Cloudhaven & Sunhaven Apartments 5th and 6th Avenue South | St. Cloud, MN 56304

FOR SALE | $3,920,000

Mike Bobick, CCIM 320.333.2692 [email protected] A 40 Unit Family Housing Package

Cloudhaven - 28 Units - Located at 605 15th Street South, 1416 and 1420 6th Avenue South, St. Cloud, MN 56301. Sunhaven - 12 Units - Located at 1450 5th Avenue South, St. Cloud, MN 56301. *Assume Fannie Mae Loan 16.5% Down Payment!* +Significant Value Add Opportunity The Offering

Granite City Real Estate is proud to present Cloudhaven and Sunhaven apartments, a 40 unit investment package consisting of all 4 bedroom, 1-1/2 or 2 bath family housing units centrally located in St. Cloud, MN. The investment includes four buildings all constructed between 1987 and 1988. Rents range from $900-$1250 per unit monthly.

Until recently these buildings were occupied by students, generally only 10 months per year. As demand has changed at St. Cloud State University, these properties have been converted to family housing and the result is higher lease rates, full-time occupancy, which has resulted more stable performance.

The unit mix includes 4-two level townhome style units and the remaining 36 units are four-bedroom flats with a unique separate water closet, shower, both with doors, and double sink bathroom.

These buildings qualify for the HUD Section 8 voucher program which provides guaranteed contributions to tenant’s monthly rent. Approximately 75% of the tenancy participates in this program.

The investment is being offered at $3,920,000, which is a 7.78% “going in” capitalization rate, assuming an overall vacancy of 6.6%. There is existing Fannie Mae financing on 28 of the units which the seller will require to be assumed with the purchase (makes the down payment 16.5%).

Sunhaven 12 Units Cloudhaven 28 Units

This information has been obtained from the property owner or other sources that we deem reliable. However, neither the owner, nor Granite City Real Estate LLC guarantees the accuracy of such information. 2 St. Cloud Area Demographic & Economic Profile

The greater St. Cloud region is among the fastest growing in the State of Minnesota and is the largest population center in the central region of the state. One unique aspect of the St. Cloud region is that it spans three countries, all of which are among the largest and fastest growing in the state of Minnesota.

The St. Cloud area has earned recognition as a great place to do business. Entrepreneur magazine listed St. Cloud among the “Top 10 Mid-sized Cities in the Nation for Small Businesses” and Forbes included the area in its 2010 Top 200 list of “Best Small Cities for Business and Careers.” Minnesota Business magazine referred to the I-94 region from St. Cloud to the Twin Cities as “The Golden Corridor” due to the area’s stable economy and continuous business and residential development.

• A large regional hub with an excess of 30,000 daily commuters into the city for work. Our Regional Economy: • Located one hour northwest of Minneapolis/St. Paul. Annual Job Growth (2010-2018) - 15.6% • St. Cloud Regional Airport is served by Allegiant and Sun Country Airlines. GDP Growth (2014-2018) - 12.2% • Northstar Commuter Rail link with daily service to downtown Minneapolis from St. Cloud. Cost of Living (2018) - 4% lower than state average

Major Employers St Cloud Hospital/CentraCare Health 7,748 Healthcare Sherburne County 678 County Admin State of Minnesota* 2,293 State Admin Sauk Rapids-Rice School District #47 649 Education St. Cloud VA Health Care System 1,780 Healthcare City of St. Cloud 608 City Admin St. Cloud Area School District #742 1,157 Education Coldspring 606 Granite Quarry Coborn's, Inc. 721 Grocery Anderson Trucking 603 Logistics Pilgrim's-formerly GNP Company 1,250 Poultry Alltran 597 Call Center Stearns County 955 County Adm Essilor of America 550 Optical lens manuf College St. Benedict/St. John's University 935 Education Sartell-St.Stephen School District #748 500 Education New Flyer of America 763 Manufacturing Wolters Kluwer Financial Services 490 Financial Knife River Corporation - North Central 700 Mining\trucking Bluestem Fulfillment, Inc. 471 Mail order Capital One 360 695 Financial Woodcraft Industries 409 Millwork Bernick's 680 Bottling American Axle & Manufacturing 387 Manufacturing *Includes St. Cloud State University 3 Our Workforce

Employment by Sector (2018): Global Companies: • Healthcare and Social Services - 29.473 • Arctic Cat • Geringhoff • Manufacturing - 25.634 • Capitol One • New Flyer • Education - 15.843 • Coldspring • Pilgrim’s Pride • DeZURIK • Quanex/Woodcraft Labor Force Participation Rate (2017) = 73.3% Logistics: Projected Population Growth (2010-2017) = 32.6% • Roadways: MN Highways 10, 15 and 23; Interstate 94. Projected Workforce Growth (2015-2030) = 3.9% • Rail: BSNF, CP Rail, Northstar Commuter Train, Amtrak Train. Number of College Students (2018-2019) = 24.790 • Air: St. Cloud Regional Airport, MSP International Airport.

