Williams Pointe OM

Page 1

WILLIAMS POINTE 2024

OFFERING MEMORANDUM 411 EAST MAIN STREET, WILLIAMSBURG, OH OM

austin.sum@marcusmillichap.com

jordan.dickman@marcusmillichap.com

CONTENTS LEAD AGENTS Austin Sum Senior Associate Cincinnati Office D. 513.878.7747
Nick Andrews First Vice President Investments Cincinnati Office D. 513.878.7741
Jordan Dickman First Vice President Investments Cincinnati Office D. 513.878.7735
nicholas.andrews@marcusmillichap.com
The Investment Local Competitors Financials 06 12 16 SECTIONS

“OUR COMMITMENT IS TO HELP OUR CLIENTS CREATE AND PRESERVE WEALTH BY PROVIDING THEM WITH THE BEST REAL ESTATE INVESTMENT SALES, FINANCING, RESEARCH AND ADVISORY SERVICES AVAILABLE.”

300 WEST 4TH STREET, CINCINNATI, OH

GLOBAL REACH, LOCAL EXPERTISE

$86.3B

VALUE OF RECENTLY CLOSED TRANSACTIONS

12,272

CLOSED SALES IN MOST RECENT YEAR

$12.8B

TOTAL VALUE OF RECENT LISTINGS

2,143

CLOSED FINANCINGS IN MOST RECENT YEARS

CALABASAS, CALIFORNIA | HQ 2,500 | EMPLOYEES 80+ | OFFICES
CINCINNATI DAYTON LEXINGTON LOUISVILLE

YOUR TEAM

JORDAN DICKMAN

FIRST VICE PRESIDENTS DIRECTOR, NMHG

NICK ANDREWS

FIRST VICE PRESIDENTS DIRECTOR, NMHG

AUSTIN SUM

SENIOR INVESTMENT ASSOCIATE

AUSTIN Hall

INVESTMENT ASSOCIATE

ALDEN SIMMS

INVESTMENT ASSOCIATE

CORPORATE SUPPORT

LIZ POPP

MIDWEST OPERATIONS MANAGER

JOSH CARUANA

VICE PRESIDENT

REGIONAL MANAGER

INDIANAPOLIS | CINCINNATI | LOUISVILLE | ST LOUIS | KANSAS CITY

JOHN SEBREE

SENIOR VICE PRESIDENT

NATIONAL DIRECTOR

NATIONAL MULTI HOUSING GROUP

MICHAEL GLASS

SENIOR VICE PRESIDENT

MIDWEST DIVISION MANAGER

NATIONAL DIRECTOR, MANUFACTURED HOME COMMUNITIES GROUP

BROKER SUPPORT

SAM PETROSino

VALUATION & RESEARCH

BRETT MARTIN

INTERNAL ACCOUNTANT

MARKETING

DATA SUMMARY

Property Address: 411 East Main St

City, State, Zip: Williamsburg, Ohio, 45176

Submarket: Amelia/Batavia

County: Clermont County

Year Built/Reno: 1969

Number Of Units: 95

Avg Unit Size: 759

Rentable Sqft: 72100

Number of Parcels: 1

Lot Size (Acres): 7.93

Density: 11.98

# of Buildings: 8

# of Stories: 3

Current Occupancy: 94%

Parking Type: Surface Level

Parking Surface: Asphalt (resurfaced & striped in 22’)

Parking Spaces: 190

Parking Ratio: 2.00

Foundation: Poured Concrete

Framing: Wood

Roof Type: Pitched Shingle (4 replaced since 22’)

HVAC: Through wall A/C & Boiler Heat (all new since new 22’)

NOTE: AERIAL PHOTOS WERE TAKEN PRIOR TO ASPHALT BEING RESEALED

NOTE: AERIAL PHOTOS WERE TAKEN PRIOR TO ASPHALT BEING RESEALED

TENANT PAYS: Electric, Cable/Internet

01
SECTION - THE INVESTMENT

OVER $1.2M OF CAPEX SINCE 22’

