South 46th Street Apartment Homes
734-40 S 46th StSan Diego, CA 92113
OFFERING MEMORANDUM | WELL-MAINTAINED 5-UNIT APARTMENT WITH UPSIDE
Max Delbecq, MBA (858) 333-7701Lic: 01964069 [email protected]
South 46th Street Apartment HomesCONTENTS
Exclusively Marketed by:
Max Delbecq, MBALic: 01964069(858) 333-7701 [email protected]
We obtained the following information above from sources we believe to be reliable. However, we have not verified its accuracy and make no guarantee, warranty or representation about it. It is submitted subject to the possibility of errors, omissions,change of price, rental or other conditions, prior sale, lease or financing, or withdrawal without notice. We include projections, opinions, assumptions or estimates for example only, and they may not represent the current or future performance of theproperty. You and your tax and legal advisors should conduct your own investigation of the property and transaction.
1550 Hotel Circle North #225San Diego, CA 92108
01 Executive Summary Investment Summary 5
Unit Mix Summary 7
Location Summary 8
02 Property Description Property Features 10
Aerial Map 11
Common Amenities 12
Unit Amenities 13
Property Images 14
03 Sale Comps sales comps 27
price sens 28
Sale Comparables 29
Sale Comparables Summary 32
Sale Comparables Charts 33
Sale Comparables Map 34
04 Rent Roll Rent Roll 36
05 Financial Analysis Income & Expense Analysis 38
Multiyear Cash Flow Assumptions 39
Cash Flow Analysis 40
Disposition Sensitivity Analysis 42
Setup 43
06 Demographics Demographics 45
Demographic Charts 47
Advisor Profile 49
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 Top
Gun CRE, Inc. and it should not be made available to any other person or entity without the written consent of Top Gun CRE, Inc..
By taking possession of and reviewing the information contained herein the recipient agrees to hold and treat all such information in the strictest confidence. The recipient
further agrees that recipient will not photocopy or duplicate any part of the offering memorandum. If you have no interest in the subject property, please promptly return
this offering memorandum to Top Gun CRE, Inc.. This offering memorandum has been prepared to provide summary, unverified financial and physical 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. Top Gun CRE, Inc. 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, PCBs or asbestos, the compliance with local, state and federal regulations, the
physical condition of the improvements thereon, or 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 offering memorandum has been obtained from sources we believe reliable; however, Top Gun CRE, Inc. has not verified, and will not verify,
any of the information contained herein, nor has Top Gun CRE, Inc. 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. Prospective buyers shall be responsible for their costs and expenses of investigating the subject property.
South 46th Street Apartment Homes Confidentiality and Disclaimer | 03
CONFIDENTIALITY AND DISCLAIMER
PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.
PLEASE CONTACT TOP GUN CRE, INC. FOR MORE DETAILS.
Copyright © 2020 TOP GUN CRE, INC. All Rights Reserved.
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Executive Summary
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South 46th Street Apartment Homes Investment Summary | 05
OFFERING SUMMARY
ADDRESS 734-40 S 46th StSan Diego CA 92113
FINANCIAL SUMMARY
PROPOSED FINANCING
New 1st Trust Deed
LOAN TYPE Amortized
DOWN PAYMENT $533,000
LOAN AMOUNT $492,000
INTEREST RATE 3.50 %
LOAN TERMS 5-years
ANNUAL DEBT SERVICE $26,513
LOAN TO VALUE 48 %
AMORTIZATION PERIOD 30 Years
DEMOGRAPHICS 1 MILE 3 MILE 5 MILE
OFFERING PRICE $1,010,000
PRICE PSF $305
PRICE PER UNIT $202,000
OCCUPANCY 97.00 %
NOI (CURRENT) $31,358
NOI (Pro Forma) $58,632
CAP RATE (CURRENT) 3.10 %
CAP RATE (Pro Forma) 5.81 %
COUNTY San Diego
MARKET Mountain View
BUILDING SF 3,31 0 SF
LAND SF 6,11 6
NUMBER OF UNITS 5
YEAR BUILT 1 955
APN 551 - 1 22 - 21 - 00
OWNERSHIP TYPE Fee Simple
2020 Population 37,1 87 248,531 621,993
2020 Median HH Income $44,477 $51,710 $57,973
2020 Average HH Income $59,040 $70,017 $81,895
South 46th Street Apartment Homes Investment Summary |06
Top Gun CRE, Inc., as exclusive listing broker, is pleased topresent the “South 46th Street Apartment Homes” a new,value-add, 5-unit apartment listing located in the quiet,family-friendly sub-market in southeastern San Diego ofMountain View.
Built 1955 and comprised of a desirable unit mix of 2 and 1-bedroom units, this well-maintained property sits on adecent, over 6,000 SF lot with mature landscaping on aquiet, residential street. It has been owned long-term andcared for by a pride of ownership family trust for the last 2decades, and is ready for your upgrades.
The unit mix is: (1) 2bed+2bath, (2) 2bed+1bath units, and(2) 1bed+1bath units, for an estimated combined total of3,310 rentable SF. It sits on a roughly 6,116 SF lot zoned RS-1-7. There are 3 rear storage garages allocated to the 2-bedroom units, and a common laundry room storage areawith laundry hookups and storage lockers accessible via therear alley. The mature landscaping and ample front yardprovide tenants with shade and privacy, and some room torelax outside off the main street. There are roughly 4-5parking spaces in the rear of the property.
