Value Add Covered Land Opportunity in A+ Location Offering Memorandum BRIARWEST 1950 Winrock Blvd, Houston, TX 77057 OFFER PROCESS PRESENTED BY NKF INVESTMENT DOSCH MARSHALL NKF DEBT AND EXCLUSIVE REPRESENTATION SALES REAL ESTATE STRUCTURED FINANCE Newmark Knight Frank (Newmark Knight Frank) has been exclusively retained to represent the Seller in the disposition of Briarwest. All inquiries about the Offering ZACH SPRINGER DAVID MARSHALL ADAM ALLEN or the Property should be directed to Newmark Knight Frank. [email protected] [email protected] [email protected] T 713-425-5428 T 713-955-3126 T 713-425-5433 OFFERING PROCESS M 713-897-9670 M 713-824-6066 The Property is being offered on an All Cash basis to qualified purchasers. TIM DOSCH Prospective purchasers will have the opportunity to visit the Property through RUSSELL JONES [email protected] TIP STRICKLAND scheduled tours with Newmark Knight Frank. Please do not contact the on-site [email protected] T 713-955-3127 [email protected] management directly. T 713-425-5422 T 713-337-5810 M 832-541-1499 TOM DOSCH M 832-724-4288 OFFER REQUIREMENTS [email protected] Offers should be presented in the form of a non-binding Letter of Intent, and must MATT SAUNDERS T 713-955-3125 DAVID SCHWARZ include at least: [email protected] [email protected] T 713-554-1303 BECKY HAND T 713-337-5811 M 281-300-1468 [email protected] M 713-412-9055 Asset Pricing • T 713-955-3121 Due Diligence and Closing Time frame • DAVID MITCHELL PURVESH GOSALIA Earnest Money Deposit • [email protected] JP HAYES [email protected] Description of Debt/Equity Structure • T 713-425-5421 [email protected] T 713-300-7954 Qualifications to Close • M 713-503-2513 T 713-955-4473 M 313-570-5221 Purchase terms shall require cash to be paid at closing. Offers should be delivered DAVID WYLIE DAKOTA DOSCH to the attention of Zach Springer via fax or email. [email protected] [email protected] T 713-425-5410 T 713-955-4472 FINANCING M 832-526-5206 For parties interested in receiving debt quotes, please contact our Debt and Structured Finance team, Adam Allen, Tip Strickland, David Schwarz or Purvesh THOMAS ALLEMAN Gosalia. Newmark Knight Frank facilitates agency, life company, bank, bridge, and [email protected] mezzanine financing options. T 713-425-5434 M 713-305-3827 UNDERWRITING For questions regarding the underwriting presented in this offering memorandum please contact Anthony Likefahr at 713-337-5812 or [email protected]. Newmark Knight Frank PROPERTY TOURS 1700 Post Oak Blvd | 2 BLVD Place, Suite 400 | Houston, TX 77056 To accommodate the Property’s ongoing operations, Newmark Knight Frank T 713-599-1800 | F 713-599-1801 requests 24-hour advance notice to schedule a tour. Dosch Marshall Real Estate 777 Post Oak Blvd. | Suite 255 | Houston, TX 77056 T 713.955.3120 TABLE OF CONTENTS INVESTMENT PROPERTY MARKET APPENDIX 06HIGHLIGHTS 26 INFORMATION 36 OVERVIEW 40 EXECUTIVE SUMMARY ADJACENT TO SOME OUTSTANDING VALUE- LOCATED NEAR OF TEXAS’ WEALTHIEST ADD OPPORTUNITY ABUNDANT RETAIL NEIGHBORHOODS Outstanding Value-Add Opportunity Located Near Abundant Retail » All units at the Property have received light upgrades consisting » Briarwest is in close proximity to Houston’s premier retail of upgraded lighting, hardware, and kitchen faucets destinations including being within five miles of The Galleria, River Oaks District, City Centre, Memorial City, & Woodlake Square » A new owner has the potential to add granite countertops, black/ Shopping Center stainless steel appliances, tile backsplashes, and faux wood flooring in all units. » The Property is within 1-mile of Kroger, Whole Foods, & H-E-B offering residents an abundance of grocery options » Current effective rents are over $150 below the average for Galleria Class B properties & approximately $250 below the Surrounded by some of Houston’s Largest Employment Centers competitive set, indicating ample runway to increase rents. » The Galleria (82,000 employees), Westchase District (93,000 Adjacent to some of Texas’ Wealthiest Neighborhoods employees), Memorial District (47,000 employees) & Greenway Plaza (25,000 employees) are all within 4 miles of Briarwest » Five of Houston’s ten most expensive neighborhoods are within 3 miles of the Property » Additionally, the Energy Corridor (94,000 employees), CBD (157,000 employees), and Texas Medical Center (106,000 » Piney Point Village, which is 1.50 Miles from the Property, is employees) are all within a 20 minute commute Houston’s most expensive neighborhood with median home values in 2018 of $2.7M SURROUNDED BY SOME OF HOUSTON’S LARGEST EMPLOYMENT CENTERS 4 BRIARWEST APARTMENTS PROPERTY SUMMARY BRIARWEST APARTMENTS 1950 Winrock Blvd, ADDRESS Houston, TX 77057 NUMBER OF UNITS 379 YEAR COMPLETED 1969 NET