KINGSGATE APARTMENTS OFFERING BROCHURE 96 UNITS A Multifamily Investment Opportunity with value-add potential in Beaumont, Texas KINGSGATE APARMENTS PROPERTY OVERVIEW INVESTMENT HIGHLIGHTS Kingsgate Apartments is a 96-unit , Class A, multifamily asset located in northwest Beaumont, Texas. The City of Beaumont is • Class “A” apartment community well in southeast Texas minutes from the Louisiana border, 90 miles (1 located on N. Major Dr. in northwest hour) Northeast of Houston, with a population of (2014) 117,769. Beaumont, TX Beaumont is one of the three neighboring cities along with Port Arthur and Orange, forming: ”The Golden Triangle”. • Impeccably maintained with low-density The property benefits from an excellent location at the intersection layouts of North Major Dr. and State Highway 105, which receives an average daily traffic count of over 13,800 vehicles. Interstate 10 is 8 miles south of the property and Highway 287 is 2.5 miles • Opportunity to increase income with east. Kingsgate was built in 1999 and constructed with brick and minor interior upgrades hardiplank exteriors. Occupancy is currently at 98% (August 2015). Currently, there are only 328 apartment units under construction • Few units under construction and none in Beaumont, Texas. With limited exposure to new supply, a new proposed in the immediate submarket owner has the opportunity to raise rental rates. Residents are within close proximity to major employers including • Near the Port of Beaumont recognized as Memorial Hermann Baptist Hospital (8 miles, 1,620 employees) the busiest military port in the world and Christus St. Elizabeth Hospital (6 miles, 1,574 employees), combined with the Port of Port Arthur, ExxonMobil Oil Corporation (10 miles, 2,000 employees and 1,000 the 4th largest port in tonnage in the U.S. contractors) among many others. Beaumont has a rich history in the oil industry and an abundance • Excellent proximity to high-end retail of museums, parks, and retail venues. A few noteworthy include: and entertainment venues including the Parkdale Mall (4 minutes), McFaddin-Ward House (13 minutes) and 1.35 million SF Parkdale Mall Texas Energy Museum (15 minutes). With a strong employment base surrounding the property and few • Located within minutes of major comparable units being delivered to the submarket, Kingsgate employers and medical facilities Apartments is exceptionally positioned to capture increased rents through a minor value-add program. • Within the recognized Beaumont I.S.D. (11 Exemplary Schools) PRICE TBD • Available All Cash PRICE PER UNIT/ SF TBD TERMS All Cash 2 INTERIOR FEATURES • Open Concept • Two-tone paint Design • Walk-in closets • Washer/Dryers* • Elegant Crown • Bookshelves Molding • Patios/ Balconies • High-grade • Frost Free carpets Refrigerators with • Ceiling Fans Ice Maker • Nine-foot ceilings • Garbage • GE appliances disposals • Double-sink • Dishwashers Vanities • Kitchen pantries • Computer Desk • Faux Wood Area Flooring * • Mini-blinds * in select units COMMUNITY AMENITIES • Resort-Style • 24-Hr Fitness Swimming Pool Center • Custom Laundry • Picnic Areas Facilities • Outdoor Grills • Perimeter fence • Valet Trash • Limited Access Service Gates • Covered Parking • Pet Park • 24-Hr Emergency • Pet Shower Maintenance • Car Care Center • Concierge Services • Boat & RV Parking • Playground • Business Center 3 • Wi-Fi pool side KINGSGATE 5750 n. major dr. | beaumont, texas | 77713 APARTMENTS SITE INFORMATION ADDRESS UTILITIES 5750 N. Major Dr. Beaumont, TX 77713 Electrical Individually metered PROPERTY HVAC Individual climate-controlled units Units 96 Total Rentable Sf 83,808 Water Individual hot water heaters Year Built 1999 Number of Buildings 7 + office # of Gallons 38 Gallons per individual heater Avg. Unit Sf 873 Stories 2 Electric Electric heated water Avg. Rent / Unit $904 Lot Size (Acres) 5.68 RUBS Water and Sewer Avg. Rent / Sf $1.04 Density (Units / Acre) 16.90 Full-size W/D connections 48 units CONSTRUCTION Stackable W/D connections 24 units Style Garden-style Units with no connections 24 units (All 1 BR) Foundation Concrete slab PROPERTY STAFF Framing Wood Property Manager 1 Exterior Brick and Hardiplank siding Lead Maintenance 1 Roof Pitched with composite shingles TOTAL 2 Paving Concrete DEPOSITS/OTHER FEES Wiring Copper & SER Cable feed Application Fee $35 per applicant HVAC Individual ground-mounted units (non-refundable) Plumbing Copper-PVC $50 per couple SCHOOLS Administration Fee $75 School District Beaumont I.S.D. 1 Bedroom Deposit $200 Elementary Guess 2 Bedroom