9258 birch st - loopnet › d2 › qth8djcisjw4iy5mk4...9258 birch street is a 12 unit apartment...

9258 Birch St9258 Birch St, Spring Valley CA 91977

O F F E R I N G M E M O R A N D U M

9258 Birch StCONTENTS

Exclusively Marketed by:

Cody Evans Vice President (858) 729-3094 License # 0139935 [email protected]

We obtained the following information above from sources we believe to be reliable. However, we have not verified its accuracy and make no guarantee, warranty or representation about it. It is submitted subject to the possibility of errors, omissions, change of price, rental or otherconditions, prior sale, lease or financing, or withdrawal without notice. We include projections, opinions, assumptions or estimates for example only, and they may not represent the current or future performance of the property. You and your tax and legal advisors should conduct yourown investigation of the property and transaction.

01 Executive Summary Investment Summary 5 Unit Mix Summary 6 Location Summary 7

02 Property Description Property Features 9 Property Images 10

03 Financial Analysis Income & Expense Analysis 12 Multiyear Cash Flow Assumptions 13 Cash Flow Analysis 14

04 Demographics Demographics 17 Demographic Charts 18

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 South Coast Commercial Inc.and it should not be made available to any other person or entity without the written consent of South Coast Commercial Inc.. 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 thatrecipient will not photocopy or duplicate any part of the offering memorandum. If you have no interest in the subject property, please promptly return this offering memorandum to South CoastCommercial Inc.. This offering memorandum has been prepared to provide summary, unverified financial and physical information to prospective purchasers, and to establish only a preliminarylevel of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. South Coast Commercial Inc. has not made any investigation, and makes no warranty orrepresentation 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 andimprovements, the presence or absence of contaminating substances, PCBs or asbestos, the compliance with local, state and federal regulations, the physical condition of the improvementsthereon, or 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 reliable; however, South Coast Commercial Inc. has not verified, and will not verify, any of theinformation contained herein, nor has South Coast Commercial Inc. conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding theaccuracy 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 responsiblefor their costs and expenses of investigating the subject property.

9258 Birch St Confidentiality and Disclaimer | 03

CONFIDENTIALITY AND DISCLAIMER

PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.PLEASE CONTACT SOUTH COAST COMMERCIAL INC. FOR MORE DETAILS.Copyright © 2019 CREOP, LLC. All Rights Reserved.

9258 Birch St | Executive Sum

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Executive Summary

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Investment Summary

Unit Mix Summary

Location Summary

9258 Birch St Investment Summary | 05

OFFERING SUMMARYADDRESS 9258 Birch St

Spring Valley CA 91977COUNTY San DiegoMARKET Spring ValleyBUILDING SF 10,188LAND SF 14,922NUMBER OF UNITS 12YEAR BUILT 1984APN 578-201-21-00

FINANCIAL SUMMARYOFFERING PRICE $2,425,000PRICE PSF $238.03PRICE PER UNIT $202,083OCCUPANCY 95.00 %NOI (CURRENT) $114,317NOI (Pro Forma) $130,048CAP RATE (CURRENT) 4.71 %CAP RATE (Pro Forma) 5.36 %GRM (CURRENT) 12.24GRM (Pro Forma) 11.24

PROPOSED FINANCINGLOAN TYPE Fully AmortizedDOWN PAYMENT $720,000LOAN AMOUNT $1,705,000INTEREST RATE 3.75 %ANNUAL DEBT SERVICE $94,750LOAN TO VALUE 70 %AMORTIZATION PERIOD 30 Years

DEMOGRAPHICS 1 MILE 3 MILE 5 MILE2019 Population 24,313 138,218 364,6202019 Median HH Income $65,967 $71,557 $72,2762019 Average HH Income $81,183 $87,784 $92,249

• 1984 Construction• Superior Unit Mix Of 2 & 3 Bedrooms• 19 Open Parking Spaces• Plumbed For Individual Laundry Hook Ups• Rental Upside• Value Add

