MADISON APARTMENTS 4050 MADISON AVENUE SOUTH OGDEN, UTAH OFFERED BY: MARK JENSEN mjensen@ngacres.com 801.578.5505 GREG RATLIFF gratliff@ngacres.com 801.578.5531 CHRIS TURNER cturner@ngacres.com 801.578.5533 1
EXECUTIVE SUMMARY 2
EXECUTIVE SUMMARY PROPERTY Built in 1968, Madison is a 26-unit apartment community on almost an acre of ground. While it is relatively older product, Madison masonry construction is built to last structurally and aesthetically, featuring newly remodeled interiors with quality finishes, including hardwood floors. In addition to the upgrades, the property is situated adjacent to the 1.5-acre Madison Avenue Park and just half a block from 40th Street, a primary artery with access to Newgate Mall, Ogden County Club, and Weber State University all within less than a 1.5-mile radius or 5-minute drive of Madison. MARKET On a broad level, the Utah economy has been very robust over the last half decade, maintaining extremely low unemployment rate of less than 4% and has become a magnet for technology jobs, healthcare, and transportation of which Ogden is famous for due to the strategic location in relation to other regional markets. The Ogden-Clearfield MSA, with a 2010 census population of 547,184, is smaller than the more well-known Salt Lake and Provo markets, but has been a massive benefactor of Utah s economic success Ogden was the 6th-fastest growing city in the nation (Salt Lake City was #5 with year-over-year GDP growth of 7.21% according to Forbes Magazine. Madison central location bodes well for any investor looking to capitalize on the trends we are seeing in the Ogden market. OPPORTUNITY Priced at just $75,000 a door, Madison offers significant value even in this very tight market. Location cannot be overlooked, as Madison is strategically placed in the middle of major desirable economic drivers, from the Division-I Weber State University to the McKay-Dee Hospital complex, both located only a few blocks up the hill. Additionally, major expansions have occurred or are underway in manufacturing, as Ogden is the burgeoning outdoor-gear cluster hot spot in the US, attracting the likes of French cycling company Mavic (which recently moved its American HQ to Ogden, ENVE Composite, and Quality Bicycle, generating nearly 1,000 new jobs in the area in the next four years; these diversifying demographics will serve Madison well moving forward. Rent growth is likely to remain strong as the property has already seen GRR raise 5% on T-6 numbers, again demonstrating the upside that exists in the current market, and why we are excited about this offering. 3
PROPERTY OVERVIEW UNITS 26 CONSTRUCTED 1968 TOTAL RENTABLE SF 21,360 LOT SIZE 0.92 Acres UNIT MIX 24 Two Bedroom/1 Bathroom (820 SF 2 One Bedroom/1 Bathroom (720 SF APARTMENT AMENITIES Covered Parking Central HVAC On-site Laundry Facility Renovated Units 4
AERIAL MAP N EXECUTIVE SUMMARY Li b er ty A v e nu e 165' 060510003 0.94 Acres JULYN & ASSOCIATES LLC 249' Ma d is o n A v e nu e COMPARABLES 255' FINANCIALS 161' 41 S t S t re e t Imagery 2016, State of Utah 5
AERIAL MAP Har r ison Boule va rd Qu inc y Ave nu e Jef f e rs on Av en ue Adam s Aven ue R FINANCIALS oa 15 d Linc oln Av enu e Gr a nt Ave nue D riv e S er d al e 36t h St re et Ch s on St r e e t i li n m COMPARABLES Edval ky ri v e e D Newgate Mall iv es V ie w D ri v e 26,681 Students al e R o ad 40t h St re et R iv Ogden Country Club 3 00 W es t 44 0 o 0 S ut h Co Adam s Aven ue er d 4 1 00 Wa shin gt on Bo ule var d Hi nc k le y R EXECUTIVE SUMMARY Wa ll Aven ue N M on r oe un t ry H ills Dr iv So u th e 4600 So ut h B lv d 480 0 Sout h Imagery 2016, DigitalGlobe, State of Utah, U.S. Geological Survey, USDA Farm Service Agency 6
7 FINANCIALS