The property has been well cared for and there is no readilyapparent significant deferred maintenance. The roofs werereplaced within the last 4 years, and newer bathrooms donewithin the last 2-4 years. The unit interiors, while somewhatdated and worn, are fairly clean and it should be relativelyeasy to renovate to modern finishes.
Current rents are significantly below market, allowinginvestors to further renovate the units and increase rents tomarket rates. It is estimated there is 45% upside in rents onaverage. All but 1 tenant is currently month to month.
The property is located in the southeastern portion of theMountain View neighborhood, which is one of San Diego’solder neighborhoods. The neighborhood became known as"Mountain View" because of its unobstructed view of SanMiguel Mountain to the east. It features wide streets and isgenerally quiet and family-friendly. The immediate areacontains several neighborhood parks and schools. Theproperty is located 1-block west of the 805 freeway, givingresidents easy access within a 10-15 minute drive toDowntown, Balboa Park & Zoo, Coronado Island, and theUS-Mexico border. Fun fact: Mountain View abuts two ofthe largest and oldest cemeteries in San Diego County -Mount Hope Cemetery and Greenwood Memorial Park.
In total, this property represents a fantastic value-addopportunity to increase income and build equity in adesirable and improving residential submarket with long-term appreciation potential.
South 46th Street Apartment Homes Unit Mix Summary | 07
Actual MarketUnit Mix # Units Square Feet Current Rent Rent PSF Monthly Income Market Rent Market Rent
PSFMarket Income
2 bd + 2 ba 1 800 $950 $1.06 $950 $1,650 $2.06 $1,650
2 bd + 1 ba 2 705 $1,063 $1.51 $2,126 $1,550 $2.20 $3,100
1 bd + 1 ba 2 550 $1,000 $1.95 $2,150 $1,350 $2.45 $2,700
Totals/Averages 5 662 $1,004 $1.60 $5,075 $1,517 $2.24 $7,450
South 46th Street Apartment Homes Location Summary | 08
The property is located in the southeastern portion of theMountain View neighborhood, which is one of San Diego’solder neighborhoods. The neighborhood became known as"Mountain View" because of its unobstructed view of SanMiguel Mountain to the east. It features wide streets and isgenerally quiet and family-friendly. The immediate areacontains several neighborhood parks and schools. Theproperty is located 1-block west of the 805 freeway, givingresidents easy access within a 10-15 minute drive toDowntown, Balboa Park & Zoo, Coronado Island, and theUS-Mexico border. Fun fact: Mountain View abuts two ofthe largest and oldest cemeteries in San Diego County -Mount Hope Cemetery and Greenwood Memorial Park.
Regional Map
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Pictures with Captions
South 46th Street Apartment Homes Property Features | 10
PROPERTY FEATURES
NUMBER OF UNITS 5
BUILDING SF 3,310
LAND SF 6,116
LAND ACRES .14
YEAR BUILT 1955
# OF PARCELS 1
ZONING TYPE RS-1-7
NUMBER OF STORIES 2
NUMBER OF BUILDINGS 1
NUMBER OF PARKING SPACES 3-4
PARKING RATIO .8
WASHER/DRYER Common Area Hookups
UTILITIES
WATER Owner
TRASH City
GAS Tenant
ELECTRIC Tenant
RUBS N/A
CONSTRUCTION
FRAMING Wood-frame
EXTERIOR Stucco
PARKING SURFACE Paved, Rear Alley
ROOF Composition
STYLE Pitched
LANDSCAPING Mature
South 46th Street Apartment Homes Aerial Map | 11
Common Amenities» Common Area Laundry & Storage
w/ W/D Hookups
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Unit Amenities» New Bathrooms Done Last 2-4 Years
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South 46th Street Apartment Homes Property Images | 15
Building Storage
South 46th Street Apartment Homes Property Images | 16
Common Laundry Room + Storage Area w/W/D Hookups
South 46th Street Apartment Homes Property Images | 17
740 2bed+2bath 740 2bed+2bath
740 2bed+2bath 740 2bed+2bath
South 46th Street Apartment Homes Property Images | 18
740 2bed+2bath 740 2bed+2bath
740 2bed+2bath 740 2bed+2bath
South 46th Street Apartment Homes Property Images | 19
740 2bed+2bath (New Bathrooms AllUnits)
740 2bed+2bath
740 2bed+2bath 740 2bed+2bath
South 46th Street Apartment Homes Property Images | 20
740 1/2 2bed+1bath 740 1/2 2bed+1bath
740 1/2 2bed+1bath 740 1/2 2bed+1bath
South 46th Street Apartment Homes Property Images | 21
740 1/2 2bed+1bath 740 1/2 2bed+1bath
740 1/2 2bed+1bath 740 1/2 2bed+1bath
South 46th Street Apartment Homes Property Images | 22
740 1/2 2bed+1bath 740 1/2 2bed+1bath
740 1/2 2bed+1bath 734 1bed+1bath
South 46th Street Apartment Homes Property Images | 23
734 1bed+1bath 734 1bed+1bath
734 1bed+1bath 734 1bed+1bath
South 46th Street Apartment Homes Property Images | 24
734 1bed+1bath 734 1bed+1bath
South 46th Street Apartment Homes Property Images | 25
4-5 Rear Parking 3 Garages for 2-bedroom Units
New Roof 4-Years Ago
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Sale Comparables
Sale Comparables Summary
Sale Comparables Charts
Sale Comparables Map
Comps Link:(Click for more details)
Comps:
TG LISTING!
