S VERMONT AVE
6501 S Vermont Avenue 20 Unit Value-Add Investment Opportunity in South Los Angeles Consisting of 18 Singles & 2 One-Bedroom Apartment Units 26% Rental Upside | 11.39 Current GRM | $134,750 per Unit CONFIDENTIALITY AND DISCLAIMER
The information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCB’s or asbestos, the compliance with State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein.
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EXCLUSIVELY LISTED BY:
NEEMA AHADIAN LEO LATERZA Senior Managing Director of Investments Senior Associate of Investments Tel: (310) 909-5444 Tel: (310) 909-2372 [email protected] [email protected] License: CA 01346750 License: CA 01861324 01 EXECUTIVE SUMMARY
02 INVESTMENT HIGHLIGHTS
03 FINANCIALS
04 SALES COMPARABLES W 65TH ST
W 66TH ST
S VERMONT AVE 6501 S Vermont Avenue
Executive Summary
The Neema Group of Marcus & Millichap is pleased to present Four units have recently been renovated with new flooring, ceiling 6501 S Vermont Ave, a 20-unit investment opportunity located on fans, a stainless steel kitchen refrigerator and oven, countertops, the main thoroughfare of Vermont Ave in South Los Angeles just and a fresh coat of paint. In addition, there is community laundry south of W Gage Ave with easy access to the 110 Freeway. for the building.
Built in 1928, this true value-add building is currently leased at Vermont Harbor is a densely populated neighborhood in South below market rents and presents an investor the opportunity to Los Angeles just below USC and Exposition Park. The location attain over 26% in rental upside. provides convenient access to the 110 Freeway and Downtown Los Angeles. The subject property is located nearby Vermont The unit mix consists of 18 singles and 2 one-bedrooms Gage Pocket Park, John Muir Middle School, Augustus Hawkins apartment units. Furthermore, there are preliminary plans in place High School, and the Vermont Slauson Shopping Mall. to add ADU’s.
The subject property is being offered at a 11.39 GRM on current income with a pro forma CAP rate of 6.15%. DOWNTOWN LA
EXPOSITION PARK
BUDLONG AVENUE JOHN MUIR VERMONT/SLAUSON AUGUSTUS HAWKINS ELEMENTARY SCHOOL MIDDLE SCHOOL SHOPPING MALL HIGH SCHOOL
VERMONT/GAGE POCKET PARK
S VERMONT AVE Property Summary
PROPERTY INFORMATION PRICING INFORMATION
6501 S Vermont Ave Sales Price $2,695,000 Address Los Angeles, CA 90042 Cost per Legal Unit $134,750 Number of Units 20 Cost per Bldg SF $309 Approx. Gross SF 8,734 Current GRM 11.39 Approx. Lot Size 4,053 Market GRM 9.05 Year Built/Renovated 1928 Current CAP 4.08% APN 6014-005-001 Market CAP 6.15% Zoning LAC2
6501 S Vermont Avenue
20 Unit Value-Add Investment Opportunity
Consisting of 18 Singles & 2 One-Bedroom Apartment Units
26% Rental Upside | 11.39 GRM | $134,750 per Unit S VERMONT AVE
W 65TH ST 20 18 2 UNITS SINGLES 1+1
Investment Highlights
• The Neema Group of Marcus & Millichap is pleased to present 6501 • Four units have recently been renovated with new flooring, ceiling S Vermont Ave, a 20-unit investment opportunity located on the fans, a stainless steel kitchen refrigerator and oven, countertops, main thoroughfare of Vermont Ave in South Los Angeles just south and a fresh coat of paint. In addition, there is community laundry for of W Gage Ave with easy access to the 110 Freeway. the building.
• Built in 1928, this true value-add building is currently leased at • Vermont Harbor is a densely populated neighborhood in South Los below market rents and presents an investor the opportunity to Angeles just below USC and Exposition Park. The location provides attain over 26% in rental upside. convenient access to the 110 Freeway and Downtown Los Angeles. The subject property is located nearby Vermont Gage Pocket Park, • The unit mix consists of 18 singles and 2 one-bedrooms apartment John Muir Middle School, Augustus Hawkins High School, and the units. Furthermore, there are preliminary plans in place to add Vermont Slauson Shopping Mall. ADU’s.
• The subject property is being offered at a 11.39 GRM on current income with a pro forma CAP rate of 6.15%.
Potential ADU Additions
Ownership currently has preliminary plans to add two ADU’s (392 SF & 508 SF) in the existing storage area of the building. Opportunity for an investor to take over the plans and further increase the NOI upon approval.
