802 SOUTH MAIN STREET REDEFINING MULTIFAMILY INVESTMENTS (513) 878-7704
ADGMultifamily.com
ADG MULTIFAMILY
1
CONFIDENTIALITY & DISCLAIMER 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 Marcus & Millichap and it should not be made available to any other person or entity without the written consent of Marcus & Millichap. 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 Marcus & Millichap. 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. Marcus & Millichap 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 of 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, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap 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.
PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY. PLEASE CONTACT ANDREWS | DICKMAN FOR MORE DETAILS.
2
ADG MULTIFAMILY
PRESENTED BY
BRIAN JOHNSTON
Associate 513-878-7704 Brian.Johnston@marcusmillichap.com
JORDAN DICKMAN
First Vice President of Investments Director, National Multi Housing Group 513-878-7735 Jordan.Dickman@marcusmillichap.com
NICK ANDREWS
First Vice President of Investments Director, National Multi Housing Group 513-878-7748 Nick.Andrews@marcusmillichap.com
ADG MULTIFAMILY
3
the INDEX
01 02 03 04
the asset the competitive set the persepective the market
CALABASAS, CALIFORNIA | HQ
80+ | OFFICES
2,500 | EMPLOYEES
UNRIVALED SUCCESS IN THE MIDWEST Nick Andrews
First Vice President Investments Director, NMHG
Jordan Dickman
First Vice President Investments Director, NMHG
INVESTMENT ADVISORS
Austin Sum Investment Associate
Garry Schloemer
JD Schmerge Investment Associate
Brian Johnston
Investment Associate
Tim VanWingerden
Investment Associate
Investment Associate
VALUATION & RESEARCH
DEBT & STRUCTURED FINANCE
Jim Leonard
Derek Maddy
Senior Managing Director of Capital Markets MMCC
Financial & Research Analyst
Chris Litzler Senior Director MMCC
Alec Neesham Associate Director MMCC
OPERATIONS & MARKETING
Brittany Campbell-Koch Director of Operations
Josh Caruana
Vice President Regional Manager Indianapolis | Cincinnati | Louisville St Louis | Kansas City
Alex Papa
Sidney Bills
Marketing
Office Administrator
John Sebree
Senior Vice President National Director National Multi Housing Group
Liz Popp
Midwest Operations Manager
Michael Glass
Senior Vice President Midwest Division Manager National Director, Manufactured Home Communities Group