4 Property Details

Address: 605 15th St S, 1450 5th Ave S 1416-1420 6th Ave S, County: Stearns

Land Area: 89,720 square feet 2.059 acres Property IDs: 82.44703.0000, 82.44703.0001 82.44706.0000, 82.44694.0000 Year Built: 1987-1988

Construction: Three-story wood built construction

Floors: 3 Floors 4 Buildings Units: 40 Total 4-bedroom Units Average Unit Size: 1380 SF

Property Type: High Density Multifamily

Parking: 83 stalls

Elevators: None

Projected NOI: $304,834

Pricing: $3,920,000 $98,000/unit

5 Property Details

Building Addresses: Number of Units Square Footage/Unit Bldg Gross SF Cloudhaven 605 15th St. S. 8 1380 10,314 Cloudhaven 1416 6th Ave. S. 8 1380 10,396 Cloudhaven 1420 6th Ave. S. 12 1380 15,112 Sunhaven 1450 5th Ave S. 12 1370 15,000

Building 605 15th St. S. 1416 6th Ave. S. 1420 6th Ave. S. 1450 5th Ave. S Parking 12 12 28 31 Exterior steel/brick steel/brick steel/brick vinyl/brick Water heaters (all natural gas) 2013 2013 2013 2019

6 Features

Construction: • Foundation: Poured concrete footings/ concrete block • Structural framing: Wood frame • Roof: Pitched roof, asphalt shingles • Entry doors: Hollow core metal storefront type with glass • Windows: Metal or vinyl clad sliders • HVAC: Gas-fired hot water boilers provide radiant heat and wall sleeve air conditioning units. Boilers are plumbed with backup circulation pumps. Units are also equipped with wall hung dehumidifiers • Electrical: Copper, 100 amp per apartment. Circuit breakers • Plumbing: Copper supply lines, PVC drain lines

Kitchens: • Appliances: Electric range/oven, dishwasher and refrigerator • Countertops: Laminate • Cabinets: Pre-manufactured mill cabinetry • Sink: Double stainless steel sink Laundry: • Lighting: Ceiling Mounted Fluorescent Common area laundry rooms, coin operated. Some machines are leased.

Bathrooms: Fire Safety: • Bathtub/Shower: Integrated acrylic shower/tub Hallway mounted strobes and exit lighting throughout. • Sink/Vanity: Inset porcelain in laminate counter • Lighting: Wall mounted Utilities: • Wall mounted dehumidifiers Heat,water and trash are included in base rent. • Gas: Xcel Energy Additional Interior: • Electricity: Xcel Energy • Carpet and Vinyl flooring. • Water/Sewer: City of Saint Cloud • Eight foot ceilings. • Cable/TV: Several options

7 Financial Summary Cloudhaven

CLOUD HAVEN 8 Month Trailing & 12 Month Extrapolation 28 Units Aug-19 Sept Oct Nov Dec 20-Jan Feb Mar 8 month T12 Forecast RENTAL INCOME Actual Rental income unit 33,880 33880 33880 33720 33680 33680 33680 33680 270,080 405,120 Rental vacancy unit -4600 -4600 -4600 -4440 -4400 -3300 -3300 -3300 -32540 (34,435) 8.50% Loss/gain to market -506 -506 -506 -506 -406 -506 -506 -486 -3928 (5,892) Rental allowance -25 0 0 0 0 -47 0 0 -72 (108) Total rental income 28,749 28774 28774 28774 28874 29827 29874 29894 233,540 364,685 Total OTHER INCOME 806 2 923 412 164 863 381 -76 3,475 5,213 Total operating income 29,555 28,776 29,697 29,186 29,038 30,690 30,255 29,818 237,015 369,898 EXPENSE Total WAGES AND PAYROLL TAXES 0 730 2560 732 1003 155 729 729 6638 9,574 Total ADMINISTRATIVE EXPENSES 2097 1721 1559 2913 1901 4319 1675 2186 18371 25,993 Total REPAIRS AND MAINTENANCE 853 1829 2623 5393 2977 2627 5371 4094 25767 36,011 PropertyTotal UTILITIES insurance 5844958 958739 6279958 1644958 7900958 2637958 7363958 2167958 345737664 11,496 51,860 Total OTHER OPERATING EXPENSE 3776 3090 3090 3090 3090 3090 3090 3890 26206 37,080 TOTAL OPERATING EXPENSE 160,517 $5,732/u/y NOI – net operating income 209,381

