Value-Add Safeway Anchored Retail Center www.orioncp.com Bayview Center 2743 E Highway 101, Port Angeles, WA 98362 Scott Clements P C E 206.445.7664 206.793.1074 sclements@orioncp.com David Butler P C E 206.445.7665 425.890.7919 dbutler@orioncp.com
table of contents 1 Executive Summary 2 SiTE Overview 3 LeSSEE Information 4 Valuation Analysis 5 Market Overview 6 DEMOGRAPHICS Bayview Center ORION Commercial Partners 2
ExecUtive Summary Investment Highlights Offering Price $2,200,000 Pro Forma Cap Rate 10.32% Total Building Area 21,000 SF Price Per Square Foot $104.76 Total Land Area 91,040 SF (2.09 Acres) Pro Forma NOI $227,011 Occupancy 50% Vacancy 10,467 SF (4 Suites) Anchored by Safeway Inc. Located on the bus Hwy 101 corridor Added Value through lease-up Safeway Fuel - Gas on site Priced below replacement cost The Property ORION Commercial Partners is excited to offer for sale the Bayview Center, anchored by Safeway (not included). Located at 2743 E. Highway 101 in Port Angeles, WA., this value-add retail investment is being offered for sale at a 10.32% pro forma capitalization rate. In addition to benefiting from the continuous traffic generated by Safeway and Safeway Gas, the location draws from Port Angeles, and Sequim along with the annual throng of tourists traveling Hwy 101 to Olympic National Park and the Northern Washington Coast of the Pacific Ocean. Currently, the retail center is 50% leased with four vacancies which upon leaseup will add significant value to the center. The current tenant mix is made up of a mix of long-term tenants (Subway, and Go Wireless Inc [Verizon]) and newer tenants (Vern Fonk Insurance, Maurices and GNC). This investment opportunity has huge upside for the value-add investor. By conservatively inputting $12.00 NNN rents on the vacant spaces (actual average rents in the center are $16.42) and applying a 15% vacancy factor on the pro forma and actual rents a conservative NOI of $281,436 is easily achievable. By purchasing the Bayview Center, the investor will capitalize on a rare opportunity to create significant value through lease-up while purchasing the building below replacement cost. This statement with the information it contains is given with the understanding that all negotiations relating to the purchase, renting or leasing of the property described above shall be conducted through ORION Commercial Partners LLC. The above information, while not guaranteed, has been secured from sources we believe to be reliable. Bayview Center ORION Commercial Partners 3
SiTE Overview Site Plan Demographics 1 Mile 3 Mile 5 Mile Population 2,337 15,292 26,797 Average HH Income $58,303 $55,390 $56,597 N Brooke Ave Suite 2719 Suite 2727-2729 Suite 2731 Suite 2741 N BayView Ave Median HH Income $49,559 $42,954 $45,452 Bayview Center ORION Commercial Partners 4
SiTE Overview Parcel Map Bayview Center ORION Commercial Partners 5
Site Overview Aerial N Shoreline Auto and Passenger Ferry Terminal Bayview Center SUBJECT PROPERTY SEQUIM (13 MILES) OLYMPIC MEDICAL CENTER Bayview Center ORION Commercial Partners 6
site overview Area Overview N OLYMPIC NATIONAL PARK OLYMPIC MEDICAL CENTER Bayview Center Sportsmen Motel Bayview Center ORION Commercial Partners 7
site overview Photos Bayview Center ORION Commercial Partners 8