35 Units Renovated:

• LVP Flooring throughout unit

• Kitchen Cabinets & Hardware

• Faux Granite Countertops

• White Appliances

• Ceiling Fans and Light Fixtures

• Bathroom Vanities Medicine Cabinet & Light

• Bathtub & Surround replaced or reglazed

• Toilets

• Paint & Outlet Covers

15 Units Received a Heavy Turn with 1-3 of the above-mentioned items upgraded.

*Full CapEx list available in Deal Vault

Community Upgrades & Maintenance:

• All windows & Sliders - vinyl frame double pane

• Unit Entrance Doors

• Rebuilt all Wood Decks

• Roofs, Gutters, & Downspouts – Four buildings since 22’

• Boilers (all eight are new)

• Electrical Panels and Breakers replaced

• Driveway & Parking Lot resealed & stripped

• Hot Water Heaters - Five new since 22’

WILLIAMS POINTE 18 MIN DRIVE 37 MIN DRIVE DOWNTOWN CINCINNATI
EASTGATE SHOPPING CENTER

Williamsburg highlights

• 18 Minute Drive to Eastgate Shopping Center

• 37 Minute Drive to Downtown Cincinnati

• Median Household Income of $65,454

WILLIAMS POINTE

development spotlight

Nestle’s Purnia Factory

• $550 Million total investment

• 300 new full-time employees by end of 2024

• Hourly compensation range from $26-42/hour

• Salary Range from $53-90k

• 9-minute drive from Williams Pointe

RENT MATRIX | ONE BED

02 SECTIONLOCAL COMPETITORS One
Property Year Built # Units Avg SF Avg Rent Avg Rent/SF Subject Pro Forma 1969 95 700 $975 $1.39 3357 St Rt 132 1978 12 700 $950 $1.36 208 W South St 1981 16 800 $900 $1.13 Concord Square 1981 54 572 $850 $1.49 Subject Average Effective 1969 95 700 $849 $1.21 Market Average 1973 49 694 $904 $1.31
Bedroom

RENT MATRIX | two bed

02 SECTIONLOCAL COMPETITORS
Property Year Built # Units Avg SF Avg Rent Avg Rent/SF Subject Pro Forma 1969 95 900 $1,175 $1.31 Subject Average Effective 1969 95 900 $1,109 $1.24 115 & B Dell Acres Dr Year Built 2 1100 $1,000 $0.91 Concord Square 1981 54 858 $925 $1.08 Market Average 1973 62 940 $1,053 $1.13
Two Bedroom

UNIT MIX BREAKDOWN

WILLIAMS POINTE - financials AVERAGE EFFECTIVE MARKET PROJECTED UNIT TYPE NO. OF UNITS RENTABLE SF TOTAL SF RENT/UNIT RENT/SF TOTAL RENT POTENTIAL RENT/UNIT RENT/SF TOTAL RENT POTENTIAL RENT/UNIT RENT/SF TOTAL RENT POTENTIAL One Bedroom 1BR/1BA 67 Units 700 SF 46,900 SF $849.00 $1.21 SF $56,883 $924.00 $1.32 SF $61,908 $975.00 $1.39 SF $65,325 Totals / Wtd. Averages 67 Units 700 SF 46,900 SF $849.00 $1.21 SF $56,883 $924.00 $1.32 SF $61,908 $975.00 $1.39 SF $65,325 Two Bedroom 2BR/1BA 28 Units 900 SF 25,200 SF $1,109.40 $1.23 SF $31,063 $1,174.00 $1.30 SF $32,872 $1,175.00 $1.31 SF $32,900 Totals / Wtd. Averages 28 Units 900 SF 25,200 SF $1,109.40 $1.23 SF $31,063 $1,174.00 $1.30 SF $32,872 $1,175.00 $1.31 SF $32,900 Summary One Bedroom 67 Units 700 SF 46,900 SF $849.00 $1.21 $56,883 $924.00 $1.32 SF $61,908 $975.00 $1.39 SF $65,325 Two Bedroom 28 Units 900 SF 25,200 SF $1,109.40 $1.23 $31,063 $1,174.00 $1.30 SF $32,872 $1,175.00 $1.31 SF $32,900 Totals / Wtd. Averages 95 Units 759 SF 72,100 SF $925.75 $1.22 SF $87,946 $997.68 $1.31 SF $94,780 $1,033.95 $1.36 SF $98,225 03 SECTION - THE FINANCIALS