Address 2136-38 Harrison 443-47 47th St 3750-60 Ocean View 4519-33 Delta 1505-25 S 40th Average Subject
Date Sold 7/28/2020 2/24/2020 12/31/2019 10/28/2019 1/10/2020 TBD# Units 5 8 10 12 5 5
Current GSI $87,888 $168,385 $189,720 $115,920 $97,800 $61,500
Current NOI $57,889 $109,450 $122,629 $75,348 $63,160 $35,003
Market GSI $109,800 $168,385 $189,720 $189,600 $116,400 $94,200
Market NOI $80,400 $109,450 $122,629 $123,240 $75,660 $63,347
Year Built 1898, 1925, 1979 1957 1958 1954 1944 1955Lot SF 7,947 5,663 7,841 19,328 17,668 6,116Zoning
Unit Mix (1) 3+2, (2) 2+1, (1) studio (8) 2bed+1bath (10) 2bed+1bath (4) 2+1, (8) 1+1 (1) 5+3 SFR, (4) 2+1Avg. Unit SF 718 690 705 745 965 765 662
Avg. Unit Rent $1,465 $1,754 $1,581 $805 $1,630 $1,447 $1,025Avg. Rent/SF $2.04 $2.54 $2.24 $1.08 $1.69 $1.92 $1.55
Notes/Condition
All units full renovated with
new kitchens, bathrooms,
flooring 10 yrs. ago,
upgraded plumbing,
electrical, roofs as well.
Good rents with upside
Fully renovated inside and
out with new
kitchens/bathrooms/floorin
g, paint, and landscaping.
Market rents.
Seller completed
renovations on 6 units prior
to sale. New kitchens,
heating systems, flooring,
paint, and bathrooms, etc.
Not a lot of info on this one,
but appears to need a lot of
work and be a fixer with really
low rents. Large lot, possible
development potential.
5-bedroom house + (4)
2bed+1bath units. Lower
rents, appears to need some
work, but all kitchens and
some baths updated. Larger
lot with some development
potential.
South 46th Street Apartment Homes sales comps | 27
Price $1,050,000 $1,990,000 $2,100,000 $1,930,000 $1,300,000 $1,010,000
Price/Unit $210,000 $248,750 $210,000 $160,833 $260,000 $217,917 $202,000SF 3,589 5,520 7,050 8,943 4,827
Price/SF $293 $361 $298 $216 $269 $287 $305
Current CAP Rate 5.51% 5.50% 5.84% 3.90% 4.86% 5.12% 3.10%
Current GRM 11.95 11.82 11.07 16.65 13.29 12.96 16.58
Market GRM 9.56 11.82 11.07 10.18 11.17 10.76 10.72Market CAP Rate 7.66% 5.50% 5.84% 6.39% 5.82% 6.24% 5.81%
Price/Unit Price/SF Current GRM
Market GRM Current Cap Rate Market Cap Rate
Market Market
Sale Price GRM CAP Rate Price/Unit Price/SF GRM CAP Rate
$900,000 14.63 3.89% $180,000 $272 9.55 7.04%$925,000 15.04 3.78% $185,000 $279 9.82 6.85%$950,000 15.45 3.68% $190,000 $287 10.08 6.67%$975,000 15.85 3.59% $195,000 $295 10.35 6.50%
*Suggested List
Price Based on
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South 46th Street Apartment Homes price sens | 28
$1,000,000 16.26 3.50% $200,000 $302 10.62 6.33%$1,010,000 16.58 3.10% $202,000 $305 10.72 5.81%$1,050,000 17.07 3.33% $210,000 $317 11.15 6.03%$1,075,000 17.48 3.26% $215,000 $325 11.41 5.89%$1,100,000 17.89 3.18% $220,000 $332 11.68 5.76%$1,125,000 18.29 3.11% $225,000 $340 11.94 5.63%$1,150,000 18.70 3.04% $230,000 $347 12.21 5.51%
South 46th Street Apartment Homes Sale Comparables | 29
1
1505-25 S 40thSan Diego, CA 92113
TOTAL UNITS 5
YEAR BUILT 1944
SALE PRICE $1,300,000
PRICE/UNIT $260,000
PRICE/SF $269.32
CAP RATE 4.86 %
GRM 13.29
BUILDING SF 4,827
LAND SF 17,668
CLOSING DATE 1/10/2020
DISTANCE 1.2 miles
Cap Rate Range 3.12 % - 5.84 %
LOW HIGH
Price/Unit Range $160,833 - $260,000
LOW HIGH
Price S/F $216 - $361
LOW HIGH
2
4519-33 Delta StSan Diego, CA 92113
TOTAL UNITS 12
YEAR BUILT 1954
SALE PRICE $1,930,000
PRICE/UNIT $160,833
PRICE/SF $215.81
CAP RATE 3.90 %
GRM 16.65
BUILDING SF 8,943
LAND SF 19,328
CLOSING DATE 10/28/2019