LeSsEe Information Rent Roll - INCLUDING Pro Forma Unit Tenant Sq. Ft. Monthly Rent Annual Rent Rent/SF Term Begins Term End 2719 Vacant 3,900 $3,900 $46,800 $12.00 -- -- 2725 GNC 1,300 $1,950 $23,400 $18.00 01/29/2015 01/31/2020 2727-29 Vacant 2,600 $2,600 $31,200 $12.00 -- -- 2731 Vacant 1,300 $1,300 $15,600 $12.00 -- -- 2733 Subway 1,300 $2,002 $24,024 $18.48 11/19/2001 08/31/2016 2735 Vern Fonk Insurance 1,300 $1,649 $19,788 $15.24 08/06/2012 10/05/2020 2737 Go Wireless, Inc. (Verizon) 1,300 $2,052 $24,624 $18.94 05/25/2007 05/2/2017 2741 VACANT 2,667 $2,667 $32,004 $12.00 -- -- 2743 Maurice Inc. #655-0 5,333 $5,333 $63,996 $12.00 07/18/2013 01/31/2019 TOTALS 21,000 $23,453 $281,436 $14.52 Total Units SF Percentage Total Sq. Ft. Total Potential Monthly Rent Total Actual Monthly Rent Occupied 5 50% 10,533 $12,986 $12,986 Vacant 4 50% 10,467 $10,467 -- TOTALS 9 21,000 $23,453 $12,986 This statement with the information it contains is given with the understanding that all negotiations relating to the purchase, renting or leasing of the property described above shall be conducted through ORION Commercial Partners LLC. The above information, while not guaranteed, has been secured from sources we believe to be reliable. Bayview Center ORION Commercial Partners 9
LeSsEe Information Current Rent Roll Unit Tenant Sq. Ft. Term Begins Term End Rent/ SF Monthly Rent Annual Rent Rent Increases Option Periods Expenses 2719 Vacant 3,900 -- -- -- -- -- -- -- -- 2725 GNC 1,300 01/29/2015 01/31/2020 $18.00 $1,950 $23,400 Fixed beginning in year 4 (2) 5 Year NNN 2727-29 Vacant 2,600 -- -- -- -- -- -- -- -- 2731 Vacant 1,300 -- -- -- -- -- -- -- -- 2733 Subway 1,300 11/19/2001 08/31/2021 $18.48 $2,002 $24,024 3% annually (1) 5 Year NNN 2735 Vern Fonk Insurance 1,300 08/06/2012 10/05/2020 $15.24 $1,649 $19,788 2.5% annually N/A NNN 2737 Go Wireless, Inc. (Verizon) 1,300 05/25/2007 05/2/2017 $18.94 $2,052 $23,916.68 3% annually (2) 3 Year NNN 2741 VACANT 2,667 -- -- -- -- -- -- -- -- 2743 Maurice Inc. #655-0 5,333 07/18/2013 01/31/2019 $12.00 $5,333 $63,996 Flat (3) 5 Year NNN TOTALS 21,000 $16.53 $12,986 $155,832 This statement with the information it contains is given with the understanding that all negotiations relating to the purchase, renting or leasing of the property described above shall be conducted through ORION Commercial Partners LLC. The above information, while not guaranteed, has been secured from sources we believe to be reliable. Bayview Center ORION Commercial Partners 10
Valuation Analysis Valuation Analysis Including Pro Forma Price: $2,200,000 Loan Information Proposed Down Payment: 45.45% $1,000,000 Proposed First Loan Amount: $1,200,000 Current Cap Rate: 10.32% Interest Rate: 4.50% Approximate Net Rentable SF: 21,000 sf Amortization: 25 Approximate Lot Size: 91,040 sf Annual Debt Service: $(80,040) Year Built: 2009 Loan Maturity: Ten years Cost Per Net Rentable SF: $104.76 Rent Per Net Rentable SF: $16.03 NNN 2016 Annualized Data Including Pro Forma 2016 Operating Expenses Including Pro Forma Gross Potential Rental Income: $281,436 Real Estate Taxes (2015): Tenant Paid Plus Recaptured Operating Expenses: $81,400 Insurance: Tenant Paid Less Vacancy and Credit Loss @ 15%: $54,425 Repairs: Tenant Paid Gross Operating Income: $308,411 Maintenance: Tenant Paid Less Operating Expenses: $81,400 Utilities: Tenant Paid Net Operating Income: $227,011 Management/Admin: Tenant Paid Less Annual Debt Service: $(80,040) Pre-Tax Cash Flow: 14.70% $146,971 Total Non-Recaptured Expenses: $- Plus Principal Reduction: $26,584 Total Estimated Property Expenses: $81,400 Pre-Tax Return: 17.36% $173,554 Property Expenses/Net RSF: $3.88 *as a percentage of down payment This statement with the information it contains is given with the understanding that all negotiations relating to the purchase, renting or leasing of the property described above shall be conducted through ORION Commercial Partners LLC. The above information, while not guaranteed, has been secured from sources we believe to be reliable. Bayview Center ORION Commercial Partners 11
