BALLARD 5 Offering Memorandum

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Jason KonoP: 206.566.6595C: 206.920.0187jason@pilotnw.com

Matt JohnstonP: 206.556.4419C: 425.422.7840mjohnston@pilotnw.com

Casey ZejdlikP: 206.566.6599C: 206.280.1871casey@pilotnw.com

EXCLUSIVELY LISTED BY

Investment Overview

Location

Financials

Comparables

Offer Guidelines

TABLE of CONTENTS

The information included in this document has been obtained from sources we believe to be reliable. While we do not doubt its accuracy, we have not verified it and cannot make any guarantee, warranty or representation about it. It is your responsibility to independently confirm its accuracy and completeness. Any projections, opinions, assumptions, or estimates used are for example only and may not accurately represent the current or future performance of the property. The value of any proposed transaction to you depends on tax and other factors which should be evaluated by your tax, financial and legal advisors. You and your advisors should conduct a careful, independent investigation of the property to determine to your satisfaction the suitability of the property for your needs. © Pilot Ventures LLC.

INVESTMENT OVERVIEW

BALLARD 5 | 5

A value-add property with future redevelopment potential in North Ballard.

BALLARD 5 | 6

$66,777PROFORMA NOI

Price $ 1,195,000

Units 5

Price Per Unit $ 239,000

Rentable SF 4,430

Price Per SF $ 270

Current Cap Rate 4.32 %

Market Cap Rate 5.59 %

Current GRM 13.0

Market GRM 11.7

Year Built 1926 / 1956

Parcel Number 292170-0240

Land SF 6,935

Zoning LR2 RC

Construction Type Wood Frame

Plumbing Mixed

Parking 3 Garage Stalls, 1 Surface Stall

Hot Water Central

Heating Central

Roof Type Composition

Roof Year Fourplex: 2012Single Family: 2008Garage: 2001

Interior Photos

BALLARD 5 | 7

LOCATION OVERVIEW

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BALL ARD 51301-1311 NW 85th St, Seattle, WA 98117

Nestled in the quaint and expanding North Ballard neighborhood, Ballard 5 is well poised to take advantage of all that Ballard has to offer. Ballard 5 sits on a nearly 7,000 SF lot with LR2 RC designated zoning. The property consists of a fourplex with one non-conforming unit and a single family home on one parcel. An investor in the Ballard 5 will have a myriad of options to maximize value and grow their investment in a high-demand rental market.

Residents of the Ballard 5 benefit from an abundance of retail, entertainment, and recreational amenities within an extremely close proximity. The beloved Golden Gardens Park is a short drive away and the running trails and beachfront access at Carkeek Park are just a short trip to the north. Further, residents are in a great position to take advantage of all the amenities offered in Ballard, Green Lake, and other surrounding neighborhoods.

Ballard 5 is surrounded by local dining favorites including Pagliacci Pizza, Chuck’s Hop Shop, and Wild Mountain Café. Residents have ample shopping opportunities at the local Safeway, Fred Meyer, and QFC. Commuting is a breeze with bus stops within walking distance that provide quick access to the Seattle core, and I-5 is a short drive to the east, allowing residents easy access to the rest of the Puget Sound region to the north and south.

Ballard 5 consists of four apartment-style units and one single family home on the same tax parcel. Tasteful landscaping and a well-maintained brick façade offer curb appeal and charm. Spacious units make residents feel at home and the property offers on-site laundry and three garage parking stalls and one surface parking stall for increased convenience. Ballard 5 offers an investor the chance to raise below market rents at a well-maintained and professionally managed property with future redevelopment potential.

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WALKSCORE.COM

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INK 1 Dick’s Drive-In

2 The Lodge Sports Grille

3 Flying Bike Brewery

4 Razzis Pizzeria

5 Gorditos

6 FlintCreek Cattle Co

7 The Angry Beaver

8 The Yard Cafe

9 Kasbah Moroccan

10 Taki’s Mad Greek

11 Thai Siam

12 The Wing Dome

13 Gorgeous George’s

14 Pete’s Eggnest

15 El Taco Loco

16 Goofys

17 Wild Mountain Cafe

18 Hounds Tooth Public House

19 Taqueria Tequila

20 Valhalla Sandwiches

21 Monkey Grind Espresso Bar

22 The Dane

1 Sandel Park

2 Crown Hill Park

3 Greenwood Park

4 The Pocket Theater

5 Greenwood Public Library

6 Green Lake Park

1 Grocery Outlet

2 Fred Meyer

3 Chuck’s Hop Shop

4 Safeway

5 QFC

6 Petco

1 Whole Life Yoga

2 The Grinning Yogi

3 Bohemian Studios

4 Revel Athletics

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BALLARD

BALLARD | Seattle | 98117

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Seattle is a bustling metropolis, ranked by the U.S. Census in the “Top 4 for Growth” for five consecutive years.

