BURGUNDY COURT 1
SUBMITTED BY: LEAD AGENTS
Jordan Dickman First Vice President Investments Cincinnati Office D. 513.878.7735 jordan.dickman@marcusmillichap.com
Nick Andrews First Vice President Investments Cincinnati Office D. 513.878.7741 nicholas.andrews@marcusmillichap.com
Austin Sum Senior Associate Cincinnati Office D. 513.878.7747 austin.sum@marcusmillichap.com
2
NON-ENDORSEMENT & DISCLAIMER NOTICE CONFIDENTIALITY DISCLAIMER THIS IS A BROKER PRICE OPINION OR COMPARATIVE MARKET ANALYSIS OF VALUE AND SHOULD NOT BE CONSIDERED AN APPRAISAL. This information has been secured from sources we believe to be reliable, but we make no representations or warranties, express or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies.
NON-ENDORSEMENT NOTICE Marcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation’s logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers.
CONTENTS
B R O K E R C A PA B I L I T I E S
06 | THE ASSE T
01
&
24 | LOCAL COMP E TITORS
02
38 | THE FIN ANC I ALS
03
44 | CINCINN ATI OVERV IEW
04
O P I N I O N O F V A L U E
3
4
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
Austin Sum
Senior Investment Associate
INVESTMENT ADVISORS
JD Schmerge Investment Associate
Brian Johnston Investment Associate
Tim VanWingerden Investment Associate
DEBT & STRUCTURED FINANCE
Chris Litzler
Senior Director of Organization MMCC
VALUATION & RESEARCH
Sam Petrosino
Financial & Research Analyst
CLIENT RELATIONS
MARKETING
Alex Papa
Marketing Coordinator
Kristin Smith Marketing
Skyler Wilson
Client Relations Manager
OPERATIONS
Sidney Bills
Office Administrator
Josh Caruana
Vice President Regional Manager Indianapolis | Cincinnati | Louisville St Louis | Kansas City
Brittany Campbell-Koch Director of Operations
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
5
S E C T I O N
6
01
THE ASSET 7
INVESTMENT HIGHLIGHTS
BURGUNDY COURT THE MARKET Like many Midwest markets, Cincinnati evaded the worst effects of the pandemic relative to other areas of the country. Spurred by healthy job gains and moderate population growth, the Cincinnati apartment market continues to attract new residents, investors, and developers. Apartment demand reached 3,785 units in 2021 one of Cincinnati’s better performances in the last 30 years. This strong apartment demand boosted occupancies to its highest recorded level at 98.1% in the fourth quarter of 2021. Such strong demands allow operators to push rental rates with an all-time high annual rental growth rate of 8.4% in 2021. Along with a tightening Multifamily market the housing market inventory in Cincinnati is at an all-time low. With the low housing inventory, rising home rates, coupled with increasing household formation, many are being forced to sit on the sidelines and continue to rent. LOCATION Burgundy Court Apartments are located in Colerain Township. Colerain Township is one of the largest townships in the state of Ohio encompassing 42.9 square miles while serving 58,499 residents. The Township is located north of Downtown Cincinnati and is conveniently located off of two major interstates thus providing easy access for all Cincinnati has to offer. Burgundy Court is less than 2-miles from one of Cincinnati’s premier public high schools, Colerain high School. The Apartment complex is also surrounded by numerous Restaurants (Starbucks, Outback Steakhouse, Skyline, Chipotle), top tier shopping (Northgate Mall, Stone Creek Towne 8
Center, Target, Best Buy, Home Depot, Dick’s Sporting Goods), as well as various Grocery options (Three Kroger’s, Meijer, Walmart). Tenants of Burgundy Court are only 10 miles from downtown Cincinnati and multiple interstates, providing residents with effortless commutes in and around the city. VALUE- ADD OPPORTUNITY Burgundy Court Apartments is a true Value add property that was built in 1967. The current owner purchased the property in 2010. This is a very well-maintained property inside and out. Major Cap-X items like windows, roofs, parking lot, and landscaping are in good condition. The true opportunity lies on the inside of the units. With a strategic renovation on this property an incoming investor will be able to increase rents by an average of $250 bringing the ROI to just over 18%. LONG TERM OWNERSHIP: Cincinnati has continued to push forward into a more transactional market; assets are generally being traded within 3-5 years of ownership. A historic ownership of over 10 years will add highlights to the true value potential that is left in Burgundy Court Apartments and will be highly sought after, compared to some of the competitors that may be on the market.