Property Highlights

9258 Birch St Unit Mix Summary | 06

Unit Mix # Units Current Rent Monthly Income Market Rent Market Income

2 bd / 1 ba 8 $1,283 $10,264 $1,400 $11,2003 bd / 1 ba 4 $1,562 $6,248 $1,695 $6,780

Totals/Averages 12 $1,376 $16,512 $1,498 $17,980

Location Summary | 07

9258 Birch St

Spring Valley is a community a part of the east county San Diego region that consists of rolling hills and countryside. It is a 20-minute commute (17 miles) to downtown via Highway 94. The area offers a diverse geography sharing a landscape of choices, from a touch of urban living to snow-dusted slopes in the rural back country in a mild climate influenced by ocean currents and abundant sunshine. Spring Valley is San Diego County’s largest unincorporated community, offering a small town flavor to each of its residents. Lifestyles range from apartments or town home residents to the urban professional, and on to those with larger properties for enjoying horses, livestock and rural community life.

Regional Map

Locator Map

9258 Birch St | Property D

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Property Description

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Property Features

Aerial Map

Parcel Map

Property Images

9258 Birch St Property Features | 09

PROPERTY FEATURESNUMBER OF UNITS 12BUILDING SF 10,188LAND SF 14,922YEAR BUILT 1984# OF PARCELS 1NUMBER OF STORIES 2NUMBER OF BUILDINGS 1NUMBER OF PARKING SPACES 19

9258 Birch Street is a 12 unit apartment building located in the community of Spring Valley. Originally built in 1984 and consisting of one structure on a 14,922 square foot lot. The property has desired unit mix of Eight 2 bedroom 1 bath units and Four 3 bedroom 1 bath units for a total of 10,188 rentable square feet. There are 19 open parking spaces. Each unit has laundry hook-ups, though only 3 are currently exposed. Ownership recently put on a new roof. This complex represents a value add opportunity for an owner to make strategic capital improvement to increase the cash flow on this well-priced asset.

9258 Birch St Property Images | 10

9258 Birch St | Financial A

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Financial Analysis

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Income & Expense

Multiyear Cash Flow Assumptions

Multiyear Cash Flow Projections

9258 Birch St Income & Expense Analysis | 12

INCOME CURRENT PRO FORMAGross Potential Income $198,144 $215,760

Less: General Vacancy $9,907 $10,788

Effective Gross Income $188,237 $204,972

Less: Expenses $73,920 $74,924

Net Operating Income $114,317 $130,048

Annual Debt Service $94,750 $94,750

Debt Coverage Ratio 1.21 1.37

Cash Flow After Debt Service $19,566 $35,297

Principal Reduction $30,813 $30,813

Total Return 7.0 % $50,379 9.2 % $66,110

EXPENSES CURRENT PRO FORMA

Real Estate Taxes $2,284 $27,403 $2,284 $27,403

Insurance $239 $2,868 $239 $2,868

Management Fee $941 $11,294 $1,025 $12,298

Trash Removal $381 $4,567 $381 $4,567

Repairs & Maintenance $1,250 $15,000 $1,250 $15,000

Water / Sewer $374 $4,490 $374 $4,490

Landscaping $111 $1,330 $111 $1,330

Gas & Electric $274 $3,293 $274 $3,293

Pest Control $29 $350 $29 $350

Other Expenses $277 $3,325 $277 $3,325

Total Operating Expense $6,160 $73,920 $6,244 $74,924

Expense / SF $7.25 $7.35

% of EGI 39.27 % 36.55 %

Per Unit Per Unit

REVENUE ALLOCATION

DISTRIBUTION OF EXPENSES

9258 Birch St Multiyear Cash Flow Assumptions | 13

GLOBALSale Price $2,425,000

INCOMEGross Potential Rent 5.00 %

EXPENSESReal Estate Taxes 2.00 %Insurance 3.00 %Trash Removal 3.00 %Repairs & Maintenance 3.00 %Water / Sewer 3.00 %Landscaping 3.00 %Gas & Electric 3.00 %Pest Control 3.00 %Other Expenses 3.00 %

