Offering Memorandum PHINNEY BUILDING 7405-7407 Greenwood Ave N Seattle, WA Exclusively offered by Paragon Real Estate Advisors 1
Offering Summary Paragon Real Estate Advisors is pleased to exclusively offer for sale the Phinney Building. This mixed-use building consisting of two ground floor retail spaces with well-established tenants and three apartment units with long term residents. Situated in a very walkable and amenity rich neighborhood, the Phinney Building offers the commercial tenants vibrant business opportunities and the residential residents the highest quality of urban living. This is the first time the Phinney Building has been available for purchase in over 35 years and offers a buyer the rare opportunity to purchase a well-maintained mixed-use building in a location that is quickly becoming the most highly sought after neighborhood by retailers, restaurateurs, new home owners and apartment dwellers alike. Name Phinney Building Address 7405-7407 Greenwood Ave N, Seattle, WA 98103 Total Units 5 (2 Commercial + 3 Residential) Built 1912 Square Feet 4,677 Total Net Rentable (4,896 Gross per KCR) Price $2,250,000 Price Per Foot $481.08 Current GRM/CAP 21.6/3.4% (2% Vacancy) Market GRM/CAP 17.6/4.3% (3% Vacancy) Expense Per Unit $4,879/Year Terms Cash Out Lot Size 3,400 Square Feet Zoning NC2P-40 (Greenwood-Phinney Urban Village) PHINNEY BUILDING 2
Investment Highlights First time on market in 35 + years Highly desirable, pedestrian friendly neighborhood Newly discovered destination location known for the many unique stores, cafés, eateries, hip pubs Two well established and successful retail tenants Retail spaces have been updated and are spacious and light filled Three spacious residential units Wood-framed construction Updated electrical Updated plumbing Outdoor garden oasis for the enjoyment of its residents Rental upside 3
CARKEEK PARK Neighborhood Map U DISTRICT FREMONT SEATTLE CBD QUEEN ANNE GREENLAKE BALLARD PHINNEY BUILDING 4
Neighborhood Amenities - Phinney Ridge Food/Drink Shopping/Services Parks/Schools 1 Red Mill Burgers 2 The Barking Dog Alehouse 3 Kens Market 4 Woodland Park Zoo 5 Greenwood Hardware 6 Fred Meyer 7 Ballard High School 8 Cornuto Pizzeria 9 Greenwood Library 10 Hecho Cantina 11 74th Street Ale House 12 Greenwood Sip and Ship 13 United States Post Office 14 Bishop Blanchet High School 15 The Bathhouse Theater 16 Nutty squirrel Gelato 17 Beth s Cafe 18 Top Ten Toys 19 Fred Meyer 20 Dicks Drive In 21 Quality Food Center 22 Safeway 23 Woodland Park 24 West Woodland Elementary 25 Starbucks 26 Green Lake Park 7 22 2 19 PHINNEY BUILDING 24 11 3 18 6 13 14 9 12 8 15 17 16 5 1 4 23 21 10 26 20 25 5
Location The Phinney Building is located at 7405 7407 Greenwood Ave North in the PhinneyWood neighborhood of Seattle. This area offers in-city living without the intensity and congestion of Downtown Seattle. PhinneyWood is a close knit community of all ages with a strong neighborhood association that supports, engages and connects local establishments and residents through a variety of community programs, services and activities. PhinneyWood Monthly Art Walk, PhinneyWood One Day Garage sale, the Greenwood Car Show, Winter Beer Taste and the Winter Festival & Crafts Fair are a few of the well-known annual community events. This location also offers easy access to Woodland Park Zoo and Green Lake Park where residents enjoy the many recreational activities offered by both popular parks. The Ballard and Fremont neighborhoods are also located within a short distance. The PhinneyWood neighborhood allows for quick and direct access to downtown Seattle and South Lake Union employment centers via Highway 99 and Greenwood Ave North. The area also offers abundant public transportation options. Phinney and Greenwood Avenues are filled with pedestrians strolling and enjoying the surroundings during both day and evening hours. The Aves offer an abundance of quaint coffee shops, eateries, bars with great pub food, a variety of locally owned retail shops, a full service neighborhood grocery store, a True Value neighborhood hardware store, library and a community theatre. 6
