1644 sw 2nd street · 1644 sw 2nd street # executive summary offering summary 4 the offering price...
TRANSCRIPT
1644 SW 2nd StreetMiami, FL 33135
6 Unit Multifamily
Offering Memorandum
1
N O N - E N D O R S E M E N T A N D D I S C L A I M E R N O T I C E
Confidentiality and DisclaimerThe information contained in the following Marketing Brochure is proprietary and strictly
confidential. It is intended to be reviewed only by the party receiving it from Marcus &
Millichap Real Estate Investment Services of Florida, Inc. ("Marcus & Millichap") and
should not be made available to any other person or entity without the written consent of
Marcus & Millichap. This Marketing Brochure has been prepared to provide summary,
unverified 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 or absence of
contaminating substances, PCB's or asbestos, the compliance with 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 Marketing Brochure
has been obtained from sources we believe to be 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. Marcus & Millichap is a service mark of Marcus & Millichap
Real Estate Investment Services, Inc. © 2018 Marcus & Millichap. All rights reserved.
Non-Endorsement NoticeMarcus & 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.
ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.
PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE
DETAILS.
1644 SW 2ND STREET
Miami, FL
ACT ID ZAA0390964
2
INVESTMENT OVERVIEW 01Offering Summary
Regional Map
Local Map
Aerial Photo
FINANCIAL ANALYSIS 02
Rent Roll Summary
Rent Roll Detail
Operating Statement
Notes
Pricing Detail
Acquisition Financing
MARKET COMPARABLES 03
Sales Comparables
Rent Comparables
MARKET OVERVIEW 04
Market Analysis
Demographic Analysis
1644 SW 2ND STREET
3
INVESTMENT
OVERVIEW
1644 SW 2ND STREET
#
EXECUTIVE SUMMARY
OFFERING SUMMARY
4
THE OFFERING
Price $975,000
Property Address1644 SW 2nd Street,
Miami, FL
Assessors Parcel Number
01-4102-006-2870
Zoning T4-L
SITE DESCRIPTION
Number of Units 6
Number of Buildings 1
Number of Stories 2
Year Built/Renovated 1971
Rentable Square Feet 4,026
Lot Size 0.17 acre(s)
Type of Ownership Fee Simple
Parking 8 Spaces
Landscaping None
UTILITIES
WaterMiami-Dade W&S - Paid by
Landlord
Phone Paid by Tenant
Electric FPL - Paid by Tenant
Gas None
CONSTRUCTION
Foundation Concrete
Parking Surface Asphalt
Roof Pitched Roof
MECHANICAL
HVAC Wall A/Cs
Fire Protection Fire Extinguishers
UNIT MIX
NUMBEROF UNITS
UNIT TYPEAPPROX.SQUARE FEET
2 2 BED 1 BATH 771
4 1 BED 1 BATH 621
6 Total 4,026
VITAL DATA
Price $975,000 CURRENT YEAR 1
Loan Amount $682,500 CAP Rate 5.29% 5.56%
Loan Type Proposed New GRM 12.85 11.61
Interest Rate / Amortization
4.25% / 30 Years
Net Operating Income
$51,564 $54,178
Price/Unit $162,500Net Cash Flow After Debt Service
3.85% / $11,274 4.75% / $13,888
Price/SF $242.18 Total Return 7.79% / $22,780 8.85% / $25,893
Number of Units 6
Rentable Square Feet 4,026
Number of Buildings 1
Number of Stories 2
Year Built 1971
Lot Size 0.17 acre(s)
1644 SW 2ND STREET
OFFERING SUMMARY
▪ 100% Occupied with Upside in Rental Income
▪Exceptional Condition 1971 Concrete Construction
▪ Favorable Mix of 2 & 1 Bedroom Units
▪On-Site Parking & Laundry Facility
▪ 40-Year Re-certification Completed
▪ 7,500 Sq Ft Lot Zoned T4-L
INVESTMENT HIGHLIGHTS
Marcus & Millichap, as exclusive listing agent, is pleased to offer for sale 1644 SW 2nd Street, a six unit
apartment building located in the highly sought-after Little Havana neighborhood in the City of Miami.
Built in 1971, and featuring a unit mix comprised of two two-bedroom/one-bathroom and four one-
bedroom/one-bathroom units, 1644 SW 2nd Street sits on a 7,500 sq ft lot, zoned T4-L.
