OM - 9005 Orion Ave - Kelly Morgan

9001 ORION AVE NORT H H I LLS , CA 9 1 3 4 3

KELLY MORGAN COMMERCIAL GROUP www.KellyMorganCommercial.com

Confidentiality Agreement Affiliated Business Disclosure 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 KW Commercial and it should not be made available to any other person or entity without the written consent of KW Commercial. 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 at this time, please return this Offering Memorandum to KW Commercial.

Confidentiality Agreement 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.

KW Commercial 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 the financial condition or business prospects of any tenant, or any tenant’s plans or intentions to continue its occupancy of the subject property.

The information contained in this Offering Memorandum has been obtained from sources we believe to be eliable; however, KW Commercial has not verified, and will not verify, any of the information contained herein, nor has KW Commercial 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.

All potential buyers are strongly advised to take advantage of their opportunities and obligations to conduct thorough due diligence and seek expert opinions as they may deem necessary, especially given the unpredictable changes resulting from the continuing COVID-19 pandemic. KW Commercial has not been retained to perform, and cannot conduct, due diligence on behalf of any prospective purchaser. KW Commercial’s principal expertise is in marketing investment properties and acting as intermediaries between buyers and sellers. KW Commercial and its investment professionals cannot and will not act as lawyers, accountants, contractors, or engineers. All potential buyers are admonished and advised to engage other professionals on legal issues, tax, regulatory, financial, and accounting matters, and for questions involving the property’s physical condition or financial outlook. Projections and pro forma financial statements are not guarantees and, given the potential volatility created by COVID-19, all potential buyers should be comfortable with and rely solely on their own projections, analyses, and decision-making.)

K E L LY M O R G A N 310.836.3638 Kelly@KellyMorganCommercial.com www.KellyMorganCommercial.com CA DRE# 01898026

Where’s The Next

MULTI-FAMILY HOT SPOT?

Where’s The Next MULTI-FAMILY HOT SPOT?

P R O P E R TY NE A R TR A NSI T HAS H IGH E R A P P R E C IATI O N Studies have noted how new public transit stops drive up nearby rental prices.

25% - 67%

HI GHER I N PUBL I C T R A NS I T STATI ON AREAS

H IGH E S T GA I NS NE A R R A P ID RA I L TR A NS IT, B R T, A ND CO M M U TE R RA I L. Sources: http://www.urbandisplacement.org RadPad on March 17, 2016. https://blog.onradpad.com/rent-on-los-angeles-expo-line-up/Note: There is no guarantee the transit line will be completed and no guarantee that it will affect rents in the same way as other transit lines in the past.

Where’s The Next MULTI-FAMILY HOT SPOT?

LIGHT RAIL TRANSIT LINE UNDER CONTRUCTION ON VAN NUYS BLVD.

Where’s The Next MULTI-FAMILY HOT SPOT?

ICON AT PANORAMA CITY IN DEVELOPMENT. MIXED USE WITH 623 MULTIFAMILY UNITS CONNECTED WITH RETAIL & COMMERCIAL.

Where’s The Next MULTI-FAMILY HOT SPOT?

IZEK SHOMOF PLANS 200 APARTMENTS AND RETAIL NEXT TO HIS NEW 821 LUXURY RESIDENTIAL APARTMENTS IN THE PANORAMA TOWER.

Where’s The Next MULTI-FAMILY HOT SPOT?

5,000,000 SQUARE FEET OF HOUSING, HOTEL, ENTERTAINMENT, FOOD & COMMERCIAL

AND NOW….

EXPERIENCE THE PANORAMA CITY CENTER THE HEART OF THE VALLEY WILL BE RE-ENERGIZED

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

3,544

Square Feet of Multi-Family

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

190,000

Square Feet of Retail Shops

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

34,000

Square Feet of Fitness

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

36,480

Square Feet of Fast Food

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

24,320

Square Feet of Restaurants

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

24,000

Square Feet of Food Hall

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

75,000

Square Feet of Event Space/Banquet Hall/Museum

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

50,000

Square Feet of Cinema

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

30,000

Square Feet of Recording/Movie Studio

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

194,800

Square Feet of General Office

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

284,500

Square Feet of Medical Office/Clinic

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

113,800 Square Feet of Hotel

Where’s The Next MULTI-FAMILY HOT SPOT?