FINANCIAL ANALYSIS PROPERTY ABSTRACT 26 Year Built 1968 Rentable SF 21,360 Lot Size Acres 0.92 Occupancy (Feb RR 88% APN: 06-051-0003 FINANCIAL INDICATORS Price $1,950,000 Down Payment $487,500 Down Payment % 25% Current CAP 5.89% Cost Per Sq. Ft. Ground $48.66 Cash on Cash Return: 3.83% Price / Unit $75,000.00 PSF $91.29 MARKET RENT (T-3 NUMBERS Market Rent: $16,745.00 Gain on Lease $465.00 Loss on Lease ($1,567.92 Gross Rent Revenue $15,642.08 Vacancy/Collection Loss ($964.32 OR INCOME (T-3 NUMBERS Utility Reimbursment $430.39 Other Income $1,118.67 Total Income $16,226.82 EST. ANNUALIZED EXPENSES Administrative $2,979.24 Repairs & Maintenance $7,172.36 Landscaping/Service Cont. $5,520.00 Utilities $16,653.60 Property Taxes $9,312.00 Property Insurance $4,020.00 Management/Turnover/ Payroll $31,789.24 Reserves $2,500.00 Total Expenses: $(79,946.44 ESTIMATED ANNUALIZED OPERATING DATA CURRENT PROFORMA Scheduled Gross Income $194,722 $207,000 Market Vacancy: 5% $0 ($10,350 Gross Operating Income $194,722 $196,650 Expenses ($79,946 ($79,946 Net Operating Income $114,775 $116,704 Less Loan Payments ($96,107 ($96,107 Pre-Tax Cash Flow $18,668 $20,596 Percentage Return 3.8% 4.22% FIRST LOAN $1,462,500 RATE 4.25% TERM 25 ANNUAL PMT ($96,107 8
RENT ROLL v UNIT SIZE (SF UNIT STATUS STATUS MARKET RENT SCHEDULED CHARGES LEASE START LEASE END 11 820 Occupied No Notice Occupied $650 $582 7/31/2014 7/31/2016 12 820 Notice Unrented -- Vacant -- $650 13 820 Occupied No Notice Occupied $665 $757 12/1/2015 5/31/2017 14 820 Vacant Unrented Ready -- Vacant -- $665 15 820 Occupied No Notice Occupied $650 $532 9/1/2015 10/31/2016 16 820 Notice Unrented Occupied $650 $582 8/17/2015 3/1/2016 17 820 Occupied No Notice Occupied $650 $607 11/4/2015 10/31/2016 18 820 Occupied No Notice Occupied $650 $482 11/1/2015 20 720 Vacant Unrented Ready -- Vacant -- $550 21 820 Occupied No Notice Occupied $650 $507 10/1/2015 22 820 Occupied No Notice Occupied $650 $557 2/1/2016 23 820 Occupied No Notice Occupied $650 $657 8/2/2015 5/31/2016 24 820 Occupied No Notice Occupied $650 $582 12/28/2015 25 820 Occupied No Notice Occupied $650 $532 10/15/2015 10/15/2016 26 820 Occupied No Notice Occupied $650 $682 8/1/2015 8/31/2016 27 820 Occupied No Notice Occupied $650 $582 1/1/2016 28 820 Occupied No Notice Occupied $650 $582 1/20/2016 30 720 Occupied No Notice Occupied $550 $607 8/1/2015 8/31/2016 31 820 Occupied No Notice Occupied $650 $757 12/1/2015 5/30/2016 32 820 Occupied No Notice Occupied $650 $577 10/1/2015 33 820 Occupied No Notice Occupied $650 $657 12/16/2015 34 820 Occupied No Notice Occupied $650 $632 10/6/2015 5/31/2016 35 820 Occupied No Notice Occupied $650 $682 2/13/2016 1/1/2017 36 820 Occupied No Notice Occupied $650 $682 8/1/2015 4/30/2016 37 820 Occupied No Notice Occupied $665 $682 9/30/2015 4/29/2016 38 820 Occupied No Notice Occupied $650 $557 10/1/2015 Total: 21,120 SF $16,745 $14,056 9
COMPARABLES 10
RENT COMPARABLES PROPERTY CONST- RUCTED TOTAL UNITS UNIT TYPE UNIT SF RENT RENT/SF OCC. RATES NOTES 4050 Madison Avenue South Ogden, UT 84403 26 1 Bed/1 Bath 2 Bed/1 Bath 720 820 $550 $650 $0.76 $0.79 92% Pet Rent: Cats allowed Pet Fee/Deposit: WST: No Utilities: No Parking: 1 Covered Stall Media Package: Available BROOK HOLLOW APARTMENTS 4515 Harrison Blvd Ogden, UT 84403 40 2 Bed/1.5 Bath 1020 $620 - $670 $0.61 - $0.66 100% Pet Rent: $15.00 Pet Fee/Deposit: $200.00 WST: Included Gas & Electric: No Parking: 1 Sta;; Media Package: Available BONNE VILLA APTS & CONDOS 3257 South Harrison Blvd Ogden, UT 84403 47 3 Bed/2 Bath 2 Bed/2 Bath 2 Bed/1 Bath 1 Bed/1 Bath 1000 850 800 700 $750 $650 $565 $505 $0.75 $0.76 $0.71 $0.72 100% Pet Rent: $20.00 Pet Fee/Deposit: $400($100 nonrefundable WST: Included Gas & Electric: No Parking: 1 Sta;; Media Package: N/A CHRISTOPHER VILLAGE APTS 4935 Old Post Road Ogden, UT 8443 113 2 Bed/1.5 bath 1,050 $745 - $785 $0.71 - $0.75 100% Pet Rent: $25.00 Pet Fee/Deposit: $300 WST: No Gas & Electric: No Parking: 1 Sta;; Media Package: $35 11