01
the ASSET
10 12
- property snapshot - photos of asset
802 SOUTH MAIN
PROPERTY SNAPSHOT 802 South Main Street, Franklin Ohio 45005
1979-2020
10 4 1,2 IN UNIT SURFACE
YEAR BUILT
NUMBER OF UNITS
NUMBER OF BUILDINGS
NUMBER OF STORIES
LAUNDRY
PARKING
TENANT PAYS: cable internet
CONCRETE WOOD PITCHED 2020 COPPER MIXED MIXED OWNER PAYS: trash
FOUNDATION
FRAMING
ROOF
WIRING
WATER/SEWER
ELECTRIC
02
the COMPETITIVE SET
16 18
- rent sort - market comparables
COMPETITIVE SET
RENT SORT Two Bedroom Apartment Rents Sorted by Net Rent Property
Year Built
Unit Type
SF
Market Rent
Utility Adjustment/Month
Net Rent
Net Rent/SF
Occupancy
Wyndemere Apartments
1991
2x2
930
$920.00
$0
$920
$0.99
100%
Harding House
1979
2x1
846
$920.00
$140
$780
$0.92
100%
Liberty Station
1971
2x1
905
$845.00
$65
$780
$0.86
44%
Carlisle Crossing
1971
2x1
839
$849.00
$70
$779
$0.93
75%
Ashgrove Apartments
1982
2x1
864
$760.00
$0
$760
$0.88
100%
Franklin Court Apartments
1980
2x1
1000
$808.00
$65
$743
$0.74
100%
Emerald Edge
1997
2x2
1008
$795.00
$65
$730
$0.72
97%
175 E 6th St.
1969
2x1
1000
$750.00
$65
$685
$0.69
96%
1917/2020
2x1
740
$788.00
$110
$678
$0.92
100%
Crown Ridge Apartments
1970
2x1
900
$670.00
$0
$670
$0.74
97%
The Plaza Apartments
1975
2x1
1000
$725.00
$65
$660
$0.66
100%
802 S Main St.
1979/2020
2x1
740
$753.00
$110
$643
$0.87
100%
216 Bridge St.
1972
2x1
650
$675.00
$65
$610
$0.94
70%
Colonial Village
1978
2x1
600
$555.00
$0
$555
$0.93
97%
Averages
1979
859
$772
$82
$714
$0.84
91%
802 S Main St.
CARLISLE CROSSING
216 BRIDGE ST
802 S MAIN ST ASHGROVE APTS 17
COMPETITIVE SET
THE COMPARABLES 1
CARLISLE CROSSING
2
ASHGROVE APARTMENTS
3
216 BRIDGE STREET
976 Dubois Road, Carlisle, OH 45005 Year Built: 1971 Units: 192 Occupancy: 75%
UNIT MIX
RENT
SF
RENT/SF
2x1 2x1.5
$765 $850
743 934
$1.03 $0.91
COMPARABLES RENT ANALYSIS $0-$920
2 Bed LOW
HIGH SUBJECT
COMP
Amenities/Features: Country Setting, Pet-Friendly, On-Site Parking, Air Conditioning, Heating, Shower/Tub Combo, Full Kitchen, Carpeting
1 Ashgrove Court, Franklin, OH 45005 Year Built: 1982 Units: 64 Occupancy: 100%
UNIT MIX
RENT
SF
RENT/SF
Studio 1x1 2x1 2x2
$516 $660 $760 $780
288 576 864 864
$1.79 $1.15 $0.88 $0.91
COMPARABLES RENT ANALYSIS $0-$920
2 Bed LOW
HIGH SUBJECT
Amenities/Features: Landscaped Courtyard, Parking, 24-Hour Maintenance, Pet Friendly, Private
COMP
Entrances, Full Kitchen Package, Private Patio, Plush Carpeting, Cable/WiFi Ready
216 Bridge Street, Franklin, OH 45005 Year Built: 1972 Units: 20 Occupancy: 70%
UNIT MIX
RENT
SF
RENT/SF
1x1 2x1
$575 $675
525 650
$1.10 $1.04
Amenities/Features: Updated Kitchens, White Cabinets, Laminate Countertops, Black
Appliances, Vanity Bathrooms, LVP Flooring, New Baseboards, New Doors, New Light Fixtures
COMPARABLES RENT ANALYSIS $0-$920
2 Bed LOW
HIGH SUBJECT
COMP
ADG MULTIFAMILY
19
03
the PERSPECTIVE 22 24 26 28
- investment highlight - unit mix - value analysis - cash flow
802 South Main Street Franklin Ohio 45005
7,400
RENTABLE SF
10
TOTAL UNITS
1979-2020 YEAR BUILT
reno
INVESTMENT HIGHLIGHTS
802 SOUTH MAIN INVESTMENT HIGHLIGHTS
Marcus & Millichap is pleased to present 802 S Main St., a 4-building, 10-unit apartment complex located in Franklin, OH. The property sits between Cincinnati and Dayton allowing residents access to both of the amenities that are provided in those cities. The building offers a potential investor to take advantage of the newly renovated units that are achieving high rents and the utility swap that is going to be implemented by the owner
MARKET PROVEN RENTS The property is located in an area that has seen an influx of CAPEX among countless units proving not only a rental increase but demand for this unit type. This will allow the investor to take advantage of the renovations and push rents. The competitive set allows an investor to acquire an asset that is located in an area with proven rental upside in the market.
802 SOUTH MAIN
UNIT UPGRADES Current ownership has completed upgrading all of their units. New apartment features include brand new kitchen appliances, new cabinets, new flooring, updated bathrooms and countertops. This provides the opportunity for an investor to acquire an asset that has undergone renovations allowing for higher rents.
