9 are onebedroom/ one-bathroom apartments with efficient and functional floor plans equipped with complete appliance packages including in-unit washers and dryers for resident s convenience. There are three different floor plans at the West 9, with some offering city, mountain and territorial views. Four of the units have recently been renovated and modernized with designer finishes and fixtures including new quartz counters, new cabinets, undermount sinks, tile/lvt/carpet flooring, some stainless steel appliances, subway tile shower surround, 8
Development Potential 7,200 rectangular lot APPROVED TRANSIT PLAN Lot dimensions 60 x 120 60 frontage on SW Avalon Site has gentle slope from alley to Avalon Way Midrise zoning WEST 9 APTS 500 from Sound Transit Rapid Ride stop Frequent transit corridor West Seattle Junction Hub Urban Village No density limit Walking distance to Starbucks, Trader Joe s and Whole Foods Five miles from Downtown Seattle Future Light rail stop located on Avalon Way Alley access 9
Building Photos 10
Unit Photos 11
Aerial Photos WEST 9 APTS WEST 9 APTS 12
Floorplan W/D DINING FLOORPLAN 2 BEDROOM BEDROOM BALCONY BATH BATH KITCHEN LIVING ROOM W/D DINING KITCHEN BATH W/D LIVING ROOM DINING KITCHEN FLOORPLAN 3 FLOORPLAN 1 BEDROOM LIVING ROOM BALCONY BALCONY ALL FLOORS IDENTICAL 13
Operating Summary Total Monthly Income Monthly Scheduled Rent $10,602 $12,955 Parking Income (9 Stalls) $50 $50/stall $450 Utility Income $150 $60/unit $540 West 9 Apartments 3046 SW Avalon Way, Seattle WA Units 9 Price $2,350,000 Year built 1978 Price Per Unit $261,111 Rentable Area 5,164 Per Square Foot $455.07 Down Payment $822,500 Current GRM 18.05 Loan Amount $1,527,500 Current CAP 4.09% Interest Rate 4.0% Market GRM 13.99 Amortization 30 Market CAP 5.27% Approx Current Market Units Type Size Rent Rent A 1 Bd/1 Bth 560 $1,122 $1,395 B 1 Bd/1 Bth 525 $960 $1,395 C 1 Bd/1 Bth 636 $1,000 $1,395 D* 1 Bd/1 Bth 560 $1,425 $1,495 E 1 Bd/1 Bth 525 $1,008 $1,395 F* 1 Bd/1 Bth 636 $1,365 $1,495 G 1 Bd/1 Bth 560 $1,122 $1,395 H* 1 Bd/1 Bth 525 $1,200 $1,495 I* 1 Bd/1 Bth 636 $1,400 $1,495 9 Avg S.F. 574 $2.05 $2.51 Other Income $50 $50 Total Monthly Income $10,852 $13,995 Annualized Operating Data Current Market Scheduled Gross Income $130,224 $167,940 Less Vacancy 2.00% $2,604 3.00% $5,038 Gross Operating Income $127,620 $162,902 Less Expenses $31,418 $39,077 Net Operating Income $96,202 $123,825 Annual Debt Service ($7,293/mo) $87,510 $87,510 Cash Flow Before Tax 1.06% $8,691 4.42% $36,315 Principal Reduction $26,900 $26,900 Total Return Before Tax 4.33% $35,591 7.69% $63,214 Annualized Operating Expenses Current Market Real Estate Taxes 2016 $11,661 $15,000 Current Operations Insurance Quote $1,805 $1,805 Expenses/Unit $3,491 Utilities 2016 Annualized $8,052 $8,052 Expenses/Foot $6.08 Percent of GSI 24.13% On-site Payroll Proforma $0 $4,320 Maint/Repairs Proforma $6,750 $6,750 Market Operations Admin Proforma $900 $900 Expenses/Unit $4,342 Reserves Proforma $2,250 $2,250 Expenses/Foot $7.57 Total Expenses $31,418 $39,077 Percent of GSI 23.27% *=renovated units 14
Sale Comparables SUBJECT: WEST 9 APARTMENTS 3046 SW Avalon Way, Seattle WA Year Built 1978 Units 9 Sales Price $2,350,000 Price/Unit $261,111 Price/Foot $455.07 GRM/CAP 18.05/4.09% Sales Date TBD 1. ADMIRAL FLATS 3431 California Ave SW, Seattle WA Year Built 1977 Units 8 Sales Price $2,450,000 Price/Unit $306,250 Price/Foot $416 GRM/CAP 13.5/5.3% Sales Date February 2016 2. ALASKA 45 4546 45th Ave SW, Seattle WA Year Built 1962 Units 18 Sales Price $5,650,000 Price/Unit $313,889 Price/Foot $432.95 GRM/CAP 15.5/4.5% Sales Date 2.11.2016 3. CALIFORNIA CONDOS 4012 California Ave SW, Year Built 1977 Units 6 Sales Price $1,700,000 Price/Unit $283,333 Price/Foot $352.40 GRM/CAP 15.8/4.5% Sales Date 04.01.2016 4. ALKI PARK 2664 59th Ave SW, Seattle WA Year Built 1916 Units 6 Sales Price $1,435,000 Price/Unit $239,167 Price/Foot $429.90 GRM/CAP 13.9/5.0% Sales Date February 2016 5. SOUND BREEZE APTS 5034 Fauntleroy Way SW, Year Built 1989 Units 6 Sales Price $1,685,000 Price/Unit $280,833 Price/Foot $310.66 GRM/CAP 16.4/3.96% Sales Date 10.07.2016 15