Deposit $300 Middle MLK 3 Bedroom Deposit $400 High West Brook or Central Covered Parking $30 (per month) PARKING Pet Deposit $400 Spaces 153 uncovered spaces/ 38 covered (8 handicap) Non-refundable $300 Ratio 2.07 spaces per unit Pet Rent $10 per month Restrictions No aggressive breeds 4 KINGSGATE 5750 n. major dr. | beaumont, texas | 77713 APARTMENTS FLOORPLANS The York | 1 Bedroom | 1 Bath | 568 SF The Sussex | 1 Bedroom | 1 Bath | 685 SF The Lancaster | 2 Bedroom | 2 Bath | 963 SF The Norfolk | 3 Bedroom | 2 Bath | 1,315 SF 5 KINGSGATE 5750 n. major dr. | beaumont, texas | 77713 APARTMENTS SITE PLAN BARBECUE GRILLS PICNIC AREA CAR CARE CENTER PLAYGROUND PROFORMA NOTES UNIT MIX DOG PARK BARBECUE GRILLS / PICNIC AREA 6 KINGSGATE 5750 n. major dr. | beaumont, texas | 77713 APARTMENTS PROFORMA: UNIT MIX: PROPERTY TAXES ANNUAL MONTHLY PER UNIT PER SF Gross Potential Rent $1,167,816 $97,318 $12,165 $13.93 Loss/Gain to Lease 2.00% (23,356) (1,946) (243) (0.28) Adjusted Gross Potential Rent 1,144,460 95,372 11,921 13.66 Vacancy Loss 5.00% (57,223) (4,769) (596) (0.68) Concessions 0.14% (1,638) (136) (17) (0.02) Models 0.92% (10,514) (876) (110) (0.13) Employee Units 0.08% (948) (79) (10) (0.01) Non Revenue Units 0.56% (6,380) (532) (66) (0.08) Total Rental Income 1,067,757 88,980 11,122 12.74 Other Income 72,693 6,058 757 0.87 Utility Reimbursements 48,010 4,001 500 0.57 Total Other Income 120,703 10,059 1,257 1.44 Effective Gross Income 1,188,460 99,038 12,380 14.18 Operating Expenses Payroll & Benefits 115,200 9,600 1,200 1.37 General & Administrative 18,720 1,560 195 0.22 Repairs & Maintenance 47,520 3,960 495 0.57 Contract Services 49,440 4,120 515 0.59 Advertising & Promotion 7,200 600 75 0.09 Controllable Expenses 238,080 19,840 2,480 2.84 Utilities 68,586 5,715 714 0.82 Insurance 48,000 4,000 500 0.57 Management Fee 35,654 2,971 371 0.43 Gross Receipts Tax 6,834 569 71 0.08 Property Taxes 118,730 9,894 1,237 1.42 Operating Expenses Before Reserves (515,883) (42,990) (5,374) (6.16) Replacement Reserves 24,000 2,000 250 0.29 Total Operating Expense (539,883) (44,990) (5,624) (6.44) NET OPERATING INCOME $648,577 $54,048 $6,756 $7.74 Post- Post- Appraisal District Jefferson County Market Market Avg Upgrade Upgrade Unit # of % of Rent / Rent / Unit Rent / Rent / 2014 Tax Rate 2.744638% Description Units Total Unit SF SF Unit SF Property ID # 128215 1Bd/1Bth (downstairs) 16 16.7% 568 $679 $1.20 $758 $1.33 Land $298,160 1Bd/1Bth (upstairs) 16 16.7% 568 $729 $1.28 $815 $1.44 Improvements $3,634,470 1Bd/1Bth (downstairs) 8 8.3% 685 $769 $1.12 $861 $1.26 Total 2015 Tax Value $3,932,630 1Bd/1Bth (upstairs) 8 8.3% 685 $789 $1.15 $884 $1.29 2Bd/2Bth 24 25.0% 963 $959 $1.00 $1,080 $1.12 3Bd/2Bth 24 25.0% 1,315 $1,199 $0.91 $1,344 $1.02 Totals/Avg 96 100% 873 $904 $1.04 $1,014 $1.16 1. Gross Potential Rent is per the Post-Upgrade rent schedule 2. Other Income per the T12 actuals through Aug. 2015 3. Utility Reimbursements: 70% recapture of Utilities expense 4. Utilities expense per the T12 actuals through Aug. 2015 5. Management Fee is based on 3.00% of Effective Gross Income 6. Property Taxes: 110% of 2015 assessed tax value at 2014 tax rate 7. Replacement reserves are estimated to be $250 per unit and do not reflect actual capital expenditures 7 KINGSGATE 5750 n. major dr. | beaumont, texas | 77713 APARTMENTS AREA DEMOGRAPHICS Radius 1 Mile 3 Mile 5 Mile 2015 Population by Hispanic Origin 606 2,629 8,631 2015 Population by Race 5,958 29,226 75,398 White 3,360 56.39% 16,204 55.44% 42,338 56.15% Black 2,093 35.13% 10,598 36.26% 28,386 37.65% American Indian and Alaskan 47 0.79% 206 0.70% 587 0.78% Asian 327 5.49% 1,666 5.70% 2,792 3.70% Hawaiian and Pacific Islander 3 0.05% 13 0.04% 48 0.06% Other Race 128 2.15% 538 1.84% 1,246 1.65% Households Owner Occupied 1,106 42.26% 6,921 55.63% 18,322 59.37% Renter Occupied 1,511 57.74% 5,520 44.37% 12,539 40.63% 2015 Households by HH Income 2,615 12,442 30,861 Income Less Than $25,000 682 26.08% 3,167 25.45% 8,890 28.81% Income: $25,000 - $50,000 500 19.12% 2,804 22.54% 7,409 24.01% Income: $50,000 - $75,000 520 19.89% 2,240 18.00% 5,637 18.27% Income: $75,000 - $100,000 371 14.19% 1,050 8.44% 2,532 8.20% Income: $100,000 - $125,000 196 7.50% 877 7.05% 1,990 6.45% Income: $125,000 - $150,000 124 4.74% 624 5.02% 1,310 4.24% Income: $150,000 - $200,000 140 5.35% 741 5.96% 1,312 4.25% Income: $200,000 or more 82 3.14% 939 7.55% 1,781 5.77% 2015 Avg Household Income $69,581 $78,869 $69,639 2015 Med Household Income $55,080 $52,708 $46,869 Source: CoStar Realty Information, Inc., Aug.