802 SOUTH MAIN
THE UNIT MIX Two Bedroom
No. of
Rentable
Total
Avg. Effective
Unit Type
Units
SF
SF
Rent/Unit
Rent/SF
2x1 Renovated
6 Units
700 SF
4,200 SF
$703.00
2x1.5 Renovated
4 Units
800 SF
3,200 SF
Totals / Wtd. Averages
10 Units
740 SF
Summary
No. of
Unit Type
Units
Avg. Effective Total Effective
Market
Market
Total Market
Projected
Rent Potential
Rent/Unit
Rent/SF
Rent Potential
Rent/Unit
Rent/SF
Rent Potential
$1.00 SF
$4,218
$725.00
$1.04 SF
$4,350
$760.00
$1.09 SF
$4,560
$768.00
$0.96 SF
$3,072
$795.00
$0.99 SF
$3,180
$830.00
$1.04 SF
$3,320
7,400 SF
$729.00
$0.99 SF
$7,290
$753.00
$1.02 SF
$7,530
$788.00
$1.06 SF
$7,880
Rentable
Total
Avg. Effective
Market
Market
Total Market
Projected
SF
SF
Rent/Unit
Rent/Unit
Rent/SF
Rent Potential
Rent/Unit
Avg. Effective Total Effective Rent/SF
Rent Potential
Avg. Projected Total Projected
Avg. Projected Total Projected Rent/SF
Rent Potential
Two Bedroom
10 Units
740 SF
7,400 SF
$735.50
$0.99
$7,290
$753.00
$1.02 SF
$7,530
$788.00
$1.06 SF
$7,880
Totals / Wtd. Averages
10 Units
740 SF
7,400 SF
$735.50
$0.99 SF
$7,290
$753.00
$1.02 SF
$7,530
$788.00
$1.06 SF
$7,880
FINANCIAL BREAKDOWN &
VALUE ANALYSIS
Current
Year 1
(Rent Roll/T12 Income; T12 Expenses)
(Rent Increase; Begin LTL Recapture, Stabilized Occupancy and Other Income, Normalized Expenses)
GROSS POTENTIAL RENT
% of GPR
All Units at Market Rent
$90,360
Gain (Loss) to Lease
($2,880)
GROSS SCHEDULED RENT
$87,480
3.19% RR
Per Unit
% of GPR
9,036
$90,360
(288)
($452)
8,748
$89,908
Per Unit 9,036
0.50%
(45) 8,991
Other Income Pet Fees/Rent
$0
0.00%
0
$600
MTM/Short-Term Fees
$0
0.00%
0
$600
Note 9
0.67%
60
Admin/Application Fees
$0
0.00%
0
$125
Note 10
0.14%
13
0.54%
47
$0
0.00%
0
0.54%
47
$1,325
1.47%
133
Other Total Other Income
$472
GROSS POTENTIAL INCOME
$87,952
Physical Vacancy
($4,374)
Bad Debt
EFFECTIVE GROSS INCOME
T3, Note 3
$472
Note 8
0.67%
60
8,795
$91,233
5.00%
(437)
($8,991)
10.00%
(899)
$0
0.00%
0
($899)
1.00%
(90)
$83,578
91.81%
8,358
$81,343
88.50%
8,134
% of EGI
Per Unit
% of EGI
Per Unit
7.89%
659
8.11%
659
Normalized
9,123
Non-Controllable Real Estate Taxes 2019 Taxes Paid
$6,594
Note 4
$6,594
Adjustment For Sale
$0
0.00%
0
$0
0.00%
0
Total Real Estate Taxes
$6,594
7.89%
659
$6,594
8.11%
659
Insurance
$2,594
T12
3.10%
259
$2,750
3.38%
275
$7,293
T12, Note 5
8.73%
729
$0
Note 11
0.00%
0
0.00%
0
$300
Note 12
0.37%
30
4.14%
346
$0
Note 11
0.00%
0 126
Utilities Electric Electric Vacant
Water & Sewage Trash Removal
$0
$3,458
T12, Note 5
$1,240
T12
1.48%
124
$1,265
1.55%
Total Utilities
$11,990
14.35%
1,199
$1,565
1.92%
156
Total Non-Controllable
$21,179
25.34%
2,118
$10,909
13.41%
1,091
Controllable Contract Services Snow Removal Landscaping/Grounds
$456
T12
0.55%
46
$250
0.31%
25
$1,304
T12
75
1.56%
130
$750
0.92%
$0
0.00%
0
$250
0.31%
25
Total Contract Services
$1,760
2.11%
176
$1,250
1.54%
125
Repairs & Maintenance
$17,812
21.31%
1,781
$12,000
14.75%
1,200
Pest Control
Marketing & Promotion
T12
$750
Note 6
0.90%
75
$750
0.92%
75
General & Administrative
$1,000
Note 6
1.20%
100
$1,000
1.23%
100
Management Fee
$3,993
T12
4.78%
399
$6,507
8.00%
651
Replacement & Reserves
$2,550
Note 7
3.05%
255
$2,601
3.20%
260
Total Controllable
$27,865
33.34%
2,787
$24,108
29.64%
2,411
TOTAL EXPENSES
$49,044
58.68%
4,904
$35,018
43.05%
3,502
NET OPERATING INCOME
$34,534
41.32%
3,453
$46,326
56.95%
4,633
Year 2
Underwriting Notes & Assumptions
Year 3
