The Abberley at Ingleside 81 Units | Macon, Ga

THE ABBERLEY AT INGLESIDE 81 UNITS | MACON, GA

Significant Interior Renovation in Expanding Macon Economy THE ABBERLEY AT INGLESIDE 2140 INGLESIDE AVENUE | MACON, GA

Confidentiality & Disclaimer

The information contained in the following Offering Memorandum is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from The Kirkland Company and should not be made available to any other person or entity without the written consent of The Kirkland Company. This Offering Memorandum has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level TABLE OF CONTENTS of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. The Kirkland Company 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 Property Overview...... 04 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 Offering Memorandum has been obtained from sources we believe to be reliable; however, The Kirkland Company has not verified, and will not verify, any of the information contained herein, nor has The Kirkland Company conducted any investigation regarding these matters and makes no warranty or Investment Rationale...... 11 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. Location Overview...... 25 ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONSULT YOUR KIRKLAND COMPANY AGENT FOR MORE DETAILS. Financial Analysis...... 35

Rent Comparables...... 39

TKC Assigned Listing Agents

William Kirkland Managing Partner [email protected]

Tim Ellrich Managing Partner [email protected]

5141 Virginia Way, STE 320 | Brentwood, TN 37027 T: 615.690.3001 | F: 615.523.4990

2 3 EXTERIOR

4 5 INTERIOR

6 7 OFFERING SUMMARY

THE ABBERLEY AT INGLESIDE

THE ABBERLEY SITE AT INGLESIDE Number of Units 81

Rentable Square Feet 75,825

Average SF Per Unit 936

# of Apartment Buildings 11

Year Built 1947

Macon Acreage 10.64

Density (Units Per Acre) 7.61

Property Address 2140 Ingleside Avenue

UNIT BREAKDOWN Type Units Unit SF Total SF

1BD/1BA 16 850 13,600

2BD/1BA 51 925 47,175

3BD/1BA 14 1,075 15,050 Total/Avgs 81 936 75,825

CONSTRUCTION & UTILITIES

Exterior Brick / Siding

Roof Pitched / Shingles

Parking Surface Asphalt THE ABBERLEY AT INGLESIDE Electricity Georgia Power Company Water & Sewer Macon Water Authority

8 9 INVESTMENT RATIONALE

10 11 INVESTMENT RATIONALE

MASSIVE INTERIOR RENOVATION UNDERWAY: Current ownership has recently invested roughly $1.3-$1.4 million in both interior and exterior renovations. Exterior renovations include new windows and doors as well as investments in the property’s concrete, paint, roofs, fascia, lighting, and electrical. Interior The Abberley at Ingleside is an 81-unit multifamily community in Macon, GA. Current ownership has recently renovations include new plumbing, electrical, HVAC, water heaters, cabinets, bathrooms, floors, lighting, renovated 60 of these units, while the remaining 21 are currently being renovated. Additionally, new ownership will appliances, and paint. have the potential to increase leasing activity by enhancing the property’s online presence.

INCREASED WEB PRESENCE & PROPERTY BRAND: Currently, the subject property is difficult Macon is showing healthy signs of growth in its economy as well as its multifamily segment, with 3 recent job to search for online, returning inaccurate or incomplete information regarding the property’s name and location. New ownership will have the potential to increase the property’s web visibility in order to drive announcements & expansions in its industrial sector in addition to positive rental growth. It also features a growing leasing activity. retail area, highlighted by a new shopping center that is set to open this year. Macon is also home to a wide array of historic landmarks and entertainment venues, and the combination of Macon’s job market, retail segment, and EXPANDING INDUSTRIAL SECTOR: In South Macon, roughly 2 million square feet of industrial entertainment options provide its residents a high quality of life. development is either underway, nearing completion, or recently completed. The three companies expanding its presence are: • Amazon - Opened Summer 2018 / 500 jobs • Tyson Foods - $59 million investment / 100 jobs • Irving Consumer Products - $400 million / 700,000 SF / 200 jobs

