broadway center seattle

8/3/2019 Broadway Center Seattle

1/22

Sean TuftsKidder Mathews

206.296.9649

[email protected]

Erik SwansonKidder Mathews

206.296.9628

[email protected]

Exclusively represented by

For Sale - Retail Investment

Broadway Center | 206 Broadway E, Seatlte, Washington

www.ReCapNW.com


2/22kiddermathews.com

This information supplied herein is from sources we deem reliable. It is provided without any representation, warranty or

guarantee, expressed or implied as to its accuracy. Prospective Buyer or Tenant should conduct an independent investigation and

verification of all matters deemed to be material, including, but not limited to, statements of income and expenses. Consult your

attorney, accountant, or other professional advisor.

Memorandum Disclaimer



Table of Contents

1. Executive Summary

Investment Opportunity

2. Financial Analysis

Rent Roll

Income/Expenses

Pricing Summary

3. Comparables

Rent Comparables

4. Location Overview

Overview

Sound Transit Station

230 Broadway

5. Map, Aerials, Plat Map & Photos

6. Demographics

Broadway Center



Executive Summary



Broadway Center

Executive Summary

Kidder Mathews has been retained to exclusively market

and sell the Broadway Center located at 206 Broadway E,

Seattle, Washington.

THE OPPORTUNITY

The Broadway Center is a 4-tenant, 13,556 SF, retail &

office building located in one of Seattles oldest and most

vibrant neighborhoods. This opportunity is a leasehold

interest and is subject to a ground lease that expires in

August 2024. The property consists of two parcels totaling

12,800 SF of dirt and is currently 100% occupied with

additional income from Diamond Parking.

The Broadway neighborhood is one of the first areas

in Seattle to experience new development since the

recession began in 2008. The largest and most significant

project currently underway is the Capital Hill Sound

Transit Station on the adjacent block to the south. With a

scheduled completion in 2016, the subject property will

significantly benefit from the increased foot traffic the

station provides.

An additional significant development is underway on the

same street that will include over 235 new apartments

and additional retail. With a population of nearly 400,000

and an average income of $87,735 within five miles, the

Broadway Center represents a dense in-fill opportunity for

an investor.

The Broadway Center has four tenants and is anchored

by Castle Megastores, which operates 17 stores in from

Arizona to Alaska. Castle opened this location in 2003

and has two years remaining on their lease. They have

two 5-year options and benefitting from a below market

lease rate. The Highline Bar & Grill was opened last year by

successful local vegan restaurant operators.

All leases have annual increases between 2-4%.

The Broadway Center represents a strong cash-flow

opportunity for an investor. Financing a leasehold interest

may be a challenge and the buyer will likely be either

all cash or very low leverage. Based on the current and

projected income stream, the asking price (or Net Present

Value) is calculated using an 11% discount over the

remaining term of the ground lease.

INVESTMENT SUMMARY

Sale Price $1,695,000

Year Built 1987

Building Area 13,556 SF

Stories 3

Land Area 12,800 SF

Occupancy 100%

CAP Rate 12.94%

Price/SF $125.04

Ground Lease Expiration: August 31, 2024

Parking Stalls: 33



Financial Analysis


7/22

BroadwayCenter

RENTROLL

TenantName

Suite

Sq.F

t.

Monthly

Rent

Annual

Rent

Rent/

SF

%RSF

Mthly

NNN

NNN/

SF

Le

ase

Start

Lease

Expiration

Option

Periods

Re

ntal

Inc

reases

Notes

CastleMegaStore

1

6,085

$15,476

$185,715

$30.52

44.89%

$5,675

$11.19

9/1

0/03

10/15/13

Two5

Year

CP

I,2%

min-4%max

FMRatoption

Subway

2

710

$3,000

$36,000

$50.70

5.24%

$662

$11.20

10/15/00

10/14/15

One5

Year

3%

annual

FMRatoption

TheApothocary

2B

2,761

$3,000

$36,000

$13.04

20.37%

$2,577

$11.20

3/1

/11

3/31/14

None

4%

annual

HighlineBar&Grill

C

4,000

$5,837

$70,040

$17.51

29.51%

$3,731

$11.19

2/1

5/10

5/30/15

Two5

Year

3%

annual

FMRatoptions

DiamondParking

PK

$2,500

$30,000

0.00%

$0

$0.00

7/1

/07

MTM

13,55

6

$29,813

$357,755

$12,645

OCCUPIED

13,55

6

100.00%

FinancialAnalysis



Broadway Center

SCHEDULED INCOME

Current

Scheduled Gross Income: $357,755 $26.39

CAM Recapture: $151,737 $11.19

Gross Operating Income: $509,492 $37.58

Less Vacancy: 5% ($25,475) ($1.88)