BURGUNDY COURT PROPERTY SUMMARY
210,574
RE N TABLE S Q UARE FE E T
234
TOTAL UNI T S
900 AV G S F
#1 Bedrooms
32
#2 Bedrooms
140
#3 Bedrooms
62
% Leased
99%
9
PROPERTY DETAILS
BURGUNDY COURT Name Address City st zip Property Use Acres Number of building Number of floors Year Rentable Area Units Units Per Acre Foundation Roofs
10
Laundry
Burgundy Court 3295 Rocker Dr Cincinnati, Ohio 45239 Multi-Family Residential 15.91 7 2 1967 210,574 234 14.71 Concrete Slab Material Warrenty until 5-22-31 Mansard with Flat Rubber Washer/Dryer Hookups
UTILITIES Electric Gas Water Sanitary HVAC
Resident Pays Electricity Property Pays Gas Resident Pays Sewer Property Pays Trash Removal Resident Pays Water
ROOF SCHEDULE Address
3231-3290 Rocker 3201-3299 Nandale 3293 Rocker
Flat-Rubber
Contractor
Year Replaced
Waranty Start Date
Material Warranty
Labor Warranty
Flat Roof Flat Roof Flat Roof
Eckstein Eckstein Eckstein
2011 2011 2011
5/23/2011 5/23/2011 5/23/2011
20 Yr 20 Yr 20 Yr
5 Yr 5 Yr 5 Yr
BOILER SCHEDULE Property
Burgundy Ct High: 11
Material Warranty Expiration 5/22/2031 5/22/2031 5/22/2031
Labor Warranty Expiration 5/22/2016 5/22/2016 5/22/2016
Address
Manufacturer
# of Boilers
Installed
Replacement
Budget
Domestic
3290 Nandale 3272 Rocker 3210 Nandale
Triangle Tube Triangle Tube Triangle Tube
3 4 4
2011 2011 2011
2026 2026 2026
2025 2025 2025
Yes Yes Yes
COMPLETED CAPEX Unit Renovations Landscaping Interior Building Exterior Building Parking Lot Pool, Fence, Playground, Outdoor Amenities HVAC Boilers Total
2020 $14,555 $2,876 $18,853 $78,012 $28,700 $9,150 $$$152,146
2021 $36,353 $6,529 $5,721 $64,928 $34,300 $10,592 $22,400 $28,220 $209,043
2022 YTD $6,208 $$7,133 $$$$$$13,341
2022 Budget $50,000 $17,500 $31,087 $96,000 $40,000 $21,500 $$55,000 $311,087
Labor Warranty Expiration 5/22/2016 5/22/2016 5/22/2016
Warranty Number MR036062 MR036062 MR036062
Warranty Number MR036062 MR036062 MR036062
11
BURGUNDY COURT
PENTUP RENTAL GROWTH
Burgundy Court offers an incoming investor the opportunity to capitalize on pent up organic rental growth. From 2020 to 2021 the Cincinnati MSA saw rental growth increase from 3.5% to over 8.5% respectively, while Burgundy Court increased rents by less than 1% for both 2020 and 2021. Occupancy data further confirms the untapped growth, as the subject property has maintained an occupancy rate of at least 150 basis points stronger than Cincinnati’s average and has not been below 97.5% going back to 2019. Over 40% of the of the residents have been at the property for 3 years or more with nearly 20% of the residents having lived art the property for more than 5 years. Excellent occupancy, with minimal rental growth, and long term tenancy are highly desired characteristics as those aspects position the asset perfectly for a value-add business plan through rental increases that can be further organic rental increases to be implemented.
Avg Cincinnati Rental Growth from 19-22 = 5.3% Avg Rental Growth at Burgundy Court from 19-22 = <1%
12
40% of Residents Stay for 3-4 Years 20% of Residents Stay for 5+ Years
3 Year Occupancy Avg at Burgundy = 97.8% Burgundy Out Paces Cincy’s Occupancy by 120 Bps 3 Year Occupancy Avg for Cincinnati = 96.6%
13
BURGUNDY COURT
PROPOSED RENOVATIONS VALUE ADD OPPORTUNITY Recent market competitors have undergone renovations and their upgraded units are achieving monthly rents 26.86% higher than Burgundy per month. Using these as a case study, there is significant value add opportunity to remodel Burgundy Court with stainless appliances, modern light fixtures, granite countertops, new cabinets, upgraded bathrooms and flooring and achieve an estimated $250 monthly premium on rents, capturing a 18.18% ROI on unit upgrades.
RENOVATIONS
ESTIMATED BUDGET
Vanity & Tub Surround
$1,500
Granite Counter Tops
$2,500
Lighting
$750
Kitchen Cabinets
$3,000
LVP Flooring
$4,500
Paint
$1,200
Misc.
