7401 pacific blvd. huntington park, ca 90255€¦ · 1. 7401 pacific blvd. huntington park, ca...

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7401 PACIFIC BLVD.HUNTINGTON PARK, CA 9025590% FINANCING AVAILABLESTRIP CENTER - MTM TENANCY

OFFERING MEMORANDUM | $1,295,000

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This Memorandum (“Offering Memorandum”) has been prepared by Brookfield Partners, Inc. and BRC Advisors, Inc. based on information that was furnished to us by sources we deem to be reliable. No warranty or representation is made to the accuracy thereof; subject to correction of errors, omissions, change of price, prior sale, or withdrawal from market without notice.

This Memorandum is being delivered to a limited number of parties who may be interested in and capable of purchasing the Property. By its acceptance hereof, each recipient agrees that it will not copy, reproduce or distribute to others this Memorandum in whole or in part, at any time, without the prior written consent of Brookfield Partners, Inc. and BRC Advisors, Inc., and it will keep permanently confidential all information contained herein not already public and will use this Confidential Memorandum only for the purpose of evaluating the possible acquisition of the Property.

This Memorandum does not purport to provide a complete or fully accurate summary of the Property or any of the documents related thereto, nor does it purport to be all-inclusive or to contain all of the information, which prospective buyers may need, or desire. All financial projections are based on assumptions relating to the general economy, competition and other factors beyond the control of the Owner and, therefore, are subject to material variation. This Memorandum does not constitute an indication that there has been no change in the business or affairs of the Property or the Owner since the date of preparation of this Memorandum.

This Memorandum is being delivered by Brookfield Partners Inc. and BRC Advisors, Inc., to prospective purchasers with the understanding that all prospective purchasers will conduct their own independent investigation of those matters, which they deem appropriate in order to evaluate this offering. Additional information and an opportunity to inspect the site will be made available to interested and qualified prospective purchasers. Brookfield Partners, Inc. and BRC Advisors, Inc., reserves the right to request the return of any or all of the information enclosed.

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TABLE OF CONTENTS

SECTION ONE 04EXECUTIVE PROFILE

SECTION TWO 12PROPERTY INFORMATION

© 2014 Brookfield Partners, Inc. & BRC Advisors. The information contained in this document has been obtained from sources believed reliable. While Brookfield Partners, Inc. & BRC Advisors does not doubt its accuracy, Brookfield Partners, Inc. & BRC Advisors has not verified it and makes no 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 do not represent the current or future performance of the property. The value of this 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.

Brookfield Partners, Inc. & BRC Advisors and the Brookfield Partners, Inc. & BRC Advisors logos are service marks of Brookfield Partners, Inc. & BRC Advisors and/or its affiliated or related companies in the United States and other countries. All other marks displayed on this document are the property of their respective owners.

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SECTION 1 | EXECU

TIVE OVERVIEW

6 - BRC ADVISORS & BROOKFIELD PARTNERS, INC.

INVESTMENT OVERVIEW

Brookfield Partners and BRC Advisors have been retained to exclusively market

a strip center, with an apartment unit. Currently, the building is 69% leased

with 2 vacancies (1-2 bed + 1 bath apt) + (retail unit). An investor could stablize

the property at market rents and triple net leases, capturing a favorable cap

rate quickly. All tenants are on a month-to-month leases. On the other hand, an

owner user buyer could easily obtain 90% financing with an SBA loan, while

receiving supplemental income from the remaining unused square footage. An

owner user could live in the two bedroom unit as well or rent out in a city with

no rent control.

This property is situated just south of Florence Avenue on a corner location.

There is visible signage on the premises, along with excellent frontage and

exposure on California Street and Pacific Blvd. There is generous traffic counts

and foot traffic, with surrounding retail synergy.

PROPERTY HIGHLIGHTS

• 90% Financing Available - Live/Work Opportunity

• Corner Location with Generous Street Frontage

• Excellent Foot and Traffic Counts

• Plenty of Street Parking

• All Month-to-Month Tenancy - NNN Upside Potential

• Rental Upside - No rent Control City for Apt Unit

BRC ADVISORS & BROOKFIELD PARTNERS, INC. - 7

PROPERTY INFORMATION

site description Physical description

DESCRIPTION SPECIFICATION

RENTABLE SF 5,434 SF

ASSESSOR’S SF 4,198 SF

LOT SIZE 8,494 SF

APN 6201-014-001

NUMBER OF TENANTS 7 Tenants Retail/Apt

FLOOR-TO-AREA RATIO 0.64

ZONING LCC2

PARKING Street Parking

YEAR BUILT 1938

LOT DIMENSIONS 64’ X 121’ X 78’

STREET FRONTAGE 121’ on Pacific Blvd.