PANORAMA CITY CENTER

2 M INUTE WALK TO BRT

Property Summary

THE ASSET

FINANCIAL SUMMARY

NUMBER OF UNITS

18

SALE PRICE

$3,999,000

UNIT MIX

4 (1+1) 1 (2+1) 6 (2+2) 7 (3+2)

BUILDING SF

± 17,911

*GRM

10.20

LOT SF

± 20,934

YEAR BUILT

1964

*CAP

6.22%

APN

2654-001-045

PRICE/UNIT

$233,278

PARKING

18

ZONING

R3-1

PRICE/SF

$234

*As of Feb/2024

42

OPPORTUNITY HIGHLIGHTS

6.22% Cap Rate as of Feb 2023

Down the street from the upcoming Van Nuys Light Rail at Nordhoff

Less than 2 miles from the future Panorama City Center

43

44

45

46

47

48

49

50

51

52

L O C AT I O N O V E RV I E W 9 0 0 1 O R I O N AV E

CLOSE PROXIMITY TO TRANSIT CORRIDORS INCREASES

PROPERTY VALUES LOS ANGELES METRO BOARD GREENLIGHTS LIGHT RAIL PROJECT IN SAN FERNANDO VALLEY The project will officially begin major construction in 2022 and is scheduled The final configuration of the first rail line to serve the east San Fernando Valley since the 1950s was approved Thursday by the Los Angeles county Metropolitan Transportation Authority Board of Directors.

to open by 2028. When complete, the new Valley light-rail line will make it easy to connect between L.A. Metro’s G Line, Metrolink, Amtrak and numerous east-west Valley bus lines. Another L.A. Metro project — the Sepulveda Transit Corridor — proposes to build a high-capacity transit line from Van Nuys across the Sepulveda Pass to the Westside and then beyond to LAX. That project is currently in the planning phase as different routes and financing plans are being studied and developed.

54

TWO DEVELOPMENTS THAT CHANGED NEIGHBORHOODS AND INCREASED PROPERTY VALUES.

THE GROVE

THE AMERICANA AT BRAND

•

When The Grove was built in 2002, the neighborhood was more a through-way than a place to stop and shop. Now the $100-million dollar project on 25 acres is one of the highest grossing shopping centers in the country.

•

The Americana at Brand, a $400-Million Dollar development on 15.5 acres modeled after The Grove has also brought astounding success

•

It successfully offers a place where people can spend a whole day shopping, eating and connecting with friends both new and old.

•

What was originally a blighted area in the center of Glendale is not only a Major Shopping Destination for people through-out Los Angeles, but a catalyst for the accelerating revitalization of the entire Glendale community

•

The Grove has substantially increased rents and property values in the local community and grown to become an attraction for tourists around the world.

•

Apartments in the area of the Americana at Brand achieve rents which are 30% above market and are 98% leased

55

THE ICON THE ICON | THE “NEXT AMERICANA AT BRAND” •

Major Redevelopment of Montgomery Ward Site in Panorama City

56

•

7 Building Complex with 623 apartments

•

60,000 SF of stores & restaurants

•

17,000 SF of landscaped plaza

PANORAMA MALL RE-IMAGINED PANORAMA MALL COMPLEX REIMAGINED •

3,544 Residential Units

•

125,000 SF of retail

•

70,000 SF of food & beverage

•

90,000 SF of entertainment

•

125,000 SF of Office Space

•

230,000 SF of Medical

•

120 Room Hotel

57

PANORAMA CITY CENTER

58

F I N A N C I A L A N A LY S I S 9 0 0 1 O R I O N AV E

FINANCIAL ANALYSIS WITH CONSTRUCTION COSTS Summary

Current Rents

Price

$3,999,000

First Loan Amount

$2,800,000

NEW

$1,199,000

*Terms

5.75%

5YR Fixed

Down Payment

30%

Market Rents

Proposed Financing

Retrofit Construction Costs

$120,000

$120,000

Interior Rehab (2 currently demoed units @ $40,000/interior)

$80,000

$520,000

Total Cost

$4,199,000

$4,639,000

Total Cash Investment

$1,399,000

$1,839,000

Number of Units

18

Cost per Unit

$233,278

$257,722

GRM

10.75

8.81

Rental Upside:

35%

CAP

5.71%

7.86%

Parking:

18

GRM (Feb 2024)

10.20

CAP ( Feb 2024)

6.23% CURRENT

Year Built / Age

1964

Approx. Lot Size

20,934

Approx. Bldg SF

17,911

Cost per Net RSF

$234

Scheduled Income

MARKET

$259

Current Rents

Market Rents

No. of Units

Bdrms/ Baths

Approx. Sq. Ftg.