ROBUST & GROWING RETAIL CORRIDOR: Northwest Macon features two significant retail developments: • The Shoppes at River Crossing - 750,000 SF, 67-acre shopping center anchored by Dillard’s, Belk, Barnes & Noble, DSW, Dick’s Sporting Goods, H&M, PetSmart, & Ulta • North Macon Plaza - 166,465 SF (anticipated opening in Fall 2019) anchored by Old Navy, Michael’s, Marshalls, HomeGoods, & Bealls

MACON’S RICH HISTORY & ENTERTAINMENT: Macon is home to several venues and museums that highlight the city’s rich history & entertainment options. These include: • Macon Coliseum - 9,252-seat venue • Georgia Sports Hall of Fame - 43,000 SF • Tubman Museum - Founded in 1981, reconstructed in 2015 • Allman Brothers Museum - Opened in 2009 • Hay House - 24-bedroom Italian Renaissance Revival-style house

POSITIVE MULTIFAMILY SUBMARKET INDICATORS: Asking Rent Growth, Vacancy, Absorption, & Sales Volume are all above historic averages, as shown below: • 12-Month Asking Rent Growth - 2.6% • Vacancy Rate - 8.5% • 12-Month Absorption Units - 372 • 5-Year Market Rent Growth - 14.47%

12 13 SIGNIFICANT INTERIOR RENOVATION UNDERWAY

Current ownership has spent roughly $1.3-$1.4 million on renovations and improvements to the property’s exteriors, common areas, and interiors. Roughly 75% of the units have been renovated, while the remaining 21 units (as of the 1/18/19 rent roll) are currently being renovated. New ownership will benefit from this soon-to-be repositioned asset.

EXTERIOR CAPX: New Windows New Doors Concrete Repair Paint $1.3 - $1.4 Roofs MILLION Fascia Parking Lighting IN CAPX Electrical SPENT INTERIOR CAPX: Plumbing Electrical HVAC Water Heaters Cabinets Bathrooms Floors Lighting Package Appliances Paint

14 15 INCREASE WEB New ownership will have the potential to increase the property’s web presence by PRESENCE solidifying the property’s brand as The Abberley at Ingleside. Instead of identifying the property by its address on Apartments.com, Apartment Finder, and Apartment Guide, new ownership can update and refresh these listings to further the property’s brand. The Abberley at Ingleside is located off Ingleside Avenue with close proximity to major thoroughfare Another option could include creating a property website to showcase the property’s Riverside Drive as well as I-75. Despite its visibility within Macon, the property is challenging to locate amenities, floor plans, directions, and photos. and contact via a web search. A Google search of the property returns different names such as ‘Ingleside Townhomes’ and ‘Regency Townhomes’ or identifies the property by its address. The same Google search also does not immediately bring up a location of the property.

By making the property more visible to prospective tenants, new ownership will have the potential to drive leasing activity to the property. The property offers tenants a 5-10 minute drive into Downtown Macon and Mercer University, which could also present a strong selling point to tenants searching online.

SUGGESTED: CREATE PROPERTY WEBSITE & APP TO LEGITIMIZE BRANDING (MOCK-UP WEBSITE) CURRENTLY: A GOOGLE SEARCH SHOWS THAT ABBERLY AT INGLESIDE IS NOT FOUND ON VARIOUS APARTMENT PLATFORMS (ACTUAL SCREENSHOT)

16 17 GROWING INDUSTRIAL SEGMENT In South Macon, roughly 2,000,000 SF of industrial real estate is underway, nearing completion, or recently opened. The three companies accounting for this transformation are described below:

TYSON FOODS In June 2017, Tyson Foods announced it will invest $59 million into its distribution center that will add 152,000 square feet and 100 jobs with an anticipated opening in late 2018.