RENTABLE SF 343,575 SF AVERAGE UNIT SIZE 907 SF MARKET RENT PER $1,023 UNIT MARKET RENT PER SF $1.13 OCCUPANCY 93% Occupied NUMBER OF 42 two-story residential buildings; 1 BUILDINGS clubhouse ACREAGE & DENSITY 11.70 Acres | 32.39 Units/Acre PARKING 506 total spaces HOUSTON Briargrove Elementary School INDEPENDENT Tanglewood Middle School SCHOOL DISTRICT Wisdom High School NEWMARK KNIGHT FRANK | DOSCH MARSHALL REAL ESTATE 5 INVESTMENT HIGHLIGHTS Briarwest Augusta Court Chateaux Dupre Creole on Yorktown Tanglebrook The Heritage 9900 Memorial Woodway Square YOC 1969 1982 1964 1971 1973 1965 1968 1992 Countertops Resurfaced Granite in Upgraded Units Granite Granite in Upgraded Units Resurfaced Granite Granite in Upgraded Units Quartz in Upgraded Units Appliances Black Stainless Steel in Upgraded Units Black Stainless Steel in Upgraded Units Stainless Steel in Upgraded Units Stainless Steel in Upgraded Units Stainless Steel in Upgraded Units Black OUTSTANDING VALUE-ADDCabinets White OPPORTUNITY with Pulls Dark with Pulls Beige with Pulls Wood Laminate with Pulls White with Pulls White with Pulls Cherry with Pulls Dark with Pulls Faux Wood Throughout In Select Units In Upgraded Units In Select Units In Upgraded Units In Upgraded Units In Upgraded Units In Wet Areas In Upgraded Units Property Performance Tile Backsplash No RENT COMPARISONNo No In Upgraded Units No Yes In Upgraded Units Yes Average effective rents at Briarwest are over $150 below Effective Rent/Unit average rents in the Class B tranche of the Galleria/Uptown $1,500 submarket and are nearly $250 below Briarwest’s competitive $1,329 $1,332 set. The large rent delta between Briarwest and nearby $1,300 $1,271 $1,180 $1,144 competitors, coupled with strong demand for the area (avg. $1,091 $1,097 $1,109 occupancy for stabilized product within 1-mile of Briarwest $1,100 is 91%), signifies a large runway for a new owner to increase $937 $900 rents through a strategic value-add program. $700 $500 Briarwest Chateaux Dupre Creole on Yorktown Tanglebrook 9900 Memorial Competitive Set August Court Woodway Square The Heritage Average NEW CABINET FRONTS TILE BACKSPLASH UNDERMOUNT SINK WITH MODERN FIXTURES MODERN GRANITE COUNTERTOPS STAINLESS STEEL APPLIANCES FAUX WOOD FLOORING 8 BRIARWEST APARTMENTS OUTSTANDING VALUE-ADD OPPORTUNITY BRIARWEST AUGUSTA COURT CHATEAUX DUPRE CREOLE ON YORKTOWN Excellent Value-Add Opportunity A new owner has the potential to upgrade all units to include stainless steel appliances, tile backsplashes, faux wood floors throughout, $334 HIGHER $154 HIGHER $160 HIGHER and updated cabinetry. The increased revenue from the TANGLEBROOK THE HERITAGE 9900 MEMORIAL WOODWAY SQUARE value-add scope will bring the Property in-line with Class B averages, while also allowing Briarwest to remain a discount to Class A product. $172 HIGHER $394 HIGHER $207 HIGHER $392 HIGHER INTERIOR COMPARISON Creole on Briarwest Augusta Court Chateaux Dupre Yorktown Tanglebrook The Heritage 9900 Memorial Woodway Square YOC 1969 1982 1964 1971 1973 1965 1968 1992 Granite in Upgraded Granite in Upgraded Granite in Upgraded Quartz in Upgraded Countertops Resurfaced Granite Resurfaced Granite Units Units Units Units Stainless Steel in Stainless Steel in Stainless Steel in Stainless Steel in Stainless Steel in Appliances White/Almond Black Black Upgraded Units Upgraded Units Upgraded Units Upgraded Units Upgraded Units Wood Laminate with Cabinets White with Pulls Dark with Pulls Beige with Pulls White with Pulls White with Pulls Cherry with Pulls Dark with Pulls Pulls Faux Wood In Select Units In Upgraded Units In Select Units In Upgraded Units In Upgraded Units In Upgraded Units In Wet Areas In Upgraded Units Throughout Tile Backsplash No No No In Upgraded Units No Yes In Upgraded Units Yes NEWMARK KNIGHT FRANK | DOSCH MARSHALL REAL ESTATE 9 ADJACENT TO SOME OF TEXAS’ WEALTHIEST NEIGHBORHOODS Strong Single Family Anchor SPRING VALLEY HILSHIRE VILLAGE VILLAGE » Five of Houston’s ten most expensive neighborhoods are HOMES TO $1.3 M HOMES TO $1.25 M located within 3 miles of the Property: 10 • Briargrove (0.20 Miles from Briarwest) – Home values up HEDWIG VILLAGE GESSNER RD HOMES TO $1.5 M to $2.3M HUNTER’S CREEK VILLAGE TANGLEWOOD • Riverbend (0.50 Miles from Briarwest) – Home values up HOMES TO $1.2 M HOMES TO $6 M 610 BUNKER HILL to $2.95M VILLAGE HOMES TO $3.5 M 3 MILES • Tanglewood (1.50 Miles from Briarwest) – Home values VOSS RD PINEY POINT up to $6M VILLAGE SAM HOUSTON PKWY HOMES TO $7 M BRIAR GROVE • Piney Point Village (1.50 Miles from Briarwest) – Home HOMES TO $2.3 M values up to $7M SAN FELIPE BRIAR FOREST 1 MILE RIVERBEND • Bunker Hill (2.00 Miles from Briarwest) – Home values up HOMES TO $2.95 M to $3.5M WESTHEIMER RICHMOND AVE 69 WESTPARK TOLLWAY