Monthly Rent/Unit ($)

Monthly Income ($)

Monthly Rent/Unit ($)

Monthly Income ($)

4

1+1

850

$1,370

$5,480

$1,850

$7,400

1

1+1 w/Den

850

$2,150

$2,150

$2,150

$2,150

6

2+2

1000

$1,400

$8,401

$2,395

$14,370

1

2+2 w/Den (demo)

1000

$2,795

$2,795

$2,795

$2,795

3

2+2 w/Den (1000 SF)

1000

$2,367

$7,100

$2,695

$8,085

2

3+2 (1220 SF)

1220

$1,682

$3,364

$2,895

$5,790

1

3+2 w/Den (1220 SF)(demo)

1220

$2,995

$2,995

$2,995

$2,995

Total Scheduled Rent *Terms to provide who gave us the quote *Bobby Broukhim, New Plan Capital, 310-284-8401 x101, BobbyB@NewPlanCap.comPgs

60

$32,284

$43,585

ANNUALIZED OPERATING DATA Total Gross Current Monthly Rents

Current

Market

Total Scheduled Rent

$32,284

$43,585

Laundry (est., 12 x $20/unit)

$240

$240

Other Income (SCEP)

$40

$40

Monthly Scheduled Gross Income

$32,564

$43,865

Annualized Scheduled Gross Income

$390,770

$526,377

Annualized Operating Data

Current

Market

Scheduled Gross Income

$390,770

$526,377

Vacancy Rate Reserve

($11,723)

Gross Operating Income

$379,047

Expenses

($139,180)

Net Operating Income

$239,867

$364,828

Loan Payments

($196,080)

($196,080)

Pre-Tax Cash Flow

$43,787

Principal Reduction

$42,000

Total Return

$85,787

Estimated Expenses

Current

Market

Taxes

$49,988

$49,988

Insurance-actual

$7,189

$7,189

Utilities-actual

$31,437

$31,437

Trash-actual

$6,774

$6,774

Gardner-est

$1,800

$1,800

Off Site Mgr-est

$18,952

$25,529

On Site Mgr-est

$8,640

$8,640

Misc/Rserves-est

$7,200

$7,200

Maint/Repairs-est

$7,200

$7,200

Total Expenses

$139,180

$145,757

Per Net Sq. Ft.

($7.77)

($8.14)

Per Unit

($7,732)

($8,098)

3.0%

($15,791)

3.0%

$510,585 35.6%

3.13%

($145,757)

$168,748

28%

9.18%

$42,000 6.13%

$210,748

11.46%

61

CASH FLOW ANALYSIS Cash Flow Analysis

Year 1

Year 2

Year 3

Year 4

Year 5

Disposition Cash Flow

Scheduled Gross Income

$390,770

$411,471

$427,796

$444,774

$462,430

$480,793

Vacancy Rate Reserve

($11,723)

($12,344)

($12,834)

($13,343)

($13,873)

($14,424)

$5,950

$5,950

$5,950

$5,950

Capital Improvement Recoup From Tenants Gross Operating Income

$379,047

$405,077

$420,912

$437,380

$454,507

$466,369

Estimated Expenses

($139,180)

($143,355)

($147,656)

($152,086)

($156,648)

($161,348)

Net Operating Income

$239,867

$261,722

$273,256

$285,295

$297,859

$305,022

Retrofit Construction Costs

($120,000)

Exterior Rehab Interior Rehab

($120,000)

Loan Payments

($196,080)

($196,080)

($196,080)

($196,080)

($196,080)

($196,080)

Pre-Tax Cash Flow

($196,213)

$65,641

$77,176

$89,214

$101,779

$108,941

Pre-Tax Cash on Cash Return

-16.36%

4.56%

5.36%

6.76%

7.07%

14.28%

Principal Reduction

$42,000

$43,000

$44,000

$45,000

$46,000

$47,000

$5,234,438

$5,465,122

$5,705,893

$5,957,181

$6,100,434

$65,641

$77,176

$89,214

$101,779

Property Value Cash at Sale in Year 5

$3,184,910

Cash Flow Stream (Pre-Tax)

($1,199,000)

($196,213)

Average Annual ROI (Return on Investment)

24%

$446,489

Total 5 Year ROI

160%

$2,232,447

IRR (Compounding) Average Annual Return

18.6%

Rent Increase Year 1

7%

Rent Increase Assumption

4%

Disposition Cap Rate

5%

Total Principal Reduction

$220,000

$3,293,851

*The five year Cash Flow assumes completion of the two demoed units and turning the one unrehabbed eviction unit. After that if you were able to turn one vacancy per year for three years you would be at a 21.9% IRR. See Rent Roll-Unit Turns sheet for details. **The figures above are merely projections to be verified by Buyer. Seller and his/her representative do not warrant the accuracy of these figures. Buyer to conduct his/her own due diligence.

