Offering Memorandum

BALLINGER ESTATES 72 UNITS 2609 NE 195th St Lake Forest Park, WA

Exclusively offered by Paragon Real Estate Advisors

600 University Street | Suite 2018 | , WA 98101 1 P 206.623.8880 | E [email protected] | ParagonREA.com Offering Summary

Paragon Real Estate Advisors is pleased to offer for sale the Ballinger Estates Apartments. This 72 unit apartment building is located in a residential neighborhood of Lake Forest Park.

As people are moving North in search of affordable rental units Ballinger Estates offers an investor the opportunity to acquire a well located, well maintained apartment building with income upside. A new owner can increase rents to market value and reap the rewards of immediate upside and long-term appreciation or reposition the building by upgrading the finishes and adding washer and dryers to the units.

Name Ballinger Estates Address 2609 NE 195th St, Lake Forest Park WA 98155 Total Units 72 Built 1985 Square Feet 44,454 Total Net Rentable Price $16,995,000 Price Per Unit $236,042 Price Per Foot $382.31 Current GRM/CAP 17.5/3.3% (3% Vacancy) BALLINGER Market GRM/CAP 15.0/4.1% (3% Vacancy) ESTATES Expense Per Unit $5,308/Year Terms Cash Out Lot Size 131,551 Square Feet Zoning RM 1800

600 University Street | Suite 2018 | Seattle, WA 98101 2 P 206.623.8880 | E [email protected] | ParagonREA.com Location

LAKE BALLINGER MOUNTLAKE TERRACE TRANSIT CENTER

CASCADE K-8 COMMUNITY SCHOOL

BALLINGER WAY NE

BALLINGER NE 195TH ST ESTATES

600 University Street | Suite 2018 | Seattle, WA 98101 3 P 206.623.8880 | E [email protected] | ParagonREA.com Location Highlights

Served by the Shoreline School District

12.5 miles to Downtown Seattle

1.7 miles to the proposed 185th Light Rail Station

The highly acclaimed Burke-Gilman Trail which stretches from Seattle to Kenmore passes directly through Lake Forest Park

Seven distinct parks offering a wide range of recreational activities including hiking, biking, walking and running trails

Easily accessible and quaint, the Town Center at Lake Forest Park is a neighborhood center offering a dynamic mix of shopping, dining and entertainment options with more than 240,000 square feet of retail space

Farmers market on Sundays - May through October

Lyon Creek Waterfront Preserve is near the town center and has a small play area, benches and a boardwalk with views of Lake

600 University Street | Suite 2018 | Seattle, WA 98101 4 P 206.623.8880 | E [email protected] | ParagonREA.com Parks and Recreation

The city of Lake Forest park offers eight distinct The Grace Cole Nature Park is a 15.2 acre wetland parks. These areas offer a wide range of preserve and home to various native plants, birds recreational activities from hiking, bird watching, and amphibians. Take a stroll on the boardwalk and children’s play area, picnic areas, biking, walking, peer into the headwaters of Brookside Creek. Come running and much more. back often to observe how the wetland changes seasonally and develops throughout the years. Lyon Creek Waterfront Preserve is a .89 acre passive park located across from Lake Forest Other parks include Eagle Scout, Horizon view Park Town Center. It includes 100 feet of Lake Park, Whispering Willow Park and the Mickinnon Washington shoreline and 250 feet of Lyon Creek. Creek Trail. Enjoy a quiet moment on the dock down by the lake, or take a few minutes to look for salmon swimming in Lyon Creek. Nearly four acres of maintained meadow and tall, arching shade trees at Pfingst Animal Acres Park provide a lovely area for picnics or a nature walk. At the south edge of the park, McAleer Creek winds through a forested corridor with a salmon viewing platform. This platform is used by local schools for annual salmon release events. This park also features a community volunteer demonstration vegetable garden and a crushed gravel walking trail that loops the perimeter of the park. Blue Heron Park is a small half acre hidden gem. Lush native landscaping gives way to a primitive pathway lined by planting beds with an array of native drought–tolerant plants. Enjoy viewing the salmon in fall, winter or spring, watch for herons fishing for lunch.