$3,050
Total
$16,500
$16,500K/UNIT 14
AVG RENO COST
$250/MONTH AVG RENT INCREASE
18.18% ROI
1. BATHROOM VANITY 2. GRAINTE COUNTERTOPS SUBEJECT
3. MODERN LIGHT FIXTURES 4. NEW KITCHEN CABINETS
THE APEX 3
5. LVP FLOORING 6. NEW PAINT GALBRAITH POINTE 6
6
3
6
6 6
5
5 3
3
3 4
4 2
4
2
2
5
5 3
6
2
4
5
6
3
6 1
5
1 1
1 15
BURGUNDY COURT
MARKET PROVEN RENTS Burgundy Court is well-positioned for a value-add interior renovation with rents trailing the renovated units in the market by an average of 26.86%. The provides an excellent opportunity for an incoming investor to implement a value-add renovation strategy to bring rents to market.
TWO BEDROOM
RENO MARKET AVG RENT GAP: 28.42%
16
RENO MARKET AVG RENT GAP: 27.07%
THREE BEDROOM
ONE BEDROOM
RENO MARKET AVG RENT GAP: 19.61%
17
BURGUNDY COURT
AMENITIES - POOL - PLAYGROUND - OUTDOOR AREA - COMMUNITY CENTER - PET FRIENDLY
18
19
BURGUNDY COURT
UNIT FEATURES - DISHWASHER - W/D CONNECTIONS - LARGE CLOSETS - PRIVATE PATIO IN SELECT UNITS - CENTRAL AIR - PLUSH CARPETING
20
21
BURGUNDY COURT
FLOOR PLANS
1 BED | 1 BED 646 SQ. FT.
22
2 BED | 1.5 BATH 828 SQ. FT
3 BED | 2.5 BATH 1177 SQ. FT.
23
S E C T I O N
24
02
LOCAL COMPETITORS 25
LOCAL COMPETITORS REN T C OMPAR ABLE S
26
1
COMPTON LAKE
2
GALBRAITH POINTE
3
WOODMERE APARTMENTS*
4
NORTHGATE MEADOWS*
5
LAKE OF THE WOODS
6
WOODGROVE POINT
7
THE PARKTON APARTMENTS
8
THE APEX
7
4
3 1 5
6
2
* BURGUNDY COURT 8
27
LOCAL COMPETITORS - ONE BEDROOM
28
One Bedroom Property
Year Built
# Units
Avg SF
Avg Rent
Avg Rent/SF
Compton Lake
1972
163
740
$1,000
$1.35
The Parkton Apartments
1970
352
600
$989
$1.65
Subject Pro Forma
1967
234
646
$975
$1.51
Lake of the Woods
1966
264
631
$950
$1.51
The Apex
1970
317
657
$919
$1.40
Northgate Meadows*
1972
272
605
$899
$1.49
Woodgrove Point
1971
100
660
$885
$1.34
Woodmere Apartments*
1971
150
714
$845
$1.18
Subject Average Effective
1967
234
646
$764
$1.18
29
LOCAL COMPETITORS - TWO BEDROOM
30
Two Bedroom Property
Year Built
# Units
Avg SF
Avg Rent
Avg Rent/SF
Galbraith Pointe
1971
188
1070
$1,499
$1.40
The Parkton Apartments
1970
352
907
$1,256
$1.38
Subject Pro Forma
1967
234
835
$1,150
$1.38
Lake of the Woods
1966
264
891
$1,081
$1.21
Compton Lake
1972
163
880
$1,060
$1.20
Northgate Meadows*
1972
272
760
$1,050
$1.38
The Apex
1970
317
870
$1,039
$1.19
Woodgrove Point
1971
100
884
$1,015
$1.15
Woodmere Apartments*
1971
150
925
$970
$1.05
Subject Average Effective
1967
234
835
$854
$1.02
31
LOCAL COMPETITORS - THREE BEDROOM
32
Three Bedroom Property
Year Built
# Units
Avg SF
Avg Rent
Avg Rent/SF
Galbraith Pointe
1971
188
1358
$1,999
$1.47
Subject Pro Forma
1967
234
1177
$1,450
$1.23
The Apex
1970
317
1070
$1,399
$1.31
The Parkton Apartments
1970
352
1060
$1,394
$1.32
Lake of the Woods
1966
264
1294
$1,310
$1.01
Woodmere Apartments*
1971
150
1245
$1,195
$0.96
Northgate Meadows*
1972
272
1220
$1,125
$0.92
Subject Average Effective
1967
234
1177
$1,077
$0.92
33
THE APEX UNITS YEAR BUILT OCCUPANCY UNIT MIX One Bedroom
# OF UNITS SQFT 125 657
RENT $919
317 1970 N/A RENT/SF $1.40
Two Bedroom
171
870
$1,039
$1.19
Three Bedroom
21
1070
$1,399
$1.30
Apartment Interior Amenities Private Balcony/Patio Washer/Dryer In All Units High Speed Internet Access Common Area Amenities Fitness Center Clubhouse Playground Utilities Responsibility Resident Pays Electricity Resident Pays Gas Resident Pays Sewer Resident Pays Trash Removal Resident Pays Water