HIGHWAY ACCESS 110 and 105 Freeways

TRAFFIC COUNT ±22,539 cars/day

DESCRIPTION SPECIFICATION

CONSTRUCTION TYPE Wood-Frame Stucco

ROOF Rolled Composition

FOUNDATION Concrete

FIRE PROTECTION TBD

HVAC TBD

METERS Seperately

LANDSCAPING None

TOPOGRAPHY Flat

ACCESS California St.

LEASE TYPE Modified Gross/Full Service Gross

TENANCY Multi-Tenant


SUMMARY TERMS

PRICE $1,295,000

DOWN PAYMENT (15%) $194,250

BUILDING SIZE 5,434 SF

PRICE PER FOOT ON BUILDING $238.31

LOT SIZE 8,494 SF

PRICE PER FOOT ON LAND $152.46

YEAR BUILT 1938

ZONING LCC2

DESCRIPTION ESTIMATED PSF

OPERATING EXPENSES

TAXES (1.169%) $15,139 $2.79

INSURANCE $2,445 $0.45

UTILITIES $5,434 $1.00

REPAIRS & MAINTENANCE $4,075 $0.75

CAPITAL RESERVES/MISC $2,717 $0.50

TOTAL OPERATING EXPENSES $29,810 $5.49

DEBT SERVICE $83,688 $15.40

TOTAL OCCUPANCY COSTS $113,498 $20.89

MONTHLY OCCUPANCY COSTS(before tax advantages of ownership) $1.74 PSF

SUMMARY TERMS

LOAN AMOUNT $1,100,750

LOAN TYPE SBA

BLENDED SBA RATE 4%

BLENDED AMORTIZATION 25 Years

SALES COMPARISON APPROACH ESTIMATED ANNUALIZED | USER OCCUPANCY COSTS

NEW LOAN

USER OCCUPANCY COSTS


LEASE VS. OWN

PROPERTY SIZE 5,434 SF 5,434 SF

LEASE ASSUMPTIONS: Rent Per Month Rent Per SF

START-UP COSTS:

Prepaid rent and security deposit (2 mo.’s total) Lessee TI costs, net of lessor TI allowance** Total startup costs

GROSS MONTHLY COSTS: Rent payment Lease operating costs** Gross monthly cash cost

LEASE BENEFITS (PER MONTH): Depreciation tax benefit at 35% tax rate Avg. monthly principal paydown | equity build Tax benefit on rent deduction at 35% tax rate Tax benefit on operating costs at 35% tax rate Lease-out income (net of tax at 35% rate)

NET COST AFTER LEASE BENEFITS: Est. appreciation benefit, per month

NET COST AFTER LEASE BENEFITS

PROJECTED RENT COST IN YEAR 10 Net rent cost (after tax benefits at 35% rate) Assumed annual rent escalation

ASSUMED ANNUAL APPRECIATION RATE OF: 2.0%BORROWER DOWN PAYMENT (15%): $194,250

Year 5

Year 10

Year 15

Year 20

$238$0

$238

$1.28$0.46$1.74

$0.15$0.48$0.27$0.16$0.00

-$0.06$1.01

$0.73$0.40

$0.33

$10,868

$2.00

$21,736$0

$21,736

$10,868$2,174

$13,042

$0$0

$3,804$761

$0$0

$4,565

$8,477$0

$8,477

$11,061

$1,295,000$0

$1,295,000

$194,250$6,475$5,000

$205,725

$6,974$2,483$9,457

$823$2,619$1,470

$869$0

-$299$5,483

$3,975$2,158

$1,816

LEASE SCENARIO OWN SCENARIO PER/SF PER/SFAMOUNT AMOUNT

GROWTH IN PROPERTY VALUE & OWNER EQUITY

Disclaimer: This sample analysis is based on a series of assumptions, including loan interest rates and annual appreciation rates, and is meant only to be illustrative in nature. The analysis is not a guarantee of any actual results of any loan or purchase transaction or ownership of any real property, all of which are subject to risks, uncertainties and assumptions that are difficult to predict and beyond our control. No warranties or representations, express or implied, are made as to the accuracy of the information contained herein, and same is submitted subject to the possibility of errors, omissions, change of price, rental or other conditions, withdrawal without notice, prior sale, lease or financing. We include projections, opinions, assumptions or estimates for example only, and they may not represent future performance of the property. You and your financial and legal advisors should conduct your own evaluation of the property and transaction economics.

