351-353 S La Brea Ave Los Angeles, Ca 90036 Retail/Office Building Located in Greater Wilshire Subject Property
Total Page:16
File Type:pdf, Size:1020Kb
OFFERING MEMORANDUM 351-353 S LA BREA AVE LOS ANGELES, CA 90036 RETAIL/OFFICE BUILDING LOCATED IN GREATER WILSHIRE SUBJECT PROPERTY EXECUTIVE SUMMARY PROPERTY PROPERTY TYPE Retail/Office/Medical Office CONSTRUCTION TYPE Type IV - Wood Frame ASKING PRICE PROPERTY TYPE DAYTIME POPULATION FOUNDATION Concrete Slab $5,998,000 RETAIL/ 3,918,800 OFFICE BUILDING SF 6,240 SF PARCEL SIZE 4,203 SF NO. OF RETAIL UNITS 2 Tenants (3,200 SF) LOT SIZE SF AVAILABLE TRAFFIC COUNT NO. OF OFFICE UNITS 3 Office Tenants 4,203 SF 6,240 SF ±47,827/DAY NO. OF APT UNITS 2 Non-Conforming Units LEASE TYPE Month-to-Month CEILING HEIGHT 15 Feet PARKING 4 Rear Spaces YEAR BUILT March 1929 ZONING C2-1 METERS/POWER Separately Metered/200 Amp ROOF Rolled Composition TRAFFIC COUNT ±47,827 CPD 4 351-353 S LA BREA AVE | LOS ANGELES, CA 90036 INVESTMENT OVERVIEW Hudson Partners is pleased to present 351-353 S. La Brea Avenue, a mixed-use retail/office building ideally located adjacent to the prime corner of 3rd and La Brea in one of the most desirable neighborhoods of Los Angeles. The art-deco designed building, built in 1929 and renovated in 1990, features two ground floor retail units as well as a warehouse currently utilized as a furniture/ art studio. The ground floor units feature 15 ceiling heights and classic design elements, making them ideal for a variety of creative, retail, and showroom uses. Upstairs there are two units whose most recent permitted use is for medical office and are currently rented for short term and month-to-month apartment rentals (Buyer to verify all allowed uses). The units currently consist of a 1 bed 1 bath + den loft (currently operating as a short term rental), and a vacant, furnished studio apartment. HIGHLIGHTS • 40 Feet of Frontage on La Brea • Over 47,000 Cars Pass By Daily • 3rd & La Brea Trophy Location • Potential Live-Work Opportunity • Potential Medical Office Opportunity • Artist's Loft Configuration • Up to 90% SBA Financing Available HUDSON COMMERCIAL PARTNERS, INC. 5 PROPERTY OVERVIEW LOCATION PARKING BUILT 353 S La Brea Ave., Provides approximately 4 spaces, which 353 S La Brea Ave was built in 1929, ren- Los Angeles, CA 90036 equates to 0.64 spaces per 1,000 SF ovated multiple times and most recently in parking ratio. 1990. SITE Located on the west side of La Brea Ave, between 3rd St and 4th St, in the city of Los Angeles, CA. TRAFFIC COUNT ZONING La Brea Ave............................±47,827 CPD Per the city of Los Angeles, the property is currently zoned as C2-1. LAND AREA The property consists of 1 parcel (APN #5508-001-013) totaling 4,203 SF of land area. BUILDING AREA PARCEL MAP The subject consists of 1 building equaling to 6,240 total square feet. FRONTAGE & ACCESS The site features 40 linear feet of frontage along La Brea Ave. Access points into the building include 1 entrance off La Brea Ave. 6 351-353 S LA BREA AVE | LOS ANGELES, CA 90036 LA BREA AVE 7 HUDSON COMMERCIAL PARTNERS, INC. USER OCCUPANCYZIMAS COSTS MAP 75% LTV - OWNER USER ESTIMATED ANNUALIZED | USER OCCUPANCY COSTS SUMMARY TERMS DESCRIPTION ESTIMATED PSF Price $5,998,000 OPERATING EXPENSES Down Payment (25%) $1,499,500 Gross Square Feet 6,240 SF Taxes (1.25%) $74,975 $12.02 Price Per Foot On Building $961.22 Insurance $2,808 $0.45 Lot Size 4,203 SF Price Per Foot On Land $1,427.08 Utilities $10,920 $1.75 Debt Service PSF $41.02 PSF Operating Expense PSF $15.76 PSF Repairs & Maintenance $7,488 $1.20 Occupancy Cost $56.79 PSF Capital Reserves/Mic. $2,184 $0.35 After Tax Advantage $1.27 PSF Total Operating Expenses $98,375 $15.76 LOAN ASSUMPTIONS SUMMARY TERMS Debt Service $255,988 $41.02 Conventional Loan $4,498,500 Interest Rate 3.0% Total Occupancy Costs $354,363 $56.79 Amortization 20 Years Monthly Occupancy Costs $4.73 PSF Monthly Payment $21,332.39/month (before tax advantages of ownership) 8 351-353 S LA BREA AVE | LOS ANGELES, CA 90036 LEASE VS. OWN 6,240 SF 6,240 SF LEASE SCENARIO PER/SF AMOUNT OWN SCENARIO PER/SF AMOUNT LEASE ASSUMPTIONS: PURCHASE ASSUMPTIONS: Rent Per Month $1,380 Purchase Price $1,011 $1,395,000 Rent Per SF Industrial Gross $1.00 Improvement - Additional $0 $0 START-UP COSTS: Total $1,011 $1,395,000 Prepaid rent and security deposit (2 mo.'s total) $2,760 START-UP COSTS: Lessee TI costs, net of lessor TI Allowance** $0 Borrower cash down payment (10%) $279,000 Total startup costs $2,760 Estimated fees on 1st mortgage** $5,231 GROSS