AMAZON In October 2017, Amazon and the Macon-Bibb Industrial Authority announced a new facility was coming to south Macon. The facility opened in the Summer of 2018 and is in the process of hiring 500 positions.

IRVING CONSUMER PRODUCTS In August 2017, Canada-based Irving Consumer Products announced it is investing $400 million into a 700,000 square foot tissue and paper towel manufacturing plant in South Macon that will create 200 jobs. The project is expected to be completed in 2019.

18 19 SHOPPES AT RIVER CROSSING The Shoppes at River Crossing is a 750,000 SF, 67-acre open-air shopping center anchored by Dillard’s, Belk, Barnes & Noble, DSW Shoe Warehouse, Dick’s Sporting Goods, H&M, PetSmart, and Ulta. Other featured tenants ROBUST & include American Eagle, Buca Di Beppo, Chico’s, Chili’s, Coach, Gap, Gymboree, H&M, Jos. A. Banks, Men’s Wearhouse, Olive Garden, Texas GROWING Roadhouse, and Victoria’s Secret.

RETAIL The Shoppes at River Crossing draws shoppers over 60 miles to the north and south and 50 miles east and west, and this trade area boast a CORRIDOR population with an average household income of $84,495.

ADDITIONAL AREA RETAIL

NORTH MACON PLAZA In the same area as The Shoppes at River Crossing is a retail center under construction that will be called North Macon Plaza. This 166,465 SF retail development is well-positioned off of I-75 and SUBJECT Bass Road, northwest of Downtown Macon.

Anchor tenants will include Old Navy, Michael’s, Marshalls, HomeGoods, and Bealls.

The center is expected to open in the Fall of 2019. MACON

SOURCES: https://www.theshoppesatrivercrossing.com/en/directory/ http://jwamalls.com/property/the-shoppes-at-river-crossing/ 20 21 POSITIVE MULTIFAMILY SUBMARKET INDICATORS

Macon’s multifamily indicators over the past 12 months have been both stable and growing. Vacancy in the market currently sits at 8.5%, less than its historical average of 10.2%. Net Absorption, Asking Rent Growth, and Sales Volume MACON are all above historical averages as well. Over the next 5 years, the Macon market is expected to see a positive trend in both Net Absorption and Asking Rent Growth, indicating stability in the market for the foreseeable future. ENTERTAINMENT & TOURISM

MACON COLISEUM - historic venue holding up to 9,252 spectators and is home to the minor league teams Macon Mayhem (hockey) and Georgia Doom (indoor football)

OVERALL MARKET RENT GROWTH GEORGIA SPORTS HALL OF FAME (2014-2018):14.47% - 43,000 SF sports hall and is the largest state sports hall of fame in America

TUBMAN MUSEUM - founded in 1981 and reconstructed in 2015, this museum is the largest museum in the nation 12-MONTH ASKING dedicated to educating people about the Art, History, and Culture of RENT GROWTH: 2.6% African Americans.

ALLMAN BROTHERS MUSEUM - also known as The Big House, this is the property the members occupied from 12-MONTH ABSORPTION 1970-1973 and turned into a museum in 2009. The museum houses the UNITS: 372 largest collection of band memorabilia.

HAY HOUSE - constructed between 1855-1859, this 24 bedroom Italian Renaissance Revival style house is now one of the most popular attractions in the city and is a prominent rental venue for special VACANCY RATE: events. 8.5%

22 23 LOCATION OVERVIEW

24 25 MARKET SUMMARY

THE HEART MACON, OF GEORGIA GEORGIA

With 152,555 residents, Macon is the 4th-largest city in Georgia. A part of the Macon-Warner Robins CSA, a total of 417,473 people live in the area. Nicknamed “The Heart of Georgia”, Macon is home to numerous historical sites & museums and boasts strong education, healthcare, agriculture, and defense industries. Macon is a center of commerce and culture in central Georgia, and recent job growth (1.4%) and home price increase (2.6%) demonstrate the steady and constant growth of the market.

