OFFERING MEMORANDUM
A 10-unit multifamily community in Port Angeles, Washington
ROZELLE APARTMENTS
Table of ContentsINVESTMENT SUMMARY01
Ryan DiniusKidder MathewsSenior Vice [email protected]
Sid WarsinskeKidder MathewsSenior [email protected]
kiddermathews.com
Exclusively Offered by
PROPERTY OVERVIEW02
FINANCIAL ANALYSIS03
RENT COMPARABLES04
3OFFERING MEMORANDUM | THE MARTIN AT MEADOWDALE
Investment SummaryThe Offering
Investment Highlights
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Rozelle Apartments | Offering Memorandum | Kidder Mathews 4
The Rozelle Apartments consists of 10 classic homes located in the heart of Port Angeles. Home to the natural wonders of the Olympic National Park, Clallam County attracted nearly 4 million visitors in 2016. The region boasts over 200 miles of coastline, a strong commercial and sport fishing industry, natural abundance in forestry jobs, and the Peninsula College which has three campus locations.
Originally constructed in 1955 and recently upgraded, this 100% occupied property provides spacious one and two-bedroom units with long-term tenants at below market rents. As the Puget Sound Region continues to grow, an incoming investor will be able to add value and increase their returns by bringing rents up to market levels. This opportunity allows for an attractive down payment, in which a Buyer can maximize their leverage and achieve more than a 12% cash-on-cash return after bringing the rents up to market. With a going-in CAP Rate of 7.5%, The Rozelle Apartments is an excellent opportunity to acquire a centrally located piece of real estate and achieve outstanding returns.
Investment Summary
Property Overview
PRICE $795,000
NOI $59,600
PRICE PER UNIT $79,500
CAP RATE 7.50%
ADDRESS 212 W Third Street, Port Angeles, WA 98362
UNITS 10
OCCUPANCY 100%
YEAR BUILT 1955 / 2017
NRSF ± 6,200
PARCEL # 56135
Rozelle Apartments | Offering Memorandum | Kidder Mathews 5
Investment Highlights
EXCELLENT LOCATION
Located in the heart of Port Angeles, just three blocks from dining, shopping, and grocers
EXCELLENT UNIT MIX
2 one-bedroom and 8 two-bedroom units
UNIT LAYOUT
Units averaging ± 620 square feet each with spacious layouts
VALUE-ADD INVESTMENT
10 quality homes with significant rental upside
AMPLE PARKING
On-site parking and ample on-street
PORT ANGELES
Port Angeles is the largest city in Clallam County, with a population of roughly 20,000 people
6OFFERING MEMORANDUM | THE MARTIN AT MEADOWDALE
Property OverviewLocation Aerials / Maps
02
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ROZELLE APARTMENTS
N
Port Angeles
W 3rd St
W 4th St
W 2nd St
W 2
nd S
t
S C
herr
y St
W 1st St
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Amenities Map
1
1
SHOPPING1. Brown’s Outdoor Clothing Store
2. Port Angeles Baby Store
3. Necessities and Temptations
4. Patricia’s Pet Shop
5. Cowboy Country Apparel
6. Walgreens
7. North by Northwest Surf Co
8. Sears Hometown Store
9. Straight Music
10. Angeles Furniture Co
11. Harbor Freight
12. Auto Zone
13. Payless ShoesSourse
14. Aaron’s
15. Port Angeles Goodwill
EAT + DRINK1. Tendy’s Garden
2. Bella Italia
3. Sabai Thai