Rent Roll
UNIT # UNIT TYPE ACTUAL RENTS PROFORMA RENTS NOTES
1 Single $1,200 $1,200 Will be Vacant 2 Single $1,095 $1,200 3 Single $954 $1,200 4 Single $1,095 $1,200 5 1+1 $965 $1,375 6 Single $864 $1,200 7 Single $1,095 $1,200 8 Single $780 $1,200 9 Single $909 $1,200 10 Single $965 $1,200 11 Single $864 $1,200 12 Single $1,095 $1,200 13 1+1 $885 $1,375 Section 8; On-Site Manager* 14 Single $860 $1,200 15 Single $760 $1,200 16 Single $802 $1,200 17 Single $802 $1,200 18 Single $1,200 $1,200 Will be Vacant 19 Single $1,095 $1,200 20 Single $965 $1,200 Total $19,249 $24,350 Single $17,399 *On-site manager is a section 8 tenant. Current compensation for management is the ownership paying the tenant’s portion of the rent ($513 per month). 1+1 $1,850 Total $19,249 Financials
OPERATING DATA CURRENT RENTS MARKET RENTS
Scheduled Gross Income: $236,651 $297,862
Less Vacancy Rate Reserve: $(11,833) 5.0% $(14,893) 5.0%
Gross Operating Income: $224,819 $282,969
Less Expenses: $(114,979) 48.6% $(117,306) 39.4%
Net Operating Income: $109,839 $165,663
Reserves: $(4,000) $(4,000)
Less Debt Service: $(87,133) $(87,133)
Pre-Tax Cash Flow: $18,707 1.7% $74,531 6.9%
Plus Principal Reduction: $31,323 $31,323
Total Return Before Taxes: $50,030 4.6% $105,854 9.8%
Current Market Rents MONTHLY MONTHLY MONTHLY MONTHLY NUMBER OF UNITS UNIT TYPE APPROX SF RENT/UNIT INCOME RENT/UNIT INCOME
18 Single 456 $967 $17,399 $1,200 $21,600
2 1+1 540 $925 $1,850 $1,375 $2,750
Total Scheduled Rent $19,249 $24,350
Storage $300 $300
RSO $72 $72
Laundry $100 $100
Monthly Scheduled Gross Income: $19,721 $24,822
Annual Scheduled Gross Income: $236,651 $297,862 Financials
EXPENSES % CURRENT PROFORMA PRICING
Taxes: 1.20% $32,340 $32,340 Price: $2,695,000
Insurance $9,962 $9,962 Down Payment: 40% $1,078,000
Utilities: $32,617 $32,617 Number of Units: 20
Waste Removal $7,416 $7,416 Cost per Legal Unit: $134,750
Repairs & Maintenance $10,000 $10,000 Current GRM: 11.39
Elevator 4% $1,500 $1,500 Market GRM: 9.05
Management $8,993 $11,319 Current CAP: 4.08%
Cleaning $3,300 $3,300 Market CAP: 6.15%
Pest Control $420 $420 Approx. Age: 1928
On Site Manager $6,156 $6,156 Approx. Lot Size: 4,053
License & Fees $1,000 $1,000 Approx. Gross SF: 8,734
Direct Assessment $1,276 $1,276 Cost per Net GSF: $309
Total Expenses: $114,979 $117,306 NEW POTENTIAL FINANCING Per Net Sq. Ft.: $13.16 $13.43 New First Loan: $1,617,000 Per Unit: $5,749 $5,865 Interest Rate: 3.50% Amortization: 30 Monthly Payment: $7,261 DCR: 1.26 W 66TH ST
W 65TH ST
S VERMONT AVE
W 65TH ST Sales Comparables
01 02
ADDRESS 6501 S Vermont Ave ADDRESS 4270 Leimert Blvd ADDRESS 837-839 W 43rd Pl Los Angeles, CA 90044 Los Angeles, CA 90008 Los Angeles, CA 90037
SALES PRICE $2,695,000 SALES PRICE $1,550,000 SALES PRICE $1,500,000 PRICE/UNIT $134,750 PRICE/UNIT $193,750 PRICE/UNIT $166,667 BLDG SF 8,734 BLDG SF 4,775 BLDG SF 5,834 LOT SIZE 4,053 LOT SIZE 5,227 LOT SIZE 6,534
UNIT MIX 18 Singles UNIT MIX 4 Singles UNIT MIX 8 Singles 2 1+1 4 1+1 1 2+1
CAP RATE 4.08% CAP RATE 4.00% CAP RATE 3.28% DATE SOLD - DATE SOLD On-Market DATE SOLD 3/5/21 03 04 05
ADDRESS 2501-2515 W 54th St ADDRESS 923-929 W 75th St ADDRESS 1182 E 52nd St Los Angeles, CA 90043 Los Angeles, CA 90044 Los Angeles, CA 90011
SALES PRICE $2,875,000 SALES PRICE $1,629,000 SALES PRICE $1,195,000 PRICE/UNIT $191,667 PRICE/UNIT $148,091 PRICE/UNIT $149,375 BLDG SF 15,036 BLDG SF 7,209 BLDG SF 4,490 LOT SIZE 10,890 LOT SIZE 11,208 LOT SIZE 17,441 3 Singles 3 1+1 UNIT MIX 15 2+1 UNIT MIX 5 1+1 UNIT MIX 5 2+1 3 2+1 CAP RATE N/A CAP RATE N/A CAP RATE 4.61% DATE SOLD 11/13/20 DATE SOLD 6/15/20 DATE SOLD 2/6/20 Sales Comparables (Cont.)
06
ADDRESS 2417 W Vernon Ave Los Angeles, CA 90008
SALES PRICE $1,960,000 PRICE/UNIT $163,333 BLDG SF 6,624 LOT SIZE 12,502
UNIT MIX 6 Singles 6 1+1
CAP RATE 4.50% DATE SOLD 1/10/20 1 2 6
5 3
4 AREA OVERVIEW
SOUTH LOS ANGELES
Vermont Harbor is a densely populated neighborhood in the city of Los Angeles just below USC and Exposition Park. The location provides convenient access to the 110 Freeway and Downtown Los Angeles. The subject property is located nearby Vermont Gage Pocket Park, John Muir Middle School, Augustus Hawkins High School, and the Vermont Slauson Shopping Mall.
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. S VERMONT AVE
6501 S Vermont Avenue 20 Unit Value-Add Investment Opportunity in South Los Angeles Consisting of 18 Singles & 2 One-Bedroom Apartment Units 26% Rental Upside | 11.39 Current GRM | $134,750 per Unit