The Edge on Seventeen

THE EDGE ON SEVENTEEN 2501 W. OCOTILLO ROAD | PHOENIX, AZ | 85017 52-UNIT MULTIFAMILY INVESTMENT OPPORTUNITY OFFER SOLICITATION PROCESS PROPERTY VISITATION Prospective purchasers will have the opportunity to visit the property via pre-scheduled property tours. These tours will include access to a representative sampling of units and access to maintenance and other similar facilities. In order to accommodate the property’s ongoing operations, property visitation will require advance notice and scheduling. OFFER SUBMISSION Offers should be presented in the form of a non-binding Letter of Intent, spelling out the significant terms and conditions of Purchasers’ offers including, but not limited to (1) asset pricing, (2) due diligence and closing time frame, (3) earnest money deposit, and (4) qualifications to close. The purchase terms shall require all cash to be paid at closing. Offers should be delivered to the attention of Ryan Ash and Mike Woodrick using the email or fax number information listed below. CONTACT INFORMATION Ryan Ash Senior Managing Director Tel: 602-852-3784 [email protected] Mike Woodrick Director Tel: 602-852-3789 [email protected] ARA - Phoenix 2398 E. Camelback Road Suite 950 Phoenix, Arizona 85016 Tel: 602-252-4232 Fax: 602-252-4236 www.ARAnewmark.com 2 TABLE OF CONTENTS 03 EXECUTIVE SUMMARY 07 PROPERTY OVERVIEW 12 VALUATION SUMMARY 16 COMPARABLE SALES 22 AREA OVERVIEW 33 CONTACT EXECUTIVE SUMMARY DOWNTOWN PHOENIX CAMELBACK CORRIDOR CENTRAL CORRIDOR THE EDGE ON SEVENTEEN 4 THE OPPORTUNITY INVESTMENT HIGHLIGHTS The Edge on Seventeen is a 54-unit apartment community located in Phoenix, AZ. The property has great visibility and frontage just west of the Interstate-17 which provides residents convenient • Majority 2 Bedroom Units access to Downtown Phoenix just 10 minutes to the south. Nearby schools and parks, include SS. • 1982 Construction, Individually Metered Simon & Jude Cathedral School, Bennett Academy, Montebello Elementary School, Washington • Great Frontage and Visibility Park and Mariposa Park. The community is also within 5 minutes of two major employment and • Pool, On-Site Laundry and Leasing Office entertainment centers with Christown Spectrum Mall and Metrocenter Mall. Furthermore, within 2 miles of the community is the booming Grand Canyon University, which has recently gone • Recent Capital Improvements through a $100 million dollar renovation and has another $500 million dollar renovation planned • New Signage and Exterior Paint in the upcoming years. This provides a tremendous benefit to the local submarket through added • New Landscaping Throughout employment and educational opportunities. • New Wood Vinyl Flooring The Edge on Seventeen was constructed in 1982 of wood frame, with a stucco exterior, pitched • Painted Cabinets & Resurfaced Countertops roofs and is individually metered. The property has a great unit mix of 48 Two Bedroom/One Bath • Value Add Through Enhanced Interior units and 6 One Bedroom/One Bath units. The 89% 2 Bedroom unit mix provides an investor a Upgrades great advantage to maximize rent and offer majority 2 Bedroom units, which are in the highest • Ability to Add Washer & Dryers in Units demand. Community amenities include a pool and sundeck, on-site laundry facilities, on-site leasing office, and the community is gated. Current ownership purchased the property in 2014 • Near Booming Grand Canyon University and has done a number of improvements to the property including new exterior paint, signage, stacked stone outside office entry, reseal and stripe of parking lot, new landscaping throughout, and a majority of the units have been turned and partially upgraded with wood vinyl, painted cabinets, resurfaced countertops, appliances, and faucets and fixtures as needed. These improvements have resulted in an increase in rents of over $250 on average. Further upside in rents of $50-$100 could be achieved by an investor by implementing second generation interior upgrades. Those interiors upgrades include more modern finishes and colors as has been the trend with investors in the Central corridor and is now being pushed into the West Phoenix submarket. Furthermore, the units have the space and ability to add washer & dryers in the units, which is in high demand and could further push rent upside by $50. The Edge on Seventeen offers an investor a majority 2 bedroom unit community that has great frontage and visibility and has benefited from recent capital improvements by ownership while still providing a Buyer with further rental upside. 