Offering Memorandum TAYLOR WEST APARTMENTS 401 Taylor Pl NW Exclusively offered by Paragon Real Estate Advisors The Right Location Offering The Best for Less 1
Offering Summary Paragon Real Estate Advisors is pleased to offer for sale the Taylor West Apartments. This 16 unit (15 plus 1) apartment building is located in a residential neighborhood just blocks from Downtown Renton. Taylor West Apartments offers an investor the opportunity to acquire a welllocated, meticulously maintained apartment building with income upside. The Buyer can increase rents to market levels, charge for utilities and reap the rewards of immediate upside and long-term appreciation in a location that is rapidly being discovered. Name Taylor West Apartments Address 401 Taylor Pl NW, Renton WA 98057 Total Units 16 (15 + 1) Built 1969 Square Feet 10,730 Total Net Rentable (10,154 Per KCR) Price $3,499,000 Price Per Unit $218,688 Price Per Foot $326.10 Current GRM/CAP 17.5/3.7% (3% Vacancy) Market GRM/CAP 13.8/5.0% (3% Vacancy) Expense Per Unit $4,097/Year Terms Cash Out Lot Size 11,339 Square Feet Zoning RM-F TAYLOR WEST APARTMENTS 2
Location SEATTLE CBD MERCER ISLAND BELLEVUE TAYLOR WEST APARTMENTS SOUTHPORT THE LANDING DOWNTOWN RENTON 3
Location Highlights Renton has been discovered by millennials and has become an extension of Seattle Home of the Seattle Seahawks headquarters and training facility Home of the annual Seahawks 12K Run at the Landing Downtown Renton is a thriving urban environment with boutique shops, cafés and restaurants Accessible by four state highways, Interstate 405, Interstate 5 and close to Interstate 90 11 miles to Downtown Seattle, 8 miles to Downtown Bellevue, 6 miles to SeaTac International Airport 1.8 miles to the Landing, a 46-acre site containing retail stores, restaurants and entertainment venues 2 miles to Gene-Coulon Memorial Beach Park a 55 acre lakeside park Downtown Renton is seeing an increase in new apartment construction as seen with the Sanctuary, Reserve Apartments and the Bristol Renton is affordable and offers affordable housing Renton is business-friendly and has streamlined the planning and development process and reduced approval time of permits in order to expedite quality developments 4
Renton Overview The word is getting out and Renton is quickly being discovered by those who desire affordable housing, ease of transportation, an enjoyable urban community, access to extensive parks, trails and opportunities for water related recreational activities. Centrally located at the south end of Lake Washington, Renton s strategic location, in the heart of the Puget Sound region, provides access to local, regional, national and international markets. The City, a 23.79 - square mile urban community, has approximately 95,540 residents, 41,271 jobs and is the fourth largest city in King County. 5
Renton Overview Downtown Renton is undergoing a renaissance. Once known for vacant storefronts and the Renton Loop, the center of the City is a thriving, urban environment where people live, work and play. This area is now populated with quaint restaurants, boutique shops and an active nightlife scene. In addition, new apartment and condominium construction continues to bring in new residents to the area. The Renton Transit Center provides access to buses with connections to and from Seattle, Bellevue and beyond. Existing and planned office buildings provide companies with a central locale and employees access to restaurants, shops and other amenities. City Center Parking, the City s new public parking garage, and the Renton IKEA Performing Arts Center, and the city-owned Pavilion Event Center are attracting even more people Downtown. 6
Renton Overview Historically downtown Renton has been the primary location for restaurants, shops, and entertainment options for the greater southend community. In recent years new developments have created many new retail hubs such as The Landing in North Renton or the Highlands in Northeast Renton. The Landing is a new $300 million Urban Village and the shopping destination for locals and tourists alike. The development contains over 600,000 square feet of retail stores, restaurants and entertainment venues, plus 880 residential units at the Sanctuary and The Reserve Apartments. Collectively, Renton s retail businesses employ thousands of individuals and add hundreds of millions of dollars to the local economy. The business community also provided over $24 million in sales tax revenue to the City of Renton in 2008, representing about 26 percent of the city s overall general fund revenue. 7
