BRANDON MICHAELS GROUP

1936 HILLHURST AVENUE , CA 90027

OFFERING MEMORANDUM La La Casting Investment Advisors BRANDON MICHAELS Sr. Managing Director Investments Director, National Retail Group Tel: (818) 212-2794 Fax: (818) 212-2710 [email protected] License: CA #01434685

ANDREW LEFF Senior Associate Director, National Retail Group Tel: (818) 212-2815 Fax: (818) 212-2710 [email protected] License: CA: 01865688 BRANDON MICHAELS GROUP

2 3 I. EXECUTIVE SUMMARY

Contents II. PROPERTY OVERVIEW

III. INVESTMENT HIGHLIGHTS Maru Coffee IV. FINANCIALS

V. SALES COMPARABLES

4 5 Executive Summary

Marcus & Millichap is pleased to present the opportunity to purchase 1936 Hillhurst Avenue, a 2,765 square-foot multi-tenant mixed use retail & office building located in the heart of Los Feliz Village, one of L.A.’s most trendy and walkable commercial districts.

1936 Hillhurst Avenue is currently 100% occupied. Maru Coffee, the solitary retail tenant, began its occupancy in 2016 and has quickly become the go-to coffee spot on Hillhurst Avenue, and is regarded by many as the best coffee in Los Feliz. The remainder of the property consists of office space tucked behind the coffee shop, with indi- vidual access to each unit and private, gated parking in the rear of the property. The property has been meticulous- ly maintained and improved over time and the attention to detail along with the small unit sizes makes the property extremely attractive to a wide variety of potential tenants.

The property is ideally positioned along Hillhurst Avenue, north of Franklin Avenue and south of Clarissa Avenue, directly next door to the popular Mustard Seed Café. The property is surrounded by a variety of unique shopping and dining destinations, bars, a neighborhood movie house, an independent bookstore, under-the-radar boutiques, and a number of longstanding local business- es, which give Los Feliz its distinctive small town vibe.

1936 Hillhurst Avenue offers an investor the unique oppor- tunity to purchase a prime asset along a coveted street Maru Coffee where properties rarely change hands. Los Feliz is well-lo- cated in Los Angeles, just minutes away from Downtown Los Angeles, , and Silver Lake. Rapid develop- ment in these bordering neighborhoods will further add value to the immediate area over time.

7 hillhurst avenue hillhurst 1936 HILLHURST AVENUE LOS ANGELES, Property CA 90027 Overview

franklin avenue 1936 Hillhurst Avenue, ADDRESS Los Angeles, CA 90027

ASKING PRICE $2,250,000

CURRENT CAP RATE 2.77%

PROFORMA CAP RATE 5.29%

PRICE/SF (BLDG) $814

BLDG SF 2,765 SF

LOT SIZE 6,752 SF

APN 5590-011-009

YEAR BUILT 1925

ZONING LAC4

TYPE OF OWNERSHIP Fee Simple

1936 Hillhurst Avenue is surrounded by a variety of unique shopping and dining destinations, and a number of 1936 Hillhurst Avenue longstanding local businesses, which give Los Feliz it’s distinctive small town vibe.

8 9 Los Feliz

10 11 Investment Highlights

IRREPLACEABLE LOS FELIZ LOCATION Located at the heart of Los Feliz on Hillhurst Avenue. Hillhurst Avenue is the main retail corridor in Los Feliz. The walkable district includes trendy and hip restaurants and eateries like Alcove, Mustard Seed Cafe, Jeni’s Splendid Ice Creams, Blue Bottle Coffee, and more. Healthworks

UNIQUE AND WALKABLE NEIGHBORHOOD Hillhurst Avenue and are home to a variety of unique retailers including independent bookstores, local businesses, upscale shopping, dining, and nightlife.

STABLE AND SECURE INCOME 1936 Hillhurst Avenue is 100% occupied. Each tenant has 3% annual rental increases.

POPULAR RETAIL TENANT The retail tenant, Maru Coffee, is regarded as one of the best coffee shops in Los Feliz by coffee aficionados. Maru Coffee is currently expanding and opening a second location in the Arts District of Downtown Los Angeles due to its success in Los Feliz.

FUTURE POTENTIAL All tenants have 3 years or less remaining plus options, however leases can be restructured at landlords discretion at option period.

RARE ASSET ON THE MARKET Few assets exchange in the immediate submarket, especially store-front retail.

DENSE AND AFFLUENT DEMOGRAPHICS The population within a 5-mile radius is 1,038,340 and average household income within a one-mile radius is $82,049.

12 13 Property Information

Location Frontage and Access APN’s 1936 Hillhurst Avenue, Los Angeles, Approximately 51 feet of frontage on The APN is 5590-011-009. CA 90027 Hillhurst Avenue.