With Mercer University, Middle Georgia State University, and Wesleyan College all located within city limits, Macon is a hub of education in Central Georgia. Mercer, along with Georgia Tech, University of Georgia, and Emory University, is one of the only schools in the state to crack US News & World Report’s list for top National Universities. Mercer boasts a full array of colleges & majors as well as a Division 1 athletics program. Middle Georgia State has ~8,000 students and ~700 employees, while Wesleyan College was the first women’s college in the state of Georgia as well as the birthplace of the first collegiate sororities. Healthcare is another strong suit of Macon. Navicent Medical Center is the #10 hospital in the state of Georgia according to US News & World Report and has over 600 licensed beds. Coliseum Medical Center, across the Ocmulgee River from Downtown Macon, also provides 300+ beds.

26 27 MARKET SUMMARY LIFESTYLE

Despite its size, there is plenty to do in and around Macon. The Museum of Aviation at Robins AFB is the largest tourist attraction in the state outside of Atlanta. The Hay House downtown, the Allman Brothers Band EMPLOYMENT Museum, and Ocmulgee National Monument are all popular historic attractions. Amerson River Park, Ocmulgee The largest employer in the area, by far, is Robins Air Force Base, with 24,500 jobs on site (16,000 Heritage Trail, and Lake Tobesofkee provide outdoor activities. Athletics are also popular in Macon, as the city civilian jobs). Following Robins is GEICO (5,500), Navicent (4,600 employees), Coliseum Health is home to the Georgia Sports Hall of Fame. Mercer University participates in Division 1 athletics, while there Systems (1,400), Mercer (937), YKK Inc. (600), Ricoh USA (575), Georgia Farm Bureau Federation are also minor league hockey and baseball teams in the area. The International Cherry Blossom Festival lasts (525), Boeing Manufacturing (518), Haeco Manufacturing (410), and Bass Pro Shops Distribution 10 days each March and brings visitors from around the country to Macon. Music fans have several venues in (400). Tractor Supply Company, Kohl’s, Ryder, and Trane Company also have facilities in Macon. the area, including Macon Coliseum (9,252 capacity), Macon City Auditorium (2,688), and The Grand Opera According to Sperling’s Best Places, Job Growth in Macon is expected to hit 34.97% in the next House (2,418). 10 years.

34.97% EXPECTED JOB GROWTH

IN THE NEXT 10 YEARS SPERLING’S BEST PLACES

28 29

FINANCIAL ANALYSIS

34 35 FINANCIAL ANALYSIS FOOTNOTES

2018 % of Gross Year 1 Pro Year 2 Pro Year 3 Pro Year 4 Pro Year 5 Pro REAL ESTATE TAXES INCOME Dec-18 T3 % of Gross Forma % of Gross Forma Forma Forma Forma Tax Last Next Assessment Market Rent $575,940 $575,940 $575,940 $587,459 $599,208 $611,192 $623,416 Total Millage Rate Reappraisal Schedule Reassessment Year Reassessment Year Ratio Rent Growth $0 $0 $11,519 $11,749 $11,984 $12,224 $12,468

Scheduled Rent $575,940 $575,940 $587,459 $599,208 $611,192 $623,416 $635,884 Annually 2018 2019 40% $3.9966 per $100 of assessed value

(Vacancy: General) ($225,362) 39.13% ($206,938) 35.93% ($58,746) 10.00% -$59,921 -$61,119 -$62,342 -$63,588 Appraised Bibb Co. Macon Millage Net Rental Income $350,578 $369,002 $528,713 $539,287 $550,073 $561,074 $572,296 Time Period Parcel ID Assessed Value Real Estate Taxes Value millage rate Rate Plus: Other Income $0 $0 $4,872 $4,970 $5,069 $5,171 $5,274 2017 $975,000 $390,000 $3.7466 $0.0000 $14,612 Effective Gross Income $350,578 $369,002 $533,585 $544,257 $555,142 $566,245 $577,570 P064-0112 2018 $1,190,988 $476,395 $3.9966 $0.0000 $19,040