#
(Stabilized LTL) % of GPR $94,560 ($1,891)
2.00%
$92,669
Per Unit
% of GPR
9,456
$97,397
(189)
($1,948)
9,267
$95,449
Per Unit 9,740
2.00%
Note
1 Rent Roll Date: February 2021 2 T12 Date Range: February 2020 - January 2021
(195)
3 Other: includes pet fees, late fees, and laundry
9,545
4 Taxes: information from Warren County Auditor
$618
0.67%
62
$637
0.67%
64
$618
0.67%
62
$637
0.67%
64
$129
0.14%
13
$133
0.14%
13
$0
0.00%
0
$0
0.00%
0
$1,365
1.47%
136
$1,406
1.47%
141
5 Electric/Water & Sewage: some units currently paid by tenant and some paid by owner as owner is in process of switching all to tenants
6 Added expense based on market norm Replacement & Reserves: added based on market norm of $255 per unit per year
9,403
$96,855
9,685
7 Pet Fees/Rent: added based on assumption of $20 per unit per month for 25% of units
($4,633)
5.00%
(463)
($4,772)
5.00%
(477)
($927)
1.00%
(93)
($954)
1.00%
(95)
8 MTM/Short-Term Fees: added based on assumption of $50 premium for 10% of units
$88,473
92.00%
8,847
$91,128
92.00%
9,113
% of EGI
Per Unit
% of EGI
Per Unit
7.45%
659
$6,594
7.45%
659
$94,034
$6,594 $0
0.00%
0
$0
0.00%
0
$6,594
7.45%
659
$6,594
7.45%
659
$2,805
3.17%
281
$2,861
3.23%
286
$0
0.00%
0
$0
0.00%
0
$306
0.35%
31
$312
0.35%
31
$0
0.00%
0
$0
0.00%
0 132
$1,290
1.46%
129
$1,316
1.49%
$1,596
1.80%
160
$1,628
1.84%
163
$10,995
12.43%
1,100
$11,083
12.53%
1,108
$255
0.29%
26
$260
0.29%
26
$765
0.86%
77
$780
0.88%
78
$255
0.29%
26
$260
0.29%
26
$1,275
1.44%
128
$1,301
1.47%
130
$12,240
13.83%
1,224
$12,485
14.11%
1,248
$765
0.86%
77
$780
0.88%
78
$1,020
1.15%
102
$1,040
1.18%
104
$7,078
8.00%
708
$7,290
8.00%
708
$2,653
3.00%
265
$2,706
3.06%
271
$25,031
28.29%
2,503
$25,602
28.70%
2,539
$36,026
40.72%
3,603
$36,686
41.47%
3,669
$52,447
59.28%
5,245
$54,442
61.53%
5,444
9 Admin/Application Fees: added based on $25 per unit for 50% of units 10 Electric/Water & Sewage: switched to tenants 11 Electric Vacant: assumes $25 per month at given vacancy 12 Electric Vacant: assumes $25 per month at given vacancy
ADG MULTIFAMILY
27
04
the MARKET 32
- incredible connectivity
34
- local market highlights
36
- world class employment
HAMILTON | FRANKLIN
INCREDIBLE CONNECTIVITY the
FRANKLIN STATS
11,734 POPULATION
$50,143
MEDIAN HOUSEHOLD INCOME
38
MEDIAN AGE
859,396 RETAIL SPACE (SF)
42.9%
RENTER OCCUPIED HOUSING
FRANKLIN HIGH SCHOOL
Hampton Early Childhood Center
FRANKLIN MIDDLE SCHOOL
$60 M+ HIGH SCHOOL & MIDDLE SCHOOL REDEVELOPMENT
LOCAL MARKET HIGHLIGHTS
DAYTON, OH
What sets Dayton apart from other mid-sized American cities? One word: innovation. The Dayton metro area is often referred to as the birthplace of aviation, as it was the home of the Wright Brothers and where they researched and experimented with flight. Composed of Greene, Montgomery, and Miami Counties, it is the fourth largest metropolitan area in Ohio. Defense and aerospace industries comprise a large section of the region’s economy. Additionally, healthcare accounts for a sizable portion of the area’s employment; several key institutes and centers are located here as well. The University of Dayton and Wright State University are two major higher-education institutions impacting the local economy. The Dayton Area Chamber of Commerce expects the region’s economy will continue growing, thanks in part to manufacturing companies bringing new life to the area’s water-powered industries, including companies like PepsiCo and Cargill.