62

RENT ROLL Unit

Unit Type

Remodeled

Approx. Sq. Ft.

Lease Date

Current Rent

Market Rent

1

2+2

Yes

1,015

06/15/21

$2,100.00

$2,695.00

2

3+2 (1253 SF)

No

1,253

08/01/10

$1,453.29

$2,995.00

3 (vacant-pf)

2+2 (demo)

No

1,200

$2,795.00

$2,795.00

4 (eviction-pf)

1+1

No

848

$1,850.00

$2,150.00

5

2+2

No

1,015

09/01/12

$1,421.91

$2,695.00

6

1+1

No

848

08/01/19

$1,267.06

$2,150.00

7

2+2

No

1,015

10/02/15

$1,517.09

$2,695.00

8

2+2

No

1,015

08/01/10

$827.82

$2,695.00

9 (vacant-pf)

3+2 (1253 SF)(demo)

No

1,253

$2,995.00

$2,995.00

10

3+2 (1015 SF)

Yes

1,015

02/25/21

$2,300.00

$2,695.00

11

1+1

No

848

07/01/18

$1,300.00

$2,150.00

12

2+2

No

1,015

08/01/10

$1,164.76

$2,695.00

14

3+2 (1015 SF)

Yes

1,015

05/27/20

$2,450.00

$2,695.00

15 (eviction-pf)

2+1

Yes

848

$2,150.00

$2,150.00

16

2+2

No

1,015

06/28/11

$1,369.04

$2,695.00

17

3+2 (1015 SF)

Yes

1,015

04/01/21

$2,350.00

$2,695.00

18

1+1

No

848

prior to 2018

$1,062.52

$2,150.00

19

3+2 (1253 SF)

No

1,253

08/01/10

$1,910.97

$2,995.00

Monthly Totals

$32,284

$46,785

Laundry (est)

$195

$195

Other Income (SCEP)

$43

$43

Monthly

$32,523

$47,023

Annually

$390,273

$564,280

63

S O L D C O M PA R A B L E S 9 0 0 1 O R I O N AV E

Sold Comparables 1

2

3

9001 ORION AVE AS OF FEB 2024 (AFTER COSTS FOR RETROFIT & REHAB OF 2 UNITS) YEAR BUILT

1964

UNIT MIX

BUILDING SF

17,911

4 (1+1

UNITS

18

1 (2+1)

SALE DATE

-

6 (2+2)

SALE PRICE

$3,999,000

7 (3+2)

GRM

10.20

CAP RATE

6.22%

PRICE/UNIT

$233,278

PRICE/SF

$234

9001 ORION AVE (AFTER COSTS FOR RETROFIT & REHAB OF 2 UNITS) YEAR BUILT

1964

UNIT MIX

BUILDING SF

17,911

4 (1+1

UNITS

18

1 (2+1)

SALE DATE

-

6 (2+2)

SALE PRICE

$3,999,000

7 (3+2)

GRM

10.75

CAP RATE

5.70%

PRICE/UNIT

$233,278

PRICE/SF

$234

14312 ROSCOE BLVD, PANORAMA CITY YEAR BUILT

1953

UNIT MIX

BUILDING SF

4,492

4 (1+1)

UNITS

5

1 (3+1)

SALE DATE

10/26/22

SALE PRICE

$1,180,000

GRM

17.92

CAP RATE

2.48%

PRICE/UNIT

$236,000

PRICE/SF

$263

Sold Comparables 4

5

6

9017 LANGDON AVE, NORTH HILLS YEAR BUILT

1963

UNIT MIX

BUILDING SF

18,611

4 (0 + 1)

UNITS

24

7 (1 + 1)

SALE DATE

10/31/22

10 (2 + 1)

SALE PRICE

$5,100,000

3 (2 + 1.5)

GRM

12.23

CAP RATE

4.73%

PRICE/UNIT

$212,500

PRICE/SF

$274

9075 CEDROS AVE, PANORAMA CITY YEAR BUILT

1995

UNIT MIX

BUILDING SF

30,018

8 (1+1)

UNITS

33

10 (2+1)

SALE DATE

12/19/22

4 (2+1.5)

SALE PRICE

$9,300,000

7 (2+2)

GRM

12.44

2 (3+1)

CAP RATE

4.88%

2 (3+2)