34
PARKTON APARTMENTS Apartment Interior Amenities Private Balcony/Patio Washer/Dryer Available Washer/Dryer Hookups Available High Speed Internet Access Common Area Amenities Controlled Access Tennis Court Basketball Court Playground Swimming Pool Laundry Facilities
UNITS YEAR BUILT OCCUPANCY UNIT MIX One Bedroom
# OF UNITS 32
SQFT 600
RENT $989
352 1970 97.7% RENT/SF $1.65
Two Bedroom
284
907
$1,256
$1.38
Three Bedroom
36
1060
$1,394
$1.52
Utilities Responsibility Resident Pays Electricity Resident Pays Gas Resident Pays Sewer Property Pays Trash Removal
35
GALBRAITH POINTE UNITS YEAR BUILT OCCUPANCY UNIT MIX Two Bedroom Three Bedroom
# OF UNITS SQFT 128 1070 60
1358
RENT $1,499 $1,999
Apartment Interior Amenities Washer/Dryer Hookups In All Units High Speed Internet Access 188 Private Balcony/Patio 1971 90.4% RENT/SF Common Area Amenities $1.40 Community Room Basketball Court $1.47 Playground 2 Swimming Pools Utilities Responsibility Resident Pays Electricity Resident Pays Gas Resident Pays Sewer Resident Pays Trash Removal Resident Pays Water
36
LAKE OF THE WOODS Apartment Interior Amenities Private Balcony/Patio Fireplaces Available In Select Units High Speed Internet Access Common Area Amenities Waterscape Clubhouse Swimming Pool 20 Laundry Facilities
UNITS YEAR BUILT OCCUPANCY UNIT MIX One Bedroom Two Bedroom Three Bedroom
# OF UNITS 123
SQFT 631
RENT $950
264 1966 93.9% RENT/SF $1.51
112 29
891 1294
$1,081 $1,310
$1.21 $1.36
Utilities Responsibility Resident Pays Electricity Property Pays Gas Resident Pays Sewer Property Pays Trash Removal Resident Pays Water
37
S E C T I O N
38
03
THE FINANCIALS 39
BURGUNDY COURT - FINANCIALS
UNIX MIX SUMMARY AV E R A G E E F F E C T I V E
MARKET
P RO J E CT E D
N O . O F U N I TS
R E N TA B L E S F
T O TA L S F
RENT/UNIT
RENT/SF
T O TA L R E N T POTENTIAL
SUMMARY One Bedroom Two Bedroom Three Bedroom
32 Units 140 Units 62 Units
646 SF 835 SF 1,177 SF
20,672 SF 116,928 SF 72,974 SF
$764.16 $857.26 $1,077.40
$1.18 $1.03 $0.92
$24,453 $120,016 $66,799
$835.00 $890.43 $1,165.00
$1.29 SF $1.07 SF $0.99 SF
$26,720 $124,660 $72,230
$975.00 $1,150.00 $1,450.00
$1.51 SF $1.38 SF $1.23 SF
$31,200 $161,000 $89,900
Totals / Wtd. Averages
234 Units
900 SF
210,574 SF
$902.85
$1.00 SF
$211,268
$955.60
$1.06 SF
$223,610
$1,205.56
$1.34 SF
$282,100
UNIT TYPE
RENT/UNIT
UNIT DISTRIBUTION
RENT/SF
TOTA L R E N T P OT E N T I A L
RENT/UNIT
RENT/SF
TOTA L R E N T P OT E N T I A L
UNIT RENTS
14% 26%
One Bedroom Three Bedroom
40
60%
Two Bedroom
1 Bed
Avg. Effective
2 Bed
3 Bed
Pro Forma Projection
BURGUNDY COURT - FINANCIALS
UNIX MIX BREAKDOWN AV E R A G E E F F E CT I V E
MARKET
PROJECTED
N O . O F U N I TS
R E N TA B L E S F
T O TA L S F
RENT/UNIT
RENT/SF
T O TA L R E N T POTENTIAL
1BR/1BA Totals / Wtd. Averages
32 Units 32 Units
646 SF 646 SF
20,672 SF 20,672 SF
$764.16 $764.16
$1.18 SF $1.18 SF
$24,453 $24,453
$835.00 $835.00
$1.29 SF $1.29 SF
$26,720 $26,720
$975.00 $975.00
$1.51 SF $1.51 SF
$31,200 $31,200
TWO BEDROOM 2BR/1.5BA 2BR/1.5BA Totals / Wtd. Averages
104 Units 36 Units 140 Units
828 SF 856 SF 835 SF
86,112 SF 30,816 SF 116,928 SF
$854.36 $865.63 $857.26
$1.03 SF $1.01 SF $1.03 SF
