OFFERING MEMORANDUM 1602 S WAHSATCH AVE SPRINGS, CO 80905

JEFF DIMMEN JASON KOCH Investment Sales Advisor Partner

[email protected] [email protected] 719.459.5756 303.918.8909 TABLE OF CONTENTS

EXECUTIVE SUMMARY PROPERTY OVERVIEW FINANCIAL OVERVIEW LOCATION OVERVIEW EXECUTIVE SUMMARY PROPERTY HIGHLIGHTS

Great unit mix of 2 and 3 bedrooms.

Desirable location near the Colorado Creekwalk & Downtown.

Individually metered utilities.

Recently replaced roof and windows.

Room for rent growth.

PROPERTY OVERVIEW AREA STREET MAP

MAY DR

S WAHSATCH AVE WAHSATCH S S WEBER ST WEBER S

1602 S WAHSATCH AVE

HUNTER AVE LOCATION MAP KISSING CAMELS GOLF CLUB

COLORADO SPRINGS CHEROKEE RIDGE COUNTRY CLUB GOLF COURSE

RED ROCK CANYON PATTY JEWETT OPEN SPACE GOLF COURSE

E PLATTE AVE

VALLEY HI MEMORIAL GOLF COURSE SKATE PARK SEVEN FALLS SILVER SPRUCE GOLF COURSE

1602 S WAHSATCH AVE

EL POMAR YOUTH SPORTS PARK

THE BROADMOOR NORTH CHEYENNE 21 CANON PARK

CHEYENNE MOUNTAIN ZOO BLUESTERN PRAIRIE OPEN SPACE AREA MAP

North Colorado Springs Area Map

1602 S WAHSATCH AVE NEIGHBORHOOD MAP DINING 1 Chick-Fil-A 21 8 2 Prime 25 3 Ivywild Kitchen 4 Edelweiss German Restaurant 5 Arceo's Mexican Restaurant 6 Starbucks 7 Five Guys 1602 S N POWERS BLVD WAHSATCH AVE 8 Dos Santos

RETAIL 7 6 9 Ross Dress for Less 11 5 3 2 23 10 PetSmart 4 1 11 Natural Grocers 115 12 Bed, Bath & Beyond 16 13 Ulta Beauty 19 14 Target 15 Michaels 9 18 15 10 16 Safeway 13 12 LIFESTYLE 17 17 Broadmoor Towne Center 18 Veda Salon & Spa 19 24 Hour Fitness LAKE AVE 20 The Broadmoor World Arena 22 14 20 21 Weidner Field 22 North Cheyenne Canon Park 23 The Vanguard School PHOTOS 1602 S WAHSATCH AVE PHOTOS 1602 S WAHSATCH AVE PROPERTY DETAILS 1602 S WAHSATCH AVE

UNIT MIX & CURRENT RENTS

Unit Type Unit Amount Unit SF Current Avg. Rent Current Rent/SF Market Rent Market Rent/SF