UNIT RENTS

UNIT DISTRIBUTION

WILLIAMS POINTEfinancials

T12 RENT ROLL: AS OF JUNE 5TH, 2024 INCOME AND EXPENSES: JUNE 2023 - MAY 2024 GROSS POTENTIAL RENT % of GPR Per Unit All Units at Market Rent $1,094,235 T12 11,518 Gain (Loss) to Lease ($36,657) T12 3.35% (386) GROSS SCHEDULED $1,057,578 11,132 TOTAL OTHER INCOME $149,417 14.13% 1,573 GROSS POTENTIAL INCOME $1,206,995 12,705 Physical Vacancy ($140,385) T12 13.27% (1,478) Bad Debt ($20,716) T12 1.96% (218) Concessions Allowance ($31,953) T12 3.02% (336) EFFECTIVE GROSS INCOME $1,013,941 78.40% 10,673 NON-CONTROLLABLE Real Estate Taxes % of EGI Per Unit 2024 Taxes $46,393 Auditor 4.58% 488 Total Real Estate Taxes $46,393 4.58% 488 Insurance $15,324 T12 1.51% 161 Utilities Electric & Gas $45,531 T12 4.49% 479 Water & Sewage $61,252 T12 Note 2 6.04% 645 Trash Removal $9,920 T12 0.98% 104 Utilities $116,703 11.51% 1,228 Total Non-Controllable $178,421 17.60% 1,878 CONTROLLABLE Contract Services Contract Services $47,504 T12 4.69% 500 Snow Removal $0 0.00% 0 Landscaping/Grounds $0 0.00% 0 Pest Control $0 0.00% 0 Contract Services $47,504 4.69% 500 Repairs & Maintenance $39,920 T12 3.94% 420 Marketing & Promotion $9,775 T12 0.96% 103 On-Site Payroll $100,346 T12 9.90% 1,056 Payroll Taxes & Benefits $0 0.00% 0 General & Administrative $12,548 T12 1.24% 132 Management Fee $51,410 T12 5.07% 541 Replacement & Reserves $28,500 Note 1 2.81% 300 Total Controllable $290,003 28.60% 3,053 TOTAL EXPENSES $468,424 46.20% 4,931 NET OPERATING INCOME $545,518 53.80% 5,742 EXPENSE INCOME UNDERWRITING NOTES # NOTE 1 Replacement & Reserves: added based on market norm of $255 per unit per year 2 Water & Sewer: $5,000 added to May 2024, bill not received at time of analysis
T6 T1 YEAR 1 % of GPR Per Unit % of GPR Per Unit % of GPR Per Unit $1,116,870 T6 11,757 $1,125,696 T3 11,849 $1,178,700 12,407 ($59,422) T6 5.32% (625) ($62,076) T3 5.51% (653) ($23,574) 2.00% (248) $1,057,448 11,131 $1,063,620 11,196 $1,155,126 12,159 $158,129 14.95% 1,665 $161,639 15.20% 1,701 $166,488 14.41% 1,753 $1,215,577 12,796 $1,225,259 12,897 $1,321,614 13,912 ($122,498) T6 11.58% (1,289) ($82,865) T3 7.79% (872) ($57,756) 5.00% (608) ($22,389) T6 2.12% (236) ($25,881) T3 2.43% (272) ($11,551) 