$88,853 $31,163 $120,016
$875.00 $935.00 $890.43
$1.06 SF $1.09 SF $1.07 SF
$91,000 $33,660 $124,660
$1,150.00 $1,150.00 $1,150.00
$1.39 SF $1.34 SF $1.38 SF
$119,600 $41,400 $161,000
THREE BEDROOM 3BR/1BA Totals / Wtd. Averages
62 Units 62 Units
1,177 SF 1,177 SF
72,974 SF 72,974 SF
$1,077.40 $1,077.40
$0.92 SF $0.92 SF
$66,799 $66,799
$1,165.00 $1,165.00
$0.99 SF $0.99 SF
$72,230 $72,230
$1,450.00 $1,450.00
$1.23 SF $1.23 SF
$89,900 $89,900
UNIT TYPE
RENT/UNIT
RENT/SF
T O TA L R E N T POTENTIAL
RENT/UNIT
RENT/SF
T O TA L R E N T POTENTIAL
ONE BEDROOM
41
INCOME
GROSS POTENTIAL RENT All Units at Market Rent Gain (Loss) to Lease GROSS SCHEDULED RENT Other Income Water/Sewer Reimbursement Late Charges MTM Premium Pet Charges Collections for Damages Damages Billed Application Fees Renter's Insurance
EXPENSE
BURGUNDY COURT - FINANCIALS
INCOME & EXPENSES 42
CURRENT
Total Other Income GROSS POTENTIAL INCOME Physical Vacancy Non-Revenue Units Bad Debt EFFECTIVE GROSS INCOME NON-CONTROLLABLE Real Estate Taxes 2020 Taxes Paid Adjustment for Sale Total Real Estate Taxes Insurance Utilities Electric - Common Electric - Vacant Gas - Common Gas - Vacant Water & Sewage Trash Removal Total Utilities Total Non-Controllable CONTROLLABLE Contract Services Security Expense Snow Removal Landscaping/Grounds Pest Control Pool Total Contract Services Repairs & Maintenance Marketing & Promotion On-Site Payroll Payroll Taxes & Benefits General & Administrative Management Fee Telephone & Internet Replacement & Reserves Total Controllable TOTAL EXPENSES NET OPERATING INCOME
$2,586,644 T3 ($74,926) T3 $2,511,718 $140,904 $20,000 $15,228 $12,468 $5,593 $5,217 $4,600 $3,230 $218,266 $2,729,984 ($27,224) ($6,600) ($9,519) $2,686,641
T3 T3 T3 T3 T3 T3 T3 T3 T3 Note 2 T3
$203,974 Auditor $0 $203,974 $77,122 Note 3
YEAR 1 % of GPR
Per Unit 11,054 (320) 10,734
$3,385,200 ($67,704) $3,317,496
1.08% 0.26% 0.38% 95.38%
602 85 65 53 24 22 20 14 933 11,667 (116) (28) (41) 11,481
$145,131 $20,600 $15,685 $12,842 $5,761 $5,374 $4,738 $3,327 $224,814 $3,542,310 ($165,875) $0 ($16,587) $3,359,848
5.00% 0.00% 0.50% 92.50%
620 88 67 55 25 23 20 14 961 15,138 (709) 0 (71) 14,358
% of EGI 7.59% 0.00% 7.59% 2.87%
Per Unit 872 0 872 330
$203,974 $371,853 $575,827 $76,050
6.07% 11.07% 17.14% 2.26%
% of EGI 872 1,589 2,461 325
2.90% 5.61% 0.80% 0.61% 0.50% 0.22% 0.21% 0.18% 0.13% 8.69%
% of GPR 2.00% 4.37% 0.62% 0.47% 0.39% 0.17% 0.16% 0.14% 0.10% 6.78%
Per Unit 14,467 (289) 14,177
$12,168 $1,051 $44,012 $379 $146,683 $17,043 $221,336 $502,432
T12 T12 T12 T12 T12 T12
0.45% 0.04% 1.64% 0.01% 5.46% 0.63% 8.24% 18.70%
52 4 188 2 627 73 946 2,147
$12,411 $1,072 $44,892 $387 $149,617 $17,384 $225,762 $877,639
0.37% 0.03% 1.34% 0.01% 4.45% 0.52% 6.72% 26.12%
53 5 192 2 639 74 965 3,751
$431 $5,657 $34,640 $3,301 $4,346 $48,375 $34,013 $9,466 $287,138 $0 $9,971 $104,620 $2,265 $59,670 $555,518 $1,057,950 $1,628,691
T12 T12 T12 T12 T12
0.02% 0.21% 1.29% 0.12% 0.16% 1.80% 1.27% 0.35% 10.69% 0.00% 0.37% 3.89% 0.08% 2.22% 20.68% 39.38% 60.62%
2 24 148 14 19 207 145 40 1,227 0 43 447 10 255 2,374 4,521 6,960
$1,170 $7,020 $35,100 $5,850 $4,680 $53,820 $117,000 $11,700 $234,000 $23,400 $17,550 $134,394 $2,340 $60,863 $655,067 $1,532,706 $1,827,141