2 Bed / 1 Bath 4 650 $900 $1.38 $1,050 $1.62 3 Bed / 1 Bath 1 700 $1,050 $1.50 $1,200 $1.71

3 Bed / 1 Bath 1 832 $1,250 $1.50 $1,350 $1.62

Total/Average 6 689 $983 $1.42 $1,125 $1.63

BUILDING DETAILS SYSTEMS

Units: 6 Gas/Elec Meters: Separate / Separate

Building SF: 3,732 Water: Master

Parking: 12 Trash: Springs Waste

Land: 7,000 Roof: Pitched

Zoning: C5 Heating: Electric

Year Built: 1954 Cooling: None FINANCIAL OVERVIEW INVESTMENT & DEBT SUMMARY

INVESTMENT SUMMARY DEBT SUMMARY

Purchase Price: $875,000 Loan to Value: 75.00%

Units: 6 Loan Amount: $656,250

Price Per Unit: $145,833 Loan Term: 60 Months

Total SF: 3,732 Interest Rate: 3.75%

Price Per SF: $234 Amortization: 30 Years

T12 Cap Rate: 5.61%

Year 1 Cap Rate: 6.72%

Year 1 Cash Flows: $22,097

5 Year IRR: 32.55% CASHFLOW PROJECTIONS

T12 Year 1 Year 2 Year 3 Year 4 Year 5 REVENUE Gross Potential Revenue $70,800 $81,000 $83,430 $85,933 $88,511 $91,166 Vacancy ($3,540) ($4,050) ($4,172) ($4,297) ($4,426) ($4,558) Rental Revenue $67,260 $76,950 $79,259 $81,636 $84,085 $86,608 Effective Gross Revenue $67,260 $76,950 $79,259 $81,636 $84,085 $86,608

EXPENSES

Repairs and Maintenance ($6,000) ($6,000) ($6,180) ($6,365) ($6,556) ($6,753) Utilities ($5,400) ($5,400) ($5,562) ($5,729) ($5,901) ($6,078) Insurance ($3,600) ($3,600) ($3,708) ($3,819) ($3,934) ($4,052) Real Estate Taxes ($1,974) ($1,974) ($2,033) ($2,094) ($2,157) ($2,222) Admin and Other ($1,200) ($1,200) ($1,236) ($1,273) ($1,311) ($1,351)

Total Expenses ($18,174) ($18,174) ($18,719) ($19,281) ($19,859) ($20,455) Expenses Per Unit ($3,029) ($3,029) ($3,120) ($3,213) ($3,310) ($3,409)

NET OPERATING INCOME $49,086 $58,776 $60,539 $62,355 $64,226 $66,153 Cap Rate 5.61% 6.72% 6.92% 7.13% 7.34% 7.56% $32,493

Debt Service-Yr 1 ($36,679) ($36,679) ($36,679) ($36,679) ($36,679) ($36,679) Total Cash Flow $12,407 $22,097 $23,860 $25,676 $27,547 $29,474 Cash on Cash Return 5.67% 10.10% 10.91% 11.74% 12.59% 13.47% SOLD COMPS

PROPERTY ADDRESS UNITS SF PRICE $ PRICE PER UNIT PRICE PER FOOT

(subject) 1602 S Wahsatch Ave 6 3,732 $875,000 $145,833 $234

1 316 E Brookside St 17 13,440 $2,460,000 $144,706 $183

2 831-903 Fontmore Rd 10 7,752 $1,460,000 $146,000 $188

3 2620 King St 6 4,800 $875,000 $145,833 $182 4 506 E Ave 8 5,797 $1,100,000 $137,500 $190

Averages $1,473,750 $143,510 $186

3 2

4

1 S LOCATION OVERVIEW DEMOGRAPHICS

CENSUS 2020 SUMMARY .25m .5m .75m

Population 846 3,057 6,626

Households 473 1,607 3,263

Families 165 609 1,398

Average Household Size 1.79 1.9 2.01

Owner Occupied Housing Units 55 436 1,070

Renter Occupied Housing Units 418 1,171 2,193

Median Age 33.8 38.4 38.2

STREET MAP STREET Median Household Income $27,748 $29,245 $32,700

Average Household Income $33,305 $37,912 $46,229 AREA

.25 MILE CENSUS 2025 SUMMARY .25m .5m .75m

Population 914 3,222 6,966

.5 MILE Households 512 1,699 3,436 Families 176 635 1,453

Average Household Size 1.79 .75 MILE 1.89 2.01 Owner Occupied Housing Units 61 455 1,100

Renter Occupied Housing Units 451 1,244 2,336

Median Age 34 39.2 39.2

Median Household Income $28,910 $31,372 $35,427

Average Household Income $36,032 $41,703 $50,008 COLORADO SPRINGS NOTABLE RANKINGS #1 MOST DESIRABLE PLACE TO LIVE (U.S. NEWS & WORLD REPORT, 2018)