DISTANCE 1.1 miles
Cap Rate Range 3.12 % - 5.84 %
LOW HIGH
Price/Unit Range $160,833 - $260,000
LOW HIGH
Price S/F $216 - $361
LOW HIGH
South 46th Street Apartment Homes Sale Comparables | 30
3
3750-60 Ocean View BlvdSan Diego, CA 92113
TOTAL UNITS 10
YEAR BUILT 1958
SALE PRICE $2,100,000
PRICE/UNIT $210,000
PRICE/SF $297.87
CAP RATE 5.84 %
GRM 11.07
BUILDING SF 7,050
LAND SF 7,841
CLOSING DATE 12/31/2019
DISTANCE 1.2 miles
Cap Rate Range 3.12 % - 5.84 %
LOW HIGH
Price/Unit Range $160,833 - $260,000
LOW HIGH
Price S/F $216 - $361
LOW HIGH
4
443-47 47th StSan Diego, CA 92102
TOTAL UNITS 8
YEAR BUILT 1957
SALE PRICE $1,990,000
PRICE/UNIT $248,750
PRICE/SF $360.51
CAP RATE 5.50 %
GRM 11.82
BUILDING SF 5,520
LAND SF 5,663
CLOSING DATE 2/24/2020
DISTANCE 1.3 miles
Cap Rate Range 3.12 % - 5.84 %
LOW HIGH
Price/Unit Range $160,833 - $260,000
LOW HIGH
Price S/F $216 - $361
LOW HIGH
South 46th Street Apartment Homes Sale Comparables | 31
5
2136-38 Harrison AveSan Diego, CA 92113
TOTAL UNITS 5
YEAR BUILT 1898
SALE PRICE $1,050,000
PRICE/UNIT $210,000
PRICE/SF $292.56
CAP RATE 5.51 %
GRM 11.95
BUILDING SF 3,589
LAND SF 7,947
CLOSING DATE 7/28/2020
DISTANCE 2.9 miles
Cap Rate Range 3.12 % - 5.84 %
LOW HIGH
Price/Unit Range $160,833 - $260,000
LOW HIGH
Price S/F $216 - $361
LOW HIGH
S
South 46th Street ApartmentHomes
734-40 S 46th StSan Diego, CA 92113
TOTAL UNITS 5
YEAR BUILT 1955
ASKING PRICE $1,025,000
PRICE/UNIT $205,000
PRICE/SF $309.67
CAP RATE 3.12 %
OCCUPANCY 97.00 %
BUILDING SF 3,310
LAND SF 6,116
Cap Rate Range 3.12 % - 5.84 %
LOW HIGH
Price/Unit Range $160,833 - $260,000
LOW HIGH
Price S/F $216 - $361
LOW HIGH
South 46th Street Apartment Homes Sale Comparables Summary | 32
PROPERTY Units Built Sale Price Price/Unit PSF Cap Rate Close Date DISTANCE (mi)
1 1505-25 S 40thSan Diego, CA 92113 5 1944 $1,300,000 $260,000 $269.32 4.86% 1/10/2020 1.20
2 4519-33 Delta StSan Diego, CA 92113 12 1954 $1,930,000 $160,833 $215.81 3.90% 10/28/2019 1.10
3 3750-60 Ocean View BlvdSan Diego, CA 92113 10 1958 $2,100,000 $210,000 $297.87 5.84% 12/31/2019 1.20
4 443-47 47th StSan Diego, CA 92102 8 1957 $1,990,000 $248,750 $360.51 5.50% 2/24/2020 1.30
5 2136-38 Harrison AveSan Diego, CA 92113 5 1898 $1,050,000 $210,000 $292.56 5.51% 7/28/2020 2.90
AVERAGES 8 1942 $1,674,000 $217,917 $287.21 5.12%
SUBJECT 5 1955 $1,010,000 $202,000 $305.67 3.1 0%
South 46th Street Apartment Homes Sale Comparables Charts | 33
South 46th Street Apartment Homes Sale Comparables Map | 34
# Address City
S 734-40 S 46th St San Diego
1 1505-25 S 40th San Diego
2 4519-33 Delta St San Diego
3 3750-60 Ocean View Blvd San Diego
4 443-47 47th St San Diego
5 2136-38 Harrison Ave San Diego
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Rent Roll Rent UpsideEst. Approx. Last Last Sec. Current Stabilized Renovated
Unit # Address Type SqFt Move In Increase Remodeled Deposit Rent (Per SF) Rent (Per SF) (Market) Rent (Per SF)
2 736 1bed+1bath 550 $1,000 $1.82 $1,150 $2.09 $1,350 $2.45
3 738 2bed+1bath 700 $1,050 $1.50 $1,350 $1.93 $1,550 $2.21
5 740.5 2bed+1bath 710 $1,075 $1.51 $1,350 $1.90 $1,550 $2.18
Sub Totals: 3,310 $5,125 $1.55 $6,450 $1.95 $7,450 $2.25 Average Rent Upside
Unit Rent Analysis and Other Income Unit Mix
Avg. SqFt Avg. Current Avg. Stabilized Avg. Renovated# of Units Per Unit Rent/Unit Rent/Unit Rent/Unit
3bed+3.5bath
2bed+1bath 2 705 $1,063 $1,350 $1,5502 550 $1,075 $1,150 $1,350
SRO/Asst. Liv.