1644 SW 2nd Street is located in Little Havana, a highly desirable area within Miami-Dade County
because of the close proximity to Downtown Miami and the Brickell area. This is a significant advantage
and the main reason to attract tenants that will look to live in an up and coming neighborhood within
very close proximity to major employers and enjoy access to main traffic arteries such as Interstate 95
and 836 Expressway. West Flagler and the world Southwest 8th Street (Calle Ocho) are a few blocks
away. Moreover, The Jackson Memorial Hospital, PortMiami and the Miami International Airport are
within a short driving distance. These are the biggest employers in Miami-Dade County. These variables
create a centrally located place to live with high demand for rentals, translating into properties
commanding high rents with a very low vacancy at all times.
INVESTMENT OVERVIEW
5
AERIAL PHOTO
1644 SW 2ND STREET
6
W Flagle
r Street
Downtown Brickell
1644 SW 2nd Street
LOCAL MAP
1644 SW 2ND STREET
7
INTERIOR PHOTOS
1644 SW 2ND STREET
8
INTERIOR PHOTOS
1644 SW 2ND STREET
9
1644 SW 2ND STREET
10
FINANCIAL
ANALYSIS
FINANCIAL ANALYSIS
1644 SW 2ND STREET
RENT ROLL SUMMARY
11
FINANCIAL ANALYSIS
1644 SW 2ND STREET
OPERATING STATEMENT
12
Notes:1. Physical vacancy, repairs and maintenance, operating reserves and management fee assumed according to lending standards.2. Pro-forma taxes assumed according to lending standards at 75% of list price and including 4% discount for early payment.
FINANCIAL ANALYSIS
1644 SW 2ND STREET
PRICING DETAIL
13
FINANCIAL ANALYSIS
1644 SW 2ND STREET
PRICING DETAIL
14
MARCUS & MILLICHAP CAPITAL CORPORATION
CAPABILITIES
MMCC—our fully integrated, dedicated financing arm—is committed to
providing superior capital market expertise, precisely managed execution, and
unparalleled access to capital sources providing the most competitive rates and
terms.
We leverage our prominent capital market relationships with commercial banks,
life insurance companies, CMBS, private and public debt/equity funds, Fannie
Mae, Freddie Mac and HUD to provide our clients with the greatest range of
financing options.
Our dedicated, knowledgeable experts understand the challenges of financing
and work tirelessly to resolve all potential issues to the benefit of our clients.
National platform
operating
within the firm’s
brokerage
offices
$6.24 billion
total national
volume in 2018
Access to
more capital
sources than
any other firm
in the industry
Optimum financing solutions
to enhance value
Our ability to enhance
buyer pool by expanding
finance options
Our ability to enhance
seller control
• Through buyer
qualification support
• Our ability to manage buyers
finance expectations
• Ability to monitor and
manage buyer/lender
progress, insuring timely,
predictable closings
• By relying on a world class
set of debt/equity sources
and presenting a tightly
underwritten credit file
WHY MMCC?
Closed 1,678
debt and equity
financings
in 2018
ACQUISITION FINANCING
1644 SW 2ND STREET
15
1644 SW 2ND STREET
16
MARKET
COMPARABLES
1644 SW 2ND STREET
SALES COMPARABLES MAP
17
1644 SW 2ND STREET
(SUBJECT)
817 NW 2nd St
1874 W FLAGLER ST
651 SW 3RD ST
1644 SW 3RD ST
1653 NW 1ST ST
SALES COMPARABLES
1
2
3
4
5
PROPERTY NAME1644 SW 2ND STREET
SALES COMPARABLES
18
SALES COMPARABLES
Avg.
$270.07
$0.00
$50.00
$100.00
$150.00
$200.00
$250.00
$300.00
$350.00
$400.00
$450.00
$500.00
1644 SW
2nd Street
817
NW 2nd St
1874 W
FLAGLER ST
651
SW 3RD ST
1644
SW 3RD ST
1653
NW 1ST ST
Average Price Per Square
Foot
Avg.