Less Reserves: $0.10 ($1,356) ($0.10)

Less Expenses: ($263,286) ($19.42)

Net Operating Income: $219,375 $16.18

SCHEDULED EXPENSES:Estimate $/SF

Property Tax $27,816 $2.05

Insurance $13,461 $0.99

Utilities $26,570 $1.96

R&M $20,000 $1.48

CAM $35,800 $2.64

MGMT 5% $17,888 $1.32

Land Lease Payment $121,752 $8.98

Total Expenses $263,286 $19.42

INCOME

EXPENSES



Broadway Center

PRICING SUMMARY

Net Present Value Analysis

Price: $1,695,000

Down Payment: 100%

Current Net Operating

Income:

$219,375

Cap Rate 12.94%

Price/SF $125.04

Price/SF $216.18

Year Date Annual $ Total Cash Flow

1 9/1/2011 $219,375 $219,375

2 9/1/2012 $225,957 $445,332

3 9/1/2013 $232,735 $678,067

4 9/1/2014 $239,717 $917,784

5 9/1/2015 $246,909 $1,164,693

6 9/1/2016 $254,316 $1,419,009

7 9/1/2017 $261,946 $1,680,955

8 9/1/2018 $269,804 $1,950,759

9 9/1/2019 $277,898 $2,228,657

10 9/1/2020 $286,235 $2,514,892

11 9/1/2021 $294,822 $2,809,714

12 9/1/2022 $303,667 $3,113,380

13 9/1/2023 $312,777 $3,426,157

Assumed Growth Rate: 3%

NPV @ 11.11% $1,695,000



Lease Comparables



RETAIL COMPARABLES

Broadway Center206 Broadway E, Seattle, WA

Total SF 13,556

Land 0.29 acres

Available SF 0

Price/SF $32.63

% Occupied 100%

Year Built 1987

Notes Subject Property.

SUBJECT

Joule

523 Broadway E, Seattle, WATotal SF 26,000

Land 1.58 acres

Available SF 13,722

Price/SF $38-$45

% Occupied 47%

Year Built Under Const.

Notes New mixed use development. 55 exclusive parking stalls.

1

Lewis Building617 Broadway Ave E, Seattle, WA

Total SF 4,956Land 0.12 acres

Available SF 1,328

Price/SF $28

% Occupied 73%

Year Built 1931/2008

Notes 16 celiings - remodeled in 2008.

2

Broadway Market401 Broadway Ave E, Seattle, WA

Total SF 167,806

Land 1.64 acres

Available SF 2,500

Price/SF $40-$85

% Occupied 98%

Year Built 1971

Notes Anchored by QFC, Golds Gym & Urban Outfitters.

3

Harvard Market1401 Broadway Ave E, Seattle, WA

Total SF 87,495

Land 1.71 acres

Available SF 2,459

Price/SF $40

% Occupied 95%


Notes Subway, Chase, Dominos with QFC and Bartells anchoring.

4

Broadway Center



OFFICE COMPARABLES

Broadway Center206 Broadway E, Seattle, WA

Total SF 13,556

Land 0.29 acres

Available SF 0

Price/SF $15.68

% Occupied 100%

Year Built 1987

Notes Subject Property.

SUBJECT

Warn Building

501 E Pine St, Seattle, WATotal SF 13,229

Land 0.21 acres

Available SF 2,038

Price/SF $23

% Occupied 81%


Notes On-site parking. Janitorial not included.

1

1000 E Pike1508 10th Ave, Seattle, WA

Total SF 49,314Land 0.51 acres

Available SF 5,641

Price/SF $25

% Occupied 89%


Notes 19 ton HVAC. Open, creative work space.

2

231 Summit Avenue ESeattle, WA

Total SF 5,448

Land 0.10 acres

Available SF 2,541

Price/SF $23

% Occupied 53%


Notes Classic brick building walking distance to transportation.

