8 Units | Built 2018 Queen Anne | Seattle, WA
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8 Units | Built 2018 Queen Anne | Seattle, WA OFFERING MEMORANDUM BERTONA STEPS 3402 15th Avenue West Seattle, 98119 Investment Contacts Matt Kemper Vice President +1 206 607 1752 [email protected] Don Flanigan Vice President +1 206 971 7020 [email protected] Jordan Louie Vice President +1 206 971 7007 [email protected] Financing Contacts Seth Heikkila Senior Vice President +1 206 607 1732 [email protected] Drew Heitstuman Associate +1 206 971 7021 [email protected] CONTENTS Executive summary 04 Property description 08 Submarket overview 14 Market overview 18 Rent & sales comparables 22 Financial analysis 28 Transaction guidelines 32 EXECUTIVE SUMMARY EXECUTIVE SUMMARY 5 The Offering JLL is pleased to present Bertona Steps to the investment community. Completed in 2018, the condo-quality asset offers eight spacious units with Scandinavian designer finishes and high energy efficiency. Bertona Steps sits on the western side of Queen Anne, providing easy access to the amenities and employment opportunities of Greater Seattle. The property is less than a five-minute walk to the RapidRide D line, as well as the future Interbay Light Rail Station. The upcoming Expedia campus is also nearby, less than 10 minutes by car. Property Details Name Bertona Steps Address 3402 15th Avenue West, Seattle, Washington 98119 Parcel Number 277060-3480 Built 2018 Construction Type Wood frame Number of Units Eight apartment homes Average Unit Size 905 square feet Residential Space 7,238 net rentable square feet Floorplans Live-work (1x1.5) and two bedroom / one bath options Parking Five parking stalls OFFERING MEMORANDUM 6 EXECUTIVE SUMMARY Investment Highlights RESIDENTIAL DESTINATION Queen Anne is among the most coveted and trendy neighborhoods for the young city-dwelling professionals of Seattle. It offers a quintessential residential environment and is filled with clusters of activity desired by the urbanites of the Millennial generation. An influx of this demographic toward Queen Anne has bolstered its residential base and solidified its status as an in-demand community of Seattle. COMPELLING LOCATION Bertona Steps is within close proximity of restaurants, shopping and entertainment such as QFC and Whole Foods, the Interbay Golf Center and Athletic Complex, as well as Seattle Pacific University and the University of Washington. The asset is conveniently located near key regional employment hubs, offering quick commuting options to notables in high-tech and bio-tech including Amazon, Google, Facebook and Microsoft, among others. Bus routes currently run within a block of the property and future light rail will open just steps away in 2035. Meanwhile, Expedia’s nearby 40-acre campus will host a staff of 4,500 and sits within a direct route of Bertona Steps. The new Expedia campus/world headquarters opens in 2019. EXCEPTIONAL PRODUCT Recently opened in summer 2018, Bertona Steps exemplifies modern, high-end design with elements such as stainless steel appliances, quartz countertops, oversized windows, plank flooring, in-unit washer/dryers and air conditioning. Luxury is blended with technology with a state-of-the-art security monitoring system, while the incorporation of energy saving appliances, light fixtures and heating/cooling keeps each unit’s energy consumption optimally low. CHALLENGING FOR-SALE HOUSING MARKET Within the immediate proximity of Bertona Steps, household incomes are $82,108, yet homeownership remains elusive with average home values of $828,500. In comparison, new construction rents average $2,308 per month and rent growth (all vintages) has averaged 5.2%. Overall home prices in Greater Seattle have climbed 85% since 2012 and sale price appreciation is number one in the country. LEADING METRO Even with surging home prices, Seattle offers 31% more disposable income over the Bay Area. As a result, Seattle is the top ranked city for career-oriented professionals and the nation’s top relocation destination. 110,000 new jobs are listed on LinkedIn and more than 100 out-of-state tech companies have planted a flag in the Seattle region in the past three years. Of the 35 Fortune 500 companies headquartered in the Bay Area, 10 now offer a significant presence in Seattle – the Urban Land Institute’s top real estate investment market for 2018. LISTED EXCLUSIVELY BY JLL EXECUTIVE SUMMARY 7 University District 5 Central Business South District Lake Union Amazon Lake Union Google Seattle Center Woodland Park Zoo Google Facebook Fremont Microso Queen Anne Elliott Bay RapidRide D Line & Future Light Rail Interbay Ballard Magnolia Discovery Park N OFFERING MEMORANDUM PROPERTY DESCRIPTION PROPERTY DESCRIPTION 9 The Asset Bertona Steps is a four-story multifamily asset built upon a 5,550-square UNIT MIX foot site. With a location along 15th Avenue West, it has a sought-after Queen Anne address, yet