2018 Per Unit 2018 Per Unit Year 1 Pro Per Unit Year 2 Pro Year 3 Pro Year 4 Pro Year 5 Pro EXPENSES Forma Forma Forma Forma Forma

Real Estate Taxes $19,040 $235 $19,040 $235 $58,350 $720 $59,517 $60,708 $61,922 $63,160 FLOOR PLANS

Insurance $3,719 $46 $3,719 $46 $18,225 $225 $18,590 $18,961 $19,341 $19,727 Type Units % Vacant % of Unit Mix Unit SF Total SF In-Place Rent Recent Leases Asking Rent Asking Rent / SF Electricity $8,911 $110 $8,911 $110 $8,911 $110 $9,090 $9,272 $9,457 $9,646 1BD/1BA 16 19% 20% 850 13,600 $501 $495 $495 $0.58 Water & Sewer $15,838 $196 $15,838 $196 $15,838 $196 $16,155 $16,478 $16,808 $17,144

Garbage Collection $5,480 $68 $5,480 $68 $5,480 $68 $5,590 $5,702 $5,816 $5,932 2BD/1BA 51 39% 63% 925 47,175 $586 $595 $595 $0.64

Pest Control $2,501 $31 $2,501 $31 $2,501 $31 $2,551 $2,602 $2,654 $2,707 3BD/1BA 14 36% 17% 1,075 15,050 $673 $695 $695 $0.65

Manager Payroll $19,188 $237 $19,188 $237 $28,350 $350 $28,917 $29,495 $30,085 $30,687 Totals / Avgs 81 34.57% 100% 936 75,825 $584 $593 $593 $0.63 Maintenance Payroll $19,188 $237 $19,188 $237 $28,350 $350 $28,917 $29,495 $30,085 $30,687 Monthly Totals $47,323 $47,995 $47,995 Payroll Tax/Insurance/Benefits $8,424 $104 $8,424 $104 $12,474 $154 $12,723 $12,978 $13,238 $13,502

Administrative $1,284 $16 $1,284 $16 $6,075 $75 $6,197 $6,320 $6,447 $6,576 Annual Totals $567,880 $575,940 $575,940

Maintenance & Repairs $66,014 $815 $66,014 $815 $28,350 $350 $28,917 $29,495 $30,085 $30,687 FLOOR PLANS - NOTES Unit Type and amount is based off a property appraisal provided by ownership. The property currently has 21 Cleaning & Decorating $4,247 $52 $4,247 $52 $16,200 $200 $16,524 $16,854 $17,192 $17,535 down units, and the down units have been assumed to be 2 1BD units, 18 2BD units, and 1 3BD unit. Landscaping & Grounds $9,915 $122 $9,915 $122 $9,915 $122 $10,113 $10,316 $10,522 $10,732

Advertising $2,400 $30 $2,400 $30 $2,400 $30 $2,448 $2,497 $2,547 $2,598

Professional $8,188 $101 $8,188 $101 $8,188 $101 $8,351 $8,518 $8,689 $8,862 NOTES Management (% of EGI) $21,936 6.26% $21,936 5.94% $21,343 4.00% $21,770 $22,206 $22,650 $23,103

Capital Reserves $28,350 $350 $28,350 $350 $28,350 $350 $28,350 $28,350 $28,350 $28,350 MARKET RENT Year 1 Market Rent is based off the monthly asking rent annualized

Total Expenses $244,624 $3,020 $244,624 $3,020 $299,301 $3,695 $304,720 $310,248 $315,886 $321,636 RENT GROWTH Rents in each year of the Pro Forma are assumed to grow at 2%. Net Operating Income $105,954 $124,378 $234,284 $239,537 $244,894 $250,359 $255,934 OTHER INCOME Other income includes app fees, pet fees, and forfeited security deposits. This analysis assumes 40% of the total units pay a $25 app fee, 6 new tenants pay a pet fee, and 15% of security deposits are not returned each year.