0.03% 0.21% 1.04% 0.17% 0.14% 1.60% 3.48% 0.35% 6.96% 0.70% 0.52% 4.00% 0.07% 1.81% 19.50% 45.62% 54.38%
5 30 150 25 20 230 500 50 1,000 100 75 574 10 260 2,799 6,550 7,808
T12 T12 T12 T12 T12 T12 Note 1
YEAR 2 $3,486,756 ($69,735) $3,417,021
YEAR 3
% of GPR 2.00% 4.37% 0.62% 0.47% 0.39% 0.17% 0.16% 0.14% 0.10% 6.78%
Per Unit 14,901 (298) 14,603
$3,591,359 ($71,827) $3,519,532
% of GPR
$153,969 $21,855 $16,640 $13,624 $6,112 $5,701 $5,027 $3,530 $238,489 $3,758,021 ($175,977) $0 ($70,391) $3,511,653
5.00% 0.00% 2.00% 91.00%
658 93 71 58 26 24 21 15 1,019 16,060 (752) 0 (301) 15,007
2.00% 4.37% 0.62% 0.47% 0.39% 0.17% 0.16% 0.14% 0.10% 6.78%
Per Unit 15,348 (307) 15,041
$149,485 $21,218 $16,155 $13,227 $5,934 $5,535 $4,880 $3,427 $231,550 $3,648,571 ($170,851) $0 ($17,085) $3,460,635
5.00% 0.00% 0.50% 92.50%
639 91 69 57 25 24 21 15 990 15,592 (730) 0 (73) 14,789
$203,974 $371,853 $575,827 $77,571
% of EGI 5.89% 10.75% 16.64% 2.24%
Per Unit 872 1,589 2,461 332
$203,974 $371,853 $575,827 $79,122
% of EGI 5.89% 10.75% 16.64% 2.29%
Per Unit 872 1,589 2,461 338
$12,659 $1,094 $45,790 $394 $152,609 $17,731 $230,277 $883,675
0.37% 0.03% 1.32% 0.01% 4.41% 0.51% 6.65% 25.54%
54 5 196 2 652 76 984 3,776
$12,912 $1,116 $46,706 $402 $155,661 $18,086 $234,883 $889,832
0.37% 0.03% 1.35% 0.01% 4.50% 0.52% 6.79% 25.71%
55 5 200 2 665 77 1,004 3,803
$1,193 $7,160 $35,802 $5,967 $4,774 $54,896 $119,340 $11,934 $238,680 $23,868 $17,901 $138,425 $2,387 $62,081 $669,512 $1,553,188 $1,907,448
0.03% 0.21% 1.03% 0.17% 0.14% 1.59% 3.45% 0.34% 6.90% 0.69% 0.52% 4.00% 0.07% 1.79% 19.35% 44.88% 55.12%
5 31 153 26 20 235 510 51 1,020 102 77 592 10 265 2,861 6,638 8,151
$1,217 $7,304 $36,518 $6,086 $4,869 $55,994 $121,727 $12,173 $243,454 $24,345 $18,259 $140,466 $2,435 $63,322 $682,175 $1,572,007 $1,939,646
0.04% 0.21% 1.06% 0.18% 0.14% 1.62% 3.52% 0.35% 7.03% 0.70% 0.53% 4.00% 0.07% 1.83% 19.65% 45.43% 56.05%
5 31 156 26 21 239 520 52 1,040 104 78 592 10 271 2,907 6,718 8,289
#
NOTE
UNDERWRITING NOTES
1 Replacement & Reserves: added based on market norm of $255 per unit per year 2 Non-Revenue Unit: Employee Allowance 3 Insurance: Includes $2,256 of flood insurance *49% to expire April to August
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S E C T I O N
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CINCINNATI OVERVIEW 45
CINCINNATI The steady and stable nature of the Cincinnati apartment market due to seasonal demand patterns, the three subsemarket was undoubtfully a benefit through 2020. The MSA quent quarters saw huge demand and absorption totaled saw a 2.7% annual increase in effective asking rents on 1,563 units. That is 38% above the 20-year norm for annual new leases which matched the market’s norm for the 2010s absorption. During the peak of the pandemic challenges the decade. This growth put Cincinnati at #14 amongst the 50 job market declined 4.6%, this ranked Cincinnati 3rd best largest markets for rent growth in 2020. Although occupan- among the Midwest and was significantly better than the cy was down 0.3 points from the prior year’s rate, the 4th national average of 5.8%. quarter 2020 occupancy rate (96.4%) ranked #11 among the top 50 markets and #3 regionally. Only Q1 2020 saw net move-outs, although that’s typically the case in the local
