Page 1

Jefferson Center

Second and Broadway, LLC c/o Luckett & Farley Development, LLC 737 South Third Street Louisville, Kentucky 40202 p. 502-585-4181 www.luckett-farley.com


Table of Contents I. Executive Summary.............................................................................. 1 Project Overview Highlights Anticipated Total Project Cost

II. Project Description............................................................................... 2 Company Ownership/Legal Entity Location / Maps Project Status and Project Timing Community & Economic Impacts

III. Financial Information and Projections.............................................. 6 Financial Summary Operating Budget Sources & Uses

IV. Project Contact....................................................................................10 V. Appendices..........................................................................................11 Property Appraisal Project Demographic Statistics Project Consultants List of Project Supporters Survey Before/After Images Conceptual Plans

The information set out herein contain statements related to Second and Broadway, LLC (the Project)’s business and financial performance and future events or developments involving the Project that may constitute forward-looking statements which involve a number of risks and uncertainties. These statements may be identified by words such as “expect,” “look forward to,” “anticipate” “intend,” “plan,” “believe,” “seek,” “estimate,” “will,” “project” or words of similar meaning. Luckett & Farley Development, LLC. (the “Company”) has based these forward-looking statements on its current expectations and projections about the Project and future events which may impact it, based on the information currently available to it. The Company may also make forward-looking statements in presentations or in materials delivered to you in the future. In addition, our representatives may from time to time make oral forward-looking statements. Such statements are based on the current expectations and certain assumptions of the Sponsor’s management, of which many are beyond its control. These are subject to a number of risks, uncertainties and factors. Should one or more of these risks or uncertainties materialize, or should underlying expectations not occur or assumptions prove incorrect, actual results, performance or achievements of the Project may (negatively or positively) vary materially from those described explicitly or implicitly in the relevant forward-looking statement. The Sponsor neither intends, nor assumes any obligation, to update or revise these forward-looking statements in light of developments which differ from those anticipated, except as may be required by law.

| 3


I. Executive Summary

II. Project Description

PROJECT OVERVIEW

COMPANY OWNERSHIP / LEGAL ENTITY

The Jefferson Center is a nine-story office building in Downtown Louisville with 128,209 square feet of interior space. Current tenants consist of education related non-profit groups such as Jefferson Community and Technical College (JCTC), Metropolitan College, and the Lincoln Foundation. The building also includes a five-story parking garage.

Second and Broadway, LLC owns the real estate at 200 West Broadway, Louisville, Kentucky 40202. It plans to redevelop, lease and manage the building. Second and Broadway, LLC is 75% owned by Luckett & Farley Development, LLC and 25% owned by the Jefferson Community and Technical College Foundation, Inc. The building renovations are expected to be completed within the fourth quarter of 2019.

The building and parking garage are in a state of disrepair and existing conditions are undesirable. Maintenance challenges include persistent roof leaks, mechanical failures, plumbing issues and dimly lit work spaces, with little to no natural light.

Luckett & Farley Development, LLC After renovation and redevelopment, the building will be a mixed-use facility with office (+/- 45,325 SF), retail (+/- 7,363 SF) and student housing (+/- 43,113 SF) components. Anticipated office tenants include JCTC, Metropolitan College, Lincoln Foundation, the University of Louisville, and Barnes & Noble Book Store. The retail space is anticipated to consist of a student bookstore and coffee shop on the ground floor. Student housing will be located on the fifth through ninth floors and will accommodate approximately 190 students. The redevelopment will create positive community and economic impacts, serve local educative and workforce development efforts, increase the population of the census tract, and elevate the quality of building stock in the immediate area.

Luckett & Farley Development, LLC is an affiliate of Luckett & Farley Architects, Engineers, & Construction Managers, Inc. Luckett & Farley was founded in 1853 and is Kentucky’s oldest and largest architecture and engineering firm. It is also one of the oldest continuously operating architectural firms in the country. Luckett & Farley provides architecture, engineering, interior design, procurement and development services. Luckett & Farley’s offices are in Louisville’s SoBro district, adjacent to the Project, within a Severely Distressed Census Tract, and the firm is a committed partner in the community’s revitalization.