#1 MOUNTAIN CITY #21 BEST CITY IN AMERICA #2 BEST PLACES TO LIVE (MONEY MAGAZINE, 2016) FOR STARTING A BUSINESS (U.S. NEWS & WORLD REPORT, 2018) (INC'S, 2019 )

3RD BEST CITY TOP 5 RENT GROWTH #2 FITTEST CITY IN AMERICA FOR LIVABILITY MARKET IN THE U.S. (MEN'S FITNESS) (U.S. NEWS & WORLD REPORT, 2016) (AXIOMETRICS)

#1 BEST CITY NATIONAL HUB FOR CYBERSECURITY TO LIVE - ROOT9B - #1 SECURITY COMPANY (MONEY MAGAZINE) IN THE WORLD (U.S. NEWS & WORLD REPORT, 2016)

5TH BEST REAL 10% INCREASE IN ESTATE MARKET MEDIAN HOME PRICES (WALLETHUB, 2018) Y-O-Y (NATIONAL ASSOCIATION OF REALTORS, 2018) COLORADO SPRINGS

The 186-square mile city of Colorado Springs is located near the base of one of the most famous American mountains, Pikes Peak, and 61 miles south of Denver. Popular destinations include:

It is one the fastest growing cities in Colorado, and in the country. With an estimated population of 456,568, Colorado Springs is the most populous city in El Paso County and it is estimated that the population will increase 58.6% by 2050. In 2019 the city was ranked #29 in the nation for fastest growing large cities (over 300,000 people) by Wallethub.

Many factors contribute the popularity of the city, as well as the unprecedented growth. The city was ranked "Most Desirable Place to Live" in 2018 by US News.

Along with many trails and parks, major attractions include:

Pikes Peak Colorado Springs Pioneers Park Peterson Air and Space Museum The Broadmoor Seven Falls United States Air Force Academy Cave Of The Winds Mountain Olympic Training Center Heritage Center Colorado Springs Fine Arts Center COLORADO SPRINGS GROWTH Colorado Springs is currently undergoing a downtown transformation. These new developments are the seeds of a new and modern downtown at the heart of Colorado Springs. The entertainment, restaurants and services that follow will contribute to a re-imagined experience for both visitors and residents. The energy and vibrancy will further the quality of life enjoyed by this community that attracts top jobs and talent. These benefits radiate beyond downtown into the greater metro area.

Here are the upcoming additions:

U.S. Olympic Museum & Hall of Fame Professional Soccer Stadium Multi-use Stadium - directly across from soccer stadium 82 acre master planned redevelopment across from both new stadiums 3,000 seat NCAA D-1 Hockey Arena University of Colorado Sports Medicine and Performance Center 4 Downtown Hotels Colorado Springs Fine Arts Center 2,700 apartment units under construction, 2,800 more planned. Amazon Fulfillment Center MILITARY IN COLORADO SPRINGS Colorado Springs is heavily influenced by the military. Approximately 5.40% of the city’s population is in the military, and the military presence accounts for nearly 40% of the city’s economy with an annual impact of $2.5 billion. Additionally, a significant number of defense corporations and bases are located within the area. El Paso County is unique as the only county in the nation that is home to five military commands:

Fort Carson Base Cheyenne Mountain U.S. Air Force Academy Schriever Air Force

Together, these bases employ approximately 60,000 people and contribute almost $6 billion to the local economy. Putting these numbers in context, the Pikes Peak region has a population of almost 680,000 people and a salaried workforce of 257,000 people.

Although the military population in Colorado Springs has been declining over the past few years due to reduced defense spending from the 2011 sequestration plan, some of the military bases, such as , have added to their capabilities and troop levels as other bases around the country were forced to close.