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E C O N O M I C OV E R V I E W Prior to the pandemic, Cincinnati’s economy grew at a moderate rate – averaging an estimated growth pace of 2.1% annually in the five years ending Q1 2020. However, the economy contracted 2.4% in 2020. By November of 2020 the pandemic induced the loss of 51,200 jobs putting the employment rate at 4.8%, below the national average of 6.4%. Cincinnati has experienced less severe economic impacts compared to other cities, this fact is credited to the divers and stable employers that call Cincinnati home. There are eight fortune 500 companies headquartered in Cincinnati: Kroger, Procter & Gamble, Fifth Third Bancorp, American Financial Group, Cincinnati Financial, Western & Southern Financial Group, Cintas & Ak Steel Holding. In addition to the nationally recognized powerhouse corporations, Cincinnati has placed a specific focus on programs to foster and promote entrepreneurs and start-ups. Also the city has made significant investments in facilities and infrastructure to support medical research, and other scientific innovations to attract and retain talent found at the University of Cincinnati. The Innovation Corridor by Uptown Consortium is the largest single development in Cincinnati since the Great American Ball Park and will be a state-of-the-art science and research hub next to UC.
ADG MULTIFAMILY
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D E M O G R A P H I C OV E R V I E W Population growth in Cincinnati remains ulation growth coupled with a modest modest, as the metro’s population ex- pipeline has maintained occupancies panded just 2.5% from 2014-2019, be- between 95%-97% over the last six years low the U.S. average of 2.9%. During with the average occupancy in Q4 of that period the majority of Cincinnati’s 2020 being above the six year average growth came from the 55+ age segment at 96.4%. The average effective asking which grew 11.5%. The 20-to 34-year-old rents have outperformed the Midwest segment grew modestly over the five- averages since 2011 and in 2020 the year period increasing 2.1% which was average effective rents grew by 2.7% above the national average of 1.6%. A outpacing the Midwest average of 0.8% very strong aspect to Cincinnati’s popu- and the national average of -1.1%. lation is the level of education amongst the working age population with 37% of that segment having a bachelor’s degree or higher compared to the national average of 33.1%. The modest pop-
D E M O G R A P H I C S : STAT I ST I C S
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Population: 2,190,000
Msa median hhi: $62,743
Msa median home value: $173,500
Average occupancy: 96.4%
Median age: 38 (.39%)
1 - Year growth: 1.77%
1 - Year growth: 4.83%
Rent growth: 2.7%
S U P P LY & D E M A N D DEMAND • Annual absorption in Cincinnati has ranged from 776 units to 3,068 units in the last five years. Average of 1,788 units annually during that time. • In the last 12 months, the Cincinnati market recorded demand for 1,462 units, exceeding concurrent supply volumes for the first time since the pandemic began. • Campbell County, Warren County and Butler County are a few of the strongest areas in Cincinnati, based on absorption, over the last five years.