ANALYSIS LIMITATIONS:THIS ANALYSIS DOES NOT INCLUDE SUPPLEMENTAL INCOME STREAM FROM POTENTIAL

TENANTS - LOWERING OCCUPANCY COSTS SIGNIFICANTLY

Modified Gross

$1.75$0.40$2.15

$0$0

$0.70$0.14$0.00

$0$0.84

$1.56$0.00

$1.56

$2.043.0%

PURCHASE ASSUMPTIONS: Purchase Price Improvements - Additional Total

START-UP COSTS: Borrower cash down payment (15%) Estimated fees on 1st mortgage** Est. appraisal, environmental, other fees** Total startup costs

GROSS MONTHLY COSTS: Mortgage payment Ownership operating costs** Gross monthly cash cost

OWNERSHIP BENEFITS - EXCEL. APPRECIATION (PER MONTH): Depreciation tax benefit at 35% tax rate Avg. monthly principal paydown | equity build Tax benefit on rent deduction at 35% tax rate Tax benefit on operating costs at 35% tax rate Lease-out income (net of tax at 35% rate) Interest on startup cost difference (net of 35% tax)

NET COST AFTER OWNERSHIP BENEFITS EXCEL APPRE: Est. appreciation benefit, per month

NET COST AFTER OWNERSHIP BENEFITS INCL. APPRE:

PROPERTY VALUE

$1,429,785

$1,578,598

$1,742,899

$1,924,302

LOAN BALANCE

$966,819

$769,520

$517,848

$196,808

OWNER EQUITY

$462,965

$809,078

$1,225,052

$1,727,494


TENANT SQUARE FOOTAGE MONTHLY RENT RENT PSF LEASE START LEASE EXPIRES OPTION

Vacant 665 SF $1,300 $1.95 ------ ------ None

Roy Tellez 850 SF $1,500 $1.76 July 1, 2015 Month-to-Month None

Selecto Tax Inc. 500 SF $1,000 $2.00 Feb. 1, 2013 Month-to-Month None

Apartment 1,000 SF $1,495 $1.50 ------ ------ None

Walter Alvarez/Diego 846 SF $1,700 $2.01 March 2, 2014 March 3, 2018 None

Beauty Salon 670 SF $1,190 $1.78 Aug. 26, 2006 Month-to-Month None

Toan Van Le 903 SF $1,300 $1.44 July 1, 2015 June 30, 2016 None

5,434 SF$9,485 AVG. PSF

$1.78$113,820

RENT ROLL


PRO-FORMA FINANCIAL ANALYSIS

ANNUALIZED OPERATING DATA

INCOME PRO-FORMA PSF

Total Gross Income $113,820 $20.95

Less: Vacancy (3%) ($3,414) ($0.63)

Effective Gross Income $110,405 $20.32

Operating Expenses ($27,580) ($5.08)

Net Operating Income $82,825 $15.24

Debt Service ($49,212) ($9.05)

Debt Coverage Ratio 1.25 -----

Net Cash Flow After Debt Service $33,613 $6.19

Cash-On-Cash Return 6.49% -----

EXPENSES PRO-FORMA PSF

Real Estate (1.169%) $14,556 $2.68

Insurance $2,445 $0.45

Utilities $2,640 $0.49

Repairs & Maintenance $4,075 $0.75

Reserve / Misc. $3,864 $0.81

TOTAL EXPENSES $27,580 $5.08

FINANCIAL OVERVIEW

DESCRIPTION SPECS

Price $1,295,000

Downpayment (40%) $518,000

Rentable Square Feet 5,434 SF

Price Per Square Foot $238.31

Assessor’s Square Feet 4,198 SF

Price Per Square Foot $308.48

Lot Size 8,494 SF

Price Per Foot on Land $152.46

Pro-forma Cap Rate 6.40%

GRM 11.38

Cash-on-Cash 6.49%

Occupancy 69%

Pro-forma Average PSF $1.78 PSF

Lease Type MG/FSG

Year Built 1938

Zoning LCC2

Type of Ownership Fee Simple

NEW LOAN

DESCRIPTION SPECSLoan Amount $777,000

Loan Type Conventional Commercial

Interest Rate 4.0%

Amortization 25 Years

SECTION 2 | PRO

PERTY INFO

RMATIO

N


AERIAL OVERVIEW


PLAT MAP


JAY MARTINEZManaging Principal

18801 Ventura Blvd., Suite 310Tarzana, CA 91356

Cal BRE: 01367663

CONTACTCELL PHONE818.212.3057

PHONE818.201.3605

FAX818.688.8140

[email protected]

WEBSITEwww.brookfield-partners.com

ELIZABETH CLARKSenior Vice President

9301 Wilshire Blvd., Suite 206Beverly Hills, CA 90210

Cal BRE: 01811246

CONTACTCELL PHONE310.740.7283

PHONE310.525.3702

FAX321.421.4184

[email protected]

WEBSITEwww.brcadvisors.com

7401 pacific blvd. huntington park, ca 90255€¦ · 1. 7401 pacific blvd. huntington park, ca...

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