Andy Merritt, Chief Defense Industry Officer of the Colorado Springs Regional Business Alliance, continues to work with many people, organizations and the regional government to support our military retention efforts. Military operations in Colorado Springs have been supported, enhanced, and grown in the area for over fifty years. AIR FORCE ACADEMY

The U.S. Air Force Academy, located north of Colorado Springs, is both a military organization and University for the undergraduate education of officers for the United States Air Force. Graduates of the four-year program receive a Bachelor of Science degree and most are commissioned as Second Lieutenants. The Academy is also one of the largest tourist attractions in Colorado, welcoming more than one-million visitors each year.

The U.S. Air Force Academy is among the most selective colleges in the United States. Candidates are judged based on their academic achievement, demonstrated leadership, athletics and character. The academy offers more than 500 courses across 32 academic disciplines. To gain admission, candidates must also pass a fitness test, undergo a thorough medical examination and secure a nomination, which usually comes from one of the candidate’s members of Congress. Recent incoming classes have usually consisted of about 1,400 cadets; just under 1,000 of those usually make it through to graduation. Cadets pay no tuition, but are committed to serve a number of years in the military service after graduation.

In addition to serving 4,400 cadets, the U.S. Air Force Academy employs 300 Air Force and civilian support personnel and manages more than $250 million worth of staff agencies and faculty resources. The surrounding military community includes 25,000 people, including 3,000 military, civilian, and contract personnel who conduct all base-level support activities, including law enforcement and force protection, civil engineering, communications, logistics, financial management, the clinic, and other services.

The academy is also well-known for its stunning chapel. The $3.5 million aluminum, glass, and steel structure is 150 feet tall and features 17 spires. The chapel was recently named one of CNN’s most epic churches in America. The building contains a separate chapel for four major religious faiths — Protestant, Catholic, Jewish, and Buddhist — plus an all-faiths room used by Muslim cadets and available for members of the other faiths as well. Each chapel has its own entrance, and services may be held simultaneously without interfering with one another.

*Some information sourced from http://www.usafa.af.mil/About-Us/Base-Information U.S. OLYMPIC MUSEUM

The U.S. Olympic Museum will be located where many Olympic and Paralympic dreams begin – at 6,035 feet above sea level, in the shadow of Pikes Peak – just a few blocks away from the United States Olympic Committee headquarters in Colorado Springs. This will be the first full-fledged Olympic museum in the United States and will be developed on 1.7 acres of land in Colorado Springs’ Southwest Downtown Urban Renewal District, creating a stunning gateway to Downtown Colorado Springs and America the Beautiful Park. It is set to open in early 2020 and has an estimated cost of roughly $75 million.

The Museum is dedicated to U.S. Olympic and Paralympic athletes and their compelling stories. It will be a world-class destination, with the artifacts, media and technology behind the athletes who make the United States proud. It will focus on the core values of the Olympic and Paralympic movements: friendship, respect and excellence; determination, equality, inspiration and courage.

While The Olympic Training Center draws about 130,000 visitors a year. Museum officials are expecting their 60,000-square-foot showcase to eventually draw up to 350,000 a year, with more than half the visitors coming from outside the state. The 60,000-square-foot building will embody the forward-looking values of Team USA, with 20,000 square feet of highly interactive exhibit space, a state-of-the-art theater, gift shop, café, and broadcast studio. BROADMOOR HOTEL

The Broadmoor in Colorado Springs is known for being a member of the Historic Hotels of America of the National Trust for Historic Preservation, as well as the longest-running consecutive winner of both the AAA Five-Diamond and Forbes Five-Star awards. The property originally started as a dairy farm, was turned into a casino in 1891, and became a hotel in 1918. Blending European elegance and Western hospitality, The Broadmoor has been the destination of a long list of presidents, statesmen, foreign dignitaries, sports stars, and celebrities. The Broadmoor is not only the premier attraction for the Springs, but draws consistent visitors nationwide.