600 University Street | Suite 2018 | Seattle, WA 98101 5 P 206.623.8880 | E [email protected] | ParagonREA.com Parks and Recreation Map

1. Blue Heron Park 4 2. Eagle Scout

3. Grace Cole Park BALLINGER ESTATES 4. Horizon View Park

5. Lyon Creek Waterfront Preserve

6. Pfingst Animal Acres Park 8 7. Whispering Willow Park

8. McKinnon Creek Trail 2 9 6 9. Log Boom Park 7 1 5 10. Burke-Gilman Trail

3 10

600 University Street | Suite 2018 | Seattle, WA 98101 6 P 206.623.8880 | E [email protected] | ParagonREA.com Neighborhood Amenities

BALLINGER ESTATES

600 University Street | Suite 2018 | Seattle, WA 98101 7 P 206.623.8880 | E [email protected] | ParagonREA.com Retail and Shopping

Town Center at Lake Forest Park is a Anchored by Third Place Books, multi-purpose shopping center that also Albertson’s grocery store, Rite Aid, Ross serves as the community hub for the city Dress for Less, and Planet Fitness of Lake Forest Park. Built in 1964, the this community shopping hub features center is located on the eastern side of almost 250,000 square feet of gross Lake Forest Park, on the western shore leasable area. Around 40 tenants are of beside City Hall. The currently open and operating at Lake southeast side of the center abuts the Forest Park Towne Centre. Along with Burke-Gilman Trail. the bookstore, The Commons offers popular food choices such as barbeque Town Center at Lake Forest Park is a at Burney Brother BBQ and coffee and true community center that draws a pastries at Honey Bear Bakery to go regional crowd and is home to several along with the unique setting and their unique and organic local stores which cozy atmosphere. collectively cater to customers, thus serving as a daily destination. Friends Each Sunday, starting in May and ending of Third Place Commons, a non-profit in October, the Third Place Commons organization that operates through Farmers Market is held in the parking public donation, offers over 1,200 lot. community events throughout the calendar year attracting patrons from all over the region. The center was renovated in 1995 to increase pedestrian traffic and since 2006, has been undergoing smaller renovations, including the addition of a Ross Dress for Less and a Planet Fitness which both opened in 2011.

600 University Street | Suite 2018 | Seattle, WA 98101 8 P 206.623.8880 | E [email protected] | ParagonREA.com Transportation

The NE 185th Street station is a proposed Link Light Rail station on the Lynnwood Link Extension serving Shoreline, Washington. The extension and station are fully funded; there are several proposed alternatives for station siting in the Shoreline area, but they all include a station at 185th Street. The station is proposed to be located on the north side of NE 185th Street, east of Interstate 5, either at-grade or on an elevated segment of the line This station will give riders a fast, frequent and reliable connection through some of the worst traffic congestion in Washington State. This extension builds four new light rail stations from Northgate to Lynnwood. With the construction on these stations riders will easily be able to travel from south Snohomish County to the University of Washington, downtown Seattle, the Eastside, the airport and more. By the year 2035 this line is expected to serve approximately 63,000 to 74,000 riders each week day.

600 University Street | Suite 2018 | Seattle, WA 98101 9 P 206.623.8880 | E [email protected] | ParagonREA.com Travel Times

185TH ST LIGHT RAIL STATION SEATTLE CBD COMMUTE TIMES BELLEVUE TRANSIT CENTER COMMUTE TIMES

Car: 2.3 miles, approximately 5 minutes 331 Bus to 522 Bus: 55 minutes from Ballinger Way NE 331 Bus to 234 Bus: 78 minutes from Ballinger Way NE

On Foot: 1.8 miles, approximately 40 minutes Car: 19 minutes via Ballinger Way NE and I5 South Car: 25 minutes via Ballinger Way NE, I5, 520 and I405

2.3 miles

1.8 miles

600 University Street | Suite 2018 | Seattle, WA 98101 10 P 206.623.8880 | E [email protected] | ParagonREA.com Improvements

Great street appeal

Meticulously cared for, turn-key building with rental upside

Possible to reposition asset by adding washer and dryers to units

Mature landscaping and open space gives grounds a quiet park-like setting

3.02 acre lot (per KCR) - 131,551 square feet

Open and spacious floor plans with a separate dining area

Abundant storage in each unit

Each unit has a private balcony or a patio

1 common laundry room in each building with leased equipment

Ample open and covered parking spaces

600 University Street | Suite 2018 | Seattle, WA 98101 11 P 206.623.8880 | E [email protected] | ParagonREA.com Building Photos