enjoys the close-in amenities of Interbay. The Floorplan Number of Units Avg. Unit Size (SF) % of Unit Mix single structure includes four live-work units and four two bedroom / one Live-Work (1x1.5) 4 790 50% bath units ranging in size from 790 to 1,020 square feet. Total net rentable space equals 7,238 square feet. The property includes five parking stalls Two Bedroom / One Bath 4 1,020 50% and private decks for the upper-level apartments. Expansive windows Total / Average 8 7,238 / 905 100% provide views out towards the west. OFFERING MEMORANDUM 10 PROPERTY DESCRIPTION sqftsqft sqft sqft L L/ W/ W 1 1 808 808 1 1 L1.5 / 1.5WL / 2 W 808 2 808 1 1 1.5 1.5 LOFT LOFT LOFT LOFT DN DN DN DN UP UP UP UP LIVE-WORK LOFT 34023402 15th 15thAve W, Ave Seattle, W, Seattle, WA. 98119WA. 98119 LIVE-WORK LOFT 3402 15th Ave3402 W, 15th Seattle, Ave WA.W, Seattle, 98119 WA. 98119 1 Bd / 1.5 Ba 1 Bd / 1.5 Ba 808 SF 771 SF LISTED EXCLUSIVELY BY JLL PROPERTY DESCRIPTION 11 sqft sqft Unit 1 1020 2 1 Plan 2 1020 2 1 BEDROOM BEDROOM BEDROOM DINING LIVING DINING BEDROOM LIVING 3402 15th Ave W, Seattle, WA. 98119 3402 15th Ave W, Seattle, WA. 98119 TWO BEDROOM TWO BEDROOM 2 Bd / 1 Ba 2 Bd / 1 Ba 1,020 SF 1,020 SF OFFERING MEMORANDUM 12 PROPERTY DESCRIPTION Property Details CONSTRUCTION DETAIL CONSTRUCTION DETAIL Exterior Finish Smooth HardyPanel, HardyPlank, natural wood Cabinets Oak veneer with contemporary hardware package Roof Thermoplastic polyolefin (TPO), three solar panels on roof Counter Surfaces Quartz Framing Conventional framing Subway tile kitchen backsplash, full tile surround on tub Backsplash and shower Live/work units: 16’ 8” Ceiling Height 2x1 units: 11’ 4” Appliances Frigidaire stainless appliances, smooth top range Windows Ply Gem Sinks Undermount Sound Insulation Floor joist bays are insulated Interior Doors Single panel contemporary Flooring Vinyl plank Decks All 2x1 units MECHANICAL DETAIL Electricity and Gas All electric Plumbing PEX plumbing with low-flow, high-efficiency shower heads Water and Sewer $60 bill back per person Water Heater Electric 36 gallon hot water tank Laundry In-unit Whirlpool stackable Lighting LED lighting package Air Conditioning 2x1 units with Daiken FTX12NMVJV ductless mini split A/C Sprinkler System All units sprinklered and alarmed Heating Stiebel Eltron convection heating units COMMUNICATION DETAIL/UTILITIES Comcast, cable in all bedrooms and living rooms, control Notes panel in master bedrooms LISTED EXCLUSIVELY BY JLL PROPERTY DESCRIPTION 13 OFFERING MEMORANDUM SUBMARKET OVERVIEW SUBMARKET OVERVIEW 15 Queen Anne / Interbay QUEEN ANNE INTERBAY • Queen Anne is largely residential with historic mansions, Victorian homes and • Traditionally, Interbay has been characterized by industrial use and the BNSF craftsman style houses. It is the architectural style of the area that gave Queen Anne rail yard. However, as industrial tenants moved south to the Kent Valley, it has its name. The main business district of this “urban village” runs atop the hill, along taken on a new residential focus for Seattle’s booming multifamily market. The Queen Anne Avenue North. Sidewalks are filled with residents and visitors enjoying Interbay area is quickly emerging as a vibrant place to live for Millennials seeking the shopping and dining of this pedestrian friendly corridor. an active lifestyle. • Lower Queen Anne also features a strong business sector, with an eclectic mix of shops, • In 2007, Interbay was rezoned to 85’ feet to help promote growth in the area. bars, restaurants and cinemas, as well as period inns. Several chains are located in As Whole Foods and other popular restaurants moved into the neighborhood, Lower Queen Anne including traditional banks, grocers and drug stores. so did new residents. In the past several years, Interbay has taken on a new identity as a lively Seattle neighborhood. Flat bike paths link Interbay with the • On the cusp of Lower Queen Anne is the headquarters for the Bill & Melinda Gates Downtown Waterfront. The residents of Interbay are afforded access to several Foundation, as well the Seattle Center, site of the 1962 World’s Fair. The fairgrounds retail options in the immediate area including a popular Whole Foods. People are now home to the Space Needle, Pacific Science Center, Museum of Pop are also drawn to Interbay to golf at the city-owned nine-hole course, or to Culture, KeyArena, Chihuly Glass and Garden Center and the north terminal of the watch college soccer matches at the Interbay Athletic Complex. Seattle Center monorail. Numerous festivals including Folklife, Bite of Seattle and Bumbershoot take place here every year. • Light rail is coming to Interbay as part of the Ballard Link Extension with a station to be built at West Dravus Street and 15th Avenue West. Currently in the • Queen Anne’s access to the Seattle waterfront was solidified in 2012 with the planning phase, the start of service is expected to begin in 2035.