Other
Laundry: $200Parking:Storage: $200
Other:$5,125 $6,450 $7,850
$61,500 $77,400 $94,200
Other Income:
45%
Total Monthly Income:Total Yearly Income:
Total/Monthly:
Type
2bed+2bath
1bed+1bath
3bed+2bath
Commercial
Studio
4bed+3bath4bed+2bath
4bed+3bath0%
3bed+2bath0%
3bed+1bath0%
2bed+2bath20%
2bed+1bath40%
1bed+1bath40%
Studio0%
Other
Unit Mix
0% 20% 40% 60% 80% 100%
734
736
738
740
740.5
South 46th Street Apartment Homes Rent Roll | 36
Notes
1 734 1bed+1bath 550 $1,000 $2.09 $1,150 $2.09 $1,350 $2.45
4 740 2bed+2bath 800 $950 $1.06 $1,450 $1.81 $1,650 $2.06
3bed+1bath1 800 $950 $1,450 $1,650
5 3,310 $5,075 $6,450 $7,450
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Multiyear Cash Flow Assumptions
Multiyear Cash Flow Projections
Disposition Sensitivity Analysis
Setup
South 46th Street Apartment Homes Income & Expense Analysis | 38
INCOME CURRENT PRO FORMA
Gross Potential Rent $61,500 $89,400
Laundry/Storage $4,800
Gross Potential Income $61,500 $94,200
Less: General Vacancy $1,845 $2,682
Effective Gross Income $59,655 $91,518
Less: Expenses $27,635 $32,747
Net Operating Income $32,020 $58,771
Annual Debt Service $26,513 $26,513
Debt Coverage Ratio 1.21 2.22
Cash Flow After Debt Service $5,507 $32,258
Principal Reduction $9,293 $9,293
Total Return 2.8 % $14,800 7.8 % $41,551
EXPENSES CURRENT PRO FORMA
Real Estate Taxes $2,534 $12,670 $2,534 $12,670
Insurance $529 $2,643 $529 $2,643
Management Fee $597 $2,983 $915 $4,576
Repairs & Maintenance $615 $3,075 $1,319 $6,594
Water / Sewer $667 $3,334 $667 $3,334
Contracted Services $336 $1,680 $336 $1,680
Reserves/Misc. $250 $1,250 $250 $1,250
Total Operating Expense $5,527 $27,635 $6,549 $32,747
Annual Debt Service $5,303 $26,513 $5,303 $26,513
Expense / SF $8.34 $9.89
% of EGI 46.32 % 35.78 %
Per Unit Per Unit
REVENUE ALLOCATION
CURRENT
DISTRIBUTION OF EXPENSES
CURRENT
South 46th Street Apartment Homes Multiyear Cash Flow Assumptions | 39
GLOBAL
Offering Price $1,025,000
Analysis Period 10 year(s)
Consumer Price Index 2.50 %
Millage Rate (not a growth rate) 1.23199 %
Exit Cap Rate 5.28 %
INCOME
Gross Potential Rent 7.50 %
Laundry/Storage 2.50 %
PROPOSED FINANCING
New 1st Trust Deed
Loan Type Amortized
Down Payment $533,000
Loan Amount $492,000
Interest Rate 3.50 %
Loan Terms 5-years
Annual Debt Service $26,513
Loan to Value 48 %
Amortization Period 30 Years
South 46th Street Apartment Homes Cash Flow Analysis |40
CASH FLOW
Calendar Year CURRENT Pro Forma Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10Gross Potential RevenueGross Rental Income $61,500 $89,400 $96,105 $103,313 $111,061 $119,391 $128,345 $137,971 $148,319 $159,443
Laundry/Storage $4,800 $4,920 $5,043 $5,169 $5,298 $5,431 $5,567 $5,706 $5,848
Gross Potential Income $61,500 $94,200 $101,025 $108,356 $116,230 $124,689 $133,776 $143,538 $154,025 $165,291
General Vacancy -$1,845 -$2,682 -$2,883 -$3,099 -$3,332 -$3,582 -$3,850 -$4,139 -$4,450 -$4,783
Effective Gross Income $59,655 $91,518 $98,142 $105,256 $112,899 $121,108 $129,926 $139,399 $149,575 $160,508
Operating ExpensesReal Estate Taxes $12,670 $12,670 $12,670 $12,670 $12,670 $12,670 $12,670 $12,670 $12,670 $12,670
Insurance $2,643 $2,643 $2,643 $2,643 $2,643 $2,643 $2,643 $2,643 $2,643 $2,643
Management Fee $2,983 $4,576 $4,576 $4,576 $4,576 $4,576 $4,576 $4,576 $4,576 $4,576
Repairs & Maintenance $3,075 $6,594 $6,594 $6,594 $6,594 $6,594 $6,594 $6,594 $6,594 $6,594
Water / Sewer $3,334 $3,334 $3,334 $3,334 $3,334 $3,334 $3,334 $3,334 $3,334 $3,334
Contracted Services $1,680 $1,680 $1,680 $1,680 $1,680 $1,680 $1,680 $1,680 $1,680 $1,680
Reserves/Misc. $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250 $1,250
Total Operating Expense $27,635 $32,747 $32,747 $32,747 $32,747 $32,747 $32,747 $32,747 $32,747 $32,747
Net Operating Income $32,020 $58,771 $65,395 $72,509 $80,152 $88,361 $97,179 $106,652 $116,828 $127,761Annual Debt Service $26,513 $26,513 $26,513 $26,513 $26,513 $26,513 $26,513 $26,513 $26,513 $26,513
Cash Flow $5,507 $32,258 $38,882 $45,997 $53,639 $61,848 $70,666 $80,139 $90,315 $101,248
Effective Gross Income vs Operating Expenses Cash Flow