1.00% (122) ($7,296) T6 0.69% (77) ($10,268) T3 0.97% (108) $0 0.00% 0 $1,063,394 80.29% 11,194 $1,106,245 83.30% 11,645 $1,252,306 92.00% 13,182 % of EGI % of EGI Per Unit % of EGI $46,393 Auditor 4.36% 488 $46,393 Auditor 4.19% 488 $46,393 4.19% 488 $46,393 4.36% 488 $46,393 4.19% 488 $46,393 4.19% 488 $15,324 T12 1.51% 161 $15,324 T12 1.51% 161 $42,750 3.86% 450 $45,531 T12 4.49% 479 $45,531 T12 4.49% 479 $46,441 4.20% 489 $61,252 T12 Note 2 6.04% 645 $61,252 T12 Note 2 6.04% 645 $62,477 5.65% 658 $9,920 T12 0.98% 104 $9,920 T12 0.98% 104 $10,119 0.91% 107 $116,703 10.97% 1,228 $116,703 10.55% 1,228 $119,037 10.76% 1,253 $178,421 16.85% 1,878 $178,421 16.25% 1,878 $208,181 18.82% 2,191 $47,504 T12 4.69% 500 $47,504 T12 4.69% 500 $0 0.00% 0 $0 0.00% 0 $0 0.00% 0 $3,325 0.27% 35 $0 0.00% 0 $0 0.00% 0 $23,750 1.90% 250 $0 0.00% 0 $0 0.00% 0 $3,325 0.27% 35 $47,504 4.47% 500 $47,504 4.29% 500 $30,400 2.75% 320 $39,920 T12 3.94% 420 $39,920 T12 3.94% 420 $47,500 3.79% 500 $9,775 T12 0.96% 103 $9,775 T12 0.96% 103 $9,500 0.76% 100 $100,346 T12 9.90% 1,056 $100,346 T12 9.90% 1,056 $85,500 6.83% 900 $0 0.00% 0 $0 0.00% 0 $9,500 0.76% 100 $12,548 T12 1.24% 132 $12,548 T12 1.24% 132 $16,625 1.33% 175 $51,410 T12 5.07% 541 $51,410 T12 5.07% 541 $50,092 4.00% 527 $28,500 Note 1 2.68% 300 $28,500 Note 1 2.58% 300 $28,500 2.28% 300 $290,003 28.25% 3,053 $290,003 27.98% 3,053 $277,617 22.49% 2,922 $468,424 44.05% 4,931 $468,424 42.34% 4,931 $485,798 43.91% 5,114 $594,971 55.95% 6,263 $637,821 57.66% 6,714 $766,509 69.29% 8,069
T12 T6 T3 YR 1 YR 2 YR 3 YR 4 YR 5 YE JUN-2025 YE JUN-2026 YE JUN-2027 YE MAY-2028 YE MAY-2029 GROSS POTENTIAL RENT All Units at Market Rent $1,094,235 $1,116,870 $1,125,696 $1,178,700 $1,214,061 $1,250,483 $1,287,997 $1,326,637 Gain (Loss) to Lease ($36,657) ($59,422) ($62,076) ($23,574) ($24,281) ($25,010) ($25,760) ($26,533) GROSS SCHEDULED RENT $1,057,578 $1,057,448 $1,063,620 $1,155,126 $1,189,780 $1,225,473 $1,262,237 $1,300,104 TOTAL OTHER INCOME $149,417 $158,129 $161,639 $166,488 $169,818 $173,214 $176,678 $180,212 GROSS POTENTIAL INCOME $1,206,995 $1,215,577 $1,225,259 $1,321,614 $1,359,598 $1,398,687 $1,438,916 $1,480,316 Physical Vacancy ($140,385) ($122,498) ($82,865) ($57,756) ($59,489) ($61,274) ($63,112) ($65,005) Bad