EXCLUSIVE INVESTMENT OFFERING Sandpiper Apartments 488 Units | Las Vegas, NV EXCLUSIVE CONTACTS Patrick Sauter Art Carll-Tangora Antone Brazill, CCIM Managing Partner Senior Partner Senior Partner | Land 8945 W Russell Road T +1 702 534 1700 T +1 702 534 1701 T +1 702 278 3886 Las Vegas, NV 89148 [email protected] [email protected] [email protected] T +1 702 383 3383 www.naivegas.com OFFERING MEMORANDUM Table Of Contents Executive Summary 7 Location Overview 10 Property Description 14 Financial Analysis 20 Sale & Rent Comparables 25 Las Vegas Overview 30 NAI Vegas Team & Terms 46 EXECUTIVE SUMMARY THE OPPORTUNITY NAI Vegas has been exclusively retained to market and offer for sale the Sandpiper Apartments, a highly desirable 2-story garden rental community in the heart of Las Vegas. This unique building offers modernly designed one and two bedroom floorplans. All common areas have been expertly designed including three resort style pools and spa, community clubhouse, 24 hour fitness center, gated access, pet park, and much more. The floorplans offer convenient full-size washer and dryer, granite countertops*, garden tubs, and walk-in closets. Sandpiper offers the investor an opportunity to add significant value to the property through formalizing and completing the interior upgrades, upgrading and modernizing common area amenities and actively reducing the loss to lease. Current market rents for a fully upgraded unit are currently significantly below submarket comparable for lesser upgraded units. 65% of the units have been renovated with granite countertops with the balance being standard units (No Upgrades). It is estimated that an investor will be able to capture over $550,000 annually in additional revenue by completing the interior renovations and increasing rents to the comparable properties in the submarket. It is estimated that Sandpiper’s asking rents on the one bedroom units are over $120 per month below the comparable units and the two bedroom unit rents are over $70 below comparable units. THE OFFERING Offering Market Price 4650 W. Oakey Blvd. Address Las Vegas, NV Year Built 1988 Number of Units 488 Land Size 20.50 AC Net Rentable SF 440,400 SF Average Unit Size 902 SF In-Place $913 Average Rent Physical Occupancy 94% "The Strip" LV Downtown Southwest Healthcare Center S. Decatur Blvd. EXCEPTIONAL LOCATION, DESIRABLE COMMUNITY The Sandpiper Apartments is a 488-unit luxury apartment complex located in the Clark County city of Las Vegas, Nevada. The property features a strong mix of one-bedroom/one-bathroom and two-bedroom/two-bathroom units, which are located within 61 residential buildings. Constructed in 1987, this in-fill community features well-amentitized unit interiors, three pools and spas, a 1,500-square-foot fitness room, and well-maintained landscaping. S. Decatur Blvd. PROPERTY DESCRIPTION PROPERTY DESCRIPTION Units: 488 4650 W. Oakey Blvd. Address: Las Vegas, NV 162-06-201-001 Parcel Number: 162-06-201-002 162-06-201-007 Year Completed: 1988 Land Size: 20.50 AC Net Rentable SF: 440,400 SF Average Unit Size: 902 SF Average Rent: $914 Physical Occupancy: 93% Floorplans: 2 Zoning: R-3 Multifamily Total:1,038 Parking Spaces: Covered: 488 Open: 550 PROPERTY AMENITIES The Sandpiper Apartments is part of community with mountain views and centrally located only minutes away from the Las Vegas Strip. Some