PROPOSED FINANCINGLoan Type Fully AmortizedDown Payment $720,000Loan Amount $1,705,000Interest Rate 3.75 %Annual Debt Service $94,750Loan to Value 70 %Amortization Period 30 Years

9258 Birch St Cash Flow Analysis | 14

CASH FLOWCalendar Year CURRENT Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10Gross Potential RevenueGross Rental Income $198,144 $215,760 $226,548 $237,875 $249,769 $262,258 $275,371 $289,139 $303,596 $318,776Gross Potential Income $198,144 $215,760 $226,548 $237,875 $249,769 $262,258 $275,371 $289,139 $303,596 $318,776General Vacancy $9,907 $10,788 $11,327 $11,894 $12,488 $13,113 $13,769 $14,457 $15,180 $15,939Effective Gross Income $188,237 $204,972 $215,221 $225,982 $237,281 $249,145 $261,602 $274,682 $288,416 $302,837Operating ExpensesReal Estate Taxes $27,403 $27,403 $27,951 $28,510 $29,080 $29,662 $30,255 $30,860 $31,477 $32,107Insurance $2,868 $2,868 $2,954 $3,043 $3,134 $3,228 $3,325 $3,425 $3,527 $3,633Management Fee $11,294 $12,298 $12,913 $13,559 $14,237 $14,949 $15,696 $16,481 $17,305 $18,170Trash Removal $4,567 $4,567 $4,704 $4,845 $4,990 $5,140 $5,294 $5,453 $5,617 $5,785Repairs & Maintenance $15,000 $15,000 $15,450 $15,914 $16,391 $16,883 $17,389 $17,911 $18,448 $19,002Water / Sewer $4,490 $4,490 $4,625 $4,763 $4,906 $5,054 $5,205 $5,361 $5,522 $5,688Landscaping $1,330 $1,330 $1,370 $1,411 $1,453 $1,497 $1,542 $1,588 $1,636 $1,685Gas & Electric $3,293 $3,293 $3,392 $3,494 $3,598 $3,706 $3,817 $3,932 $4,050 $4,171Pest Control $350 $350 $361 $371 $382 $394 $406 $418 $430 $443Other Expenses $3,325 $3,325 $3,425 $3,527 $3,633 $3,742 $3,855 $3,970 $4,089 $4,212Total Operating Expense $73,920 $74,924 $77,144 $79,437 $81,806 $84,254 $86,784 $89,399 $92,102 $94,897Net Operating Income $114,317 $130,048 $138,077 $146,545 $155,474 $164,890 $174,818 $185,283 $196,314 $207,940Annual Debt Service $94,750 $94,750 $94,750 $94,750 $94,750 $94,750 $94,750 $94,750 $94,750 $94,750Cash Flow $19,566 $35,297 $43,326 $51,794 $60,724 $70,140 $80,067 $90,533 $101,564 $113,190