PRICE/UNIT

$281,818

PRICE/SF

$310

8517 CEDROS AVE, PANORAMA CITY YEAR BUILT

1977

UNIT MIX

BUILDING SF

7,168

8 (2+1)

UNITS

8

SALE DATE

03/31/23

SALE PRICE

$2,200,000

GRM

11.50

CAP RATE

5.66%

PRICE/UNIT

$275,000

PRICE/SF

$307

Sold Comparables 7

8

15233 RAYEN ST, NORTH HILLS YEAR BUILT

1969

BUILDING SF

60,622

UNITS

84

SALE DATE

09/22/23

SALE PRICE

$19,940,000

GRM

12.64

CAP RATE

4.51%

PRICE/UNIT

$237,381

PRICE/SF

$329

UNIT MIX 84 (1+1)

8932-38 COLUMBUS AVE, NORTH HILLS YEAR BUILT

1959

BUILDING SF

9,480

UNITS

12

SALE DATE

09/28/23

SALE PRICE

$2,940,000

GRM

13.11

CAP RATE

4.33%

PRICE/UNIT

$245,000

PRICE/SF

$310

UNIT MIX 4 (1+1) 8 (2+1)

Sold Comparable s

68

Sold Comparable s

1

9001 OR I O N AVE A S O F F EB 2024 ( A F T E R COSTS FO R R ETR O F I T & R EH A B O F 2 U NI TS )

2

9001 OR I O N AVE ( A F TER CO STS FO R RETROF I T & R EH A B O F 2 UN I TS )

3

14312 ROS CO E BLVD

4

9017 L ANG DO N AVE

5

9075 C EDR O S AVE

6

8517 C ED R O S AVE

7

15233 RAYEN ST

8

8932-38 CO LUMBUS AVE

69

R E N T C O M PA R A B L E S 9 0 0 1 O R I O N AV E

Rent Comparables 1+1 ADDRESS

Square Feet

2+2 Price

Square Feet

3+2 Price

Square Feet

Price

1

15534 Chase St, North Hills, CA 91343

$1,895

View Online

2

8751 Langdon Ave, North Hills, CA 91343

$1,850

View Online

3

8960 Orion Ave, North Hills, CA 91343

976

$1,850

View Online

4

10139 Woodley Ave, North Hills, CA 91343

900

$2,200

View Online

5

8444 Columbus Ave, North Hills, CA 91343

$2,050

View Online

6

15566 Rayen St, North Hills, CA 91343

$2,050

View Online

7

17045 Roscoe Blvd, Northridge, CA 91325

8

9601 Van Nuys Blvd, Panorama City, CA 91402

1310

$2,850

View Online

9

8935 N Orion Ave

1374

$3,000

View Online

10

9223 Langdon Ave Unit A North Hills, CA 91343

1300

$2,995

View Online

800

1074

$2,500

View Online

71

Rent Comparables

72

1

15534 Chase St, North Hills, CA 91343

2

8751 Langdon Ave, North Hills, CA 91343

3

8960 Orion Ave, North Hills, CA 91343

4

10139 Woodley Ave, North Hills, CA 91343

5

8444 Columbus Ave, North Hills, CA 91343

6

15566 Rayen St, North Hills, CA 91343

7

15566 Rayen St, North Hills, CA 91343

8

15566 Rayen St, North Hills, CA 91343

9

8751 Langdon Ave, North Hills, CA 91343

10

17045 Roscoe Blvd, Northridge, CA 91325

11

8444 Columbus Ave, North Hills, CA 91343

12

10139 Woodley Ave, North Hills, CA 91343

13

9601 Van Nuys Blvd, Panorama City, CA 91402

14

8935 N Orion Ave, North Hills, CA 91343

15

9223 Langdon Ave Unit A North Hills, CA 91343

KELLY MORGAN With over 20 years of focused exploration and experience in capital markets such as Equity, Debt and Real Estate combined with Advertising and Marketing, Kelly Morgan Commercial Group brings a unique and unparalleled approach to the marketplace. We have dedicated ourselves to the deep understanding of the Southern California real estate market by taking the time to walk, examine, and analyze our landscape of submarkets.

Our clients best interest is our priority. Real estate marketing intelligence infused with financial planning has allowed us to help our clients make informed decisions about their real estate investment options.

Our educated agents work hard to get our sellers the highest price. Relationships and expertise are keys to creating Investment Property Wealth.

KELLY MORGAN 310.836.3638 Kelly@KellyMorganCommercial.com www.KellyMorganCommercial.com CA DRE# 01898026