$167,000
$0
$20,000
$40,000
$60,000
$80,000
$100,000
$120,000
$140,000
$160,000
$180,000
$200,000
1644 SW
2nd Street
817
NW 2nd St
1874 W
FLAGLER ST
651
SW 3RD ST
1644
SW 3RD ST
1653
NW 1ST ST
Average Price Per Unit
SALES COMPARABLES SALES COMPS AVG
PROPERTY NAME
MARKETING TEAM
1644 SW 2ND STREET
SALES COMPARABLES
rentpropertyname1
rentpropertyaddress1
rentpropertyname1
rentpropertyaddress1
rentpropertyname1
rentpropertyaddress1
19
SALES COMPARABLES
Units Unit Type
Offering Price: $975,000 2 2 BED 1 BATH
Price/Unit: $162,500 4 1 BED 1 BATH
Price/SF: $242.18
CAP Rate: 5.06%
GRM: 12.70
Total No. of Units: 6
Year Built: 1971
Underwriting Criteria
Income $78,096 Expenses $28,764
NOI $49,332 Vacancy ($2,304)
1644 SW 2ND STREET1644 SW 2nd Street, Miami, FL, 33135
1
Units Unit Type
Close Of Escrow: 10/3/2019 6 2 Bdr 1 Bath
Sales Price: $1,020,000
Price/Unit: $170,000
Price/SF: $183.16
Total No. of Units: 6
Year Built: 1974
817 NW 2ND ST817 NW 2nd St, Miami, FL, 33128
Units Unit Type
Close Of Escrow: 9/6/2019 12 1 Bdr 1 Bath
Sales Price: $1,850,000
Price/Unit: $154,167
Price/SF: $438.49
Total No. of Units: 12
Year Built: 1994
2
1874 W FLAGLER ST1874 W Flagler St, Miami, FL, 33135
PROPERTY NAME
MARKETING TEAM
1644 SW 2ND STREET
SALES COMPARABLES
rentpropertyname1
rentpropertyaddress1
rentpropertyname1
rentpropertyaddress1
rentpropertyname1
rentpropertyaddress1
20
SALES COMPARABLES
Units Unit Type
Close Of Escrow: 6/6/2019 6 2 Bdr 1 Bath
Sales Price: $1,035,000
Price/Unit: $172,500
Price/SF: $263.63
Total No. of Units: 6
Year Built: 1972
3
651 SW 3RD ST651 SW 3rd St, Miami, FL, 33130
4
Units Unit Type
Close Of Escrow: 9/28/2018 6 2 Bdr 1 Bath
Sales Price: $980,000
Price/Unit: $163,333
Price/SF: $237.00
Total No. of Units: 6
Year Built: 1976
1644 SW 3RD ST1644 SW 3rd St, Miami, FL, 33135
Units Unit Type
Close Of Escrow: 7/1/2018 6 2 Bdr 1 Bath
Sales Price: $1,050,000
Price/Unit: $175,000
Price/SF: $228.06
Total No. of Units: 6
Year Built: 1973
5
1653 NW 1ST ST1653 NW 1st St, Miami, FL, 33125
8
1644 SW 2ND STREET
RENT COMPARABLES MAP
1644 SW 2ND STREET
(SUBJECT)
680 SW 10th St
650 SW 10TH ST
953 SW 10th St
1140 SW 3RD ST
520 SW 6 St
592 SW 10th St
4
7
8
9
11
20
12
14
15
16
17
13
18
10
4
1
2
3
5
6
21
PROPERTY NAME1644 SW 2ND STREET
RENT COMPARABLES
22
AVERAGE RENT - MULTIFAMILY
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
1644 SW
2nd Street
1140
SW 3RD ST
520 SW 6 St 592
SW 10th St
2 Bedroom
Avg.
$1,253
$0
$200
$400
$600
$800
$1,000
$1,200
$1,400
$1,600
$1,800
$2,000
1644 SW
2nd Street
680
SW 10th St
650
SW 10TH ST
953
SW 10th St
1140
SW 3RD ST
520 SW 6 St 592
SW 10th St
1 Bedroom
Avg.