5 TERMS OF THE OFFERING TOTAL UNITS 54 YEAR BUILT 1982 PRICE $5,350,000 PRICE PER UNIT $99,074 RENTABLE SF 39,300 AVERAGE SF PER UNIT 728 PROFORMA CAP RATE 6.13% AVERAGE RENT PER UNIT $748 AVERAGE RENT PER SF $1.03 6 PROPERTY OVERVIEW 7 CAMELBACK CAMELBACK MOUNTAIN CORRIDOR WASHINGTON PARK THE EDGE 8 ON SEVENTEEN DOWNTOWN PHOENIX GRAND CANYON UNIVERSITY SS. SIMON & JUDE CATHEDRAL SCHOOL THE EDGE ON SEVENTEEN 9 WESTGATE GRAND CANYON ENTERTAINMENT UNIVERSITY DISTRICT SS. SIMON & JUDE CATHEDRAL SCHOOL THE EDGE ON SEVENTEEN 10 PROPERTY DETAILS SQUARE PROFORMA MARKET PROFORMA MARKET The Edge on Seventeen UNIT TYPE NO. OF UNITS FEET RENT/MONTH RENT/SQUARE FOOT Apartments 1 BED / 1 BATH 2 550 $629 $1.14 2501 W. Ocotillo Road ADDRESS: Phoenix, AZ 85017 1 BED / 1 BATH 2 550 $659 $1.20 1 BED / 1 BATH 2 550 $689 $1.25 COUNTY: Maricopa 2 BED / 1 BATH 16 750 $729 $0.97 YEAR BUILT: 1982 2 BED / 1 BATH 16 750 $759 $1.01 2 BED / 1 BATH 16 750 $789 $0.95 NUMBER OF UNITS: 54 TOTAL / AVG. 54 728 $748 $1.03 NUMBER OF 1 BUILDINGS: MECHANICAL SYSTEMS / METERING AMENITIES STORIES: 3 ELECTRICITY: Individually metered, resident paid POOL W/ SUNDECK WATER/SEWER: Owner paid SECURITY GATES RENTABLE AREA: 39,300 ON-SITE OFFICE TRASH DISPOSAL: Owner paid ON-SITE LAUNDRY AVERAGE UNIT SIZE: 728 CONSTRUCTION FEATURES • Wood Frame and Stucco LAND AREA: 1.13 acres • Pitched Roof 11 12 VALUATION SUMMARY 13 Financial Analysis Executive Summary The Edge on Seventeen Phoenix, Arizona EXECUTIVE SUMMARY PROPERTY OVERVIEW Proforma Number of Units 54 Per Unit Dollars Year Built 1982 Effective Gross Income $9,212 $497,465 List Price $5,350,000 Less: Operating Expenses 2,888 155,967 Price per Unit $99,074 Less: Capital Reserves 250 13,500 Price per Square Foot $136.13 Net Operating Income 6,074 327,998 Rentable Square Feet 39,300 Debt Service 211,439 Average Square Feet per Unit 728 Net Cash Flow (6.23%) $116,559 Average Rent per Unit $748 Average Rent per SF $1.03 Financial Return Financing Terms Down Payment $1,872,500 Proforma Cap Rate 6.13% Proposed New Loan $3,477,500 Proforma Cash on Cash Return 6.23% Loan-to-Value 65% Interest Rate 4.50% Loan Term 5 Years Amortization 30 Years Disclaimer This information has been obtained from sources believed to be reliable. While we do not doubt its accuracy, we have not verified it and make no guarantee, warranty or representation about it. It is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions or estimates used are for example only and do not represent the current or future performance of the property. The value of this transaction to you depends on tax and other factors which should be evaluated by your tax, financial and legal advisors. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs. 14 UNIT MIX AND CURRENT MARKET RENTS Unit Mix and Current Market Rents The Edge on Seventeen Phoenix, Arizona Proforma Proforma Proforma Monthly Annual Unit No. of % Unit Proforma Rent Rent Rent Total Description Units Type Sq. Ft. Rents /Sq. Ft. Total Total Sq. Ft. 1 Bdrm / 1 Bath 2 3.7% 550 $629 $1.14 $1,258 $15,096 1,100 1 Bdrm / 1 Bath 2 3.7% 550 $659 $1.20 $1,318 $15,816 1,100 1 Bdrm / 1 Bath 2 3.7% 550 $689 $1.25 $1,378 $16,536 1,100 2 Bdrm / 1 Bath 16 29.6% 750 $729 $0.97 $11,664 $139,968 12,000 2 Bdrm / 1 Bath 16 29.6% 750 $759 $1.01 $12,144 $145,728 12,000 2 Bdrm / 1 Bath 16 29.6% 750 $789 $0.95 $12,624 $151,488 12,000 Total / Avg. 54 100.0% 728 $748 $1.03 $40,386 $484,632 39,300 Unit Mix By Bedroom Type By Square Feet 1 Bed Eff 3% 2% 200 300 2% 3% 15 2 Bed 95% 800 95% Market Underwriting Analysis The Edge on Seventeen MARKETPhoenix, Arizona UNDERWRITING ANALYSIS Proforma INCOME Assumptions Gross Scheduled Rent $484,632 Gross Potential Income $484,632 Less: Vacancy (5.0%) (24,232) Total Rental Income 95.00% $460,400 Plus: Utility Income $386 $20,865 Plus: Other Income 300 16,200 Effective Gross Income $497,465 EXPENSES per unit Repairs & Maintenance $500 $27,000 Payroll 600 32,400 Administrative/Advertising 100 5,400 Utilities 822 44,418 Total Variable Expenses $2,023 $109,218 Taxes 325 17,533 Insurance 200 10,800 Management Fee 4.00% 18,416 Total Operating Expenses $2,888 $155,967 Plus: Capital Reserves 250 13,500 Total Expenses $3,138 $169,467 NET OPERATING INCOME $327,998 Debt Service New Financing - $3,477,500 (65% LTV) Debt Service (4.5% P & I) $211,439 Cash Flow After Debt Service (6.23%) $116,559 16 COMPARABLE SALES 17 COMPARABLE SALES APARTMENT NAME CITY UNITS PRICE $/UNIT $/SQ. FT. YOC SALE DATE S The Edge on Seventeen Phoenix 54 $5,350,000 $99,074 $136.13 1982 TBD 1 Garden Springs Phoenix 32 $3,775,000 $117,969 $120.38 1984 1/17/2018 2 Villa Ventura Phoenix 50 $4,500,000 $90,000 $100.00 1963 1/31/2018 3 Camelback Gardens Phoenix 26 $2,250,000 $86,538 $74.59 1983 11/14/2017 4 Crowne Point Phoenix 35 $2,975,000 $85,000 $99.17 1970 11/7/2017

Load more