On Market Comparables 6. 5 UNIT 2415 NW 85th St, Seattle WA Year Built 1955 Units 5 Sales Price $1,450,000 Price/Unit $290,000 Price/Foot $446.15 GRM/CAP 16/4.5% Sales Date On Market 7. BAYVIEW APARTMENTS 1914 Ferry Ave SW, Year Built 1953 Units 9 Sales Price $1,930,000 Price/Unit $214,444.44 Price/Foot $428.89 GRM/CAP 14.7/4.3% Sales Date On Market 8. HARPER HEIGHTS 2132 California Ave SW Year Built 1978 Units 11 Sales Price $3,300,000 Price/Unit $300,000 Price/Foot $381.02 GRM/CAP 18.73/3.42% Sales Date On Market 16
Sales Comparables Map West 9 Apartments 3046 SW Avalon Way 6 1. Admiral Flats 3431 California Ave SW Seattle WA 2. Alaska 45 4546 45th Ave SW Seattle WA 3. California Condos 4012 California Ave SW 4 7 8 4. Alki Park 2664 59th Ave SW Seattle WA 5. Sound Breeze Apts 5034 Fauntleroy Way SW 1 3 WEST 9 APARTMENTS 6. 5 Unit 2415 NW 85th St 2 7. Bayview Apartments 1914 Ferry Ave SW Seattle WA (on market) 5 8. Alaska 45 2132 California Ave SW Seattle WA (on market) 17
Rent Comparables Property Units Age Unit Type Size Rent Rent/Sq.Ft Comments West 9 Apartments 3046 SW Avalon Way 9 1978 1Bd/1Bth 1Bd/1Bth 574 574 $960-$1,400 $1,395-$1,495 $2.05 $2.51 Washers and dryers in units, some renovated units, new exterior paint and windows 1. Garden Terrace 4830 Fauntleroy Way SW 32 1986 1Bd/1Bth 617 $1,595 $2.59 Washers and dryers in units, original unit finishes 2. California Apartments 6040 California Way SW 25 1992 1Bd/1Bth 586 $1,550 $2.65 Washers and dryers in units, W/S/G included in rent, parking $45/mo or $65/mo with storage, views from upper units 3. Westside Flats 3233 SW Avalon Way 60 1999 1Bd/1Bth 850-885 $1,675-$1,775 $1.97-$2.00 Washers and dryers in units, W/S/Gindividually metered and billed back, parking from $85 - $135, updated units, elevator, views from upper units 4. City Watch Apartments 4744 41st Ave SW 90 1991 1Bd/1Bth 844 $1,915 $2.27 Washers and dryers in unts, garage parking, W/S/G is billed back to tenants 5. Admiral Flats 3431 California Ave SW, Seattle WA 8 1977 1Bd/1Bth 625 $1525 - $1,595 $2.44 - $2.55 Washer and Dryer in unit, Fully remodeled, hard surface flooring, Stainless Steel appliances, granite counter tops, secured entry, tenants pay additional $45 each for utilities. 18
Rent Comparables Map West 9 Apartments 3046 SW Avalon Way 1. Garden Terrace 4830 Fauntleroy Way SW 2. California Apartments 6040 California Way SW 3. Westside Flats 3233 SW Avalon Way 4. City Watch Apartments 4744 41st Ave SW 5 WEST 9 APARTMENTS 5. Admiral Flats 3431 California Ave SW 4 1 3 2 19
Paragon Real Estate Advisors ABOUT PARAGON Paragon Real Estate Advisors is the leading Seattle real estate investment firm for multi-family property sales in Washington State. We have accrued over $3 billion in sales and have closed nearly 1,700 successful real estate transactions. We are locally owned, client-focused and highly experienced. When it comes to apartments and investment real estate in the Puget Sound region, we are the smart choice to partner with. At Paragon, we build long-term partnerships that help our clients reach their long- and short-term real estate investment goals while maintaining maximum profitability for them. Our brokers have an in-depth knowledge of the Washington state real estate market, particularly in the greater Seattle area and the I-5 corridor, that comes from more than 20 years experience in the industry. Paragon s unique focus on sharing knowledge, teamwork and collaboration within the brokerage industry leverages our collective intellect for all our clients. Our brokers provide superior customer representation through our innovative and effective marketing campaigns, co-brokerage, skilled negotiations, and ongoing partnerships. The information found in this offering memorandum has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed 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. 20