$1,447
PROPERTY NAME
MARKETING TEAM
1644 SW 2ND STREET
RENT COMPARABLES
rentpropertyname1
rentpropertyaddress1
rentpropertyname1
rentpropertyaddress1
rentpropertyname1
rentpropertyaddress1
23
YEAR BUILT: 1971
rentpropertyname1
rentpropertyaddress1
Unit Type Units SF Rent Rent/SF
2 BED 1 BATH 2 771 $1,200 $1.56
1 BED 1 BATH 4 621 $1,000 $1.61
Total/Avg. 6 671 $1,067 $1.59
1644 SW 2ND STREET1644 SW 2nd Street, Miami, FL, 33135
YEAR BUILT: 1968
1
Unit Type Units SF Rent Rent/SF
1 Bdr 1 Bath 1 555-555$1,250-$1,250
$2.25
Total/Avg. 1 555 $1,250 $2.25
680 SW 10TH ST680 SW 10th St, Miami, FL, 33130
2
YEAR BUILT: 1970
Unit Type Units SF Rent Rent/SF
1 Bdr 1 Bath 1 627-627$1,300-$1,300
$2.07
Total/Avg. 1 627 $1,300 $2.07
650 SW 10TH ST650 SW 10th St, Miami, FL, 33130
PROPERTY NAME
MARKETING TEAM
1644 SW 2ND STREET
RENT COMPARABLES
rentpropertyname1
rentpropertyaddress1
rentpropertyname1
rentpropertyaddress1
rentpropertyname1
rentpropertyaddress1
24
YEAR BUILT: 1926
3
Unit Type Units SF Rent Rent/SF
1 Bdr 1 Bath 2 625-625$1,250-$1,275
$2.02
1 Bdr 1 Bath 4
Total/Avg. 6 625 $1,263 $2.02
953 SW 10TH ST953 SW 10th St, Miami, FL, 33130
YEAR BUILT: 1970
4
NOTES
RENOVATED UNITS
GATED PARKING
Unit Type Units SF Rent Rent/SF
1 Bdr 1 Bath 2 600 $1,200 $2.00
2 Bdr 1 Bath 10 650 $1,400 $2.15
Total/Avg. 12 642 $1,367 $2.13
1140 SW 3RD ST1140 SW 3rd St, Miami, FL, 33130
5
YEAR BUILT: 1940
Unit Type Units SF Rent Rent/SF
1 Bdr 1 Bath 1 677-677$1,250-$1,250
$1.85
Total/Avg. 1 677 $1,250 $1.85
520 SW 6 ST520 SW 6th St, Miami, FL, 33130
1644 SW 2ND STREET
25
MARKET
OVERVIEW
MARKET OVERVIEW
MIAMI-DADEOVERVIEW
1
Miami-Dade County is a gateway to South American and Caribbean
markets and a tourist destination. The 2,400-square-mile county
extends from the Florida Everglades east to the Atlantic Ocean. It is
bordered to the north by Broward County and to the south by the
Florida Keys. The main portion of the city of Miami lies on the shores
of Biscayne Bay and is separated from the Atlantic Ocean by barrier
islands, the largest of which holds the city of Miami Beach. The metro,
with a population of roughly 2.7 million, is located entirely within
Miami-Dade County. Miami is the most populous city, with slightly
more than 443,000 residents, followed by Hialeah with roughly
237,000 people.
MARKET OVERVIEW
METRO HIGHLIGHTS
BUSINESS-FRIENDLY ENVIRONMENT
The metro has no local business or personal income
taxes, which attracts businesses and residents to
the area.
INTERNATIONAL GATEWAY
Miami is a gateway for international trading
activities, tourism and immigration, connecting to
airports and ports around the world.
MEDICAL COMMUNITY
The county contains the largest concentration of
medical facilities in Florida, drawing residents
needing services throughout the state.
1644 SW 2ND STREET
MARKET OVERVIEW
ECONOMY▪ Various industries provide a diverse economy. Trade, international finance, healthcare and
entertainment have become major segments in the local business community.
▪ A strong tourism industry has developed with ties to Latin America and the Caribbean.
▪ Tourism and trade depend on a large transportation sector. PortMiami and Miami
International Airport are both major contributors to employment and the economy.
▪ The Miami metro gross metropolitan product (GMP) expansion is expected to be on par
with the U.S. GDP in 2019 and retail sales for the county are also rising.
SHARE OF 2018 TOTAL EMPLOYMENT
MAJOR AREA EMPLOYERS
Baptist Health South Florida
University of Miami
American Airlines
Miami Children’s Hospital
Publix Supermarkets
Winn-Dixie Stores
Florida Power & Light Co.