4. Fiesta Jalisco Mexican
5. Fresh Wok
6. Frugals
7. Gordy’s Pizza & Pasta
8. Kokopelli Grill
9. Little Devils Lunch box
10. Toga’s Soup House
11. Dynasty Restaurant
12. Turnip The Beet
13. Okasan Japanese Restaurant
14. Chestnut Cottage Restaurant
15. Golden Gate Chinese
16. The Cornerhouse Restaurant
17. Joshua’s Restaurant & Lounge
18. Smuggler’s Landing Restaurant
19. First Street Haven Restaurant
20. Shirley’s Cafe
21. Port Angeles CrabHouse
HEALTH & WELLNESS1. Anytime Fitness
2. Poser Yoga
3. Olympic Iyengar Yoga
4. Fitness West
5. Olympic Day Spa
6. La Bella Nails & Spa
7. Pure Elements Spa
8. Beauty & The Beach
GROCERY1. Safeway
2. McPhee’s Parkway Grocery
3. Country Aire Natural Foods
4. Good To Go Natural Grocery
5. Grandview Grocery
6. Fairmount Grocery
7. Lincoln Park Grocery
8. Gig Lots
PUGET SOUND
Port Angeles
ROZELLE APARTMENTS
W 8th St
S R
ace
St
E Lauridsen Blvd
E 5th St
E 8th St
W 12th St
BLACK BALLFERRY LINE
Marine Dr
S C
edar
St
S G
olf C
ourse R
d
23
4
56
7
8
9
10
1112
13 14
1516
17
1819
20
21
1
2
3
4
5 67
8
ARMORY SQUARE SHOPPING MALL
2 3
4
56
7
8
910
11 121314
15
1
2
3
6
5
1
7
8
9OFFERING MEMORANDUM | THE MARTIN AT MEADOWDALE
Financial AnalysisRent Roll
Income & ExpensesPricing
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Rozelle Apartments | Offering Memorandum | Kidder Mathews 10
Financial AnalysisRent Roll
UNIT UNIT TYPE NRSF ACTUAL RENT RENT/SF
1 Two Bed / One Bath 650 $850 $1.31
2 Two Bed / One Bath 650 $700 $1.08
3 Two Bed / One Bath 650 $675 $1.04
4 Two Bed / One Bath 650 $800 $1.23
5 Two Bed / One Bath 650 $700 $1.08
6 Two Bed / One Bath 650 $800 $1.23
7 Two Bed / One Bath 650 $850 $1.31
8 Two Bed / One Bath 650 $900 $1.38
9 One Bed / One Bath 500 $500 $1.00
10 One Bed / One Bath 500 $700 $1.40
TOTAL 6,200 $7,475
AVERAGE 620 $748 $1.21
Rozelle Apartments | Offering Memorandum | Kidder Mathews 11
CURRENT PRO FORMA
MONTHLY INCOME
Total Monthly Scheduled Rent $7,475 $8,600
Scheduled Annual Potential Income $95,159 $108,659
Less Physical Vacancy ($4,758) 5.0% ($5,433) 5.0%
Effective Gross Income $90,401 $103,226
EXPENSES
Real Estate Taxes $4,070 $8,684
Insurance $2,592 $2,592
Utilities $12,639 $13,018
Repairs & Maintenance $9,000 $9,000
Reserves $2,500 $2,500
Total Expenses $30,801 $35,794
Expenses Per Unit $3,080 $3,579
Expenses Per Square Foot $4.97 $5.77
NET OPERATING INCOME $59,600 $67,432
PRO FORMA EXPENSE NOTES
REAL ESTATE TAXESBased on current millage rate multiplied by sales price
INSURANCE Based on current
UTILITIESBased on a 3% growth rate of existing utilities
REPAIRS & MAINTENANCE
Based on $900/unit
RESERVES$250 per unit is accumulated to pay for large capital expenditures amortized over years of operations
Income & Expenses
Rozelle Apartments | Offering Memorandum | Kidder Mathews 12
FINANCING
Loan Amount $596,250
Rate 4.200%
Amortization 30
Payment ($2,916)
Annual Debt Service ($34,989)
The above financing terms were obtained in October 2017 and are based on a 5-year term, 30 years amortization. As loan information is time sensitive and subject to market fluctuations, we recommend that you verify quoted terms by contacting a preferred lender of your choice.