MONTHLY COSTS: Est. appraisal, environmental, other fees** $5,000 Rent payment $1.00 $1,380 Total startup costs $289,231 Lease operating costs** $0.50 $690 GROSS MONTHLY COSTS: MUIRFIELD RD Gross monthly cash cost $1.50 $2,070 Mortgage payment $3.94 $5,444 LEASE BENEFITS (PER MONTH): Ownership operating costs** $1.23 $1,698 Depreciation tax benefit at 35% tax rate $0.00 $0 Gross monthly cash cost $5.18 $7,142 Avg. monthly principal paydown | equity build $0.00 $0 OWNERSHIP BENEFITS - EXCEL. APPRECIATION Tax benefit on rent deduction at 35% tax rate $0.35 $483 (PER MONTH): Tax benefit on operating costs at 35% tax rate $0.18 $242 Depreciation tax benefit at 35% tax rate $0.60 $835 Lease-out income (net of tax at 35% rate) $0.00 $0 Avg. monthly principal paydown | equity build $2.26 $ 3 ,116 $0.53 $725 Tax benefit on rent deduction at 35% tax rate $0.59 $ 815 NET COST AFTER LEASE BENEFITS: $0.98 $1,346 Tax benefit on operating costs at 35% tax rate $0.43 $594 Est. appreciation benefit, per month $0.00 $0 Lease-out income (net of tax at 35% rate) $0.00 $0 NET COST AFTER LEAST BENEFITS $0.98 $1,346 Interest on startup cost difference (net of 35% tax) -$0.34 -$466 PROJECTED RENT COST IN YEAR 10 $3.55 $4,894 Net rent cost (after tax benefits at 35% rate) $1.27 $1,756 NET COST AFTER OWNERSHIP BENEFITS EXCEL APPRE: $1.63 $2,248 Assumed annual rent escalation 2.5% Est. appreciation benefit, per month $1.68 $2,325 NET COST AFTER OWNERSHIP BENEFITS INCL. APPRE: -$0.06 -$77 ANALYSIS LIMITATIONS: THIS ANALYSIS DOES NOT INCLUDE SUPPLEMENTAL INCOME STREAM FROM GROWTH IN PROPERTY VALUE & OWNER EQUITY POTENTIAL TENANTS - LOWERING OCCUPANCY COSTS SIGNIFICANTLY Assumed Annual Appreciate Rate Of: 2.0% Borrower Down Payment (20%): $279,000 Disclaimer: This sample analysis is based on a series of assumptions, including loan interest rates and annual appreciation rates, and is meant only to be illustrative in nature. The analysis is not a guarantee of any actual results of any loan or purchase PROPERTY VALUE LOAN BALANCE OWNER EQUITY transaction or ownership of any real property, all of which are subject to risks, uncertainties and assumptions that are difficult to predict and beyond our control. No warranties or representations, express or implied, are made as to the accuracy of the Year 5 $1,540,193 $883,029 $657,164 information contained herein, and same is submitted subject to the possibility of errors, omissions, change of price, rental or other conditions, withdrawal without notice, prior sale, lease or financing. We include projections, opinions, assumptions or Year 10 $1,700,497 $669,194 $1,031,303 estimates for example only, and they may not represent future performance of the property. You and your financial and legal advisors should conduct your own evaluation of the property and transaction economics. Year 15 $1,877,486 $422,159 $1,455,327 Year 20 $2,072,897 $136,770 $1,936,127 HUDSON COMMERCIAL PARTNERS, INC. 9 10 351-353 S LA BREA AVE | LOS ANGELES, CA 90036 HUDSON COMMERCIAL PARTNERS, INC. 11 12 351-353 S LA BREA AVE | LOS ANGELES, CA 90036 HUDSON COMMERCIAL PARTNERS, INC. 13 14 351-353 S LA BREA AVE | LOS ANGELES, CA 90036 HUDSON COMMERCIAL PARTNERS, INC. 15 16 351-353 S LA BREA AVE | LOS ANGELES, CA 90036 HUDSON COMMERCIAL PARTNERS, INC. 17 SNAPSHOT: LOS ANGELES Los Angeles, CA has a population of 3,918,872 and is the 2nd largest city in the United States. The population density is 8,362 per sq mi which is 3166% higher than the California average and 9129% higher than the national average. The median age in Los Angeles is 35 which is approximately 3% lower than the California average of 36. In Los Angeles, 44% of the population over 15 years of age are married, 40% speak English and 43% speak Spanish. 46% of Los Angeles residents were born in California, 15% were born out of state, 1% were born outside of the United States and 38% were foreign born. NEIGHBORHOOD CITY REGION COUNTY METRO Los Los Los Los Los Angeles Angeles Angeles Angeles Angeles DEMOGRAPHICS LOS ANGELES COUNTY The County of Los Angeles holds many disticntions. L.A. is the entertainment capital of the world, a cultural mecca boasting more than 100 museums, and a paradise of idyllic weather. From tourist attractions like the Walk of Fame's collection of stars (numbering more than 2,614 and growing by one or two a month) to career opportuni- ties like those presented in the expanding tech industry, Los Angeles County is the place to be. It is the only city LOS ANGELES LOS ANGELES COUNTY in North America to have hosted the Summer Olympics twice.