Carnival Cruise Lines
AT&T
Mount Sinai Medical Center* Forecast
2
MANUFACTURING4%
GOVERNMENT
HEALTH SERVICES
EDUCATION AND
+OTHER SERVICES
4%
LEISURE AND HOSPITALITY FINANCIAL ACTIVITIES
25%
AND UTILITIES
TRADE, TRANSPORTATION CONSTRUCTION
PROFESSIONAL AND
BUSINESS SERVICES
2%INFORMATION
14%
5%
12% 12% 7%
16%
1644 SW 2ND STREET
MARKET OVERVIEW
DEMOGRAPHICS
SPORTS
EDUCATION
ARTS & ENTERTAINMENT
▪ The metro is expected to add nearly 127,000 people over the next five years. During
the same period, approximately 62,000 households will be formed, generating
demand for housing.
▪ The homeownership rate of 53 percent is below the national rate of 64 percent,
maintaining a strong rental market.
▪ The cohort of 20- to 34-year-olds composes 21 percent of the population.
Miami-Dade County has developed into a cosmopolitan urban area offering a vibrant
business and cultural community. The metro has an abundance of popular attractions.
Miami hosts the Capital One Orange Bowl and is home to several professional sports
teams, including the Miami Dolphins, the Miami Marlins and the Miami Heat. The county
has a broad array of cultural attractions, historic sites and parks. These include the
Adrienne Arsht Center for the Performing Arts, Zoo Miami and Everglades National Park.
The region is home to a vibrant and diverse culture, family-friendly neighborhoods, a
plethora of shops and restaurants, and beautiful weather and beaches. It also offers easy
access to Latin America and the Caribbean.
QUALITY OF LIFE
3
* Forecast
Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody’s
Analytics; U.S. Census Bureau
1644 SW 2ND STREET
2018 Population by Age
0-4 YEARS
6%5-19 YEARS
17%20-24 YEARS
6%25-44 YEARS
28%45-64 YEARS
27%65+ YEARS
16%
39.9
2018MEDIAN AGE:
U.S. Median:
38.0
$45,300
2018 MEDIAN HOUSEHOLD INCOME:
U.S. Median:
$58,800
2.7M
2018POPULATION:
Growth2018-2023*:
4.6%
954K
2018HOUSEHOLDS:
6.5%
Growth2018-2023*:
MARKET OVERVIEW
29
1644 SW 2ND STREET
SOUTH FLORIDA
* Cap rate trailing 12-month average through 3Q; Treasury rate as of Sept. 30
Includes sales $1 million and greater for Miami, Fort Lauderdale and West Palm Beach.
Sources: CoStar Group, Inc.; Real Capital Analytics
Miami
• Institutional groups remain active as a strong level of portfolio deals occurred
over the past year, contributing to a low cap rate environment in some
submarkets, reaching the low-4 percent area.
• Older neighborhoods such as Little Havana, the Wynwood area and Miami
Gardens/Opa-Locka are major targets of private investors in search of
higher-yielding assets with remaining upside potential.
Fort Lauderdale
• Dania Pointe has been a catalyst for development and investment in Dania
Beach, with investors able to acquire multifamily assets with an average cap
rate in the high-5 to high-6 percent range.
• Plantation and Sunrise are receiving increased attention as investors and
developers move farther from the core, following stable population gains and
favorable rent growth. Initial yields in the submarket are in the mid-5 percent
band.
West Palm Beach
• Outside West Palm Beach, investors gravitated to Boynton Beach and
Greenacres, where going-in cap rates were in the upper-6 percent area and
the average price was in the low-$100,000s to mid-$100,000s.
• A slowdown in construction activity coupled with healthy household
formation bode well for existing complexes. Favorable demographics and
healthy property metrics will keep investors active in the search for elevated
returns. .
Multifamily 2019 Forecast
Vacancy
Y-O-Y
BasisPoint
Change
MetroEffective
Rent
Y-O-Y
Change
Fort Lauderdale 3.5% -50 $1,690 4.5%
Miami 4.3% -90 $1,640 4.1%
West Palm Beach 4.5% -80 $1,660 4.7%
Challenges to homeownership support rental demand. Strong migration trends to the
business-friendly and low-tax state of Florida are bolstering apartment demand in the three-
county area, placing the sector on a solid foundation as it enters the next year.
Homeownership in South Florida remains elusive to a wide swath of the population, resulting
in a homeownership rate in the region of 56.2 percent at midyear, well below the national rate
of 64.1 percent. A shortage of developable land and high home values are keeping the renter
pool full and property metrics at healthy levels, leading to rent growth near or above 5
percent in each county in the third quarter.