South 46th Street Apartment Homes Cash Flow Analysis | 41
Calendar Year CURRENT Pro Forma Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10Financial MetricsCash on Cash Return b/t 1.03 % 6.05 % 7.29 % 8.63 % 10.06 % 11.60 % 13.26 % 15.04 % 16.94 % 19.00 %
CAP Rate 3.12 % 5.73 % 6.38 % 7.07 % 7.82 % 8.62 % 9.48 % 10.41 % 11.40 % 12.46 %
Debt Coverage Ratio 1.21 2.22 2.47 2.73 3.02 3.33 3.67 4.02 4.41 4.82
Operating Expense Ratio 46.32 % 35.78 % 33.36 % 31.11 % 29.00 % 27.03 % 25.20 % 23.49 % 21.89 % 20.40 %
Loan to Value 47.94 % 47.04 % 46.12 % 45.10 % 44.10 % 43.04 % 41.94 % 40.82 % 39.63 % 38.39 %
Breakeven Ratio 90.77 % 64.75 % 60.38 % 56.30 % 52.49 % 48.93 % 45.61 % 42.51 % 39.62 % 36.92 %
Price / SF $309.67 $309.67 $309.67 $309.67 $309.67 $309.67 $309.67 $309.67 $309.67 $309.67
Price / Unit $205,000 $205,000 $205,000 $205,000 $205,000 $205,000 $205,000 $205,000 $205,000 $205,000
Income / SF $18.02 $27.64 $29.65 $31.79 $34.10 $36.58 $39.25 $42.11 $45.18 $48.49
Expense / SF $8.34 $9.89 $9.89 $9.89 $9.89 $9.89 $9.89 $9.89 $9.89 $9.89
South 46th Street Apartment Homes Disposition Sensitivity Analysis | 42
5 YEAR SENSITIVITY ANALYSISEXIT CAP RATE PROJECTED
SALES PRICESALES
PRICE/UNITSALES PRICE PSF PROCEEDS AFTER
LOAN PAYOFFIRR
4.28% $1,872,700 $374,540 $566 $1,425,063 25.75%
4.53% $1,769,350 $353,870 $535 $1,321,713 24.07%
4.78% $1,676,811 $335,362 $507 $1,229,174 22.48%
5.03% $1,593,471 $318,694 $481 $1,145,833 20.97%
5.28% $1,518,022 $303,604 $459 $1,070,385 19.54%
5.53% $1,449,396 $289,879 $438 $1,001,758 18.17%
5.78% $1,386,705 $277,341 $419 $939,068 16.85%
6.03% $1,329,214 $265,843 $402 $881,576 15.59%
6.28% $1,276,299 $255,260 $386 $828,661 14.38%
10 YEAR SENSITIVITY ANALYSISEXIT CAP RATE PROJECTED
SALES PRICESALES
PRICE/UNITSALES PRICE PSF PROCEEDS AFTER
LOAN PAYOFFIRR
4.28% $2,985,069 $597,014 $902 $2,577,794 21.72%
4.53% $2,820,330 $564,066 $852 $2,413,055 21.09%
4.78% $2,672,824 $534,565 $807 $2,265,548 20.50%
5.03% $2,539,979 $507,996 $767 $2,132,704 19.94%
5.28% $2,419,715 $483,943 $731 $2,012,440 19.41%
5.53% $2,310,325 $462,065 $698 $1,903,049 18.90%
5.78% $2,210,397 $442,079 $668 $1,803,122 18.42%
6.03% $2,118,756 $423,751 $640 $1,711,480 17.97%
6.28% $2,034,410 $406,882 $615 $1,627,135 17.53%
Reno. Cost/Unit (15,000)$ Down Payment 52% (533,000)$ (533,000)$ (533,000)$ Bldg. SF 3,310 Tot. Reno. Cost (25,000)$
Annualized Operating Data Expenses (Estimated, Unless Where Indicated by* Below)
Current % Return Stabilized % Return Renovated % Return 1.23199% Current Stabilized RenovatedGross Rent 61,500$ 77,400$ 89,400$ Property Taxes (New) (12,670)$ (12,670)$ (12,670)$ Vacancy (1,845)$ 3.0% (2,322)$ 3.0% (2,682)$ 3.0% Insurance (2,643)$ (2,643)$ (2,643)$ Other Income -$ -$ 4,800$ Off-Site Management (2,983)$ (3,754)$ (4,576)$ Gross Op. Income 59,655$ 75,078$ 91,518$ SDGE -$ -$ -$ Expenses (27,635)$ 45% (31,925)$ 41% (32,747)$ 37% Water (3,334)$ (3,334)$ (3,334)$ NOI 32,020$ 43,153$ 58,771$ Sewer -$ -$ -$ Debt Service (26,512)$ (26,512)$ (26,512)$ Trash -$ -$ -$ Pre-Tax Cash Flow 5,509$ 1.03% 16,642$ 2.98% 32,260$ 5.31% Contracted Services (1,680)$ (1,680)$ (1,680)$ Principal Reduction 9,442$ 9,442$ 9,442$ Repairs/Maintenance (3,075)$ (6,594)$ (6,594)$ "Earned" Return 14,951$ 2.81% 26,084$ 4.67% 41,702$ 6.86% On-Site Manager -$ -$ -$
Reserves/Misc. (1,250)$ (1,250)$ (1,250)$ Appreciation* 71,750$ 71,750$ 71,750$ Total Expenses (27,635)$ (31,925)$ (32,747)$ "Unearned" Return 86,701$ 16.27% 97,834$ 18.36% 113,452$ 18.66%
Per Unit (5,527)$ (6,385)$ (6,549)$ *Estimated Yearly Property Appreciation Rate Based on 30-year CAGR from MLS Sales Data: 7.00% % of Gross Income 45% 41% 37%
Tax Rate:
Valuators @ Stab. Value
Current Value
Valuators @ Reno. Value
Proposed FinancingRenovated ValueBldg. Stats. Stabilized Value
551-122-21-00
South 46th Street Apartment Homes Setup | 43
Purchase Price $ rent Stabi lized RenovatedPrice/Unit $ 202,000 # of Units 5 Reno. Cost/Unit $ (5,000) Price/SF $ 305 New 1st Trust Deed $ 492,000 $ 492,000 $
Current16.58
3.10%
"Market"GRM 10.72 GRM 13.05 GRM 12.21 DCR 1.21 1.63 2.22CAP Rate 5.81% CAP Rate 4.26% CAP Rate 5.11% LTV 48% 48% 43%