Market Overview About Port Angeles Port Angeles is a city in and the county seat of Clallam County, Washington, With a population of approximately 20,000, it is the largest city in the county. The city is served by William R. Fairchild International Airport and ferry service across the Strait of Juan de Fuca to Victoria, British Columbia, Canada on the M/V Coho. The city is situated on the stunning northern edge of the Olympic Peninsula along the shore of the Strait of Juan de Fuca. Port Angeles is located in the rain shadow of the Olympic Mountains, bringing the city significantly less rain than other areas of western Washington. Port Angeles is also the location of the headquarters of Olympic National Park, which encompasses most of the Olympic Mountains and draws in thousands of tourist and outdoor/nature enthusiasts all year round. The harbor of Port Angeles is deep enough to provide anchorage for large ocean-going ships such as tankers and cruise ships bringing a stream of shipping and tourism revenue into the region. The Port Angeles area has evolved into a very diverse business environment for a small rural town. Their Regional Chamber of Commerce is the largest business organization on the Olympic Peninsula. The town recently has become a wireless hot spot which allows anyone within the city limits to connect to web and e-mail services. The community also has an excellent fiber network which allows business clients with high-speed connections and provides a great tool for the telecommuters. The beautiful scenery and growing population have big retail giants like Walmart, Safeway, BigLots!, Sears - to name a few - locating to the area as well. Port Angeles is home to Peninsula College, the birthplace of football Hall of Famer John Elway, and houses an eclectic group of welcoming residents. Bayview Center ORION Commercial Partners 12
Demographics Radius 1 Mile 3 Mile 5 Mile Population: 2021 Projection 2,406 15,662 27,664 2016 Estimate 2,342 15,340 27,141 2010 Census 2,196 14,852 26,508 Growth 2016-2021 2.73% 2.10% 1.93% Growth 2010-2016 6.65% 3.29% 2.39% 2016 Population Hispanic Origin 56 583 1,082 2016 Population by Race: White 2,177 13,864 24,528 Black 16 129 231 Am. Indian & Alaskan 40 431 772 Asian 28 334 523 Hawaiian & Pacific Island 3 28 58 Other 78 555 1,030 U.S. Armed Forces: 7 41 138 Radius 1 Mile 3 Mile 5 Mile Households: 2021 Projection 1,098 7,107 12,255 2016 Estimate 1,069 6,959 12,019 2010 Census 1,002 6,737 11,740 Growth 2016-2021 2.71% 2.13% 1.96% Growth 2010-2016 6.69% 3.30% 2.38% Owner Occupied 804 4,359 7,789 Renter Occupied 265 2,600 4,230 2016 Avg Household Income $55,844 $57,269 $58,833 2016 Med Household Income $44,341 $40,063 $44,463 2016 Households by Household Inc: Less than $25,000 228 1,955 3,112 $25,000 - $50,000 345 1,902 3,285 $50,000 - $75,000 274 1,288 2,408 $75,000 - $100,000 138 959 1,552 $100,000 - $125,000 32 344 771 $125,000 - $150,000 22 194 289 $150,000 - $200,000 0 165 374 $200,000+ 29 153 227 Bayview Center ORION Commercial Partners 13
Demographics Demographic Ring - 1, 3, 5 Miles 5 Miles 3 Miles 1 Mile Bayview Center ORION Commercial Partners 14