Jefferson Community and Technical College Foundation Inc. After redevelopment, revenue for this project will be generated from tenant lease payments, student housing rent and fees, parking payments, TIF revenue and branding income.

The Jefferson Community and Technical College Foundation, Inc. “supports the mission of Jefferson Community and Technical College through fund-raising, advocacy and a commitment to bettering the lives of Jefferson’s students and their families through higher education.

HIGHLIGHTS

The Foundation provides financial assistance as needed for scholarships and financial aid, program development and expansion, upgrades for campus facilities and grounds, and other needs of the college. It is governed by a Board of Directors, comprising volunteers from throughout the community, who have dedicated time and resources to ensure the college remains a strong and vital educational institution and that it fulfills its missions to provide open access to higher education, to help students meet their educational goals, and to support the workforce needs of area employers.” (JCTC Website)

• • • • • •

Expected Return of 20% after 7 years Average Free Cash Flow of $22,558 per year (over 7 years) New Market Tax Credit (NMTC) capital of approximately $8.0M Loan to Project Cost of 60% Tax Increment Financing (TIF) Revenue of approximately $94,000 per year $3.2 M Purchase Price compared to $4.9M Appraisal

ANTICIPATED TOTAL PROJECT COST Total Cost........................................................................................... $36,475,630 Total Cost per sq. ft...................................................................................... $285 Acquisition cost............................................................................... $3,233,260 Construction cost per sq. ft................................................................... $185

1 | Luckett & Farley | Jefferson Center

| 2


II. Project Description

II. Project Description

LOCATION / MAPS

PROJECT STATUS / PROJECT TIMING To date, the following project milestones have been completed:

• A Phase I Environmental Study has been completed. • A Conditional Use Permit has been approved by the local authority, for the building’s change in use, to allow student housing.

• Commonwealth Bank & Trust Company, a Kentucky banking corporation, has issued a $2.4 M loan to Second and Broadway and intends to be the long-term debt provider.

• The architectural and engineering drawings for the project are ready for permit submittal, excepting the site plan, which is currently in progress.

• A General Contractor has been selected for the project. • Separate law offices have been engaged to pursue New Market Tax Credits (NMTC) and Tax Increment Financing (TIF) for the project.

Kentucky Map List The Jefferson Center is located at 200 West Broadway, in Louisville, Kentucky, in the SoBro (South of Broadway) district of Downtown Louisville, a sustainable neighborhood, at the Southwest corner of Second Street and Broadway.

Upon receipt of NMTC allocations, Second and Broadway plans to submit for permit review and start ordering materials, in the third quarter of 2018, with a proposed construction start in the same quarter. At this time, project completion is proposed for fourth quarter 2019. Due to the proposed phased construction, many of the building’s floors will likely be ready for occupancy before full project completion. Note: Receipt of the NMTC allocation(s) and local TIF approval will determine the ultimate construction start date. The Project will be “shovel-ready” but for the capital from the NMTC allocation(s).

COMMUNITY & ECONOMIC IMPACTS The redevelopment of the existing building into a mixed-use facility will enhance the SoBro District in many ways. It will bring student housing directly adjacent to the JCTC downtown campus, it will create comfortable and functional office workspaces for the employees of JCTC and other tenants, and with the college bookstore and coffee shop occupying the ground floor, at street level, the project is anticipated to bring economic benefits to the immediate Census Tract. The University of Louisville ULtra program will also be housed in the Facility. ULtra provides JCTC students with advice and support for a successful transfer to the University of Louisville, where the JCTC students can pursue a four-year degree. ULtra also offers other programs to get students connected with the University of Louisville before they transfer. Metropolitan College which is a “joint education-workforce-economic development initiative among the University of Louisville, JCTC, the Louisville Metro and State of Kentucky governments, and Barnes & Noble. “The partnership provides eligible Kentucky residents access to a tuition-free post-secondary education and outstanding employment opportunities” (Metropolitan College website).

