CATHEDRAL HEIGHTS DC PORTFOLIO

52 APARTMENTS 3218, 3222 & 3224 NW, WASHINGTON, DC DYNAMIC OPPORTUNITY TO ACQUIRE THREE PROPERTIES TOTALING 52 APARTMENTS ON WISCONSIN AVENUE IN NORTHWEST DC NEAR NATIONAL CATHEDRAL PROVIDING SUPERB ACCESS TO AMERICAN UNIVERSITY, GEORGETOWN AND DOWNTOWN DC.

INVESTMENT OPPORTUNITY PORTFOLIO OFFERING SUMMARY Transwestern’s Mid-Atlantic Multifamily Group, as exclusive agent, is pleased to OFFERING PRICE: Unpriced offer an opportunity to acquire the Cathedral Heights DC Portfolio consisting of 52 apartments located in three buildings along Wisconsin Avenue in northwest Properties must be purchased as a Portfolio Washington, DC. Ideally situated in the Cathedral Heights/ TERMS/FINANCING: and will be delivered “Free & Clear” neighborhood just one block from the Washington National Cathedral and the $125 million Cathedral Commons development, the properties provide OFFER DUE DATE: TBD convenient access to top employers in the District. Owned and operated for decades by the current ownership, the Portfolio offers PORTFOLIO DESCRIPTION a rare opportunity to acquire three extremely well-located apartment buildings 3218, 3222 & 3224 Wisconsin Ave NW, offering an abundance of repositioning and management upside in a high ADDRESS: Washington, DC 20016 barrier-to-entry urban location.

NUMBER OF UNITS: 52 Apartments

YEAR BUILT: Circa. 1923-1925

NET RENTABLE AREA (SF): 22,255 SF

AVERAGE UNIT SIZE (SF): 428 SF

AVERAGE LEASE RENT: $1,365

AVERAGE RENT PSF: $3.19

OCCUPANCY: 98.1% (one vacant as of 2/1/2018)

2ND GENERATION MAPLE CABINET KITCHEN - TYPICAL EFF, 1BR & 1BR DEN KITCHEN 2ND GENERATION MOCHA CABINET KITCHEN - TYPICAL EFFICIENCY SM KITCHEN

UNIT TYPE # OF UNITS % OF MIX UNIT SF LEASE RENT $/SF Efficiency SM 15 28.8% 240 $1,095 $4.56 Efficiency 5 9.6% 308 $1,220 $3.96 1BR 28 53.8% 521 $1,472 $2.83 1BR Den 4 7.7% 634 $1,827 $2.88 TOTAL/AVERAGE 52 100% 428 $1,366 $3.19 Rent based on actual lease rent from rent roll dated 2/1/2018 INVESTMENT HIGHLIGHTS

UPSIDE POTENTIAL The Portfolio offers strong value-add opportunity with the ability for continued income growth as well as additional value creation through in-unit renovations and common area enhancements. These improvements will enable the Portfolio to better compete in the submarket while offering a “value-proposition” to renters compared to the newer communities.

MANAGEMENT UPSIDE Current ownership has not taken full advantage of the allowable increases on renewals as well as vacant units and provides a tremendous opportunity to grow rental income through improved management of the DC Rent Control process.

EXPENSE REDUCTION Current ownership is operating at an 75% expense-to-income ratio and provides an immediate opportunity for investors to significantly grow NOI through improved management practices and expense control measures.

EXTREMELY RARE LEGACY SALE Owned and operated by the current ownership for decades, the Portfolio offering provides investors a boutique urban value-add investment opportunity.

INCREASED OTHER INCOME There is an immediate opportunity to increase Other Income through implementation of a reserved parking program (currently first come, first serve) consistent with neighboring communities that charge $150 to $200 per month for reserved off-street parking. Additional opportunities include the potential to charge residents a monthly fee for storage, and potential to begin passing back utility expenses to residents.

WELL-MAINTAINED BY LONG-TERM OWNERSHIP Numerous capital projects have been completed by current ownership including; the addition of mailboxes in front of each property; common area hallway paint and carpet; replacement of all windows at 3222 Wisconsin; vinyl siding on the rear building exterior at 3218 Wisconsin.

POTENTIAL ADDITIONAL DENSITY There is potential to bring two additional units online by adding the “caretaker apartment” at 3222 Wisconsin Ave which is not currently included on the rent roll, as well as potential to convert the underutilized ground-level space in 3224 Wisconsin into an additional unit.

