4837 Huntington Dr N the Offering

ELES, NG CA A 9 S 00 O 3 L 2

4 8 N 3 7 R D HU N NTINGTO

OFFERING MEMORANDUM

Huntington Dr N

El Sereno Ave

A 20-Year NNN Leased Arroyo Vista Family Healthy Center with Annual Rental Increases Ideally Located on the Northwest Signalized Corner of Huntington Drive and El Sereno Avenue in Los Angeles, CA brandonmichaelsgroup.com

INVESTMENT ADVISORS

Brandon Michaels Senior Managing Director of Investments Senior Director, National Retail Group Tel: 818.212-2794 [email protected] CA License: 01434685

Matthew Luchs First Vice President Investments COO of The Brandon Michaels Group Tel: 818.212.2727 [email protected] CA License: 01948233

Ingrid Farias-Eisner Investments Associate National Retail Group Tel: 310.909.5449 [email protected] License #02071328 Contents 04 Executive Summary 12 Property Overview 18 Area Overview 28 FINANCIAL ANALYSIS Executive Summary

4 4837 Huntington Dr N The Offering

A 20 Year NNN Leased Arroyo Vista Family Healthy Center with Annual Rental Increases Ideally Located on the Highly Trafficked Northwest Signalized Corner of Huntington Drive and El Sereno Avenue in the densely populated Los Angeles County Sub-Market of El Sereno The Brandon Michaels Group of Marcus & Millichap has been selected to exclusively represent for sale Arroyo Vista Family Health Center, a 13,600 square foot single tenant medical office building located on 31,164 square feet of land located at 4837 N. Huntington Drive in Los Angeles, CA. Arroyo Vista Family Health Center has been operating out of this location for 13 years, and they recently just executed a brand new, twenty-year absolute NNN lease with annual two percent rental increases, creating a stable and secure investment opportunity.

There are a total of 38 parking spaces, a 3 certification. The Office of Statewide parking ratio of 2.79 per 1,000 square feet. Health Planning and Development The property features 171 feet of frontage is responsible for writing regulations on Huntington Drive North, 107 feet of pertaining to licensed clinics. These frontage on El Sereno Avenue, and the regulations are identified in the California rear parking lot features an additional 50 Building Standards Code as “OSHPD 3”. feet of frontage on Locke Avenue. OSHPD 3 requirements for clinics shall only be applied to clinics that are licensed Arroyo Vista Family Health Center is a non- pursuant to Health and Safety Code (H&S) profit community health center licensed Section 1200 (which includes primary care by the State of California Department clinics and specialty clinics) or outpatient of Health Services. The company is a services of a hospital licensed pursuant to Federally Qualified Health Center, their H&S Section 1250. funding is provided through Public Health Services Act, with additional funding from 4837 Huntington Drive North is supported the State of California, Los Angeles County by a flourishing community that has and private sources. The company has four attracted several national credit tenants physical locations, one each in Highland within close distance to the subject Park, Lincoln Heights, El Sereno – Valley property, including Chase Bank, Little Boulevard, and El Sereno – Huntington, in Caesars, McDonalds, Jack-in-the-Box, addition to their mobile medical clinic. Pizza Hut, and O’Reilly Auto Parts.

The subject property has undergone substantial renovations and capital improvements and holds desirable OSHPD Executive Summary 5

DOWNTOWN

LOS ANGELES

USC L

O D W H C O O S M D O H G IU D IG D RO H ER STA W WILSON ASCOT HILLS PARK

O E L O S H E C R S EN LE O MIDD

El Sereno Ave

EL SERENO

6 4837 Huntington Dr N

MONTECITO

D HEIGHTS O D M G IU HAPPY VALLEY ER STAD ERNEST E. DEBS REGIONAL PARK ROSE HILL LINDEN HEIGHTS CONDO

Via Mia

Huntington Dr N

Intersection: Over 60,000 El Sereno Ave Vehicles Per Day

Executive Summary 7 investment highlights

ARROYO VISTA FAMILY HEALTH CENTER HAS SUCCESSFULLY OPERATED OUT OF THIS LOCATION SINCE 2007 AND JUST EXECUTED A NEW TWENTY YEAR NNN LEASE • Arroyo Vista Family Health Center has successfully been operating out of this location for 13 years • Arroyo Vista Family Health Center recently signed a new 20-year NNN lease which runs through April of 2040 • There are two percent annual increases • Arroyo Vista Family Health Center has three other physical locations in addition to a mobile medical clinic