DEMOGRAPHICS
Population Median Age Median Household Income
(2019)Median Property Value
806,548 38 $54,942 $143,600
LOCAL HIGHLIGHTS CHANGE THIS • Home to America’s oldest sports team, the Cincinnati Reds • Biggest Oktoberfest in the country with over 500,000 attendees annually • Cincinnati is the 3rd largest city in Ohio with a population of over 300,000 • Home to Christ Hospital, ranked No. 1 overall in the region by U.S News
MUSIC, SPORTS & ENTERTAINMENT
DAYTON TECH TOWN
There are many different music and entertainment venues in the Dayton area, however there is a new favorite that allows everyone to enjoy live entertainment. The Levitt Pavilion Dayton brings together people of all ages and backgrounds to experience free concerts. In 2018, the Levitt Pavilion provided $2.2 million in free programming to the community.
Dayton Tech Town was created as a tool to support the attraction and growth of high technology business and promote technology commercialization. It provides stateof-the-art facilities in an urban, live, work, and play environment that is designed to attract tech savvy workers.
In addition, the Dayton Dragons are a powerhouse when it comes to both athletics and the economy. The Dragons have an average annual economic impact of $27.6 million. The team is a huge reason as to why downtown welcomes more than 7.2 million visitors annually. Since Fifth Third Field opened and the Dragons have been downtown, there has been an estimated $1.5 billion in documented development.
HEALTHCARE Hospitals in the Greater Dayton area have an estimated combined employment of nearly 32,000 and a yearly economic impact of $6.8 billion. Premier Health and Kettering Health Network rank as the second and third largest employers in the area.
DAYON
WORLD CLASS EMPLOYMENT Located in Dayton, Wright-Patterson Air Force Base (WPAFB) is one of the most diverse, largest, and organizationally complex bases in the Air Force. Not only is WPAFB the largest single-site employer in the entire state of Ohio, but it is also a center of innovation for the Air Force. It was selected as the “preferred location” for the F-35 Lightning II Hybrid Product Support Intergrator organization, which supports the entire F-35 enterprise. This would bring a minimum of 400 new jobs to the base. The potential impact to the region cannot only be measured in jobs alone, neighboring communities would benefit through the result of more growth for contractors and businesses. Wright-Patterson Air Force Base employs 27,500 military, civilian, and contract employees and has an annual economic impact of $4.3 billion.
Employees Acres Economic Impact Annual Visitors
27,500 8,000+ $4.3B 1M+
“Wright Patterson AFB is the crown jewel of the state of Ohio, and our department will continue to accelerate the growth..” Eric Henry, Greene County’s Economic Development Coordinator
WRIGHT STATE UNIVERSITY
Located in the Dayton area, Wright State University is a national public research university. WSU offers 140 undergraduate programs and 136 graduate programs. Wright State has 20 percent more affordable in-state tuition than the national average. WSU adds $1.5 billion into the region’s economy annually and supports more than 20,000 jobs through its spending on operations and research and throuigh spending of students, alumni, and visitors. With a student body population of more than 13,000, there is only a 3,000 on-campus student housing capacity. WSU’s Nutter Center is southwest Ohio’s premier sports and entertainment facility. With a capacity of 11,200, it has also been recognized nationally as a top venue of its size.
Economic Impact Jobs Supported Students Enrolled WSU Faculty
$1.5B 20,000+ 13,000+ 2,671
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