The Sunset District NAIOP Real Estate Development Workshop April 2012 Bryant Cheong Matthew Craigie Khoa Le Jeff Sakamoto Michael Weidmann Kent Wu
The Sunset District Presentation Outline Site Assessment Development Vision Site Design Final Summary Acknowledgments Appendix
The Surrounding Area Jobs +/- 25000 Housing 6700 households Neighborhood Rock Creek / Tanasbourne Schools Six High Schools & Two PCC campuses within 5 mile radius Tanasbourne Regional Center Streets of Tanasbourne AmberGlen R.C.
Silicon Forest Oregon s Employment Hub -Local Employers- 15,000 = = 7000 1000 = = 500
Existing Conditions Owned by Standard Insurance Company Size: Approximately 16 acres Current Use: Greenfield Significant sloped topography Current Zoning: - General Commercial (C1) - Industrial Park (M-P) - Planned Unit Development Overlay since 1997 Planned Unit Development Industrial Park General Commercial Multi-Family Residential
Initial Site Analysis Strengths Proximity to employers Highway visibility Coastal Mountain view corridor High volume of visitors Weaknesses Sloped topography Landlocked between exits Zoning Soft office market Opportunities Kaiser hospital Strong rental market Growing community Threats Low multifamily rental rates Possible rezoning hurdles Constrained vehicular access
Aquatic Center Office Senior Housing Multi- Family Restaurant Self Storage Mixed Use Retail Hotel Outlet Mall For Sale Housing Medical Office Entertainment
Decision Criteria Restaurant Hotel Will the use realize the value of the land? Senior Housing Outlet Mall Campus/Industrial Is the use feasible in the development horizon? For Sale Housing Office Medical Office Entertainment Mixed Use Is the use appropriate? Aquatic Center Self Storage Casino Retail Multi- Family Rental
Development Vision Vibrant, mixed use, walkable district Marketable phases Regional entertainment destination Maximizing land value A long term precedent Urban feel in a suburban location
Market Analysis Surrounding the Sunset District is a community with a demographic profile of highly educated, high income professionals, with an average household income of over $78,000 within a 5 mile radius. INCOME DISTRIBUTION Age Groups 24.9% 0-9 13.5% 14.3% 1.8% 2.8% 12.7% 16% 9.5% 9.3% 8.6% Age Distribution Range 10-19 20-29 30-44 45-59 10.9% 15.9% 24.6% 24.6% Household Incomes 60-74 7.5% 75+ 3.0%
Development Theme ~The Sunset District~ Residential 273 Units of Multifamily Housing Destination Retail Dave & Busters, Big Al s, Regal Cinemas Upscale Hotel aloft, Hyatt Place Restaurant Oswego Grill, Thirsty Lion, Noble Rot, Starbucks
Development Overview
Multifamily Residential Features Urban community feel Neighborhood retail space 1,2, & 3 bedroom units Secure garage parking Outdoor common areas Number of Units 273 Rent per SF $1.45 Total Cost $46 million Target Market Range Cost per Unit $167,000 Return on Costs 7.0% IRR 14% Assumed Land Value $17 per SF
Destination Entertainment Synergy of uses Maximize signage/visibility Emphasis on pedestrian accessibility On street & garage parking
Development Principles ~Destination Entertainment~ Big Al s/d&b Concept: Fee simple ownership Build and sell development Building Footprint Land Sale (4 acres) 51,000 SF $17 per SF Regal Cinema Concept: Negotiation with existing landlord Turn key with 20-25 year lease Relocate and upgrade existing facility Building Footprint Total Construction Costs Comparable Rent 56,000 SF $17 million $19-$21 per SF
Hotel Concept: EB-5 Financing Midrise construction Development Principles ~Upscale Hotel~ Corporate meeting facilities Upscale hotel amenities Secure garage parking facilities Adjacent entertainment and restaurant destinations Building Shell Total Size Six Stories 66,000 SF Number of Rooms 137 Price Point Total Cost Land Value $125 per night $127,000 per key $10,000 per key
Development Principles ~Restaurant~ Restaurant Concept: Rent $34-$36 per SF Cap Rate 7.5% Total Stabilized Value $16 million Total Cost $14 million NOI $1.2 million Full Service Restaurant/Bar Number of Pads 4 Total Size 29,000 SF Pad Size Range 6,500-9,000 SF Inline Retail/Small Restaurant Number of Pads 5 Return on Costs 9% Total Size Pad Size Range 11,000 SF 1,500-3,000 SF
Parking Parking Allotment Commercial Uses Shared Parking Hotel 160 Theater 400 Entertainment Arcade 387 Restaurant / Retail 205 Total 1152 Multifamily 354
Streetscape Pedestrian friendly sidewalks and lighting Blend the street and building realm Provide visual connections and hierarchy Mitigate stormwater impacts On street parking Narrow ROW to slow traffic
Landscape and Outdoor Areas Provides Third Place Pedestrian oriented Outdoor/Green spaces for residents Supplements parking needs
Site Design Multifamily Entertainment Restaurant/Retail
Final Summary Feasible - Innovative - Delivers Value
Sincere Thanks To: Bob LeFeber - CRA Advisors Dick Loffelmacher - CB Richard Ellis Mike Wells - CB Richard Ellis Robert Crane - Regal Cinemas David Pettingill - Dave and Buster s Gary Vance - Holland Development Matt Grady - Gramor Development Dave Burnett - Oswego Grill Bud Gabriel - Oswego Grill Isaac Scott - Anthem Memory care Christopher Dobbins Hyatt Jay Leo - The Springs at Tanasbourne Willy Paul - Kaiser Mike Goakey - Goakey Theater Consulting Colin Cooper - City of Hillsboro Dawn Nguyen - Realty Income Corporation Jeffry Tallman - Cypress Capital Management Roger Collins - InnVentures Bill Jensen - Howard S. Wright Gordon Childress - Howard S. Wright Dick Spies - Group Mackenzie Mark Fisher - StanCorp Mortgage Investors, LLC
Appendix 3) Parking Structure 1) Overview 4) Theater and Hotel 2) Multi-Family 5) Restaurant and Retail
Appendix