Since 2010, our population has increased 18.7%, bringing an additional 114,412 people to America’s beloved Emerald City.

It’s no stretch to appreciate how the lush, green foliage and shimmering waters led a few to Seattle.Unparalleled beauty and access to the outdoors have helped attract some of the best companies in the country. To the east and west, the city is bordered by Lake Washington and the Puget Sound. Out further, snowcapped mountain ranges can be seen in every direction.

Home to a diverse and robust community, Seattle is the cultural and business center of the Pacific Northwest. The thriving tech sector has pushed up the wages, software engineers averaging $132,000/year, as well as the cost of rent.

Employment and population growth rates are strong and stable, supported by the variety of commerce and an ongoing demand for skilled workers.

Seattle was ranked the second-best city for STEM workers by NerdWallet. The University of Washington, a highly ranked school with a variety of nationally recognized programs, prepares top-tier students for roles at companies, such as Amazon, the Fred Hutchinson Cancer Research Center, Facebook, and the Allen Institute.

Buzzing with new infrastructure, jobs and residents, Seattle’s evergrowing metropolis is considered home to many major employers who drive growth and fuel our economic climate including:

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3.8 MILLION PEOPLE IN SEATTLE’S URBAN CORE

THAT’S OVER HALF THETOTAL POPULATION OF

WASHINGTON STATE

FINANCIALS

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UNIT Type Approx SF Current Rent Current /SF Market Rent Market /SF

1 2 Bd / 1 Bth 1,100 $ 1,650 $ 1.50 $ 1,945 $ 1.77

2 1 Bd / 1 Bth 700 $ 1,450 $ 2.07 $ 1,495 $ 2.14

3 2 Bd / 1 Bth 875 $ 1,550 $ 1.77 $ 1,795 $ 2.05

4* Studio 600 $ 1,150 $ 1.92 $ 1,250 $ 2.08

SFH 2 Bd / 1 Bth 1,150 $ 1,845 $ 1.60 $ 2,045 $ 1.78

4,425 $ 7,645 $ 1.73 $ 8,530 $ 1.93

• Opportunity to increase rents ~12%

• Three garage parking stalls, one surface parking stall

• One unit is considered “non-conforming” * Non-conforming unit

** Unit square footages are estimated and based off the Owner’s Rent Roll

Rent Roll

BALLARD 5 | 16

CURRENT PRO FORMA

Gross Potential Rent $ 91,740 $ 102,360

Vacancy $ (2,752) 3.00 % $(3,071) 3.00 %

NET RENTAL INCOME $ 88,988 $ 99,289

OTHER INCOME

Utility Billback $ 2,100 $ 3,600

Parking Income $ 0 $ 1,800

Misc Income $ 1,200 $ 1,800

Total Other Income $ 3,300 $ 7,200

EFFECTIVE GROSS INCOME $ 92,288 $ 106,489

EXPENSES

Property Taxes $ 10,407 $ 10,407

Insurance $ 3,480 $ 2,375

Utilities $ 11,933 $ 12,291

Maintenance & Repairs $ 4,000 $ 4,000

Professional Management $ 6,775 $ 6,389

Reserves $ 1,250 $ 1,250

Landscaping $ 2,763 $ 3,000

Total Expenses $ 40,608 $ 39,712

NET OPERATING INCOME $ 51,680 $ 66,777

Loan Payments $ (40,375) $ (40,375)

Pre-Tax Cash Flow $ 11,305 2.37 % $ 26,402 5.53 %

Principal Reduction $ 12,971 $ 12,971

TOTAL PRE-TAX RETURN $ 24,276 5.09 % $ 39,373 8.25 %

Financial Analysis

• Financing reflects $477,314 (40%) down at a 3.85% interest rate

• Buyer can achieve a nearly 6% cash-on-cash return on stabilized metrics

• Parcel is ~7,000 SF with LR2 RC zoning designation

COMPARABLES

BALLARD 5 | 18

PROPERTY ADDRESS Building Name Units Price Sale Date Price/Unit Price/NRSF Cap Rate GIM Year Built

1 621 NW 85th St Greenwood 7-Unit 7 $1,645,000 1/25/19 $235,000 $336 4.5% 15.5 1990

2 8500 Fremont Ave N The Cardigan 9 $2,625,000 6/18/19 $291,667 $306 5.7% 13.0 1978

3 6313 22nd Ave NW Old Ballard 5 5 $1,150,000 Pending $230,000 $329 3.7% 17.3 1900

4 906 N 85th St Green Lake 4 4 $1,150,000 5/1/19 $287,500 $429 4.7% 15.7 1958

5 4354 5th Ave NW 5th Ave Triplex 4 $1,362,500 9/17/18 $340,625 $347 4.1% 16.0 1967