of our amenities include: 3 tropical lagoon-style swimming pools and outdoor Jacuzzi to ease the day's stresses away, two lighted tennis courts, and a 1,500 square foot fitness center with free weights. These large apartment homes include refaced kitchen cabinets, granite counter tops, two-tone accent paint, large bath tubs, spacious oversized- closets, ceiling fans and in-home washer and dryer. PRIVATE SPACES: • Air Conditioning SOCIAL SPACES: • Controlled Access • Balcony, Patio, Deck • Disability Access • Cable Ready • Emergency Maintenance • Ceiling Fan(s) • Extra Storage • New/Renovated Interior • Fitness Center • Oversized Closets • Gated Access • Some Utilities Covered • Hot Tub • View • On Site Maintenance • On Site Management • Pool FLOOR PLANS A1- One Bedroom/One Bath 750 SF FLOOR PLANS B1- Two Bedrooms/Two Baths 1050 SF Aerial FINANCIAL ANALYSIS UNIT MIX TOTAL RENT Upgraded units comprise: UNIT TYPE SQFT MARKET RENTS* UNITS PER SF • Granite counter tops 1x1 73 750 $830 $1.11 • Stainless steel sinks • Refurbished cabinets with hardware 1x1 Upgraded** 167 750 $830 $1.11 • New plumbing and light fixtures 2x2 90 1050 $995 $0.95 • Refurbished bathrooms in select units 2x2 Upgraded 158 1050 $995 $0.95 AVERAGE 488 902 $914 $1.01 *Rents Include $30 a month for utility reimbursement. **Currently all rents are increased to upgraded rent upon resident vacating. FINANCIAL ANALYSIS Pro Forma Year 1 Pro Forma Operating Income T3 Nov. 17 Per Unit Per Unit Per Unit Current Collections (4% Growth) Market Rent $5,565,581 $11,405 Loss to Lease $(222,623) $(456) GPRI/Economic Rent $4,780,416 $9,796 $5,342,958 $10,949 Vacancy Loss $(267,148) $(547) Bad Debt/Other $(106,859) $(219) Model/Admin Units $(26,715) $(55) Net Rental Income $4,726,363 $9,477 $4,780,416 $9,796 $4,942,236 $10,128 Other Income $159,505 $303 $159,505 $327 $247,112 $506 Effective Gross Income (EGI) $4,772,620 $9,780 $4,939,921 $10,123 $5,189,348 $10,634 Pro Forma Year 1 Pro Forma Forecasted Expenses T3 Nov. 17 Per Unit Per Unit Per Unit Current Collections (4% Growth) Payroll $461,953 $947 $512,400 $1,050 $512,400 $1,050 Administration $115,078 $236 $122,000 $250 $122,000 $250 Management $143,179 $293 $155,680 $319 $155,680 $319 Repairs & Maintenance $350,101 $717 $146,400 $300 $146,400 $300 Utilities $392,566 $804 $404,343 $829 $403,200 $826 Advertising $28,733 $59 $24,400 $50 $24,400 $50 Landscape $48,383 $99 $48,800 $100 $48,800 $100 Insurance $84,276 $173 $85,400 $175 $85,400 $175 Property Tax (Actual) $215,599 $442 $224,223 $459 $224,151 $459 Turnover $0 $0 $122,000 $250 $122,000 $250 Expenses with Reserves $1,839,868 $3,770 $1,845,646 $3,782 $1,844,598 $3,780 Pro Forma Year 1 Pro Forma Net Operating Income T3 Nov. 17 Per Unit Per Unit Per Unit Current Collections (4% Growth) NOI $2,932,752 $6,010 $3,094,275 $6,341 $3,344,750 $6,854 NOTES TO FINANCIAL UNDERWRITING Assumptions for the proforma are based on the Property’s characteristics, as well as market-driven revenue and expense trends. REVENUE • Year 1 Proforma Gross Potential Income is generated using the current Market Rent Schedule plus 4% growth. • Proforma Economic Vacancy is 10.5% • Other income is estimated at $42 per unit per month. FORECASTED EXPENSES • Payroll is forecasted at the equivalent of $1,050 per unit per year reflecting market expense for staffing requirements of a manger, leasing