1,010,000 Year Built 1955 Purchase Price $ 1,010,000 Purchase Price $ 1,200,000 Cur
Tot. Reno. Cost $ (75,000) Tot. Investment $ (600,000)
APN(s): 3 Year IRR 3% 3 Year IRR 10% Monthly Debt Service ($2,209) ($2,209) ($2,209)Annual Debt Service ($26,512) ($26,512) ($26,512)
492,000Avg. Unit Rent $ 1,015 Avg. Unit SF 662 Tot. Investment $ (550,000) Interest Rate 3.50% 3.50% 3.50%Tot. Income Upside 55% Lot SF 6,116 Net Sale Equity $ 5 25,000 Net Sale Equity $ 715,000 Amortization Period 30 30 30Off-Street Parking 4 % Imp./Land 54% Total Return $ (25,000) Total Return $ 115,000 Due In (Years) 5 5 5Type/Quality Fixer/Value-Add Zoning RS-1-7 1 Year IRR 0% 1 Year IRR 13%
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Demographic Charts
South 46th Street Apartment Homes Demographics | 45
POPULATION 1 MILE 3 MILE 5 MILE
2000 Population 34,488 238,663 579,525
2010 Population 35,736 239,323 590,218
2020 Population 37,187 248,531 621,993
2025 Population 37,799 252,245 639,413
2020 African American 6,225 29,854 68,735
2020 American Indian 262 1,981 4,998
2020 Asian 3,075 35,869 84,342
2020 Hispanic 26,279 149,508 305,918
2020 Other Race 14,158 76,105 146,184
2020 White 11,590 90,475 279,174
2020 Multiracial 1,568 12,535 34,788
2020-2025: Population: Growth Rate 1.65 % 1.50 % 2.75 %
2020 HOUSEHOLD INCOME 1 MILE 3 MILE 5 MILE
less than $15,000 1,375 7,452 23,598
$15,000-$24,999 1,248 7,801 20,096
$25,000-$34,999 1,111 7,139 19,831
$35,000-$49,999 1,316 9,863 28,394
$50,000-$74,999 1,807 12,797 38,760
$75,000-$99,999 878 7,694 25,902
$100,000-$149,999 1,116 8,687 32,063
$150,000-$199,999 302 3,245 14,162
$200,000 or greater 160 2,427 12,745
Median HH Income $44,477 $51,710 $57,973
Average HH Income $59,040 $70,017 $81,895
HOUSEHOLDS 1 MILE 3 MILE 5 MILE
2000 Total Housing 9,337 66,753 202,776
2010 Total Households 9,044 64,874 202,599
2020 Total Households 9,313 67,105 215,552
2025 Total Households 9,423 67,984 223,517
2020 Average Household Size 3.97 3.49 2.76
2000 Owner Occupied Housing 3,646 27,640 74,850
2000 Renter Occupied Housing 5,438 37,032 119,603
2020 Owner Occupied Housing 3,560 27,300 80,371
2020 Renter Occupied Housing 5,753 39,805 135,181
2020 Vacant Housing 559 3,631 17,940
2020 Total Housing 9,872 70,736 233,492
2025 Owner Occupied Housing 3,678 28,091 82,537
2025 Renter Occupied Housing 5,744 39,892 140,980
2025 Vacant Housing 584 3,713 18,260
2025 Total Housing 10,007 71,697 241,777
2020-2025: Households: Growth Rate 1.20 % 1.30 % 3.65 %
Source: esri
South 46th Street Apartment Homes Demographics | 46
2020 POPULATION BY AGE 1 MILE 3 MILE 5 MILE
2020 Population Age 30-34 2,887 20,080 55,186
2020 Population Age 35-39 2,223 16,619 46,842
2020 Population Age 40-44 2,023 13,875 38,699
2020 Population Age 45-49 2,081 13,699 36,876
2020 Population Age 50-54 1,927 12,897 34,809
2020 Population Age 55-59 1,765 12,547 34,203
2020 Population Age 60-64 1,470 11,183 30,806
2020 Population Age 65-69 1,124 8,853 25,360
2020 Population Age 70-74 777 6,513 19,079
2020 Population Age 75-79 545 4,426 12,705
2020 Population Age 80-84 363 3,056 8,634
2020 Population Age 85+ 334 3,123 9,555
2020 Population Age 18+ 25,945 185,880 485,678
2020 Median Age 29 31 34
2020 INCOME BY AGE 1 MILE 3 MILE 5 MILE
Median Household Income 25-34 $50,348 $54,321 $61,478
Average Household Income 25-34 $61,457 $69,546 $80,673
Median Household Income 35-44 $49,878 $58,231 $69,411
Average Household Income 35-44 $64,260 $78,203 $92,388
Median Household Income 45-54 $55,689 $61,992 $71,669
Average Household Income 45-54 $68,527 $81,963 $97,659
Median Household Income 55-64 $46,251 $55,207 $61,718
Average Household Income 55-64 $57,046 $72,614 $87,327
Median Household Income 65-74 $36,364 $41,451 $46,273
Average Household Income 65-74 $51,866 $60,752 $69,985
Average Household Income 75+ $39,719 $44,467 $52,296
2025 POPULATION BY AGE 1 MILE 3 MILE 5 MILE
2025 Population Age 30-34 3,268 21,087 56,666
2025 Population Age 35-39 2,549 18,174 49,932
2025 Population Age 40-44 2,191 15,533 43,313
2025 Population Age 45-49 1,941 13,385 36,977
2025 Population Age 50-54 1,963 12,962 35,000