Traffic Counts Site Year Built Hillhurst Avenue: The subject property is just south The property was built in 1925. 27,080 vehicles per day of the southwest corner of Clarissa Avenue and Hillhurst Avenue. Franklin Avenue: Zoning 18,214 vehicles per day The zoning is LAC4.

Square Footages Parking The building square footage is 2,765 Six spots in the rear. SF on a 6,752 SF lot.

Occupied Property Type

100% Retail Office

Year Built Location Bldg SF 1925 Los 2,765 Feliz SF

14 15 MARU COFFEE HOLISTIC HEALING THERAPY

16 17 HEALTHWORKS LA LA CASTING

18 19 Financials RENT ROLL

LEASE LEASE CURRENT PROFORMA PROFORMA TENANT UNIT SF % OPTIONS RENT/SF INCREASES ANNUALIZED OPERATING DATA START EXPIRE RENT RENT RENT/SF

Maru Coffee 1936 700 25% 4/1/2016 3/31/2020 1-4 Year** $3,713.00 $5.30 $4,550.00 $6.50 3% Ann INCOME AND EXPENSE % CURRENT % PROFORMA

Scheduled Lease Income $95,897 $136,092.00

LaLa Casting 1938 800 29% 11/1/2008 12/31/2019 1-3 Year** $690.00 $2.10 $2,600.00 $3.25 3% Ann NNN Charges: $1,797 65% NNN $23,135.38

Effective Gross Income: $97,694 $159,227.38 Deborah Dion 1938 0% 11/1/2013 12/31/2019 1-3 Year** $690.00 3% Ann Vacancy 3% 3% $4,776.82

Casting Expenses $35,433 $35,433 1938 0% $300.00 3% Ann Studio* Net Operating Income $62,261 $119,017

Healthworks 1940 960 35% 4/1/2011 3/31/2021 1-5 Year*** $1,632.42 $1.70 $3,120.00 $3.25 3% Ann

Suzanne 1940 306 11% 8/10/2014 12/31/2019 1-3 Year** $966.00 $3.16 $1,071.00 $3.50 3% Ann EXPENSES ANNUAL PER SF Glickman 1/2 Taxes: 1.25% $27,000 $9.98 TOTAL 2,766 100% $7,991.42 $2.89 $11,341.00 $4.10 Insurance $1,383 $0.50

*Casting Studio rented by the day - Rent noted is monthly average Utilities $1,797 $0.65 **Option to renew at NEW MONTHLY RENT and TERMS Repairs & Maintenance $1,936 $0.70 ***Option to renew at FMV. All other Terms and Conditions shall remail the same. Trash $1,106 $0.40

Security 691.25 $0.25

Misc $968 $0.35

Reserves $553 $0.20

Total Expenses $35,433 $12.81/ $1.07

20 21 SALES COMPARABLES PRICE/SF Sales Comparables

CLOSE OF YEAR CAP # ADDRESS SALE PRICE PRICE/SF BLDG SF LOT SF ESCROW BUILT RATE

1922 Hillhurst Avenue, 1 $2,500,000 $1,008.06 2,480 6,752 3/3/2017 1959 Los Angeles

1922 1930 3128 W. 3709 W. 1410 N. Virgil 4889 Hillhurst Hillhurst Sunset Sunset Street, Los Melrose Average Avenue, Los Avenue, Los Boulevard, 1930 Hillhurst Avenue, Boulevard, Angeles Avenue, Los 2 $5,000,000 $1,818.18 2,750 6,752 3/3/2017 1922 Angeles Angeles Los Angeles Los Angeles Angeles Los Angeles

1 3128 W. Sunset 2 3 $2,500,000 $1,039.93 2,404 11,962 12/14/2016 1974 Boulevard, Los Angeles

3709 W. Sunset 1934/ 4 $13,300,000 $1,267.03 10,497 15,717 1/12/2017 4.79% Boulevard, Los Angeles 2016

5 1410 N. Virgil Street, Los 5 $700,000 $1,120.00 625 3,084 11/15/2017 1932 Angeles

4889 , 6 $1,700,000 $809.52 2,100 6,490 3/14/2016 1917 Los Angeles 4

Average $4,283,333 $1,177.12 3,476 8,460

3 6

22 23 Area Overview The neighborhood of Los Feliz is a rare spot in Los Angeles that fosters a diverse, yet cohesive, creative community.

