5731 Carlton

5731-35 Carlton Way Los Angeles, CA

OFFERING MEMORANDUM EXCLUSIVELY LISTED BY

KYLE MIRRAFATI SENIOR ASSOCIATE - MULTIFAMILY

Direct +1.310.295.4269 Mobile +1.949.533.4650 [email protected] License No. 01911204

LUC WHITLOCK ASSOCIATE - MULTIFAMILY

Direct +1.310.844.9371 Mobile +1.310.872.8004 [email protected] License No. 02070426

2 MATTHEWS REAL ESTATE 5731-35 Carlton Way Los Angeles, CA

TABLE OF CONTENTS

04 PROPERTY OVERVIEW 06 AREA OVERVIEW

10 FINANCIAL OVERVIEW

LOS ANGELES, CA 3 OPPORTUNITY PROPERTY OVERVIEW • Great Location Inside Hollywood’s Studio District • Over 40% Rental Upside Potential • A Walk Score of 86 – Most Errands can be Accomplished on Foot • Large Lot with LAR4 Zoning – Can Build up to 21 Units (By Right) • High Density Rental Market with Strong Demographics Centrally Located in Hollywood’s Studio District DESCRIPTION • 10 Bungalow Units, Built in 1923 • Unit Mix: (10) – 1Bed/1Bath • Secured Entry into a Courtyard Style Building Over 40% Rental Upside • Individually Metered for Gas & Electric Potential • 5 Surface Parking Spaces Located at the Back • No Soft Story Requirements • Well Maintained Building with Several Units Remodeled • Centrally Located Along the 101 Freeway – Accessing the Entire LA Area 5 Surface Parking Spaces • Walking Distance from Restaurants, Groceries, Bars, and other Leisure Activities • Property Sits on a Nice Wide Cul-de-Sac Street • Good Transit – Many Nearby Public Transportation Options • 3,458 Rentable SqFt on a Large 8,750 SqFt Lot with LAR4 Zoning

4 MATTHEWS REAL ESTATE LOS ANGELES, CA 5 AREA OVERVIEW

LOS ANGELES, CA As the second largest metropolitan area in the United States, the Los Angeles Metropolitan Statistical Area, or the Southland, consists of both Los Angeles and Orange Counties. These two counties also make up the inner core of the Greater Los Angeles urbanized region. Los Angeles County, one of California’s original 27 counties, is one of the nation’s largest counties both in land area and population. With nearly 10 million residents, the Los Angeles population accounts for approximately 27 percent of California’s population. The area continues to grow, especially given the vigorous residential development in downtown LA. Famously known for a heavily entertainment industry based economy, the Los Angeles metropolitan area attracts many visitors. Consequently, leisure and hospitality is also a leading industry and has experienced recent growth in employment. It is now the sixth largest hotel market in the United Sates. The Los Angeles-Orange County metro area alone has an enormous economy with an estimate $866 billion GMP. Together with Ventura, Riverside and San Bernardino Counties, Orange and Los Angeles county make up the Greater Los Angeles Area, a combined statistical area that is the third largest economic center in the world after the Greater Tokyo and New York metropolitan areas.

6 MATTHEWS REAL ESTATE POPULATION AT A GLANCE

ECONOMY The LA economy is famously and heavily based on the entertainment industry, with a particular focus on television, motion pictures, interactive games, and recorded music - 18.7 MIL $55,509 4.4% POPULATION MEDIAN UNEMPLOYMENT the Hollywood district of Los Angeles and its surrounding areas are known as the “Movie HOUSEHOLD INCOME RATE Capital of the United States” due to the region’s extreme commercial and historical importance to the American motion picture industry. Other significant sectors include shipping/ international trade - particularly at the adjacent Port of Los Angeles and Port DEMOGRAPHICS of Long Beach, together comprising the United States’ busiest seaport - as well as aerospace, technology, petroleum, fashion and apparel, and tourism. POPULATION 1-MILE 3-MILE 5-MILE 2010 Census 63,639 361,228 976,469 2018 Estimate 69,578 387,823 1,041,636 2023 Projection 71,465 397,126 1,065,435 TOP EMPLOYERS POPULATION GROWTH 1-MILE 3-MILE 5-MILE % Change: 2010 to 2018 9.33% 7.36% 6.67% % Change: 2018 to 2023 2.71% 2.40% 2.28%

