Multi-Family Investment Offering in Los Angeles

Transcription

1 Multi-Family Investment Offering in Los Angeles LOS ANGELES, CA Exclusively offered by Charles Dunn Company, Inc. Michel Hibbert Senior Managing Director (310) Lic. # Century Park East, Suite 2350 Los Angeles, CA Direct Fax Lic. #

2 Table of Contents 3 Property 9 Financial Analysis 13 Market 4 Property and Offering Summary 5 Property Photographs 7 Neighborhood and Regional Maps 10 Rent Roll 11 Pro Forma Income and Expense Statement 12 Financial Summary 14 Mid City Submarket 17 Contact 18 Contact 8 Aerial and Plat Maps These materials are based on information and content provided by others which we believe are accurate. No guarantee, warranty or representation is made by the Charles Dunn Company or its personnel, and all interested parties must independently verify its accuracy and completeness. As well, any projections, assumptions, opinion, or estimates are used for example only and do not represent the current or future performance of the identified property. Your tax, 2 financial, legal and toxic substance advisors should conduct a careful investigation of the property and its suitability for your needs, including land use limitations. The property is subject to prior lease, sale, change in price, or withdrawal from the market without notice.

3 PROPERTY INFORMATION

4 Property Property and Offering Summary Charles Dunn Company, Inc., has been exclusively retained by the owner in connection with the sale of, an 8- unit, multi-residential property located in the Mid City neighborhood of Los Angeles. The offering represents an opportunity to purchase the fee simple interest in a stabilized asset with the potential to produce excellent cash flow. Site Name and Address Assessor s Parcel Number Property Type Multifamily Offering Price $1,000,000 Price Per Unit/Price Per Gross $125,000 / $ Square Foot Assumable Loan Buyer to assume existing loan of $495,000 at 3.5% fixed for 4 years Number of Buildings/Stories 1 Building / 2 Stories Number of Units Unit Mix Approximate Building Area (Gross) Construction 8 Units 5 1 Bedroom / 1 Bath Units 3 2 Bedroom / 1 Bath Units 6,316 SF Wood Frame & Stucco Utilities All units separately metered for gas and electricity Year Built 1960 Approximate Lot Size Zoning 7,318 SF LARD2 Offering Highlights 100% occupied 6.4% Cash on Cash Return at Market Rents 8.3% Total Return at Market Rents $125,000 CPU / $159 SF 23% Potential Upside in Rents Assumable 1 st TD 4 :Marketing Package/2935 Duray Pl-[ mdg]

5 Property Property Photographs 5 :Marketing Package/2935 Duray Pl-[ mdg]

6 Property Property Photographs 6 :Marketing Package/2935 Duray Pl-[ mdg]

7 Property Neighborhood and Regional Maps 7 :Marketing Package/2935 Duray Pl-[ mdg]

8 Property Aerial and Plat Maps N 8 :Marketing Package/2935 Duray Pl mdg]

9 FINANCIAL ANALYSIS

10 Financial Analysis Rent Roll Rent Roll as of 6/1/2013 Unit Mix Rent Market Rent 1 2/1 $ 1, $ 1, /1 $ $ 1, /1 $ $ /1 $ $ 1, /1 $ $ /1 $ $ /1 $ $ /1 $ $ 950 Totals 8 $7, $8,690 Range of Rental Rates Average Total MIX MINIMUM MAXIMUM 1/1 $ $ /1 $ $ Monthly Rent Average Total 1/1 5 $ 789 $ 3, /1 3 $ 1,043 $ 3, Totals 8 $ 7, :Marketing Package/2935 Duray Pl mdg]

11 Financial Analysis Pro Forma Income and Expense Statement Projected Income Current Market Per Unit % of SGI Per Unit % of SGI Scheduled Gross Income: $84,810 $10, % $104,280 $13, % Estimated Laundry Income : $480 $60 1% $480 $60 1% Less Vacancy Reserve: $(2,559) $(320) 3% $(3,143) $(393) 3% Gross Operating Income $82,731 $10,341 98% $101,617 $12, % Actual Pro Forma Operating Expenses: Current Market Per Unit % of SGI Per Unit % of SGI Property Taxes $12,500 $1,563 15% $12,500 $1,563 12% Off-Site Management $4,137 $ % $4,137 $517 4% Property Insurance $2,945 $ % $2,945 $ % Reserves $2,000 $ % $2,000 $ % Repairs & Maintenance $6,500 $ % $6,500 $ % Landscaping $2,340 $293.3% $2,340 $ % Pest Control $480 $60.6% $ 480 $60.5% Utilities (Water & Electric) $7,000 $ % $7,000 $ % Utilities (Gas) $1,928 $ % $1,928 $ % Rubbish $1,693 $212 2% $1,693 $ % Miscellaneous $600 $75.7% $600 $75.6% Total Expenses $42,123 $5,265 50% $42,123 $5,265 40% Net Operating Income: $40,608 $5,076 50% $59,494 $7,437 57% NOTE: The income and expenses in this analysis are based on projections, prior performance and assumptions that are used industrywide. However, the Charles Dunn Company and its agents strongly suggest that Buyers rely on their own expertise to project the future income and expenses of the Property. 11 :Marketing Package//2935 Duray Pl-[ mdg]