agents, maintenance supervisor, maintenance techs and porters. • Administration is forecasted at $250 per unit per year reflecting market averages for similar properties. • Management fees are forecasted 3% of Gross Operating Income • Repairs & Maintenance expenses are forecasted at $300 per unit per year, consistent with market averages for similar size, age, and construction quality. • Utilities are forecasted to be the actual utility amount with a 3% increase. • Advertising expenses are forecasted to be $50 per unit per year • Property Insurance is forecasted to be $175 per unit per year • Property Tax are calculated on the current amount plus 4%. • Turnover expenses are forecasted to be $250 per unit per year consistent with market averages for properties similar in age on overall condition. SALE & RENT COMPARABLES SALE COMPARABLES S SANDPIPER 1 THE BRISTOL AT SUNSET 2 2051 APARTMENTS 3 FLAMINGO CHATEAU 4 INDIAN RIDGE PROPERTY 4650 W Oakey Blvd 2001 Ramrod Ave 2150 N Tenaya Way 6570 W Flamingo Rd 9353 West Twain Ave ADDRESS YEAR BUILT 1988 1989 1990 1992 1996 NUMBER OF UNITS 488 432 440 136 184 NET 440,400 358,216 424,808 117,584 169,312 RENTABLE AREA MANAGEMENT Apple Management Alliance Pinnacle Self Olen COMPANY % LEASED 93% 95% 92% 96% 95% DATE SOLD TBD 9/29/17 9/13/17 5/22/2017 5/21/2017 SALES PRICE Market Price $58,250,000 $58,200,000 $16,600,000 $22,500,000 PRICE PER UNIT TBD $134,838 $132,273 $122,059 $122,282 PRICE PER SQUARE TBD $151.21 $137.00 $141.18 $132.89 FOOT SALE COMPARABLES MAP S Sandpiper 1 The Bristol at Sunset 2 2051 Apartments 3 Flamingo Chateau 2 4 Indian Ridge S 4 3 1 RENT COMPARABLES S SANDPIPER 1 INDIAN HILLS 2 FIFTY 101 3 THE ARBORS 4 SHELTER COVE 4650 W Oakey Blvd 4550 W Sahara Ave 5101 O'Bannon Dr 1600 S Valley View Blvd 2683 S Decatur Blvd Built 1988 Built 1988 Built 1989 Built 1988 Built 1988 488 Units 484 Units 90 Units 216 Units 304 Units # PROPERTY NAME TOTAL # OF UNITS TYPE UNIT SIZE RENT** PER SF 1 Indian Hills Upgraded 484 N/A 700 $965 $1.38 3 Fifty 101 90 16 695 $955 $1.37 2 Shelter Cove Upgraded 304 N/A 700 $955 $1.36 4 The Arbors Upgraded 216 N/A 688 $900 $1.31 5 Indian Hills 484 192 700 $865 $1.24 1BED 6 Shelter Cove 304 150 700 $870 $1.24 5 Sandpiper Upgraded 488 200 750 $830 $1.11 6 The Arbors 216 48 688 $800 $1.16 # PROPERTY NAME TOTAL # OF UNITS TYPE UNIT SIZE RENT** PER SF 1 Indian Hills Upgraded 484 292 1035 $1,090 $1.05 2 Shelter Cove Upgraded 304 N/A 1035 $1,075 $1.04 3 Fifty 101 90 50 935 $1,055 $1.13 4 Sandpiper Upgraded 488 288 1050 $995 $0.95 2 BED 5 The Arbors 216 120 988 $985 $0.91 6 Shelter Cove 304 154 1035 $975 $0.94 *Rents Quoted December 2017 ** Rent includes all RUB'S charges RENT COMPARABLES MAP S 2 1 4 3 S Sandpiper 1 Indian Hills 2 Fifty 101 15 3 The Arbors 4 Shelter Cove LAS VEGAS OVERVIEW HIGHLIGHTS • Fast growing population • 3rd largest convention destination • International tourism hub • Favorable business tax structure • No state income tax • 24-hour economy • Growing tech-industry environment • A young and highly productive work force • Modern transportation infrastructure • Attractive quality of life and moderate climate • Affordable cost of living • Favorable shopping, dining & entertainment LOCATION Located in Clark County in Southern Nevada, Metropolitan Las Vegas is the 31st largest MSA in the United States, with over two million residents.