PURCHASE SCENARIO

Cloudhaven Purchase Price 2,744,000 Fannie Mae Assumption 2,332,249 Down payment 15.00% 411,751 Net Operating Income 209,381 Annual Debt Service 156,929 Cash Flow 52,452 Cash on Cash Return 12.74% Capitalization Rate 7.6%

Fannie Mae Assumption: 5.3% interest, 30 yr amortization, 10 yrs fixed, 8 yrs left in term, non-recourse

8 Financial Summary Sunhaven

SUNHAVEN 8 Month Trailing & 12 Month Extrapolation 12 Units Aug-19 Sept Oct Nov Dec Jan-20 Feb Mar 8 mo 12 Forecast RENTAL INCOME Rental income unit 14,400 14400 14460 14400 14400 14400 14400 14400 115,260 172,890 Rental vacancy unit 0 0 0 0 0 -1200 -1200 -1200 -3600 (3,600) 2.10% Loss/gain to market -300 -300 -200 -210 -150 -100 -100 -100 -1460 (1,460) Total rental income 14,100 14100 14260 14190 14250 13100 13100 13100 110,200 167,830 Total/OTHER INCOME 159 36 886 1122 12 902 195 11 3,323 4,985 TOTAL OPERATING INCOME 14,259 14,136 15,146 15,312 14,262 14,002 13,295 13,111 113,523 172,815 EXPENSE Total WAGES AND PAYROLL TAXES 330 338 0 338 387 419 656 508 2976 4,464 Total ADMINISTRATIVE EXPENSES 789 710 706 1291 1182 952 2236 3410 11276 10,483 Total REPAIRS AND MAINTENANCE 2328 2177 3784 3228 1207 1512 2567 962 17765 24,399 Total UTILITIES 1747 675 3073 1512 2454 1398 3194 1218 15271 21,639 Total OTHER OPERATING EXPENSE 1364 1364 1364 1364 1364 1364 1364 1364 10912 16,368 TOTAL OPERATING EXPENSE 77,353 $6,446/u/y NOI – net operating income 95,462

PURCHASE SCENARIO Sunhaven Purchase Price 1,176,000 Annual Debt-80%, 4.15%, 25 yr 60,529 940,800 Down Payment 20% 235,200 Net Operating Income 95,462 Annual Debt Payment 60,529 Cash Flow 34,933 Cash on Cash Return 14.9% Capitalization Rate 8.1%

9 Combined Summary

CLOUDHAVEN / SUNHAVEN INVESTMENT PACKAGE SUMMARY

PRICE 3,920,000 Down Payment --16.5% 646,951 Projected Net Operating Income 304,843

Sunhaven Annual Debt Payments -80%, 4.15%, 25 yr 60,529 (Assuming an 80% LTV @ 4.15% interest 25 yr amortization) Cloudhaven Fannie Mae Annual Payments 156,929 (Existing loan assumption P&I)

Total Annual Debt Service 217,458 Cash Flow 87,385 Cash on Cash Return 13.51% Capitalization Rate 7.78%

10 Investment Highlights

More than $312,000 in Potential Value Creation

Amenity Units Cost Per Total Monthly Total Total Added Value Unit Cost Average Monthly Yearly at 7% Cap Rate Premium / Unit Bring below market rent units 9 $0 $0 $41 $1,146 $13,752 $196,457 to market rate Implement Water Conservation 28 $314 $8,800 $9.12 monthly $255 $3,063 $43,757 at Cloudhaven savings / unit annual savings Rent Out Storage Units 4 $0 $0 $30 $120 $1,440 $20,541

Vending Machines 6 $800 $4,800 N/A $300 $3,600 $51,458

TOTAL $13,600 $1,971 $17,877 $312,243

Outstanding Upside by Opportunity to Add Value Revenue Growth Available Additional Revenue Bringing All Units To by implementing Water Through Implementation Generated Through Market Rents Conservation Efforts of rentable storage units Vending Machines Maximize the income 4 Storage units are present potential present by Decrease water utility bills on the property and are Three of the buildings are bringing rents that are by implementing low flow not currently being set up for vending below market rate to toilets, aerators and low utilized. By renting these machines. By simply market. The $1,220 market flow shower heads. Over storage units out $1,440 in purchasing the machines rents have already been $3,063 per year would be additional revenue can be an additional revenue proven out in most units saved by doing so. realized. generator can be realized

11 Aerial

3900 Roosevelt Road #125 | St. Cloud, MN 56301 Mike Bobick, CCIM Office: 320.253.003 Fax: 320.253.006 320.333.2692 www.gcremn.com [email protected]