MEDICAL USE BUILDING WITH EXCEPTIONAL ASCOT HILLS PARK UNDERLYING FUNDAMENTALS • 38 parking spaces spread across two parcels • Located at the Northwest signalized corner of Huntington Drive and El Sereno Avenue • High daily traffic counts exceeding 60,000 vehicles per day • Frontage on three streets • OSHPD 3 certified • The subject property has undergone extensive renovations and upgrades • NNN leased to a government backed company that has been successfully operating out of this property for 13 years 8 4837 Huntington Dr N investment highlights

EXCELLENT LOS ANGELES LOCATION IN THE DENSELY POPULATED AND GENTRIFYING EL SERRANO SUB- MARKET • Multiple national credit tenants in the immediate area, including Chase Bank, Little Caesars, McDonalds, Jack-in-the-Box, Pizza Hut, O’Reilly Auto Parts, and several schools and churches • Less than three miles from California State University, Los Angeles • Significant development in and around the immediate area • Median age of 35 years old within the immediate sub-market USC CAMPUS STRONG UNDERLYING DEMOGRAPHICS AND DENSE IMMEDIATE POPULATION • Over 34,000 people are located within one mile of the property, 280,400 within three miles of the property, and 781,500 within five miles • There are over 9,900 households located within one mile of the property, 86,000 within three miles, and 251,700 within five miles • Affluent sub-market with an average household income north of $81,200 within one mile of the subject property, $92,100 within three miles of the property, and $91,800 within five miles of the property • Vibrant surrounding SFR market with median home values exceeding $643,000 within one mile USC VILLAGE of the subject property Executive Summary 9 NEARBY AMENITIES Retail

1. Arco 2. USPS 3. Chase Bank 4. Autozone 5. Food 4 Less 6. O’Reilly Auto Parts 7. Big Saver Foods ELEPHANT HILL OPEN SPACE

Restaurants 6 7 1. Thai Beam Cuisine 6 2. Mariscos El Kora De

Nayarit 4 5 3. McDonald’s 3 4. Jack in the Box 5 5. Little Caesars Pizza 4 6. Pizza Hut 2 3

2 Huntington Dr N1

El Sereno Ave

10 4837 Huntington Dr N property summary

Address 4837 Huntington Dr N Los Angeles, CA 90032

Price $11,600,000 Building Size 13,669 SF Lot Size 31,164 SF Price/SF (Building) $849 Price/SF (Land) $372 CAP Rate 5.29% Occupancy 100% Tenant Arroyo Vista Family Health Center Guarantor Arroyo Vista Family Health Foundation Lease Type NNN Least Start 5/1/2021* Lease Expiration 4/30/2040 Term Remaining 20 Years Options None Rent Increases 2% Annual Parking 38 Spaces; 2.79 per 1,000 SF Year Built/Renovated 1943/1976/2020 APN Number 5213-001-034, 5213-002-013 Zoning C4, Los Angeles * Arroyo Vista Family Health Center has operated at this location since 2007 Property Overview 11 Property Overview

12 4837 Huntington Dr N property description

LOCATION 4837 Huntington Dr N Los Angeles, CA 90032

SITE The property is located at the signalized intersection of Huntington Drive N and El Sereno Avenue.

BUILDING SIZE 13,669 SF

LOT SIZE

ELES, NG CA A 9 31,164 SF S 00 O 3 GRIFFITH L 2

OBSERVATORY PARKING 4 8 N 3 7 R D HU N NTINGTO 38 Parking Spaces; A Parking Ratio of 2.79 Parking Spaces per 1,000 SF

DODGER STADIUM ZONING

UNIVERSITY OF SOUTHERN C4, Los Angeles CALIFORNIA - LOS ANGELES TRAFFIC COUNTS Intersection of Huntington Drive and El Serreno Avenue: over 60,000 Vehicles per day

Property Overview 13 14 4837 Huntington Dr N capital improvements Current Ownership has completed extensive improvements, renovations, and upgrades to the property including:

• Recently re-coated the roof with a TPO system • New Title 24 lighting, which provides energy savings • New front entrance • 90% of the building has new electric panels and subpanels • New flooring throughout 85% of the building • Updated plumbing throughout the original unit of the Arroyo Vista Family Health Center • 90% of the building walls feature new metal stud framed up to the ceiling • New fire sprinkler system and fire alarm system • 9 brand new restrooms • Fire/smoke graded Tunnel Corridor • 8 new RTU-HVAC units • New T-Bar ceiling • 80% of the indoor frames are new • New low voltage cap 6 wiring with high-speed internet • New cabinets throughout the property • The parking lot was recently slurry coated and re-striped with new handicap signage and parking stalls • New cutting-edge dental equipment • Property is OSHPD 3 certified • New security cameras

Property Overview 15 property PHOTOS

16 4837 Huntington Dr N Property Overview 17 parcel map

APN #5213-001-013

APN #5213-001-034

18 4837 Huntington Dr N Property Overview 19 ARROYO VISTA FAMILY HEALTH CENTER

TENANT PROFILE LEASE ABSTRACT

Made for the community, by the community, Arroyo Tenant Arroyo Vista Family Health Center Vista is a non-profit community health center governed by a consumer Board of Directors with a trusted team of Guarantor Arroyo Vista Family Health Foundation healthcare professionals serving the Greater Northeast Square Footage 13,669 SF Los Angeles since 1981. We are licensed by the State of California Department of Health Services. As a Federally Monthly Rent $51,116 Qualified Health Center (FQHC), funding is provided Annual Rent $613,389 through Public Health Services Act, section 330, with additional funding from the State of California, Los Angeles Rent Per SF $3.74 Per Month County and private sources. We are accredited by The Lease Start 5/1/2021* Joint Commission which means that Arroyo Vista has been rigorously inspected and evaluated assuring that Arroyo Lease Expiration 4/30/2040 Vista adheres to the highest standards of quality health care Lease Type NNN delivery. Arroyo Vista is affiliated with universities and serves as a clinical training center for medical residents and nurse Rent Increases 2% Annual practitioners. Options None

Term Remaining 20 Years

No. of Locations 4 physical locations in addition to one mobile medical clinic

* Arroyo Vista Family Health Center has operated at this location since 2007

20 4837 Huntington Dr N Property Overview 21 Area Overview

22 4837 Huntington Dr N el sereno, los angeles

El Sereno is a Los Angeles neighborhood least racially diverse neighborhoods El Sereno is a predominantly Latino in the Eastside Los Angeles region of Los in Los Angeles. The median age that neighborhood northeast of Downtown Los Angeles County, California. year was 28, resulting in a youthful Angeles. population, compared with the city El Sereno is 4.17 square miles (10.8 km2) and county in general. The percentage and has a population of 43,766. It has a of residents aged 10 or younger was population density of 9,826 people per among the county’s highest. The average square mile, which is about average for household size of 3.5 people was high for the City of Los Angeles. both the city and the county. The median household income for the neighborhood The neighboring communities are was $45,866 in 2008 dollars, which University Hills, Boyle Heights, East Los was about average for the City of Los Angeles, Lincoln Heights, Montecito Angeles. Heights, Highland Park, and the cities of Alhambra, Monterey Park and South U.S. Census data from 2010 showed Pasadena. the population to be of 79.6% Hispanic and 10.8% Asian ethnicity. The median El Sereno is a predominantly Mexican household income was $47,359. American community and one of the

Area Overview 23 LOCATION OVERVIEW

Arroyo Vista Family Healthy Center is located less than three miles from California State University, Los Angeles, a university home to 26,000 students and a brand new eight-story dormitory which will house 1,500 students

1There are several development projects taking place within the El Sereno submarket, including an eight-story dormitory for California State University, Los Angeles which will house 1,500 beds for freshman and sophomore students. The dormitory will also feature a dining-commons and learning center, the L-shaped structure will wrap around a central garden.

Arroyo Vista Family Health Center is located less than three and a half miles from 181 North Ave 21, a six-story development project situated on the corner of Barranca Street and North Avenue 21. The project will consist of 102 apartments, a 100-key hotel, and 5,000 square feet of ground-floor retail space. Proposed amenities include a pool, gym, and courtyard.

The same developer of 181 North Ave 21 is also developing a project at 215-217 North San Fernando Road, a 5-story 81 unit live/work apartment building. The property is located on North San Fernando Road between Humboldt Street and Barranca Street, a few blocks east of the Los Angeles River. The building will feature a single-story podium containing at-grade parking, and will have an amenity deck for residents.