HOUSEHOULDS 1-MILE 3-MILE 5-MILE 2010 Census 27,957 162,551 406,682 2018 Estimate 30,519 172,645 430,298 2023 Projection 31,344 176,474 439,558

INCOME 1-MILE 3-MILE 5-MILE 2018 Avg. $60,383 $77,802 $78,594 Household Income

LOS ANGELES, CA 7 IMMEDIATE LOCATION Hollywood is a neighborhood in the central region of Los Angeles. This densely populated neighborhood is notable as the home of the US film industry including several historic studios. Its name has come to be a shorthand reference for the industry and the people associated with it. Take a step back in time when you visit remnants of Old Hollywood Glam at historic theatres such as TCL Chinese Theatre, El Capitan Theatre, and the Egyptian Theatre. Amoeba Music may seem like a time capsule but the largest independent record store in the U.S. stocks an impressive variety of CDs and DVDs as well as a knowledgeable staff. See where the Academy Awards are hosted at Dolby Theatre, the star-studded Walk of Fame on Hollywood Boulevard, and the best views of the city from the overlook at Hollywood Bowl. Catch movie productions in action around Hollywood and stop by the Hollywood Wax Museum to see replicates of the more reclusive celebrities. The subject property is located in a fantastic area right off Hollywood Boulevard with easy access to amenities such as the metro and a wide variety of restaurants.

8 MATTHEWS REAL ESTATE DEVELOPMENTS 1 2 5 3 4

SUBJECT PROPERTY 7 9

6 8

10

1 161 Apartments and Retail 4 100 Units and Retail 7 Six-Story Mixed-Used Building Right next to the 101 freeway is a 161-unit Set to replace an existing 11-tenant strip mall. Nearly 300 apartments above 34,000 square apartment complex. It will be comprised of A six-story building will include a 101-unit feet of retail space, and a four-floor parking residential clusters connected to one another residential and retail complex structure by skybridges 5 Small lot subdivision with 21 homes 8 735 Units in a multi-use complex 2 5550 Hollywood Boulevard A developer plans to build a small lot subdivision Plans for a multi-use complex with 735 Expected to open in 2018, is a six-story with 21 homes apartments, 95,820 square feet of commercial apartment complex which will have 280 units 6 Seven-story residential building space and 1,463 parking spaces above 12,030 square feet of commercial and Construction is expected to start in 2018 on a 9 Target retail space. new seven-story residential building with 185 A Target is currently in the works and is half units above a 1.5-level underground parking built. Olive Hill 3 garage 10 Six-Story residential complex A developer plans to build a six-story building Set to replace a vacant lot at Western and with 200 apartments above ground-floor retail Fountain Avenues, this project would include 75 units of housing, in six stories

LOS ANGELES, CA 9 FINANCIAL OVERVIEW

INVESTMENT SUMMARY Offering Price: $2,200,000 5731 Carlton Way Property Address: Los Angeles, CA 90028 Price Per Unit: $220,000 Price Per S.F.: $636.21 Cap (current/market): 3.32% / 6.30% GRM (current /market): 17.22 / 11.11

PROPERTY DESCRIPTION Number of Units: 10 Year Built: 1923 APN: 5586-035-016 Gross Sq. Ft.: 3,458 Average S.F. Per Unit: 346 Lot Size: 8,750 Zoning: LAR4

UNIT MIX Total Units Unit Mix Unit Mix % Current Avg Rent Current Monthly Rent Market Rent Market Monthly Rent 10 1+1 100% $1,064 $10,644 $1,650 $16,500 Scheduled Monthly Rent: $10,644 $16,500 Scheduled Yearly Rent: $127,728 $198,000

10 MATTHEWS REAL ESTATE ANNUALIZED OPERATING DATA Current Market Scheduled Gross Income: $127,728 $198,000 55% Upside Less Vacancy Reserve: 3.0% $3,832 3.0% $5,940 * Gross Operating Income: $123,896 $192,060 Expenses: 39.7% $50,753 27.0% $53,479 * Net Operating Income: $73,143 $138,581 Loan Payments: $58,492 $58,492 Cash-on-Cash Return: 1.20% $14,652 6.5% $80,089 ** * As a percent of Scheduled Gross Income ** As a percent of Down Payment