AVERAGES $276,958 $349 4.5% 15.5

Sales Comparables

GREEN LAKE 4

• Renovated in 2012 • Garage parking • Patios/decks

5TH AVE TRIPLEX

• Triplex w/ one non-conforming unit

• Coin-op laundry on-site

GREENWOOD 7-UNIT

• 5-unit w/ townhome style duplex

• 5/7 units with in-unit W/D• All units have patios/decks

THE CARDIGAN

• Modern finishes and appliances • Garage parking available • Short term rental at time of sale

OLD BALLARD 5

• Value-add opportunity• Orginially a SF home• Core Ballard location

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GREENWOOD 7-UNIT

621 NW 85th St

THE CARDIGAN

8500 Fremont Ave N

OLD BALLARD 5

6313 22nd Ave NW

GREEN LAKE 4

906 N 85th St

5TH AVE TRIPLEX

4354 5th Ave NW

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BALLARD 5 | 20

PROPERTY ADDRESS Building Name Unit Type Unit SF Rent Rent /SF Year Built

1 5310 8th Ave NW 8th Ave NW 1 Bd / 1 Bth 550 $ 1,495 $ 2.72 1950

2 3202 NW 75th St 3202 NW 75th St 1 Bd / 1 Bth 500 $ 1,195 $ 2.39 1922

3 2039 NW 59th St 2039 NW 59th St 1 Bd / 1 Bth 626 $ 1,300 $ 2.08 1963

4 3222 NW 54th St Lockside Apartments 1 Bd / 1 Bth 625 $ 1,495 $ 2.39 1964

AVERAGES 575 $ 1,371 $ 2.40

8TH AVE NW

• Updated finshes/flooring• W/D on-site • Strong location

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Rent Comparables

LOCKSIDE APTS

• New flooring/appliances • Unit with deck • Laundry on-site

43202 NW 75TH ST

• Light renovation • W/D on-site • Street parking only

2 2039 NW 59TH ST

• Dated unit • On-site laundry • Carport parking

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2025 NW 59TH ST

• Dated interiors• On-site laundry • Balconies

5 STEVE’S APTS

• Dated interiors • Carport parking • W/D on-site

8841 NW 52ND

• New applainces/finishes • W/D in-unit• Attached garage

6 BON FIVE APTS

• Dated interiors • W/D in-unit • Carport parking

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5 2025 NW 59th St 2025 NW 59th St 2 Bd / 1 Bth 900 $ 1,995 $ 2.22 1963

6 841 NW 52nd St 841 NW 52nd St 2 Bd / 1 Bth 1,000 $ 1,880 $ 1.88 1968

7 1439 NW 65th St Bon Five Apartments 2 Bd / 2 Bth 1,025 $ 1,975 $ 1.93 1984

8 1122 NW Market St Steve's Apartments 2 Bd / 1.5 Bth 1,000 $ 1,850 $ 1.85 1980

AVERAGES 981 $ 1,925 $ 1.97

BALLARD 5 | 21

8TH AVE NW

5310 8th Ave NW

3202 NW 75TH ST

3202 NW 75th St

2039 NW 59TH ST

2039 NW 59th St

LOCKSIDE APARTMENTS

3222 NW 54th St

2025 NW 59TH ST

2025 NW 59th St

841 NW 52ND ST

841 NW 65th St

BON FIVE APARTMENTS

1439 NW 65th St

STEVE’S APARTMENTS

1122 NW Market St

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OFFER GUIDELINES

Pilot Ventures is pleased to announce

All questions and inquiries regarding tours and this opportunity should be addressed to the Pilot Ventures representatives listed herein. Pilot Ventures’ team will be available to assist prospective investors with questions upon their review of the offering. Investors will receive advanced notification of the bid deadline via email. Offers should include, at a minimum, the following:

• The purchase price, contingencies and closing date;

• The amount of earnest money deposit;

• The source of capital for down payment;

• A detailed timeline for the transaction;

• A brief overview of the Buyer’s qualifications.

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Built upon trust and experience, Pilot Ventures was founded by principals Casey Zejdlik and Jason Kono.

Specializing in multifamily investments and property management services, our focus on long-term client success is at the core of everything we do.

At Pilot Ventures, our experienced team of industry professionals offer more than 50 years of creative investment expertise. We engage with every client in a goal-oriented manner to enhance their portfolio and maximize results.

Together, we don’t just build equity— we build relationships.

BrokerageWhether you’re buying or selling, our experienced team of brokers will ensure you receive the best possible representation.

SyndicationOur firm’s financial expertise and professional management allows individuals, families, partnerships and trusts to invest in income producing properties without worrying about the day-to-day operations. We provide a full-service approach to every stage of your multifamily real estate investment.

ManagementManaging properties can be an overwhelming experience— in working with Pilot Ventures, we help streamline processes and systems to maximize your cash flow and ROI.

pilotNW.com

Brokerage / Syndication / Management