The Broadmoor continues to offer impeccable service, distinctive amenities, and endless opportunities to explore the picturesque mountains, streams, and canyons that have inspired generations. The hotel offers over 185,000 square feet of meeting space and 779 rooms including suites, cottages, and cabins. Fine dining includes 18 award-winning restaurants and lounges, including the Five Diamond Penrose Room. The Forbes Five-Star Spa at The Broadmoor offers luxurious spa services. The Broadmoor features three of Colorado’s championship golf courses and is also ranked among the Top 10 tennis resorts in the United States. Additionally, there are 26 specialty shops located across from the resort. Nearby activities include fly fishing, horseback riding, waterfall treks, and ziplining adventures. MANITOU SPRINGS

Manitou Springs is a small town located at the base of Pike’s Peak, just 15 minutes west of Colorado Springs with about six miles from one downtown to the other. “Manitou” is a Native American word meaning “great spirit.” The Ute, Cheyenne and other Native Americans considered this area sacred for its healing springs and clean mountain air. Manitou Springs features eight naturally carbonated mineral spring fountains, which are free to use. Health and wellness continues to be a draw for residents and visitors who come to the area for its unparalleled quality of life and holistic, spiritually uplifting charm. Additionally, with Colorado Springs banning recreational marijuana stores, Manitou Springs has emerged as the closest option for those in Colorado Springs to purchase marijuana.

Manitou Springs is a vibrant artisan community with art, music, theater, and sidewalk sculpture displays. The Historic District is lined with unique art galleries, one of a kind gift shops, and trading posts with handcrafted Native American treasures. It is also home to dozens of artists and art galleries.

Manitou Springs is known for its proximately to Pikes Peak. The Manitou and Pikes Peak Cog Railway take travelers to the top of Pikes Peak with an elevation of 14,115 feet. For those that prefer to walk, there are a variety of hiking trails leading to spectacular views at the top, with the 13-mile Barr Trail serving as one of the most popular routes. The area also features the famous Garden of the Gods Park and The Incline, a popular hiking train that gains over 2,000 feet of elevation in less than 1 mile. The Cave of the Winds, Miramont Castle, and Cliff Dwellings Museum are also popular destinations. Additionally, the North Pole and Santa’s Workshop, Cheyenne Mountain Zoo, Seven Falls, Dinosaur Resource Center, Colorado Wolf and Wildlife Center, and the Air Force Academy are all a short drive away. CAPSTONE BROKERS 1602 S Wahsatch Ave COLORADO SPRINGS, CO 80905

JASON KOCH JEFF DIMMEN Partner Investment Sales Advisor [email protected] [email protected] 303.918.8909 719.459.5756

KIM HOFF EMILY HAMPSON Marketing Manager Transaction Coordinator [email protected] [email protected] 612.669.2068 719.776.0916 CONFIDENTIALITY DISCLAIMER

Capstone Apartment Partners has been engaged as the exclusive listing Broker representative of the Owner for the sale of this property. No contact shall be made by any prospective purchaser or agents to the Owner, its executives, staff, personnel, tenants, or related parties.

This Investment Offering Memorandum is a confidential solicitation of interest, and the information provided herein is provided for the sole purpose of considering the purchase of the Property. The Owner expressly reserves the right, at its sole discretion, to reject any or all expressions of interest to purchase the Property or to terminate discussions with any entity at any time with or without notice. The Owner shall have no legal commitment or obligation to any entity reviewing the Investment Offering Memorandum or making an offer to purchase the Property unless and until the Owner executes and delivers a signed Purchase Agreement on terms acceptable to the Owner. By receipt of this Offering Memorandum, prospective purchaser will be deemed to have acknowledged the foregoing and agrees to release the Owner from any and all liability with respect hereto. The enclosed materials are being provided solely to facilitate the prospective purchaser’s own due diligence for which the purchaser shall be fully and solely responsible. All information contained herein is confidential in nature, and recipient agrees not to photocopy, duplicate, forward, distribute, or solicit third party interest without written permission and consent from Owner or Capstone Apartment Partners.

Neither Capstone Apartment Partners nor the Owner make any representation or warranty, express or implied, as to the accuracy or completeness of the information contained herein, and nothing contained herein shall be relied upon as a promise or representation as to the future performance of the Property.

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