MARKET HIGHLIGHTS

Walk Score 86 WALKABLE URBAN LOCATION FEDERAL EMPLOYMENT AND UNIVERSITIES With a WalkScore of 86 (Very Walkable), the Wisconsin Avenue Walking distance to Fannie Mae headquarters on Wisconsin NW location provides residents with convenient access to a variety Avenue NW, Homeland Security (Nebraska Avenue Complex), US of neighborhood amenities and is situated just two blocks north Naval Observatory, American University and a variety of private of Massachusetts Avenue NW (Washington’s ). schools including the National Cathedral School, St. Albans and Public transportation including local buses and two metro stations the prestigious Sidwell Friends School. Less than two-miles from (/AU and Cleveland Park) within a mile provide convenient Georgetown University and convenient access to Downtown connection to Upper Northwest neighborhoods of Tenleytown, Washington DC with 40 million square feet of office located in the , Chevy Chase/Bethesda, and closer-in downtown Central Business District (CBD). neighborhoods including Georgetown and . STRONG APARTMENT FUNDAMENTALS LIFESTYLE AND RETAIL AMENITIES Class A absorption remained strong in the District in 2017 with Conveniently located on Wisconsin Avenue NW in the Cathedral a 40% increase compared to 2016. This strong absorption of Class Heights/Cleveland Park neighborhood of northwest Washington A apartments, with an average rent of $2,585 continues to place DC; residents enjoy a live, work, play lifestyle with superb access greater demand on renovated Class B apartment stock from renters to a variety of retailers, restaurants and neighborhood amenities looking for a “value-proposition”. including the $125 million Cathedral Commons. Retailers within walking distance include Giant Food, CVS, Starbucks, as well as a host Vacancy rates for Class B apartments in the Upper Northwest of dining options including Cactus Cantina, Café Deluxe, Raku, The submarket remains one of the lowest in the region at 4.0% in the 12 Grilled Oyster Co., and California Tortilla. months ending December 2017.

Source: Delta Associates, Fourth Quarter 2017 Class A & B Apartment Market Report map Robin Williams Robin Vice Executive President 301.896.9070 [email protected] Cleveland Park C NW VE T A ZOOLOGICAL PARK ZOOLOGICAL ZOOLOGICAL PARK ZOOLOGICAL U TICU EC SMITHSONIAN NATIONAL SMITHSONIAN NATIONAL SMITHSONIAN NATIONAL SMITHSONIAN NATIONAL NN CO CLEVELAND PARK 180K SF of Retail (1/4 mile radius) C 2 miles VAN NESS - UDC NESS VAN mile radius) 60K SF of Retail (1/4 140K SF of Retail (1/4 mile radius) W W N N

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WASHINGTON WASHINGTON WASHINGTON WASHINGTON Dean Sigmon Dean Vice Executive President 301.896.9089 [email protected] Mollie Zito Associate Marketing Designer, Graphic 301.896.9021 [email protected] B B M M 441K SF of Retail (1/4 mile radius) DUPONT CIRCLE O O INTERNATIONAL SCHOOL INTERNATIONAL INTERNATIONAL SCHOOL INTERNATIONAL C C A A WOODLEY PARK - ZOO/ PARK WOODLEY MM 2.0 miles UNITED STATES UNITED STATES UNITED STATES UNITED STATES W N NAVAL OBSERVATORY NAVAL OBSERVATORY NAVAL E V A 1.5 miles S NATIONAL NATIONAL NATIONAL NATIONAL T CATHEDRAL CATHEDRAL CATHEDRAL HEIGHTS CATHEDRAL 174K SF of Retail (1/4 MILE RADIUS) T WASHINGTON WASHINGTON WASHINGTON WASHINGTON E S U H C A WISCONSIN AVE NW A SCHOOL SCHOOL FRIENDS FRIENDS SIDWELL SIDWELL S S A M Michael D’Amelio Associate 301.896.9077 [email protected] FOR MORE INFORMATION CONTACT: FOR MORE INFORMATION CCIM Justin Shay, Vice President 301.896.9082 [email protected] 2.3M SF of Retail GEORGETOWN GEORGETOWN Tenleytown B TO LEARN MORE VISIT US AT AT US VISIT LEARN MORE TO B FRIENDSHIP HEIGHTS/CHEVY CHASE CHASE HEIGHTS/CHEVY FRIENDSHIP 1.3M SF of Retail FANNIE MAE FANNIE FANNIE MAE FANNIE

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447K SF of Retail (1/4 mile radius) of Retail (1/4 mile 447K SF

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AMERICAN AMERICAN AMERICAN AMERICAN one-half mile radius UNIVERSITY UNIVERSITY 6700 Rockledge Drive 6700 Rockledge Suite 500-A Bethesda, MD 20817 Bethesda, 301.571.0900 Visit us online at www.transwestern.com $116,868 VERY WALKABLE VERY Cathedral Commons Cathedral MEDIAN INCOME A