S U P P LY • Over the past five years Annual new supply averaged 1,555 units, and annual inventory growth averaged 1.0%. In the year-ending 2nd quarter 2021, there were 1,131 units delivered. • Among submarkets, new supply over the past five years has been concentrated in Central Cincinnati, Campbell/Kenton Counties and Northeast Cincinnati/Warren County, totaling 62% of the market’s total completions over that time. Scheduled new deliveries in the coming year are expected to be concentrated in Central Cincinnati. 49
HEART OF DOWNTOWN The Banks is a gathering place for people all across the region. It provides a lively atmosphere full of attractions that promote public enjoyment and appreciation for city’s riverfront. Spanning the full width of the Central Business District, The Banks brings the waterfront to downtown’s front door. Thriving off of the energy generated by the adjacent professional sports venues, Paul Brown Stadium to the west and Great American Ballpark to the east, The Banks provides life and energy as a premier live, work, and play district.
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TQ L STA D I U M The FCC-TQL partnership brings together two Cincinnati-grown, leading businesses that share a “no limits” philosophy as well as a deep connection and commitment to our local community. There are a lot of synergies that make this alliance between TQL and FCC a perfect match and are reflected throughout the stadium from — the fin lighting to the TQL Beer District. The stadium features first-in-the-world lighting technology powered by 2.7 miles of LED lights.
I N T E R E ST I N G STAT I ST I C S 26,000 STADIUM SEATS 14,256 FEET OF LED LIGHTS 360 CANOPY ROOF 3,170 BAILEY SEATS ADG MULTIFAMILY
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ATTRACTIONS DORA From 11am – 1am daily, the 85-acre DORA district at The Banks allows guests to take their beverage purchased from one of the 18 Banks establishments and explore our public plazas and green spaces. It simply needs to be in the Official DORA Cup. At risk of missing the first pitch? Late for the opening act? Take your beverage purchased in a DORA cup from a Banks establishment and go! Waiting for a table, or wish to picnic outside in The Banks plazas or greenspaces? Grab a DORA beverage from a Banks establishment and explore!
C I N C I N N AT I Z O O The Cincinnati Zoo & Botanical Garden is the second oldest zoo in the United States, founded in 1873 and officially opening in 1875, after the Roger Williams Park Zoo. It is located in the Avondale neighborhood of Cincinnati, Ohio. It originally began with 64.5 acres in the middle of the city, but has spread into the neighboring blocks and several reserves in Cincinnati’s outer suburbs. It was appointed as a National Historic Landmark 52in 1987.
H A R D RO C K CAS I N O The game is always on at Hard Rock Casinos, where stars are made every night. Come try your hand at the tables, with classic games including blackjack, baccarat and poker, or tap into thousands of the hottest slots on the planet. With the world’s greatest rock memorabilia collection to enhance the thrill, plus the accompaniment of live, world-class entertainment, the atmosphere is like no other. 53
RETAIL & SHOPPING In addition to the restaurant and nightlight scene, the area has no shortage of retail options. Downtown offers both boutiques and department stores. Over-the-Rhine (OTR) is a historic, walkable district of downtown Cincinnati with many independent shops. Cincinnati’s
homage
Over-the-Rhine neighborhood was once a place where residents would not recommend to visitors, but that has changed. The restaurant and nightlife scene is now thriving, and the shopping scene is beginning to catch up. Most of the shops are in the southwest quarter of Over-the-Rhine, on either Vine or Main St. You won’t find chain stores in this walkable shopping district. MiCA 12/v and Urban Eden are a popular gift shops that sell local arts and crafts. Elm & Iron sells vintage and up-cycled items for the home. The Little Mahatma sells exotic jewelry and folk art from around the world. You’ll find several clothing boutiques, including Mannequin, a non-profit
otr
upscale and vintage boutique that benefits local charities. Park + Vine is a popular general store for environmentally-conscious shoppers; they sell a variety of merchandise including green cleaning and personal products, vegan foods, garden products and more.
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elm & iron
FINDLAY FARMERS MARKET Findlay Market is Ohio’s oldest continuously operated public market
merchants are new startups, while others have been in business for
and is located in the historic Over-the-Rhine neighborhood. The mar- generations. You’ll find everything from fresh meat and produce to ket is a wonderful place for locals to buy their groceries as well as imported fine teas to Belgian waffles. There are restaurants as well a must-see historic spot for visitors to Cincinnati. Findlay Market is as a beer garden, so plan to stay for lunch. Findlay Market has a fasopen year-round, Tuesday through Sunday, with a seasonal farmers cinating history. Why not take a tour to learn more? There are several market. Nearly 40 full-time businesses operate year-round, plus over
different tour options, including a culinary tour with tasty samples.
100 more vendors operate on weekends or part-time. Many vendors sell raw food while others specialize in prepared foods. Some of the
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visit adgmultifamily.com to learn more.