Pricing Overview
PRICING
Price $795,000
Down Payment $198,750
Price Per Unit $79,500
Price Per SF $128.23
Current GRM 8.79
Current Cap Rate 7.50%
ANNUALIZED OPERATING DATA CURRENT PROFORMA
Gross Potential Income $95,159 $108,659
Less Physical Vacancy ($4,758) 5.00% ($5,433) 5.00%
Effective Gross Income $90,401 $103,226
Less Expenses ($30,801) 32.37% ($35,794) 32.94%
NET OPERATING INCOME $59,600 $67,432
Less Loan Payments ($34,989) ($34,989)
Pre-Tax Cash Flow $24,611 12.38% $32,442 16.32%
Plus Principal Reduction $10,140 $10,140
TOTAL RETURN BEFORE TAXES $34,751 17.48% $48,583 21.43%
Rozelle Apartments | Offering Memorandum | Kidder Mathews 13
Rent Comparables
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Rozelle Apartments | Offering Memorandum | Kidder Mathews 14
Port Angeles Triplex226 E 11th Street, Port Angeles
Number of Units 3
Year Built 1923
1
UNIT MIX # UNITS SF CURRENT RENT AVG. RENT $/SF
1 BR / 1 BA 2 700 $750 $750 $1.07
2 BR / 1 BA 1 1,000 $1,150 $1,150 $1.15
AVG 3 800 $883 $1.10
Notes: W/D in unit.
Rozelle Apartments212 W Third Street, Port Angeles
Number of Units 10
Year Built 1955 / 2007
UNIT MIX # UNITS SF CURRENT RENT AVG. RENT $/SF
1 BR / 1 BA 2 500 $500 - $700 $600 $1.20
2 BR / 1 BA 8 650 $700 - $900 $800 $1.23
AVG 10 620 $760 $1.23
Notes: This is the subject property.
SUBJECT
PA Duplex214 W 2nd Street, Port Angeles
Number of Units 2
Year Built 1938
2
UNIT MIX # UNITS SF CURRENT RENT AVG. RENT $/SF
2 BR / 1 BA 2 700 $925 - $975 $950 $1.36
AVG 2 700 $950 $1.36
Notes: W/D in one unit.
Comparables
Rent Comparables
PA Apartments517 W 8th Street
Number of Units 8
Year Built 1981
3
UNIT MIX # UNITS SF CURRENT RENT AVG. RENT $/SF
2 BR / 1 BA 8 800 $700 - $900 $800 $1.00
AVG 8 800 $800 $1.00
Notes: W/D in unit.
Rozelle Apartments | Offering Memorandum | Kidder Mathews 15
Rent Comparables Con’t
4
321
ROZELLE APARTMENTS
Port Angeles
Black Diamond Rd
Hur
rican
e R
idge
Rd
Old
Olym
pic H
wy
Old Olympic Hwy
Pebble Bay Apartments300 S Sunnyside Ave, Sequim
Number of Units 48
Year Built 1972
4
UNIT MIX # UNITS SF CURRENT RENT AVG. RENT $/SF
1 BR / 1 BA 10 700 $750 $750 $1.07
2 BR / 1 BA 38 850 $900 $900 $1.06
AVG 48 819 $869 $1.06
Notes: W/D in unit.
N
Rozelle Apartments | Offering Memorandum | Kidder Mathews 16
Disclaimer
The information contained in this Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Kidder Mathews and should not be made available to any other person or entity without the written consent of Kidder Mathews.
This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Kidder Mathews 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, current or past tax payments, the physical condition of the improvements thereon, or the financial condition or 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 Marketing Brochure has been obtained from sources we believe to be reliable; however, Kidder Mathews has not verified, and will not verify, any of the information contained herein, nor has Kidder Mathews conducted any investigation regarding these matters and makes no warranty or 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.
This information has been secured from sources we believe to be reliable. We make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Recipient of this report must verify the information and bears all risk for any inaccuracies.
Ryan DiniusSenior Vice [email protected]
Sid WarsinskeSenior [email protected]
Kidder Mathews601 Union StreetSuite 4720Seattle, WA 98101206.296.9600 kiddermathews.com