600 University Street | Suite 2018 | Seattle, WA 98101 12 P 206.623.8880 | E [email protected] | ParagonREA.com Building Photos

600 University Street | Suite 2018 | Seattle, WA 98101 13 P 206.623.8880 | E [email protected] | ParagonREA.com Unit Photos

600 University Street | Suite 2018 | Seattle, WA 98101 14 P 206.623.8880 | E [email protected] | ParagonREA.com Operating Summary

Units 72 Price $16,995,000 Annualized Operating Data Current Market Year built 1985 Price Per Unit $236,042 Scheduled Gross Income $971,760 $1,133,220 Less Vacancy 3.0% $29,153 3.0% $33,997 Rentable Area 44,454 Sq.Ft. Per Square Foot $382.31 Gross Operating Income $942,607 $1,099,223 Down Payment $8,695,000 51% Current GRM 17.49 Less Expenses $382,150 $405,682 Loan Amount $8,300,000 49% Current CAP 3.30% Net Operating Income $560,457 $693,541 Interest Rate 3.85% (3 Yr Fixed) Market GRM 15.00 Annual Debt Service ($38,911/mo) $466,933 $466,933 Amortization 30 Years Market CAP 4.08% Cash Flow Before Tax 1.08% $93,524 2.61% $226,608 Principal Reduction $150,012 $150,012 Total Return Before Tax 2.80% $243,536 4.33% $376,620 Current Monthly Market Monthly Units Type Size Rent Income Rent Income Annualized Operating Expenses Current Market 9 Studio 420 $963 $8,667 $1,050 $9,450 Real Estate Taxes 2017 Actual $97,733 $115,000 51 1Bd/1Bth 600 $1,116 $56,916 $1,250 $63,750 Insurance Quote $20,129 $20,129 12 2Bd/1Bth 840 $1,226 $14,712 $1,500 $18,000 Utilities 2017 Est $60,000 $60,000 72 Avg S.F. 617 $1.81 $2.05 Property Management 4% $37,704 $43,969 On-Site Management $45/unit $38,880 $38,880 Maintenance & Repairs Est $46,800 $46,800 Total Monthly Income Current Market Property Maint Salary 2017 Ann. $55,404 $55,404

Monthly Scheduled Rent $80,295 $91,200 Landscaping Est $7,500 $7,500 Utility Bill Back $0 $25-$45/mo $2,550 Reserves Est $18,000 $18,000 Laundry (Leased) $435 $435 Total Expenses $382,150 $405,682 Parking (Included in rent) $0 $0 Miscellaneous Income $250 $250 Current Expenses/Unit $5,308 Market Expenses/Unit $5,634 Operations Expenses/Foot $8.60 Operations Expenses/Foot $9.13 Total Monthly Income $80,980 $94,435 Percent of EGI 39.33% Percent of EGI 35.80%

600 University Street | Suite 2018 | Seattle, WA 98101 15 P 206.623.8880 | E [email protected] | ParagonREA.com Sale Comparables

SUBJECT - BALLINGER ESTATES 1. JUNCTION 160 2609 NE 195th St, Lake Forest Park WA 16100 Linden Ave N, Shoreline WA

Year Built 1985 Year Built 1978 Units 72 Units 60 Sales Price $16,995,000 Sales Price $16,000,000 Price/Unit $236,042 Price/Unit $266,666 Price/Foot $382.31 Price/Foot $368.70 GRM/CAP 17.5/3.3% GRM/CAP 12.5/5.0% Sales Date TBD Sales Date 2.28.2017

2. KENMORE VILLAGE 3. UNION 18 17620 80th Ave NE, Kenmore WA 1140 18th Ave, Seattle WA

Year Built 1985 Year Built 1969 Units 58 Units 57 Sales Price $11,800,000 Sales Price $20,800,000 Price/Unit $203,448 Price/Unit $364,912 Price/Foot $337.38 Price/Foot $453.93 GRM/CAP 16.7/3.3% GRM/CAP 12.9/5.3% Sales Date 2.24.2017 Sales Date 9.14.2016