RENT COMPARABLES 20t h St re et r ee t 21 s t St ( 24t h St re et 255 0 S out h ri D nd la 15 400 0 S out h ( Har r ison Boule va r d c Wa shin gt on Boule va rd Hi n y kl e ve D ri Wa ll Av e nue M 190 0 W es t FINANCIALS BONNE VILLA APTS & CONDOS 3257 South Harrison Blvd Ogden, UT 84403 30t h St re et id Ma r rio t t / Slate r v ille Riv erdal e ad Sou th Og de n Wa s h i n g t o n T e r r a ce 89 We 560 0 S out h Ro 105 Roy R i ve le rd a 0 W est 480 0 S out h 27 0 0 W es t COMPARABLES Og de n ve EXECUTIVE SUMMARY Mo nr oe Boule va rd N b er 600 0 S out h D 84 ri ve Hill Air Force Base 230 0 No r th 12 4050 Madison Avenue South Ogden, UT 84403 BROOK HOLLOW APARTMENTS 4515 Harrison BLVD Ogden, UT 84403 CHRISTOPHER VILLAGE APTS 4935 Old Post Road Ogden, UT 8443
MARKET RENT BY FLOORPLAN Comparable Rents - 2 Bedroom Units $900 $800 $700 $600 $656.25 $500 $400 $300 $200 $650 $645 $565 $765 $100 $- Madison Brook Hollow Bonne Villa & Condos Christopher Village Asking Rent (average Market Average $1.00 $0.90 $0.80 $0.70 $0.60 $0.50 $0.40 $0.30 $0.20 $0.10 $- $0.79 $0.73 Madison Comparable Rent PSF - 2 Bed Units $0.70 $0.71 $0.73 Brook Hollow Bonne Villa & Condos Christopher Village Asking Rent PSF (average Market Average 13
12 5 0 S ou th 47 0 0 W e s t EXECUTIVE SUMMARY 12 0 0 W e s t Wa ll A v e nu e SALE COMPARABLES 20 th St re e t V a tr e e t 21 s t S Og de n 30 th St re e t e 19 0 0 W e s t 5 6 0 0 So ut h 23 0 0 N o r th 18 0 0 N o r th Clin ton 10 0 0 W e s t 20 0 0 W e s t 30 0 0 W e s t ut h W e b e r Dr i ve Hill Air Force Base O ld H ig hw a 193 rg ( an La y ton 14 ive re Dr St et 10 0 0 N o r th y n lle A nt el o p e Dr i v e ai Va M 27 0 0 S ou th 84 Mo 17 0 0 S ou th Sou th We b e r Clearf ield 30 0 0 W e s t So ad 45 0 0 W e s t Sy ra c u se ve Ro 70 0 Sou th 167 y GARDEN We APTS. s t 80 0 No r th 27Po Units int Built in 194530 0 No r th SOLD: $1,510,000 ri S u n se t 13 0 0 N o r th OAKRIDGE APTS. 40 Units Built in 1973 SOLD: $2,935,000 15 M a in Str e e t D 32 0 0 W e s t 23 0 0 N o r th MADISON APTS. 26 Units Built in 1968 $1,950,000 89 r 60 0 0 S ou th D r i ve Sou th Wa s h i n g toognd e n T e r r a ce be 59 0 0 W e s t Ri v e r d a l e 55 0 0 S ou th Dr i v e Roy ey la 48 0 0 S ou th H o o p er ckl nd H in We COMPARABLES iv ( M Dr id 35 0 0 W e s t OAKWOOD APTS. 27 Units Built in 2010 40 0 0 S ou th SOLD: $3,200,000 Ma r rio t t / Slate r v ille l ley 158 WASHINGTON PARK APTS. 112 Units Built in 2000 SOLD: $7,875,000 Ha r r is o n Bo ul e v ar d (2 4 t h St r e e t FINANCIALS 39 12 th St re e t 39 50 0 No r th
COMPARABLE ANALYSIS PROPERTY YEAR BUILT PRICE/ UNIT PRICE PSF AVG SF OF UNITS CAP RATE Madison 1968 $75,000 $91.29 821 5.89% Garden 1946 $55,926 $83.50 670 8.10% Oakwood 2010 $118,519 $91.17 1,300 6.52% Oakridge 1973 $73,375 $73.38 1,000 6.75% Washington Park Apts 2000 $70,313 $71.42 984 6.18% COMP INDEX AVERAGE 1982 $79,533 $79.87 988.44 6.89% Madison premium/discount on avg (14 Years -6% 13% -20% 100 BPS 9.00% 8.00% 7.00% 6.00% 5.00% 4.00% 3.00% $91 $71 $91 $73 $84 Madison Price Per Foot by CAP Rate Washington Park Oakwood Oakridge Garden Price PSF $91.29 $71.42 $91.17 $73.38 $83.50 CAP Rate 5.89% 6.18% 6.52% 6.75% 8.10% $95 $90 $85 $80 $75 $70 $65 $60 $55 $50 Price PSF CAP Rate Price/Unit By Year Built Average Unit Size $140,000 $120,000 $100,000 $80,000 $60,000 $40,000 $55,926 $75,000 $73,375 $70,313 $118,519 Average Unit SF 1,400 1,300 1,200 1,100 1,000 900 800 700 1,300 1,000 984 821 $20,000 $0 1946 1968 1973 2000 2010 Garden Madison Oakridge Washington Park Oakwood 600 500 Oakwood Oakridge Washington Park Madison 670 Garden 15