Effective Gross Income vs Operating Expenses Cash Flow

9258 Birch St Cash Flow Analysis | 15

Calendar Year CURRENT Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10Financial MetricsCash on Cash Return b/t 2.72 % 4.90 % 6.02 % 7.19 % 8.43 % 9.74 % 11.12 % 12.57 % 14.11 % 15.72 %CAP Rate 4.71 % 5.36 % 5.69 % 6.04 % 6.41 % 6.80 % 7.21 % 7.64 % 8.10 % 8.57 %Debt Coverage Ratio 1.21 1.37 1.46 1.55 1.64 1.74 1.85 1.96 2.07 2.19Operating Expense Ratio 39.26 % 36.55 % 35.84 % 35.15 % 34.47 % 33.81 % 33.17 % 32.54 % 31.93 % 31.33 %Gross Multiplier (GRM) 12.24 11.24 10.70 10.19 9.71 9.25 8.81 8.39 7.99 7.61Loan to Value 70.25 % 68.97 % 67.62 % 66.23 % 64.80 % 63.30 % 61.75 % 60.11 % 58.46 % 56.65 %Breakeven Ratio 89.61 % 82.78 % 79.87 % 77.08 % 74.41 % 71.85 % 69.39 % 67.04 % 64.79 % 62.62 %Price / SF $238.03 $238.03 $238.03 $238.03 $238.03 $238.03 $238.03 $238.03 $238.03 $238.03Price / Unit $202,083 $202,083 $202,083 $202,083 $202,083 $202,083 $202,083 $202,083 $202,083 $202,083Income / SF $18.47 $20.11 $21.12 $22.18 $23.29 $24.45 $25.67 $26.96 $28.30 $29.72Expense / SF $7.25 $7.35 $7.57 $7.79 $8.02 $8.26 $8.51 $8.77 $9.04 $9.31

9258 Birch St | D

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Demographics

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Demographic Details

Demographic Charts

9258 Birch St Demographics | 17

POPULATION 1 MILE 3 MILE 5 MILE

2000 Population 21,907 128,172 332,926

2010 Population 23,320 132,228 346,444

2019 Population 24,313 138,218 364,620

2024 Population 24,882 141,716 374,575

2019 African American 3,061 19,003 44,676

2019 American Indian 186 1,003 2,444

2019 Asian 2,058 18,221 55,610

2019 Hispanic 12,590 57,502 137,103

2019 White 10,188 60,765 174,333

2019 Other Race 6,673 27,521 59,745

2019 Multiracial 1,864 10,261 24,717

2019-2024: Population: Growth Rate 2.30 % 2.50 % 2.70 %

2019 HOUSEHOLD INCOME 1 MILE 3 MILE 5 MILE

less than $15,000 517 2,722 7,905

$15,000-$24,999 594 2,683 7,995

$25,000-$34,999 510 3,234 9,588

$35,000-$49,999 907 5,062 13,996

$50,000-$74,999 1,506 8,233 22,217

$75,000-$99,999 1,240 6,576 18,490

$100,000-$149,999 1,228 8,430 22,528

$150,000-$199,999 458 3,189 8,967

$200,000 or greater 277 2,105 8,231

Median HH Income $65,967 $71,557 $72,276

Average HH Income $81,183 $87,784 $92,249

HOUSEHOLDS 1 MILE 3 MILE 5 MILE

2000 Total Housing 6,920 40,868 114,171

2010 Total Households 6,989 40,587 114,358



2019 Average Household Size 3.33 3.24 3.01

2000 Owner Occupied Housing 4,142 26,206 68,269

2000 Renter Occupied Housing 2,598 13,855 43,246



2019 Vacant Housing 309 1,430 4,593

2019 Total Housing 7,546 43,664 124,510



2024 Vacant Housing 295 1,376 4,511

2024 Total Housing 7,674 44,564 127,405

2019-2024: Households: Growth Rate 1.95 % 2.25 % 2.45 %

Source: esri

9258 Birch St Demographic Charts | 18

1 Mile Radius 3 Mile Radius 5 Mile Radius

2019 Household Income

1 Mile Radius 3 Mile Radius 5 Mile Radius

2019 Population by Race

9258 Birch St Demographic Charts | 19

2019 Household Occupancy - 1 Mile Radius

Average Income Median Income

2019 Household Income Average and Median

9258 Birch St

Exclusively Marketed by:

Cody Evans Vice President (858) 729-3094 License # 0139935 [email protected]

9258 birch st - loopnet › d2 › qth8djcisjw4iy5mk4...9258 birch street is a 12 unit apartment...

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