Construction activity climbs in Miami-Dade and Broward. In the third quarter, roughly 25,300
apartments were underway in South Florida, up by approximately 4,500 units from the same
time last year. Over the next two and a half years, nearly 13,800 rentals will be constructed in
Miami-Dade County, followed by Broward County where more than 8,100 units will be built.
The largest property coming down the pipeline is the 816-unit Park-Line Miami, being built
directly on top of the Virgin MiamiCentral station. North in Fort Lauderdale, X Las Olas is the
largest development underway in Broward County; it is a 639-unit high-rise set to open in
2021. With construction activity still strong in Broward and Miami-Dade counties, Palm
Beach County has registered a strong pullback as about 3,400 units are underway, down by
roughly 2,000 rentals from the high recorded in 2016.
South Florida Apartment Market on Solid Footing, Encouraging
Investors to Increase Exposure
MARKET OVERVIEW
30
• Over the past four quarters,
employers added 30,000 jobs to
company payrolls, contributing to
the lowest unemployment rate
since 2007 following a 40-basis-
point decline to 3.2 percent in the
third quarter.
• Job gains were led by the
education and health services
sector, which had 11,200 new
hires, trailed by the 7,400 jobs
created in the professional and
business services sector.
EMPLOYMENT
• Through the first nine months of
2019, developers completed
nearly 5,000 units, pushing the
year-over-year total to the
highest level in more than two
decades and outpacing the
almost 5,400 rentals built during
the previous period.
• The largest delivery of the third
quarter was The Shoreline at
Solé Mia, comprising 397 doors.
Also finalized in the third quarter
was Yard 8, a 387-unit 28-story
tower in Midtown.
CONSTRUCTION
• The net absorption of more than
5,100 units and removal of 1,100
rentals compressed the vacancy
rate to 3.4 percent in the third
quarter, building on the 10-basis-
point decline posted a year ago.
• Rapid leasing momentum in the
Class A segment led to a 110-
basis-point decline over the past
year to 5.0 percent, while at
Class C complexes a 40-basis-
point decline brought the
vacancy rate down to 1.3
percent.
VACANCY
• Robust rental demand and tight
operations supported another
stout increase to the average
effective rent, rising to $1,672
per month in the third quarter
following a 6.4 percent increase
posted at the same time last
year.
• Rent growth was highest for
Class C apartments, jumping 9.8
percent over the past year to
$1,153 per month, trailed by a
4.4 percent increase in the Class
B segment to $1,625 per month.
RENTS
SOUTH FLORIDA: MIAMI
increase in effective
rents Y-O-Y5.0%basis point decrease
in vacancy Y-O-Y20units completed
Y-O-Y5,800increase in total
employment Y-O-Y2.5%
* Forecast
1644 SW 2ND STREET
3Q19 – 12-Month Period
MARKET OVERVIEW
31
Sales Volume Holds Stable as Investors Chase Deals in Miami’s
Submarkets
Outlook: Submarkets that still provide
strong rent growth and have not faced
rising competition from new development
will attract investors in search of higher
yields and value-add opportunities, such
as Hialeah, Miami Lake and North Central
Miami.
Vacancy
Rate
Y-O-Y
BasisPoint
Change
SubmarketEffective
Rent
Y-O-Y%
Change
North Central Miami 0.5% -10 $1,100 8.3%
Homestead/
South Dade County2.1% -60 $1,220 7.0%
Hialeah/Miami Lakes 2.5% 60 $1,496 5.7%
Coral Gables/
South Miami3.5% -70 $1,965 5.0%
Miami Gardens 3.5% 30 $1,330 10.2%
Westchester/Kendall 3.5% -40 $1,555 2.8%
Downtown Miami/
South Beach3.7% -90 $2,090 4.2%
West Miami/Doral 4.1% 40 $1,914 2.2%
Northeast Miami 4.5% -80 $1,634 -0.5%
Overall Metro 3.4% -20 $1,672 5.0%
Submarket Trends
Lowest Vacancy Rates 3Q19
Sales Trends
SOUTH FLORIDA: MIAMI
• Elevated investor perceptions maintained an active 12 months of trading, keeping the
average price at approximately $170,000 per unit.
• Transaction velocity edged higher in some of Miami’s neighborhoods, outside of the
urban core, including Little Havana, Miami Gardens and Opa-Locka, as buyers chased
yields and upside potential.