PRO FORMA ANNUAL OPERATING EXPENSES Current Per Unit % of SGI *Taxes 1.125% x Sale Price $24,750 $2,475 19% *Insurance $0.50 x GSF $1,729 $173 1% Off-Site Management 4.0% x GOI $4,956 $496 4% Repairs & Maintenance $500 x Units $5,000 $500 4% Contract Services Actual 2017 $3,818 $382 3% Utilities $900 x Units $9,000 $900 7% General Administration $150 x Units $1,500 $150 1.17% Total Expenses $50,753 $5,075 39.7%

Non-controllable expenses: Taxes, Insurance $26,479 $2,648 20.7% Total Expense with out Taxes $26,003 $2,600 20.36%

FINANCING Loan Amount $962,000 Terms: 30 Down Payment: 56% $1,238,000 Interest: 4.5% Yearly Pmt: $58,492 Monthly Pmt: $4,874 Debt Coverage: 1.25

LOS ANGELES, CA 11 RENT ROLL Unit Mix Rent Market Rent 5731 1+1 $927 $1,650 5731 1/2 1+1 $869 $1,650 5731 1/4 1+1 $830 $1,650 5731 3/4 1+1 $984 $1,650 5733 1/4 1+1 $1,068 $1,650 5735 1/2 1+1 $899 $1,650 5733 1/2 1+1 $1,227 $1,650 5733 1+1 $1,450 $1,650 5735 1+1 $1,229 $1,650 5735 1/4 1+1 $1,163 $1,650 Totals $10,644 $16,500 Averages $1,064 $1,650

12 MATTHEWS REAL ESTATE DOWNTOWN LOS ANGELES ±7 MILES FROM SUBJECT PROPERTY

HOLLYWOOD BLVD

HOLLYWOOD FREEWAY

SUBJECT PROPERTY

LOS ANGELES, CA 13 Confidentiality Agreement & Disclaimer This Offering Memorandum contains select information pertaining to the business and affairs 5731-35of Carlton Way Los Angeles, CA 90028 (“Property”). It has been prepared by Matthews Real Estate Investment Services. This Offering Memorandum may not be all-inclusive or contain all of the information a prospective purchaser may desire. The information contained in this Offering Memorandum is confidential and furnished solely for the purpose of a review by a prospective purchaser of the Property. It is not to be used for any other purpose or made available to any other person without the written consent of Seller or Matthews Real Estate Investment Services. The material is based in part upon information supplied by the Seller and in part upon financial information obtained from sources it deems reliable. Owner, nor their officers, employees, or agents makes any representation or warranty, express or implied, as to the accuracy or completeness of this Offering Memorandum or any of its contents and no legal liability is assumed or shall be implied with respect thereto. Prospective purchasers should make their own projections and form their own conclusions without reliance upon the material contained herein and conduct their own due diligence.

By acknowledging your receipt of this Offering Memorandum for the Property, you agree:

1 . The Offering Memorandum and its contents are confidential; 2. You will hold it and treat it in the strictest of confidence; and 3. You will not, directly or indirectly, disclose or permit anyone else to disclose this Offering Memorandum or its contents in any fashion or manner detrimental to the interest of the Seller.

Owner and Matthews Real Estate Investment Services expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers to purchase the Property and to terminate discussions with any person or entity reviewing this Offering Memorandum or making an offer to purchase the Property unless and until a written agreement for the purchase and sale of the Property has been fully executed and delivered.

If you wish not to pursue negotiations leading to the acquisition of the Property or in the future you discontinue such negotiations, then you agree to purge all materials relating to this Property including this Offering Memorandum.

A prospective purchaser’s sole and exclusive rights with respect to this prospective transaction, the Property, or information provided herein or in connection with the sale of the Property shall be limited to those expressly provided in an executed Purchase Agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims against Seller or Matthews Real Estate Investment Services or any of their affiliates or any of their respective officers, Directors, shareholders, owners, employees, or agents for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property.

This Offering Memorandum shall not be deemed to represent the state of affairs of the Property or constitute an indication that there has been no change in the state of affairs of the Property since the date this Offering Memorandum. EXCLUSIVELY LISTED BY

KYLE MIRRAFATI SENIOR ASSOCIATE - MULTIFAMILY

Direct +1.310.295.4269 Mobile +1.949.533.4650 [email protected] License No. 01911204

LUC WHITLOCK ASSOCIATE - MULTIFAMILY

Direct +1.310.844.9371 Mobile +1.310.872.8004 [email protected] License No. 02070426

Carlton Way 5731-35 ™ Los Angeles, CA

OFFERING MEMORANDUM