12 Financial Analysis Pro Forma Income and Expense Statement Investment Summary Offering Price: $1,000,000 Number of Units: 8 Property Address:. Year Built: 1960 APN: Price Per Unit: $125,000 Gross Sq. Ft.: 6,316 Price Per S.F.: $ Average S.F. Per Unit: 790 Cap (current / market): 4.1% / 5.9% Lot Size (Acres): 0.17 GRM (current / market): 11.8 / 9.6 Parking Spaces: 10 Assumable Financing Approx Loan Amount 50% * $495,000 Down payment 50% * $505,000 4 Yr. Fixed, Years 6-30 Variable (2.25 over 6 month LIBOR) Terms: 30 Interest: 3.5% Monthly Pmt: $2, Yearly Pmt: $27,266 Debt Coverage: 1.5 * As a percentage of Purchase Price Unit Mix & Scheduled Income Unit Mix Total Units Current Rent Current Monthly Rent Market Rent Market Monthly Rent 1/1 5 $555 - $924 $3, $950 $4,750 2/1 3 $961-$1208 $3,128 $1,300 $3,900 Scheduled Monthly Rent: $7, $8,690 Scheduled Yearly Rent: $84,810 $104,280 Annual Operating Summary Current Market Scheduled Gross Income: $84,810 $104,280 Estimated Laundry Income: $480 $480 Less Vacancy Reserve: $(2,559) 3.0% * $(3,143) 3.0% Gross Operating Income: $82,731 $101,617 Expenses: $(42,123) 50% * $(42,133) 40% Net Operating Income: $40,608 $59,494 Loan Payments: $(27,266) $(27,266) Pre-Tax Cash Flow: $13, % ** $32, % Plus Principal Reduction: $9,828 $9,828 Total Return Before Taxes: $23, % ** $41, % * As a percentage of Scheduled Gross Income ** As a percentage of Down Payment Pro Forma Annual Operating Expenses Current Per Unit % of SGI Market Per Unit % of SGI Property Taxes $12,500 $1, % $12,500 $1,563 12% Off-Site Management $4,137 $ % $4,137 $517 4% Property Insurance $2,945 $ % $2,945 $ % Reserves $2,000 $ % $2,000 $ % Repairs & Maintenance $6,500 $ % $6,500 $ % Landscaping $2,340 $293.7% $2,340 $ % Pest Control $480 $60.4% $480 $60.5% Utilities (Water & Electric) $7,000 $ % $7,000 $ % Utilities (Gas) $1,928 $ % $1,928 $ % Rubbish $1,693 $212 2% $1,693 $ % Miscellaneous $600 $75.5% $600 $75.6% Total Expenses $42,123 $5, % $42,123 $5,265 40% Per S.F.: $6.67 $5, % $6.67 NOTE: The income and expenses in this analysis are based on projections, prior performance and assumptions that are used industrywide. However, the Charles Dunn Company and its agents strongly suggest that Buyers rely on their own expertise to project the future income and expenses of the Property. 12 :Marketing Package/2935 Duray Pl mdg]