* Trailing 12 months through 3Q19
Pricing trend sources: CoStar Group, Inc.; Real Capital Analytics
1644 SW 2ND STREET
*Mortgage payments based on quarterly median home price with a 30-year fixed-rate conventional mortgage, 90% LTV,
taxes, insurance and PMI. **2019-2024 v Annualized Rate
MARKET OVERVIEW
32
1644 SW 2ND STREET
SOUTH FLORIDA
• Fed cuts rate again, while balancing assortment of factors. The Federal Reserve cut the overnight
rate by 25 basis points at the end of October, the third reduction in less than 100 days in an attempt to
lengthen the economic runway. Muted inflationary pressure and continued trade negotiations have
boosted the probability for an additional rate cut in December as it is anticipated by some domestic and
foreign markets. However, at the end of October, the U.S. and China were in talks for finalizing the first
phase of a trade deal, potentially erasing the need for another rate reduction if the preliminary agreement
quickly comes to fruition. This, along with positive economic indicators like strong wage growth, sustained
job creation and a rising 10-year Treasury, will continue to make future decisions difficult for Fed members
as they balance the array of forces tugging at both ends of possible outcomes. Global developments
including slowing European economies as well as the progression of Brexit and its potential aftermath will
also help determine future Fed decisions. Though recession risks remain, the economy’s solid foundation
has softened it in recent months, signaling continued domestic growth in the near future.
• Abundant liquidity balances conservative underwriting. Debt financing for apartment assets remains
strong, supported by a variety of lenders. Fannie Mae and Freddie Mac, two mainstay apartment capital
sources, were recently given increased lending caps, allowing the two Government Sponsored
Enterprises to purchase $100 billion in loans during a yearlong period that started at the beginning of the
fourth quarter 2019. A wide range of local, regional and national banks; pension funds; insurance
companies and CMBS sources will also remain active. All have responded to the falling interest rate
climate by reducing mortgage rates, but lender spreads have widened as the 10-year Treasury rate
remains near cycle lows. Given the downward pressure on interest rates, lender caution has risen,
particularly for construction loans. Though lending is still available for these types of projects, investors
may need to blend mezzanine debt with other capital sources until they prove out their concepts and
substantially fill units. For stabilized existing assets in most major markets, financing remains plentiful.Includes sales $2.5 million and greater
Sources: CoStar Group, Inc.; Real Capital Analytics
Capital Markets
By DAVID G. SHILLINGTON, President, Marcus & Millichap Capital Corporation
PROPERTY NAME
MARKETING TEAM
1644 SW 2ND STREET
DEMOGRAPHICS
Source: © 2018 Experian
Created on December 2019
POPULATION 1 Miles 3 Miles 5 Miles
▪ 2023 Projection
Total Population 67,163 346,980 547,208
▪ 2018 Estimate
Total Population 66,077 327,332 525,389
▪ 2010 Census
Total Population 60,465 294,506 474,799
▪ 2000 Census
Total Population 59,350 256,417 433,526
▪ Daytime Population
2018 Estimate 60,767 550,214 842,665
HOUSEHOLDS 1 Miles 3 Miles 5 Miles
▪ 2023 Projection
Total Households 25,907 145,323 222,717
▪ 2018 Estimate
Total Households 25,122 133,105 207,537
Average (Mean) Household Size 2.59 2.38 2.46
▪ 2010 Census
Total Households 23,045 118,976 186,805
▪ 2000 Census
Total Households 22,349 96,747 161,124
Growth 2015-2020 3.12% 9.18% 7.31%
HOUSING UNITS 1 Miles 3 Miles 5 Miles
▪ Occupied Units
2023 Projection 25,907 145,323 222,717
2018 Estimate 26,075 147,029 226,719
Owner Occupied 4,340 37,446 70,394
Renter Occupied 20,782 95,659 137,143
Vacant 952 13,924 19,182
▪ Persons In Units
2018 Estimate Total Occupied Units 25,122 133,105 207,537
1 Person Units 31.30% 35.09% 33.18%
2 Person Units 26.30% 29.44% 29.31%
3 Person Units 17.55% 15.66% 16.02%
4 Person Units 12.53% 10.35% 11.02%
5 Person Units 6.79% 5.09% 5.50%
6+ Person Units 5.54% 4.38% 4.97%
HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles
▪ 2018 Estimate
$200,000 or More 1.36% 4.32% 5.31%
$150,000 - $199,000 0.95% 2.88% 3.16%
$100,000 - $149,000 2.99% 7.40% 7.62%
$75,000 - $99,999 4.19% 7.33% 7.73%
$50,000 - $74,999 9.93% 13.49% 13.56%
$35,000 - $49,999 13.28% 12.93% 12.87%
$25,000 - $34,999 14.02% 11.74% 11.47%
$15,000 - $24,999 19.89% 15.41% 14.69%
Under $15,000 33.40% 24.49% 23.58%
Average Household Income $36,880 $60,546 $65,842
Median Household Income $22,844 $33,377 $35,274
Per Capita Income $14,180 $24,859 $26,211
POPULATION PROFILE 1 Miles 3 Miles 5 Miles
▪ Population By Age
2018 Estimate Total Population 66,077 327,332 525,389
Under 20 19.81% 18.34% 19.56%
20 to 34 Years 20.53% 23.95% 22.73%
35 to 39 Years 6.94% 8.00% 7.43%
40 to 49 Years 14.01% 14.44% 14.16%
50 to 64 Years 18.90% 18.22% 18.78%
Age 65+ 19.80% 17.06% 17.36%
Median Age 41.93 39.81 40.18
▪ Population 25+ by Education Level
2018 Estimate Population Age 25+ 49,358 248,408 391,228
Elementary (0-8) 23.23% 14.26% 12.14%
Some High School (9-11) 12.05% 9.78% 10.10%
High School Graduate (12) 35.14% 29.37% 29.01%
Some College (13-15) 8.89% 10.59% 11.85%
Associate Degree Only 4.80% 6.90% 7.45%
Bachelors Degree Only 9.37% 16.32% 16.13%
Graduate Degree 3.04% 10.43% 10.82%
▪ Population by Gender
2018 Estimate Total Population 66,077 327,332 525,389
Male Population 50.81% 50.47% 49.68%
Female Population 49.19% 49.53% 50.32%
33
Income
In 2018, the median household income for your selected geography is
$22,844, compare this to the US average which is currently $58,754.
The median household income for your area has changed by 31.51%
since 2000. It is estimated that the median household income in your
area will be $25,455 five years from now, which represents a change
of 11.43% from the current year.
The current year per capita income in your area is $14,180, compare
this to the US average, which is $32,356. The current year average
household income in your area is $36,880, compare this to the US
average which is $84,609.
Population
In 2018, the population in your selected geography is 66,077. The
population has changed by 11.33% since 2000. It is estimated that
the population in your area will be 67,163.00 five years from now,
which represents a change of 1.64% from the current year. The
current population is 50.81% male and 49.19% female. The median
age of the population in your area is 41.93, compare this to the US
average which is 37.95. The population density in your area is
21,064.91 people per square mile.
Households
There are currently 25,122 households in your selected geography.
The number of households has changed by 12.41% since 2000. It is
estimated that the number of households in your area will be 25,907
five years from now, which represents a change of 3.12% from the
current year. The average household size in your area is 2.59 persons.
Employment
In 2018, there are 14,946 employees in your selected area, this is also
known as the daytime population. The 2000 Census revealed that
35.40% of employees are employed in white-collar occupations in
this geography, and 64.44% are employed in blue-collar occupations.
In 2018, unemployment in this area is 5.80%. In 2000, the average
time traveled to work was 34.00 minutes.
Race and Ethnicity
The current year racial makeup of your selected area is as follows:
83.70% White, 4.63% Black, 0.01% Native American and 0.36%
Asian/Pacific Islander. Compare these to US averages which are:
70.20% White, 12.89% Black, 0.19% Native American and 5.59%
Asian/Pacific Islander. People of Hispanic origin are counted
independently of race.
People of Hispanic origin make up 94.30% of the current year
population in your selected area. Compare this to the US average of
18.01%.
PROPERTY NAME
MARKETING TEAM
1644 SW 2ND STREET
Housing
The median housing value in your area was $218,701 in 2018,
compare this to the US average of $201,842. In 2000, there were
4,249 owner occupied housing units in your area and there were
18,101 renter occupied housing units in your area. The median rent at
the time was $456.
Source: © 2018 Experian
DEMOGRAPHICS
34
8
1644 SW 2ND STREET
DEMOGRAPHICS
35