Renton Overview Located across from the Landing is Southport a newly constructed mixed-use development home to the Bristol; 383 exclusive waterfront apartments. The Hyatt Regency recently completed construction of a boutique hotel containing 347 guest rooms. July 7th 2017 the Hyatt Recency Lake Washington at Southport opened their doors to guests offering an upscale retreat near the shores of Lake Washington. The hotel offers guest rooms with views of Lake Washington, Gene-Coulon Memorial Beach Park and the Seattle skyline. The third phase of this development is the Southport office campus schedule to be completed in 2018. This development includes: > > 727,634 square feet of Class A office space > > 10,279 square feet of retail space > > 695,159 square feet of garage parking > > 2,121 structured parking spaces with the ability to expand > > An indoor/outdoor waterfront conference pavilion > > 3 separate secured men s and women s locker rooms > > Roof-top terraces 8
Renton Overview Renton is known for its great outdoor venues. This family friendly neighborhood has 29 developed public parks, an 18 hole golf course, 13 miles of trails and 813 acres of public open space for passive and active recreational activities. The Gene-Coulon Memorial Beach Park, a 55 acre park with nearly 1.5 miles of Lake Washington waterfront is Renton s signature recreational area. This park is a frequent water stop for cyclists and offers boat launch lanes, picnic shelters, playground equipment, tennis courts, volleyball courts, summer swimming and much more. This well known park has long been a destination for relaxation and recreation by Seattleites. 9
Select Neighborhood Amenities Food/Drink Shopping/Services 15 Parks/Recreation 1 Taqueria El Torito 2 Royal Orchid 3 Southport 4 Pabla Indian Cuisine 5 Starbucks 6 Fred Meyer 7 Melrose Grill 8 Red House Beer and Wine 9 Ikea Performing Arts Center 10 Berliner Pub 11 The Landing 12 Liberty Park 13 Safeway 14 McLendon Hardware 15 Gene-Coulon Memorial Beach Park 16 Local 907 17 Angel City Deli 18 Nevzat Espresso 19 Cheers Bar and Grill 20 Earlington Park 21 Black River Riparian Forest 22 Fort Dent Park 22 18 17 21 TAYLOR WEST APARTMENTS 20 6 1 4 13 2 5 14 9 3 19 8 11 16 10 7 12 10
Employment Once best known for The Boeing Company and the aerospace industry. Renton is now booming with the next generation of employees while maintaining companies that have been part of Renton since WWII. Game maker Wizards of the Coast, Valley Medical Center and software publisher TOPICS Entertainment are not only large and growing employers, they are leaders in the economy of the 21st Century. Renton offers approximately 41,000 jobs in a neighborhood that contains some of the most affordable housing prices in the state. TAYLOR WEST APARTMENTS 1 14 Company Employees 6 1 The Boeing Company 14,428 2 Valley Medical Center 2,267 3 Renton School District 1,837 4 Federal Aviation Administration 1,480 5 PACCAR Inc. 1,290 8 10 9 3 13 7 6 City of Renton 722 7 King County 425 8 Fred Meyer 404 5 12 4 9 Puget Sound Education Services 364 10 Convergent Outsourcing 345 11 Wizards of the Coast 336 11 Wal-Mart 293 13 Renton Technical College 274 14 IKEA Seattle 267 15 Honeywell International 262 11 15 2 11
Investment Highlights Awesome street appeal Meticulously cared for, turn-key building Many of the units have been updated Open and spacious floor plans with separate dining areas Low maintenance exterior, electric baseboard heat and copper plumbing Large lot with attractive landscaping offering a quiet respite Large private balconies Ample parking including 1 garage, 7 carports of which garage doors could be installed and 15 open parking spaces Common laundry room with leased equipment Private resident storage lockers On-site office for owner or manager Rental upside 12
Aerial View TAYLOR WEST APARTMENTS 13
Building Photos 14
Building Photos 15
Unit Photos 16
Unit Photos 17