2025 Population Age 55-59 1,747 12,171 33,040
2025 Population Age 60-64 1,572 11,459 31,560
2025 Population Age 65-69 1,316 9,966 27,877
2025 Population Age 70-74 948 7,722 22,279
2025 Population Age 75-79 690 5,673 16,678
2025 Population Age 80-84 424 3,492 10,143
2025 Population Age 85+ 348 3,286 10,010
2025 Population Age 18+ 26,755 190,589 504,358
2025 Median Age 30 32 35
2025 INCOME BY AGE 1 MILE 3 MILE 5 MILE
Median Household Income 25-34 $52,635 $57,903 $68,184
Average Household Income 25-34 $65,649 $76,765 $90,034
Median Household Income 35-44 $54,338 $63,913 $78,082
Average Household Income 35-44 $70,378 $86,399 $103,826
Median Household Income 45-54 $58,902 $68,145 $80,160
Average Household Income 45-54 $75,162 $92,463 $110,767
Median Household Income 55-64 $50,764 $58,816 $67,172
Average Household Income 55-64 $63,476 $81,448 $97,949
Median Household Income 65-74 $38,775 $44,906 $50,947
Average Household Income 65-74 $57,528 $69,410 $79,737
Average Household Income 75+ $45,126 $51,920 $60,994
South 46th Street Apartment Homes Demographic Charts | 47
1 Mile Radius 3 Mile Radius 5 Mile Radius
2020 Household Income
1 Mile Radius 3 Mile Radius 5 Mile Radius
2020 Population by Race
South 46th Street Apartment Homes Demographic Charts | 48
2020 Household Occupancy - 1 Mile Radius
Average Income Median Income
2020 Household Income Average and Median
1550 Hotel Circle North #225San Diego, CA 92108T 619.550.4293
C 858.333.7701
CalDRE #01964069
PROFESSIONAL BACKGROUND
Max specializes in exclusively representing apartment buyers and sellers in San Diego, CA, and is President and co-founder of Top GunCRE, Inc. He has been active in commercial real estate as an investor since 2012, and has been licensed as a real estate broker since 2014.
A native of Santa Clara, CA, Max moved to Los Angeles in 2005 to study business at USC. As a tenant, Max moved 10 times in 11 years as his studies and post-graduate work took him all over So-Cal and he thus became fascinated by apartments. Wanting to gain a deeper understanding of the investment world, he plunged head first into commercial apartment real estate brokerage.
During his MBA at USC, Max purchased a commercial property investment and management company that specializes in providing music rehearsal and recording spaces for musicians. Max and his partners have grown that business roughly 800% since 2012, and it now has 103 rental units across 5 locations under management, and generates returns for investors far above normal.
As a student and practitioner of business, real estate, and entrepreneurship, Max provides a unique combination of theoreticalknowledge and real-world savvy. He was mentored by some of the highest producing apartment brokers in So-Cal in his early years, andhe carries the success tactics of those mentors and his passion for entrepreneurship and real estate into all that he does. He prideshimself on providing the highest level of customer service, business acumen, and likes to believe he will generate for his clients: "thehighest price, in the quickest time, with the least amount of hassle".
Max is also a drummer of 23 years, and in his free time enjoys progressive heavy metal and jazz music, exercising, and travel. He resides in Tierrasanta with his wife and 18-month old daughter.
EDUCATION
B.S. Business Administration: University of Southern California (USC), 2005MBA, Business, Entrepreneurship, Finance, Real Estate: University of Southern California (USC), 2014CA Real Estate Salesperson License: Nationwide Real Estate School (2014)CA Real Estate Broker License: The Claire Institute (2018)
MEMBERSHIPS & AFFILIATIONS
San Diego Regional Chamber of CommerceSan Diego Association of RealtorsCalifornia Association of RealtorsNational Association of RealtorsSan Diego County Apartment Owners Association
MAX DELBECQPresident
MAX DELBECQ • President • 619.550.4293 • [email protected]
ADVISOR BIO
South 46th Street Apartment Homes
Exclusively Marketed by:
Max Delbecq, MBALic: 01964069(858) 333-7701 [email protected]
1550 Hotel Circle North #225, San Diego, CA 92108
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