13 MARKET INFORMATION

14 Market Mid City Submarket Mid-City Snapshot TOTAL POPULATION 52,141 POPULATION CHANGE 0.6% ( ) AREA 3.47 square miles (Land Area) PERSONS PER HOUSEHOLD 2.9 AVERAGE HOUSEHOLD INCOME $62,904 EDUCATION 25 Years of Age or Over: High School Graduates Bachelor Degree % % MID-CITY - AT A GLANCE Mid-City is a middle-class, highly diverse and very dense urban neighborhood in Central Los Angeles. The submarket is neighbored by Carthay and Mid-Wilshire to the north, Arlington Heights to the east, Culver City and West Adams to the south, Palms to the southwest, Beverlywood to the west and Pico-Robertson to the northwest. DEMOGRAPHICS Based on Pitney Bowes Business Insight, the population is estimated to be 52,141 for the Mid-City submarket. The racial and ethnic composition is comprised of 32.6% White, 29.0% African American, 4.9% Asian/Pacific Islander, 1.1% Native American and 32.3% other (including 2+ races). 37.1% respondents of all races claimed Hispanic or Latino ethnicity. ENCLAVES Mid-City contains historical residential developments within the submarket. Reynier Village is bordered to the north by Cadillac Avenue, to the east by Holt Avenue, to the south by Cattaraugus Avenue and to the west by Robertson Boulevard. The village is often referred to as being part of the South Robertson area but locals wanted to make it a distinction between the two and formed their own neighborhood association. Lafayette Square is a semi-gated tract just off of Crenshaw Boulevard. It was designated by the city as a Los Angeles Historic Preservation Overlay Zone in 2000 for its significant residential architecture and history. 14 :Marketing Package/2935 Duray Pl mdg]

15 Market Overview Mid City Submarket NOTABLE LOCATIONS NEARBY Downtown Culver City has a collection of outdoor cafes, unique shops, galleries and restaurants. It is also home to a vast array of entrepreneurial businesses and creative enterprises, as well as a wide selection of services for local residents. It boasts a City Hall of stunning architecture, Center Theatre Group s nationally renowned Kirk Douglas Theatre and the Guinness World Record title of World s Smallest Main Street. Sony Pictures Studios is a television and film studio complex located in Culver City, California. The facility is owned by Sony Pictures Entertainment and houses the division s film companies Columbia Pictures and TriStar Pictures. In addition to films shot at the facility, several television shows have been broadcast live or taped there. The lot, which is open to the public for daily studio tours, currently houses a total of sixteen separate sound stages. The studio is located at West Washington Boulevard Los Angeles County Museum of Art is an art museum located on Wilshire Boulevard in the Miracle Mile vicinity of Los Angeles. LACMA is on Museum Row, and is adjacent to the George C. Page Museum and La Brea Tar Pits. LACMA is the largest art museum in the Western United States. It attracts nearly a million visitors annually. It stores more than 100,000 works of art history spanning from ancient times to the present. 15 :Marketing Package/12757 Mitchell Ave. [ df] Rev. 1

16 Market Overview Mid City Submarket MARKET EVALUATION Multi-Family Market Trends The 765,043-unit Los Angeles multifamily market remains at the nation s premier level, with low vacancy and high rents. Demand is strong with substantial rental gains; the sprawling Los Angeles County remains a national market, drawing renters from a wide variety of income levels and, for that matter, a variety of geographical areas. Market Overview Vacancy Rates: Vacancy rates decreased in the Mid-City multi-family submarket, ending the 1 st quarter 2013 with 2.7% from 3.1% four quarters ago. The average apartment vacancy rate for Los Angeles County closed at 3.7%, marking it the seventh consecutive quarter of vacancy under 4%. Rental Rates: Average rental rates in Mid-City increased over the 12-month period ending 1 st quarter 2013, up from $1,680 to $1,724. For Los Angeles County, average market rental rates ended the 1 st quarter 2013 at $1,497, up 3.5% from Investment: The Mid-City submarket witnessed 7 multi-family transactions that closed in the 1 st quarter 2013 with 104 total units and a total volume of approximately $13.9 million. The 7 buildings totaled 73,343 square feet and the average price per square foot equated to $ Development: In 2012, Reis indicated 999 competitive units have been completed in 11 projects. Construction has been generally active in Los Angeles. From 2006 to 2010, 18,068 units were added, averaging 3,614 per year. Reis forecasts new construction to approximately 21,000 units from 2012 to 2016, just shy of the 25,922 forecast to be absorbed, keeping the market in balance for the next few years. 16 :Marketing Package/2935 Duray Pl-[ mdg]

17 CONTACT INFORMATION

18 Contact Michel Hibbert, CCIM Senior Managing Director (310) Lic. # Charles Dunn Company 1925 Century Park East Suite 2350 Los Angeles, CA Lic. # These materials are based on information and content provided by others which we believe are accurate. No guarantee, warranty or representation is made by the Charles Dunn Company or its personnel, and all interested parties must independently verify its accuracy and completeness. As well, any projections, assumptions, opinion, or estimates are used for example only and do not represent the current or future performance of the identified property. Your tax, financial, legal and toxic substance advisors should conduct a careful investigation of the property and its suitability for your needs, including land use limitations. The property is subject to prior lease, sale, change in price, or withdrawal from the market without notice. 18 :Marketing Package/2935 Duray Pl-[ mdg]