REAL ESTATE TAXES Taxes were not included on the financials provided. The 2018 tax value from the chart above has been used.

CAPITAL RESERVES Capital Reserves were not included on the property financials. Capital Reserves of $350 per unit have been added.

INCOME & EXPENSE SUMMARY All Other Income items are anticipated to grow at 2%. All Expense items are anticipated to grow at 2% except for Management and Capital Reserves.

36 37 RENT COMPARABLES

38 39 RENT COMPARABLES FEES & UTILITIES

PROPERTY YEAR UNITS SF RENT RENT / SF FEES Deposit Admin Fee App Fee Pet Fee Pet Rent A The Abberley at Ingleside 1947 81 936 $592 $0.63 Apartment Community (ref) (non-ref) (per person) (non-ref) (monthly) B Riverside Gardens 1983 75 946 $748 $0.81 The Abberley at Ingleside 1 Month's Rent None $25 $250 None C Clisby Towers 1980 52 564 $696 $1.23 Riverside Gardens Unable to Verify Unable to Verify Unable to Verify Unable to Verify Unable to Verify

D Vineville Christian Towers 1962 196 412 $472 $1.16 Clisby Towers Unable to Verify Unable to Verify Unable to Verify Unable to Verify Unable to Verify Vineville Christian Towers Unable to Verify Unable to Verify Unable to Verify Unable to Verify Unable to Verify E Wesleyan Gardens 1966, 1970 60 915 $589 $0.66 Wesleyan Gardens $0-$200 $99 $35 $275 $10 F Brookwood 1948, 1952 100 858 $647 $0.78 Brookwood $300 None $30 $350 None G Vineville North 1963 80 825 $462 $0.57 Vineville North Unable to Verify Unable to Verify Unable to Verify Unable to Verify Unable to Verify H North Napier 1968 104 846 $378 $0.46 North Napier 1 Month's Rent None $35 No Pets Allowed N/A

I Ashley Towers 1951 60 488 $809 $1.71 Ashley Towers 1 Month's Rent None $35 $250 $25 The Massee 1 Month's Rent None $35 $250 None J The Massee 1880, 1924 74 564 $638 $1.33

UTILITIES Apartment Community Water/Sewer Gas Trash Electricity

The Abberley at Ingleside Included with Rent/Landlord Pays None Included with Rent Tenants Pay Riverside Gardens Included with Rent/Landlord Pays Tenants Pay Included with Rent Tenants Pay Clisby Towers Included with Rent/Landlord Pays Included with Rent Included with Rent Included with Rent Vineville Christian Towers Included with Rent/Landlord Pays None Included with Rent Included with Rent Wesleyan Gardens Included with Rent/Landlord Pays None Included with Rent Tenants Pay Brookwood Included with Rent/Landlord Pays Tenants Pay Included with Rent Tenants Pay Vineville North Included with Rent/Landlord Pays Tenants Pay Included with Rent Tenants Pay North Napier Included with Rent/Landlord Pays None Included with Rent Tenants Pay Ashley Towers Included with Rent/Landlord Pays Included with Rent Included with Rent Included with Rent The Massee Included with Rent/Landlord Pays None Included with Rent Tenants Pay

40 41 THE ABBERLEY AT INGLESIDE RIVERSIDE GARDENS 2140 INGLESIDE AVENUE 575 BAXTER AVENUE MACON, GA MACON, GA TOTAL UNITS: 81 TOTAL UNITS: 75 YEAR BUILT: 1947 YEAR BUILT: 1983 OCCUPANCY: 65.43% OCCUPANCY: 94.6%

COMMENTS: COMMENTS: Cats only, no dogs allowed. Info obtained via 3rd party source. Unable to verify fee information.