Debt ($20,716) ($22,389) ($25,881) ($11,551) ($11,898) ($12,255) ($12,622) ($13,001) EFFECTIVE GROSS INCOME $1,013,941 $1,063,394 $1,106,245 $1,252,306 $1,288,211 $1,325,159 $1,363,182 $1,402,310 Real Estate Taxes $46,393 $46,393 $46,393 $46,393 $47,321 $48,267 $49,233 $50,217 Insurance $15,324 $15,324 $15,324 $42,750 $43,605 $44,477 $45,367 $46,274 Utilities $116,703 $116,703 $116,703 $119,037 $121,418 $123,847 $126,323 $128,850 Contract Services $47,504 $47,504 $47,504 $30,400 $31,008 $31,628 $32,261 $32,906 Repairs & Maintenance $39,920 $39,920 $39,920 $47,500 $48,450 $49,419 $50,407 $51,416 Marketing & Promotion $9,775 $9,775 $9,775 $9,500 $9,690 $9,884 $10,081 $10,283 On-Site Payroll $100,346 $100,346 $100,346 $85,500 $87,210 $88,954 $90,733 $92,548 Payroll Taxes & Benefits $0 $0 $0 $9,500 $9,690 $9,884 $10,081 $10,283 General & Administrative $12,548 $12,548 $12,548 $16,625 $16,958 $17,297 $17,643 $17,995 Management Fee $51,410 $51,410 $51,410 $50,092 $51,528 $53,006 $54,527 $56,092 Replacement & Reserves $28,500 $28,500 $28,500 $28,500 $29,070 $29,651 $30,244 $30,849 TOTAL EXPENSES $468,424 $468,424 $468,424 $485,798 $495,948 $506,314 $516,902 $527,714 NET OPERATING INCOME $481,545 $530,998 $573,849 $702,536 $792,263 $818,844 $910,252 $938,568 INCOME EXPENSE WILLIAMS POINTEfinancials
Tax Breakdown Property Address Parcel ID Year Built Acres Market Value Assessed Value Tax Rate Taxes Payable Land Use Code 411 E Main St 531-326.023 1969 7.93 $2,101,800 $735,630 63.065937 $46,393.20 403 C - Apartments 40+ Units Total 7.93 $2,101,800 $735,630 $46,393.20
CASH FLOW
CASH FLOW PROJECTION GROWTH RATE ASSUMPTIONS T12 T6 T3 YR 1 YR 2
Gross Potential Rent 7.72% 3.00% 3.00% 3.00% 3.00% (Loss) / Gain to Lease* 5.32% 5.51% 2.00% 2.00% 2.00% Other Income 3.00% 3.00% 3.00% 3.00% 3.00% EXPENSES Expenses 2.00% 2.00% 2.00% 2.00% Management Fee** 4.00% 4.00% 4.00% 4.00% 4.00% CASH FLOW PROJECTION GROWTH RATE ASSUMPTIONS T12 T6 T3 YR 1 YR 2 Physical Vacancy 11.58% 7.79% 5.00% 5.00% 5.00% Non-Revenue Units 0.00% 0.00% 0.00% 0.00% 0.00% Bad Debt 2.12% 2.43% 1.00% 1.00% 1.00% Concessions Allowance 0.69% 0.97% 0.00% 0.00% 0.00% Total Economic Loss 14.39% 11.19% 6.00% 6.00% 6.00%
INCOME