3 | Luckett & Farley | Jefferson Center

| 4


II. Project Description

III. Financial Information and Projections

Additionally, the construction process of the redevelopment is anticipated to provide full time work for approximately 120 FTE’s.

FINANCIAL SUMMARY

The redevelopment will help stabilize and solidify the market value for real estate in the Census Tract and the SoBro neighborhood and the Project is expected to encourage other development and economic activity there. The Project is also consistent with the SoBro neighborhood sustainability initiative, which is backed by the Louisville Metro Government, with initiative goals being to “foster social equity and economic opportunity through collaborations with citizens and public, private and nonprofit organizations” (Louisville Metro website).

Income Summary: Total Commercial sq. ft Commercial Monthly Rent/sq. ft* Total Commercial Exp/sq. ft*

128,209 $13.33 $2.97

Cost Summary:

T. otal Cost $36,475,630 .Total Cost per sq. ft. $285 .Acquisition cost $3,233,260 .Construction cost per sq. ft. $185

Lease Summary: JCTC B & N/Student Lounge Coffee Shop Basement Gym Metro College Lincoln Foundation ULTRA Student Housing Total Building SF T-Mobile Total Rented SF Common Area Space Vacant Space (Basement) Walls Total Sq Ft

Square Feet

Annual Rent*

Rent/SF

33,801

418,287

$12.38

7,176

179,400

$25.00

1,000

25,000

$ 25.00

-

-

7,739

104,477

$13.50

6,877

44,064

$6.41

1,644

22,194

$13.50

45,573

897,240

$19.69

103,810

$1,690,661

$16.50

300

$14,810

$49.37

104,373

$1,709,023

$16.37

$

-

12,036

$

-

$

-

12,100

$

-

$

-

-

$

-

$

-

128,209

$1,709,023

$13.33

*Year 4 - after stabilization

5 | Luckett & Farley | Jefferson Center

| 6


7 | Luckett & Farley | Jefferson Center Total Operating Expenses Property tax Property tax abatement Insurance Utilities Repairs & Maintenance Legal/Administrative Advertising/Marketing Other Student Utility Charge $

$ $ $ $ $ $ $ $

Application Revenue Move in Revenue Branding Revenue Tax Increment Financing (TIF) Other Revenue Parking Revenue - Daily Fees Parking Revenue - Monthly Passes Total Revenue

Student Housing - 5th Floor Student Housing - 6th Floor Student Housing - 7th - 9th T-Mobile Vacancy Total Rent

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

Year 0

JCTC Barnes & Nobles/Student Lounge Coffee Shop Basement Metro College Lincoln Foundation Kentuckiana Works (KCAC) KAESP 4C U of L (ULTRA)

Total Revenue Gross Commercial Rent

Luckett & Farley Development, LLC Operating Budget 2nd & Broadway

43,414 29,569 164,215 39,936 33,807 39,056 -

950 1,500 10,585 580,275

399,775 116,000 43,200 20,000 3,600 14,520 29,855 567,240

Year 1 Forecast 399,775 74,750 10,417 111,199 43,200 3,579 9,248 81,520 83,880 14,520 28,855 803,232

$ $

Nov '19 Year 3 Forecast

Nov '20 Year 4 Forecast

Nov '21 Year 5 Forecast

Nov '22 Year 6 Forecast

367,578 (124,053) 32,005 207,827 55,024 4,083 (108,300)

$ 4,942 $ 14,826 $ 108,243 $ 94,000 $ $ 19,484 $ 99,966 $ 2,141,061

$ 474,749 $ 190,381 $ 26,530 $ $ 110,871 $ 96,590 $ $ 3,768 $ $ 23,552 $ 267,042 $ 259,529 $ 425,587 $ 15,717 $ 94,716 $ 1,799,601

339,585 $ (113,438) 31,378 203,752 53,946 4,003 (108,300)

$ 4,845 $ 14,535 $ 106,121 $ 94,000 $ $ 19,102 $ 98,006 $ 2,100,923

$ 465,440 $ 186,648 $ 26,010 $ $ 108,697 $ 94,696 $ $ 3,694 $ $ 23,091 $ 261,806 $ 254,440 $ 417,242 $ 15,409 $ 92,859 $ 1,764,314