The Paseo at the Gateway is another major development taking place within the submarket. The project is being developed on a 2.3-acre site at Santa Anita Avenue and Santa Fe Drive. The five- story building will feature 208 units above 25,000 square feet of ground-floor retail space and a semi- subterranean parking garage. The project costs are estimated to be approximately $99 million.

This dense immediate sub-market benefits from a population of over 34,000 people located within one mile of the property, 280,400 within three miles of the subject property, and 781,500 within five miles. There are over 9,900 households located within one mile of the property, 86,000 within three miles, and 251,700 within five miles. Average household income eclipses $81,200 within one mile of the property, $92,100 within three miles of the property, and $91,800 within five miles of the property.

24 4837 Huntington Dr N Type: Private Research University

Established: October 6, 1880

Academic Affiliations: AAU; NAICU; APRU Sea-grant; Space-grant

Endowment: $5.91 billion (2020) The University of Southern California is one of the world’s leading private research universities, located in the heart of Los Angeles. Academic Staff: 4,604 (2019) Administrative Staff: UNIVERSITY OF SOUTHERN CALIFORNIA 16,313 (2019) - 2.8 MILES FROM THE SUBJECT PROPERTY Students: The University of Southern California (USC, SC, or admission to its programs is highly selective. 48,321 (2019) Southern Cal[a]) is a private research university in Los Angeles, California. Founded in 1880 by Robert M. USC was one of the earliest nodes on ARPANET and Undergraduates: Widney, it is the oldest private research university in is the birthplace of the Domain Name System. Other 20,351 (2019) California. technologies invented at USC include DNA computing, dynamic programming, image compression, VoIP, and Postgraduates: The university is composed of one liberal arts school, antivirus software. 27,970 (2019) the Dornsife College of Letters, Arts and Sciences and twenty-two undergraduate, graduate and professional USC’s notable alumni include 11 Rhodes scholars and 12 Nickname: schools, enrolling an average of 19,500 undergraduate Marshall scholars. The University of Southern California and 26,500 post-graduate students from all fifty U.S. is the largest private employer in the Los Angeles area Trojans states and more than 115 countries. USC is ranked and generates an estimated $8 billion of economic among the top universities in the United States and impact on California.

Area Overview 25 NEARBY DEVELOPMENTS

New Dormitory for Cal State LA 181 North Ave 21 Development Student Housing East, an eight-story facility The six-story development will include 100 offering 1,500 beds for freshmen and residential units and a 200-key hotel above sophomores, is currently under construction 5,000 square feet of ground-floor retail and and expected to open fall 2021. There will a 135-car garage. Plans call for a mix of one- be a residential dining facility, a health and and two-bedroom apartments - including wellness zone, and a learning center with 45 live/work units and five extremely low- study rooms, classroom space and music income affordable units. practice rooms.

215-217 North San Fernando Rd The Paseo at the Gateway Development The five-story edifice will feature 208 The new development will consist of a five- studio, one-, and two-bedroom apartments story building featuring 81 live/work apartments above approximately 25,000 square feet above a single-story podium containing at-grade of ground-floor retail space and a semi- parking. The apartment complex is one of only subterranean parking garage. SVA Architects a handful of ground-up developments entitled is designing the contemporary podium-type under the Cornfield-Arroyo Specific Plan, which development which will include a large sets zoning and land use rules for the River- amenity deck. adjacent areas in Lincoln Heights and Chinatown.

26 4837 Huntington Dr N DEVELOPMENT MAP & PIPELINE

Development Pipeline Map

Subject Property

Under Construction

1 2 3

PROPERTY NAME DEVELOPER UNITS STORIES START YEAR FINISH YEAR

1 181 North Ave 21 181 N Ave 21, Los Angeles, CA 90031 4Site Real Estate 100 6 2020 2021

215-217 N San Fernando Rd, Los Angeles, CA 215-217 North San Fernando Road 4Site Real Estate 81 5 2020 2022 2 90031

3 The Paseo at the Gateway 10568 Santa Fe Dr, El Monte, CA 91731 Grapevine Development LLC 208 4 2017 2021 TOTAL 389 15 - -

Area Overview 27 EL SERENO, LOS ANGELES DEMOGRAPHICS

MEDIAN AGE EL SERENO, LOS ANGELES TOTAL POPULATION 34 49% 51% 48,031 MALE FEMALE EDUCATION

36.16%Some High School 23.06%Some College Associate6.23 Degree% Bachelor’s13.5% Degree