CINCINNATI

THE ECONOMY

1| Prior to the pandemic, Cincinnati’s real gross metropolitan product grew at an average annual rate of 2.1% from 2015 to 2019. During that same five-year period, job growth averaged 1.4% annually, with roughly 15,500 jobs added on average each year. In 2020, COVID-19 mitigation measures and limited business activity caused the local economy to contract as much as 8.4% year-over-year in 2nd quarter. 2| In 2023, the metro’s inflation-adjusted economic output expanded 2.3%. 3| The metro recorded a net gain of 21,100 jobs, expanding the employment base 1.8%. 4| Cincinnati’s unemployment rate in November 2023 was unchanged year-over-year at 3.0%, below the national average of 3.5%. 5| Despite job losses stemming from the pandemic, Cincinnati’s current employment base now sits roughly 63,700 jobs or about 6% above the pre-pandemic level in February 2020.

3,263 units completed in past 12 months 5,184 units currently in progress

HIGHEST OVERALL PERFORMING SUBMARKET

RENT

1| Over the past five years, annual change in effective asking rents in Cincinnati ranged from 2.0% to 11.9%. 2| In 4th quarter 2023, effective asking rents for new leases were up 3.6% year-over- year. That annual rent performance was below the market’s five-year average of 5.7%. 3| Cincinnati’s recent annual rent change performance ranked #10 in the Midwest region and #27 nationally. 4| Looking at product classes in Cincinnati, Class B led for rent performance over the past five years. In 4th quarter 2023, annual effective rent change registered at 2.5% in Class A units, 3.4% in Class B units and 5.8% in Class C units. 5| Among submarkets, the strongest annual rent change performances over the past year were in West Cincinnati and Southeast Cincinnati. 6| The weakest performances were in Central Cincinnati, Butler County and North Central Cincinnati. Over the past five years, rent growth was strongest in Southeast Cincinnati.

LOCAL MARKET
Q4 2023 MARKET SNAPSHOT Pre-1970s 1970s 1980s 1990s 2000+ Occupancy 93.8% 95.4% 96.2% 94.8% 94.7% Y-O-Y Rent Growth 5.2% 3.5% 3.4% 3.0% 3.5% Average Rent Per Unit $1,094 $1,148 $1,283 $1,367 $1,732
SUBMARKETS RENT OCCUPANCY YOY Dent/Harrison $1,147 97.6% 11.0% Roselawn $1,022 92.5% 8.5% Mt Washington $1,155 94.7% 8.3% Mt Healthy $1,123 96.7% 8.1% Middletown/Franklin $969 94.1% 7.3%

SCAN FOR MORE

SUPPLY

HIGHEST OVERALL PERFORMING SUBMARKET

1| New apartment completions in Cincinnati were moderate recently, as 3,263 units delivered in 2023. That annual completion volume was a 24-year high. 2| With 150 units removed from existing stock over the past year, the local inventory base grew 1.9%. In the past year, supply was greatest in North Central Cincinnati. 3| Annual new supply averaged 1,754 units, and annual inventory growth averaged 1.0% over the past five years. During that period, new supply was concentrated in Central Cincinnati and Campbell/Kenton Counties, which received 42% of the market’s total completions. 4| At the end of 2023, there were 5,184 units under construction with 3,531 of those units scheduled to complete in the next four quarters. Scheduled deliveries in the coming year are expected to be concentrated in Central Cincinnati.

OCCUPANCY

1| Occupancy in the Cincinnati apartment market has ranged from 94.9% to 98.2% over the past five years, averaging 96.4% during that period. 2| Over the past year, occupancy lost 1.2 points, with the 4th quarter 2023 rate landing at 94.9%. 3| Looking at product classes in Cincinnati, 4th quarter 2023 occupancy registered at 94.1% in Class A units, 94.9% in Class B units and 95.6% in Class C units. 4| Occupancy in Class C product was generally tightest over the past five years. 5| Among submarkets, 4th quarter 2023 occupancy was strongest in Southeast Cincinnati and Campbell/Kenton Counties. 6| The weakest readings were seen in Central Cincinnati and North Central Cincinnati. During the coming year, occupancy in Cincinnati is expected to register around 95%.

LOWEST OVERALL PERFORMING SUBMARKETS

UNITS UNDER CONSTRUCTION

SECTOR UNITS Central Cincinnati 1,747 Northeast Cincinnati/Warren County 811 Boone County/Erlanger 769 Campbell/Kenton Counties 497 Butler County 482 TOTAL FUTURE INVENTORY GROWTH SUBMARKET CHANGE Central Cincinnati 11.9% Boon County/Erlanger 7.0% Northeast Cincinnati/Warren County 4.8% Campbell/Kenton Counties 2.9% Butler County 2.4%
SUBMARKETS RENT OCCUPANCY YOY Dent/Harrison $1,147 97.6% 11.0% Roselawn $1,022 92.5% 8.5% Mt Washington $1,155 94.7% 8.3% Mt Healthy $1,123 96.7% 8.1% Middletown/Franklin $969 94.1% 7.3%
SUBMARKETS RENT OCCUPANCY YOY Fort Mitchell/Crescent Springs $1,162 96.1% 1.0% Fairfield $1,291 94.2% 1.0% Covington/Newport $1,608 93.9% 0.8% Clifton $1,038 90.6% -0.5% Downtown $1,786 94.6% -0.8

WILLIAMS POINTE

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