339,585 $ (113,438) 30,763 199,757 52,888 3,925 (108,300)

$ 4,750 $ 14,250 $ 104,040 $ 94,000 $ $ 18,727 $ 96,084 $ 2,061,571

$ 456,314 $ 182,988 $ 25,500 $ $ 106,566 $ 92,840 $ $ 3,622 $ $ 22,638 $ 256,673 $ 249,451 $ 409,061 $ 15,107 $ 91,038 $ 1,729,720

339,585 $ (113,438) 30,159 195,840 51,851 3,848 (108,300)

$ 6,850 $ 20,550 $ 102,000 $ 94,000 $ $ 18,360 $ 94,200 $ 1,959,532

$ 418,287 $ 179,400 $ 25,000 $ $ 104,477 $ 44,064 $ $ 3,551 $ $ 22,194 $ 251,640 $ 244,560 $ 401,040 $ 14,810 $ 85,451 $ 1,623,572

42,072 $ 29,568 192,000 50,834 10,000 3,772 (21,200)

$ 5,300 $ 15,900 $ 100,000 $ $ $ 18,000 $ 74,250 $ 1,016,682

$ $ $ $ $ $ $ $ $ $ $ $ $ $ $ $

Nov '18 Year 2 Forecast

III. Financial Information and Projections III. Financial Information and Projections

OPERATING BUDGET SOURCES & USES

| 8


III. Financial Information and Projections

IV. Project Contact

Timothy Pitcher, President

Luckett & Farley Development, LLC 737 South Third Street Louisville, Kentucky 40202 (502) 585-4181 tpitcher@luckett-farley.com

9 | Luckett & Farley | Jefferson Center

| 10


V. Appendices

V. Appendices - Property Appraisal

Please find our appendices on the following pages.

11 | Luckett & Farley | Jefferson Center

| 12


Property Appraisal

Project Demographic Statistics Census Tract #21111004900 Metro (2011 - 2015 Census Data)

200 West Broadway, Louisville, Jefferson County, Kentucky 40202 The Project qualifies as Severely Distressed-Primary Poverty Rate Unemployment Rate

50.1% 9.7%

AMI 41.3%* The Project also qualifies as Severely Distressed-Primary based on the following; (i) brownfield area, (ii) a medically underserved area, (iii) a SBA Hub Zone. LFDV is working to make Second and Broadway a local TIF district. *2010 census data

13 | Luckett & Farley | Jefferson Center

| 14


Project Consultants

List of Project Supporters

Project Consultant Counsel

Mayor Greg Fischer, Office of the Mayor, Louisville, Kentucky

Barbara Sexton-Smith, Fourth District Councilwoman, Louisville Metro Counci

Jefferson Community & Technical College (JCTC)

Metropolitan College

Barnes & Noble

Stites & Harbison, PLLC 400 West Market Street Suite 1800 Louisville, Kentucky 40202

Project Accountant Novogradac & Company, LLP

Project Architect Luckett & Farley Architects, Engineers and Construction Managers, Inc. 737 South Third Street Louisville, Kentucky 402020

Project Contractor Abel Construction Company, Inc. 3401 Bashford Avenue Court Louisville, Kentucky 40218

15 | Luckett & Farley | Jefferson Center

| 16


Survey

Before & After Images

Existing Building

Post-Redevelopment Rendering

17 | Luckett & Farley | Jefferson Center

| 18


Conceptual Plans

19 | Luckett & Farley | Jefferson Center

Conceptual Plans

| 20


Conceptual Plans

21 | Luckett & Farley | Jefferson Center

Conceptual Plans

| 22


Conceptual Plans

23 | Luckett & Farley | Jefferson Center


Development 737 S. Third St. Louisville, KY 40202 (502) 585-4181 | luckett-farley.com

200 investment book pdf  

L&F Development's 2nd & Broadway Book

200 investment book pdf  

L&F Development's 2nd & Broadway Book

Advertisement