28 4837 Huntington Dr N DEMOGRAPHICS BY RADIUS

1-MILE 3-MILE 5-MILE 2021 Population 34,045 280,434 781,537 2021 Households 9,974 86,098 251,772 2021 Average Household 3.3 3.1 2.9 $92,126 781,537 Size Average HH income Population Annual Growth 2021-2026 -0.3% -0.4% -0.2% within a 3-mile radius within a 5-mile radius 2021 Median Age 35.8 36.9 37.9 2021 Owner Occupied 5,079 36,547 95,707 Households 2021 Renter Occupied 4,754 48,009 153,087 Households 2021 Average Household 95,707 153,087 $81,284 $92,126 $91,898 Owner Occupied Housing Renter Occupied Housing Income within a 5-mile radius within 5-mile radius 2021 Median Household $60,823 $66,556 $65,562 Income Businesses 435 9,666 37,229

251,772 37,229 Households Businesses within a 5-mile radius within a 5-mile radius

Area Overview 29 financial analysis RENT ROLL LEASE TERM RENT TENANT SF SF% LEASE TYPE LEASE START OPTIONS RENT RENT/SF EXPIRATION REMAINING INCREASES Arroyo Vista Family 13,669 100% NNN 5/1/21 4/30/40 20 None $51,115.76 $3.74 2% Annual Health Center TOTAL 13,669 100% $51,115.76 $3.74

* Arroyo Vista Family Health Center has operated at this location since 2007

ANNUALIZED OPERATING DATA INCOME AND EXPENSE EXPENSE BREAKDOWN* PER YEAR PER SF Scheduled Lease Income $613,389 Taxes @1.25% $145,000 $10.61 NNN Charges $203,161 Insurance $5,468 $0.40 Effective Gross Income $816,550 Utilities $6,151 $0.45 Expenses $203,161 Trash Removal $5,468 $0.40 Net Operating Income $613,389 Grounds $4,237 $0.31 Repairs & Maintenance $9,568 $0.70 Management $24,536 $1.79 Reserves $2,734 $0.20 TOTAL $203,161 $14.86 / $1.24

* Projected operating expenses based on industry averages

30 4837 Huntington Dr N pricing

CAP RATE BREAKDOWN Address 4837 Huntington Dr N YEAR MONTHLY RENT ANNUAL RENT CAP RATE Los Angeles, CA 90032 2021-2022 $51,116 $613,389 5.29% Price 2022-2023 $52,138 $625,657 5.39% $11,600,000 2023-2024 $53,181 $638,170 5.50% Building Size 13,669 SF

2024-2025 $54,244 $650,933 5.61% Lot Size 31,164 SF 2025-2026 $55,329 $663,952 5.72% Price/SF (Building) $849 2026-2027 $56,436 $677,231 5.84% 2027-2028 $57,565 $690,776 5.95% Price/SF (Land) $372 2028-2029 $58,716 $704,591 6.07% CAP Rate 5.29% 2029-2030 $59,890 $718,683 6.20% Occupancy 100% 2030-2031 $61,088 $733,057 6.32% Tenant Arroyo Vista Family Health 2031-2032 $62,310 $747,718 6.45% Center 2032-2033 $63,556 $762,672 6.57% Guarantor Arroyo Vista Family Health 2033-2034 $64,827 $777,926 6.71% Foundation 2034-2035 $66,124 $793,484 6.84% Lease Type NNN 2035-2036 $67,446 $809,354 6.98% Least Start 5/1/2021* 2036-2037 $68,795 $825,541 7.12% 2037-2038 $70,171 $842,052 7.26% Lease Expiration 4/30/2040 2038-2039 $71,574 $858,893 7.40% Term Remaining 20 Years 2039-2040 $73,006 $876,071 7.55% Options None

Rent Increases 2% Annual * Arroyo Vista Family Health Center has operated at this location since 2007 Financial Analysis 31 brandonmichaelsgroup.com

INVESTMENT ADVISORS

Brandon Michaels Senior Managing Director of Investments Senior Director, National Retail Group Tel: 818.212-2794 [email protected] CA License: 01434685

Matthew Luchs First Vice President Investments COO of The Brandon Michaels Group Tel: 818.212.2727 [email protected] CA License: 01948233

Ingrid Farias-Eisner Investments Associate Huntington Dr N National Retail Group Tel: 310.909.5449 [email protected] License #02071328