Operating Summary Units 16 (15 + 1) Year built 1969 Rentable Area 10,730 Sq.Ft. Down Payment $2,099,400 60% Loan Amount $1,399,600 40% Interest Rate 4.00% Amortization 30 Years Price $3,499,000 Price Per Unit $218,688 Per Square Foot $326.10 Current GRM 17.45 Current CAP 3.68% Market GRM 13.80 Market CAP 5.01% Annualized Operating Data Current Market Scheduled Gross Income $200,460 $253,620 Less Vacancy 3.0% $6,014 3.0% $7,609 Gross Operating Income $194,446 $246,011 Less Expenses $65,547 $70,680 Net Operating Income $128,899 $175,331 Annual Debt Service ($6,682) $80,183 $80,183 Cash Flow Before Tax 2.32% $48,716 4.53% $95,149 Principal Reduction $24,647 $24,647 Total Return Before Tax 3.49% $73,364 5.71% $119,796 Units Type Size Current Rent Monthly Income Market Rent Monthly Income 14 1 Bd/1 Bth 645 $950 - $1,095 $14,060 $1,225 $17,150 2 2 Bd/1 Bth 850 $1,200 $2,400 $1,550 $3,100 16 Avg S.F. 671 $1.53 $1.89 Total Monthly Income Current Market Monthly Scheduled Rent $16,460 $20,250 Utility Bill Back $0 $35/$50 $590 Electric Bill Back (Units 15/16) Est $95 $95 Laundry Income Est $100 $100 Other Income Proforma $50 $100 Total Monthly Income $16,705 $21,135 Annualized Operating Expenses Current Market Real Estate Taxes 2017 Actual $16,367 $21,500 Insurance 2016 Actual $2,944 $2,944 Utilities 2016 Actual $11,536 $11,536 On-Site Management Proforma $9,600 $9,600 Maintenance & Repairs Proforma $13,600 $13,600 Landscaping Proforma $5,000 $5,000 Admin/Misc Proforma $2,500 $2,500 Reserves Proforma $4,000 $4,000 Total Expenses $65,547 $70,680 Current Operations Expenses/Unit Expenses/Foot Percent of EGI $4,097 $6.11 32.70% Market Operations Expenses/Unit Expenses/Foot Percent of EGI $4,418 $6.59 27.87% 18
Sale Comparables SUBJECT - TAYLOR WEST APTS 401 Taylor Pl NW, Year Built 1969 Units 16 (15 + 1) Sales Price $3,499,000 Price/Unit $218,688 Price/Foot $326.10 GRM/CAP 17.5/3.7% Sales Date TBD 2. CHARLEMAGNE 1300 14th Ave S, Seattle, WA Year Built 1965 Units 14 Sales Price $2,875,000 Price/Unit $205,357 Price/Foot $358.93 GRM/CAP 13.1/4.9% Sales Date 2.10.2017 4. SEDONA TOWNHOMES 963 Aberdeen Ave NE, Year Built 2009 Units 10 Sales Price $2,010,000 Price/Unit $201,000 Price/Foot $289.21 GRM/CAP 12.5/4.9% Sales Date 9.30.2016 1. FRESCO 3939 15th Ave S, Seattle, WA Year Built 1959 Units 20 Sales Price $4,800,000 Price/Unit $240,000 Price/Foot $428.57 GRM/CAP 12.1/5.4% Sales Date 5.23.2017 3. PARK APARTMENTS 4700 SW Othello St, Seattle, WA Year Built 1910 Units 6 Sales Price $1,280,000 Price/Unit $213,333 Price/Foot $332.90 GRM/CAP 15.0/4.1% Sales Date 11.4.2016 5. 6 UNIT APARTMENT 4500 Delridge Way SW, Seattle, WA Year Built 1987 Units 6 Sales Price $1,305,000 Price/Unit $217,500 Price/Foot $207.19 GRM/CAP 12.6/4.6% Sales Date 9.29.2016 19
Sales Comparables Map Taylor West Apartments 401 Taylor Pl NW 2 1 1. Fresco 3939 15th Ave S Seattle, WA 5 2. Charlemagne 1300 14th Ave S Seattle, WA 3 3. Park Apartments 4700 SW Othello St Seattle, WA 4. Sedona Townhomes 963 Aberdeen Ave NE 4 5. 6 Unit Apartment 4500 Delridge Way SW TAYLOR WEST APARTMENTS 20
Rent Comparables Property Units Age Unit Type Size Rent Rent/Sq.Ft. Comments Taylor West Apartments 401 Taylor Pl NW 16 (15 + 1) 1969 1Bd/1Bth 2Bd/1Bth 645 850 $950 - $1,095 $1,200 $1.47 - $1.70 $1.42 Well maintained spacious units, common laundry, ample on-site parking 1. Barnett Apartments 412 Mill Ave S 8 1948 1Bd/1Bth 650 $1,075 $1.65 On-site parking, $35/occupant/month for W/S/G 2. The Hampton Apartments 270 Bronson Way NE 36 1967 2Bd/1Bth 1,016 $1,450 - $1,550 $1.43 - $1.53 Common laundry, open on-site parking, W/S/G is $35/unit/month 3. Rencliffe Apartments 390-400 Taylor Ave NW 40 1969 1Bd/1Bth 2Bd/1Bth 645-800 1,025 $975 - $1,195 $1,045 - $1,495 $1.49 - $1.51 $1.02 - $1.46 Common laundry, open on-site parking, W/S/G included in rent 4. Sky Lanai 360 Taylor Ave NW 48 1968 1Bd/1Bth 2Bd/2Bth 850-950 1,000 $1,150 - $1,250 $1,675 $1.32 - $1.35 $1.68 Common laundry, open on-site parking, W/S/G is $35/occupant/ month 5. Taylor Creek * 7050 S 166th Pl 53 2017 1Bd/1Bth 2Bd/1Bth 2Bd/2Bth 750 932 1,017 $1,450 $1,650 $1,815 $1.93 $1.77 $1.78 In unit W/D, W/S/G is $75/mo for 1BD and $95/mo for 2BD, garage parking is $120 and carport parking is $55/mo * new construction 21
Rent Comparables Map Taylor West Apartments 401 Taylor Pl NW 1. Barnett Apartments 412 Mill Ave S 2. The Hampton Apartments 270 Bronson Way NE TAYLOR WEST APARTMENTS 3. Rencliffe Apartments 390-400 Taylor Ave NW 4. Ski Lanai 360 Taylor Ave NW 3 4 1 2 5. Taylor Creek 7050 S 116th PL Seattle, WA 5 22
Paragon Real Estate Advisors ABOUT PARAGON Paragon Real Estate Advisors is the leading Seattle real estate investment firm for multifamily 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. 23