3

Broadway Building1620 Broadway, Seattle, WA

Total SF 175,300

Land 0.73 acres

Available SF 1,400

Price/SF $25-$26

% Occupied 97%

Year Built 2010

Notes New construction - Class A.

4

Broadway Center



Location Overview



Broadway Center Overview

LOCATION OVERVIEW

This investment opportunity is located at 206 Broadway

Avenue East in downtown Seattles Capitol Hill. The

Broadway business district is the most densely populated

residential neighborhood close to downtown and is the

central commercial street with an eclectic mix of shops,

restaurants, coffee houses and bars. The property benefits

from its frontage on a high traffic corridor. There are

nearly 20,000 cars per day and heavy pedestrian traffic to

nearby retailers including Rite Aid, QFC Grocery, American

Outfitters, Peets Coffee and historic Dicks Restaurant.

Nearby are the campuses of Seattle University, Seattle

Central Community College and Cornish College of the

Arts. Other notable attractions include the Cal Anderson

Park and the Capital Hill Farmers Market.

Planned area Growth

Directly adjacent to the subject property a six-story, 235

unit residential, retail and office building is being built and

scheduled for completion in 2012. It will include parking fo

250 vehicles located below grade.

According to the Puget Sound Regional Council, theCapital Hill area will experience strong residential and

employment growth. A key goal of the Citys Capitol Hill

Neighborhood Plan is to enhance the vibrancy of the

Broadway business district. At 1.6 miles long, Broadway

is the longest continuous pedestrian commercial street

in Seattle. The Plan recommends a number of actions

including expanding the mix of businesses, adding new

housing, and improving the environment for pedestrians.

See chart below.

Year HouseholdsHH

GrowthEmployment

Employmentgrowth

2010 13,385 4% 39,002 5%

2020 21,953 13% 41,806 7%

2030 24,120 10% 42,494 2%



Capitol Hill Station - Transit OrientedDevelopment

Capitol Hills underground station is slated to open in

2016 and will be built just a half block south of the subject

property at East John Street, beneath Nagle Place.

The Capitol Hill Station includes three at-grade station

entrances: a north entrance on the east side of Broadway

at the corner of East John Street, a west entrance on the

west side of Broadway just south of East Denny Way,

and a south entrance at the corner of East Denny Way

and Nagle Place. The three station entrances lead to an

underground station mezzanine, basement and platform.



Map, Aerials, Plat Map

& Photos



Regional Map



Aerial



Plat Map



Photos



Demographics


22/22

Demographics

STATISTICS

RADIUS 1 MILE 2 MILE 3 MILE

POPULATION

2015 Projection 52,865 209,034 408,600

2010 Estimate 48,466 190,749 381,618

2000 Census 45,422 175,480 357,471

Growth 2010-2015 4,399 18,286 26,982

Growth 2000-2010 3,043 15,269 24,147

2010 HOUSEHOLDS

2015 Projection 32,727 114,719 206,655

2010 Estimate 29,620 101,657 188,558

2000 Census 27,171 89,900 170,749

Growth 2000-2015 5,556 24,818 35,905

Growth 1990-2000 3,289 11,781 15,983Owner-Occupied 6,970 35,449 86,138

Renter-Occupied 22,650 66,208 102,420

2010 AVERAGE HOUSEHOLD INCOME $67,632 $89,963 $94,099

2010 MEDIAN HOUSEHOLD INCOME $40,783 $55,811 $64,238

2010 PER CAPITA INCOME $45,659 $51,597 $48,955

2010 HOUSEHOLD INCOME DISTRIBUTION

HH Income $200,000 or more 4.5% 8.1% 7.8%

HH Income $150,000 - $199,999 3.3% 5.2% 6.1%

HH Income $125,000 - $149,999 3.6% 4.8% 5.9%

HH Income $100,000 - $124,999 4.6% 6.8% 8.5%

HH Income $75,000 - $99,999 7.3% 9.3% 11.3%

HH Income $50,000 - $74,999 13.6% 13.6% 14.9%

HH Income $35,000 - $49,999 14.9% 12.4% 12.1%

HH Income $25,000 - $34,999 13.7% 10.6% 9.9%

broadway center seattle

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