Greenwood Snapshot Population 16,394 Median household income $75,337 Single Married Owner Occupied Renters Walk Score Transit Score Bike Score 57% 44% 52% 48% 90 - Walker s Paradise 53 - Good Transit 76 - Very Bikeable Median 1 Bd/1 Bth Rent $2,053 Median 2Bd/1 Bth Rent $2,387 Seattle Commute Times Bellevue Commute Times Bus: 32 minutes via E Line Car: 14 minutes via I5 Bus: 59 minutes via E Line/550 Car: 25 minutes via I5/WA 520 TOP JOB SECTORS: * Management: 14.4% Business 7.4% Computer: 11.8% Engineering 4.7% Art & Entertainment 3.9% Sales: 13.0% Service: 16.1% Healthcare: 2.1% Education 4.2% Social Services: 3.4% 7
Employment Greater Seattle excels at the industries of the future - the region is a center of innovation and features some of the world s top global brands. Our aerospace industry is one of the largest in the world, home to Boeing Commercial Airplanes and over 800 aerospace firms that employ 17% of all aerospace workers in the United States. Greater Seattle is also a leading center for information and communications technology, bolstered by industry pioneers such as Microsoft and Amazon. As a result, our region has emerged as a world leader in cloud computing and data visualization, and ranks 4th as a global startup hub ahead of New York and Boston. > > Adobe > > Alaska Airlines > > Amazon > > Apple > > AT&T Wireless > > Boeing > > Costco > > Expedia, Inc. > > Expeditors International > > F5 Networks > > Facebook > > Fred Hutchinson > > Gates Foundation > > Getty Images > > Google > > Microsoft > > Nintendo > > Nordstrom > > Paccar > > RealNetworks > > REI > > Russell Investments > > SpaceX > > Starbucks > > Symetra Financial > > Tableau Software > > T-Mobile > > Twitter > > Uber > > University of Washington > > Virginia Mason > > Weyerhaeuser > > Zillow > > Zulilly 8
Building Photos 9
Retail Space Photos 10
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Operating Summary Units 5 Year built 1912 Rentable Area 4,677 Down Payment $1,350,000 60% Loan Amount $900,000 40% Interest Rate 4.38% Amortization 30 Years Price $2,250,000 Per Square Foot $481.08 Current GRM 21.64 Current CAP 3.44% Market GRM 17.63 Market CAP 4.27% Units Type Size Current Rent Market Rent 1 Book Store 1,177 $2,100 $2,600 1 Salon 1,225 $2,704 $3,000 1 1Bd/1Bth 700 $1,600 $1,600 1 1Bd/1.5Bth 725 $1,025 $1,400 1 2Bd/2Bth 850 $1,150 $1,800 5 Avg S.F. 935 $1.83 $2.22 Total Monthly Income Monthly Scheduled Rent $8,579 $10,400 Laundry Income Proforma $32 $32 Utility Income $0 $150 Miscellaneous Income Com Tax + Ins $53 $53 Total Monthly Income $8,664 $10,635 Annualized Operating Data Current Market Scheduled Gross Income $103,968 $127,620 Less Vacancy 2.0% $2,079 3.0% $3,829 Gross Operating Income $101,889 $123,791 Less Expenses $24,394 $27,710 Net Operating Income $77,495 $96,081 Annual Debt Service ($4,494/mo) $53,923 $53,923 Cash Flow Before Tax 1.75% $23,572 3.12% $42,159 Principal Reduction $14,843 $14,843 Total Return Before Tax 2.85% $38,415 4.22% $57,002 Annualized Operating Expenses Current Market Real Estate Taxes Actual 2017 $9,434 $12,750 Insurance Actual 2017 $3,180 $3,180 Utilities Actual 2017 $3,780 $3,780 Maintenance & Repairs Proforma $4,500 $4,500 Administration Proforma $500 $500 Reserves Proforma $3,000 $3,000 Total Expenses $24,394 $27,710 Current Operations Expenses/Unit Expenses/Foot Percent of EGI $4,879 $5.22 23.46% Market Operations Expenses/Unit Expenses/Foot Percent of EGI $5,542 $5.92 21.71% 13
Sale Comparables 1. 475 N 36TH ST Seattle, WA Year Built 1920 Building Sq.Ft. 2,180 Lot Sq.Ft. 2,640 Sales Price $1,300,000 Price/Bldg Foot $596.33 Sales Date 9.26.2017 2. 1423 N 45TH ST Seattle, WA Year Built 1933 Building Sq.Ft. 2,690 Lot Sq.Ft. 3,800 Sales Price $1,250,000 Price/Bldg Foot $464.68 Sales Date 6.24.2017 SUBJECT - PHINNEY BUILDING 7405-7407 Greenwood Ave N, Seattle WA Year Built 1912 Units 5 (2 Commercial + 3 Residential) Building Sq.Ft. 4,677 Lot Sq.Ft. 3,400 List Price $2,250,000 Price/Foot $481.08 3. 6801 GREENWOOD AVE N Seattle, WA Year Built 2007 Building Sq.Ft. Lot Sq.Ft. 1,355 (Com Condo) N/A Sales Price $620,000 Price/Bldg Foot $457.57 Sales Date 2.22.2017 14
Sales Comparables Map Phinney Building 7405-7407 Greenwood Ave N Seattle, WA 1. 475 N 36th St Seattle, WA 2. 1423 N 45th St Seattle, WA 3. 6801 Greenwood Ave N Seattle, WA PHINNEY BUILDING 3 2 1 15
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. 16