Los Feliz is a hillside neighborhood in the central region Los Feliz Village is the southern section of Los Feliz, of Los Angeles, California, abutting Hollywood and home to most of the commercial storefronts in the encompassing part of the Santa Monica Mountains. district. It is centered on the thoroughfares of Vermont and Hillhurst Avenues and spans from about Prospect The neighborhood is named after its colonial Spanish- Avenue to Los Feliz Boulevard. There are several coffee Mexican land grantee, José Vicente Feliz, and, along shops, restaurants, and small clothing and vintage with present-day , makes up the original stores. Los Feliz Village is home to numerous bars Rancho Los Feliz land concession. According to the and restaurants catering to nightlife. They are mostly Mapping L.A. project of the Los Angeles Times, Los on Hillhurst Avenue between Los Feliz Boulevard and Feliz is part of Central Los Angeles. It is flanked on Prospect Avenue, and on Vermont Avenue between the north by Griffith Park, on the northeast by Atwater Franklin Avenue and . Some were Village, on the southeast by Silver Lake, on the south classic dive bars in their heyday, frequented by the Los Feliz Village: One of LA’s most walkable commercial districts, this collection by East Hollywood, and on the northwest by Hollywood likes of Charles Bukowski, Lawrence Tierney, sundry and Hollywood Hills. With over 4,210 acres of both working-class drunks, poets, artists, writers, and other of historic storefronts along Vermont and Hillhurst Avenues has it all, including natural chapparal-covered terrain and landscaped creative types. parkland and picnic areas, Griffith Park is one of the largest municipal parks with urban wilderness areas restaurants, a neighborhood movie house, an independent bookstore, and hip in the United States and home to the famed . clothing boutiques.

24 25 UNIQUE RETAILERS Area Overview

Glaze Fire Jeni’s Splendid Ice Cream Vista Theatre

LOS FELIZ’S RETAIL AND DINING

RESTAURANTS COFFEE SHOPS SHOPPING • Messhall Kitchen • House of Pies • Lou Wine Shop • Stamp Proper Foods • Bru Coffeebar • Box Brothers Los Feliz • Little Dom’s • Starbucks • Spitfire Girl • Mexico City • Qwench Juice Bar • Glaze Fire • Cafe Los Feliz • Blue Bottle Coffee • Vamp Shoes • Yuca’s • The Coffee Bean and Tea leaf • Jasmine Garden • Farfalla • H Coffee House • Half Off Clothing Store • Alcove • Earth Organic Juice Bar • Leap Alcove Mustard Seed Diner Cafe Los Feliz • Qwench Juice Bar • Maru Coffee • J H Collection • Daily Donuts • House of Pies • Kingswell • Mustard Seed Cafe • The hanging Company • Simply Thai • Co-op 28 POINTS OF INTEREST • Ye Rustin Inn • TUb Tim Siam • Barnsdall Art Park • Green Leaves Vegan • Improv Studio • Home Restaurant • Los Feliz Theatre • Desert Rose • Skylight Theatre Company • Spitz • Skylight Books • Butter Cake Shoppe • Griffith Observatory • Tacos Tu Madre • The Greek Theatre Home Kismet Skylight Books • Palermo Italian • Figaro Bistrot • The Dresden • 1739 Public House • Casual Public Los Feliz’s scenic hillsides give way • Starfish Sushi • Sidewalk Grill to a hip and colorful commercial • Rockwell Table & Stage • Juan the Nice Bartenders Place district below with one-of-a-kind shops and dining. Dresden Go Get Em Tiger Los Feliz Theatre

26 27 Area Overview

Griffith Observatory

DEMOGRAPHICS

1 MILE 3 MILES 5 MILES Many of Los 2014 Population 44,260 373,721 1,038,340 Feliz’s hilltop 2014 Households 21,700 153,780 421,335 2014 Average Household Size 1.98 2.38 2.40 homes host 2014 Daytime Population 9,690 108,314 546,486 celebrity 2014 Owner Occupied Housing Units 22.51% 17.7 1% 19.96% inhabitants. 2014 Renter Occupied Housing Units 7 7.49% 82.29% 80.04% 2014 Vacant 1.19% 2.68% 3.19%

$ 0 - $14,999 18.4% 19.3% 20.5% $ 15,000 - $24,999 11.9% 15.8% 15.1% Los Feliz’s cafes, $ 25,000 - $34,999 9.8% 12.6% 11.6% $ 35,000 - $49,999 12.4% 14.1% 13.4% diners, and envelope- $ 50,000 - $74,999 15.2% 15.5% 15.0% pushing culinary $ 75,000 - $99,999 9.2% 7.8% 8.1% artists contribute to $100,000 - $124,999 7.4% 5.3% 5.6% $125,000 - $149,999 4.0% 2.9% 3.2% the neighborhood’s $150,000 - $199,999 4.4% 2.9% 3.2% chic reputation. $200,000 - $249,999 2.7% 1.4% 1.5% $250,000 + 4.7% 2.5% 2.8%

2014 Median Household Income $47,011 $37,165 $37,862 2014 Per Capita Income $40,781 $25,768 $26,715 2014 Average Household Income $82,049 $61,733 $64,618

28 29 BRANDON MICHAELS GROUP

BRANDON MICHAELS Sr. Managing Director Investments Director, National Retail Group Tel: (818) 212-2794 Fax: (818) 212-2710 [email protected] License: CA #01434685

ANDREW LEFF Senior Associate Director, National Retail Group Tel: (818) 212-2815 Fax: (818) 212-2710 [email protected] License: CA: 01865688