4. HIGHLAND VILLAGE 5. GILMAN TERRACE 14510 NE 7th St, Bellevue WA 2572 Gilman Dr W, Seattle WA

Year Built 1975 Year Built 1989 Units 76 Units 65 + Com Sales Price $19,400,000 Sales Price $20,155,000 Price/Unit $255,263 Price/Unit $283,873 Price/Foot $257.04 Price/Foot $358.02 GRM/CAP 15.3/3.9% GRM/CAP 16.8/3.1% Sales Date 8.31.2016 Sales Date 5.31.2016

600 University Street | Suite 2018 | Seattle, WA 98101 16 P 206.623.8880 | E [email protected] | ParagonREA.com Sales Comparables Map

Ballinger Estates BALLINGER 2609 NE 195th St ESTATES Lake Forest Park, WA

1 2 1. Junction 160 16100 Linden Ave N Shoreline, WA 2. Kenmore Village 17620 80th Ave NE Kenmore, WA 3. Union 18 1140 18th Ave Seattle, WA 4. Highland Village 14510 NE 7th St Bellevue, WA 5. Gilman Terrace 2572 Gilman Dr W Seattle, WA 5

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600 University Street | Suite 2018 | Seattle, WA 98101 17 P 206.623.8880 | E [email protected] | ParagonREA.com Rent Comparables

Property Units Age Unit Type Size Rent Rent/Sq.Ft. Comments

Ballinger Estates Studio 420 $963 $2.29 Common laundry, secured access entry, 2609 NE 195th St 72 1985 1Bd/1Bth 600 $1,116 $1.86 balconies or patios, carport and open Lake Forest Park, WA 2Bd/1Bth 840 $1,226 $1.46 parking available

1. Ballinger 14 1Bd/1Bth 750 $1,175 - $1,250 $1.57 - $1.67 Washer and dryer in units, balconies or 19916 19th Ave NE 14 1999 2Bd/2Bth 950 $1,325 - $1,525 $1.39 - $1.61 patios, fireplace, tenant paid utilities, Shoreline, WA 1 parking space included in rent

2. Ballinger Apartments Washer and dryer in units, secured access 19921 19th Ave NE 19 1985 2Bd/1Bth 760 - 850 $1,400 - $1,595 $1.84 - $1.88 entry, W/S/G billed at $35/person, carport Shoreline, WA parking available

3. Canterbury Court 1Bd/1Bth 700 $1,229 $1.76 Common laundry, W/S/G included in rent, 2600 NE 195th St 50 1986 2Bd/1Bth 850 $1,479 $1.74 balconies or patio, 1 assigned parking space Shoreline, WA included in rent

4. Forest Creek 1Bd/1Bth 700 $ $ Washer and dryer in units, balconies or 19708 15th Ave NE 50 1985 2Bd/1Bth 840 $ $ patios, W/S/G included in rent, 1 parking Shoreline, WA 2Bd/2Bth 952 $1,698 $1.64 space included in rent

5. Maple Glen Apartments 1Bd/1Bth 661 $1,558 $2.36 Washer and dryer in units, balconies 5424 212th St SW 106 1986 2Bd/1Bth 820 - 910 $1,951 - $2,022 $2.22 - $2.38 or patios, tenant paid utilities, parking Mountlake Terrace, WA 2Bd/2Bth 910 $2,031 $2.23 included in rent

600 University Street | Suite 2018 | Seattle, WA 98101 18 P 206.623.8880 | E [email protected] | ParagonREA.com Rent Comparables Map

Ballinger Estates 2609 NE 195th St 5 Lake Forest Park, WA

1. Ballinger 14 19916 19th Ave NE Shoreline, WA 2. Ballinger Apartments 19921 19th Ave NE Shoreline, WA 3. Canterbury Court 2600 NE 195th St Shoreline, WA 4. Forest Creek 19708 15th Ave NE Shoreline, WA 5. Maple Glen Apartments 5424 212th St SW 2 1 Mountlake Terrace, WA 3

4 BALLINGER ESTATES

600 University Street | Suite 2018 | Seattle, WA 98101 19 P 206.623.8880 | E [email protected] | ParagonREA.com Paragon Real Estate Advisors

ABOUT PARAGON

Paragon Real Estate Advisors is the leading Seattle real estate investment firm for multi- family 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.

600 University Street | Suite 2018 | Seattle, WA 98101 20 P 206.623.8880 | E [email protected] | ParagonREA.com