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RENTON TRIPLEXOFFERING MEMORANDUM
CONTACT INFORMATION
Steve McWilliamsC: 425.417.6162
Casey ZejdlikP: 206.566.6599C: 206.280.1871
Jason KonoP: 206.566.6595C:206.920.0187
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.
Investment Overview
Submarket Info
Financial Analysis
Regional Information
Team Bios
CONTENTS
RENTON TRIPLEX555 Index Pl NE, Renton, WA 98056
This triplex is located in the Renton Highlands just two blocks from the Renton Technical College (“RTC”). The RTC enrolls over 4,100 full-time equivalent students each year. Many of whom are in need of housing close by. The triplex is less than a mile from The Landing, a popular shopping destination and about one and a half miles from Old Town in the Downtown Core.
This triplex has been well maintained since its construction in 1959. All of the units underwent modest renovations about 10 years ago. The middle unit was renovated in 2016, with new kitchen cabinets, tile flooring in the kitchen and entry, and new carpet and paint. All of the apartments feature full-size in-unit washer and dryers, vinyl double pane windows, and two open parking spaces each. A roof was installed in 2007 and appears to be in good condition. Adjacent to the units is a large, brick patio that offers relaxing outdoor space amid potted plants and a small gardening area.
There is room here strong upside potential in the rents with a modest rehab budget. Many of the current occupants are long term tenants and their rents are well below market.
INVESTMENT OVERVIEW
Price $485,000
Units 3
Rentable Sq.Ft. 2,270
Price Per Sq.Ft. $214
Cap Rate 4.03%
Market Cap Rate 6.50%
Price Per Unit $161,667
GRM 15.5
Parking 5 Surface
Year Built 1959
Parcel Number 722780-0615
Land SF 7,194
Zoning R-10
Construction Type Wood
Loan Type 30-Year Fixed Rate
% Down Payment 25%
Loan Amount $363,750
Interest Rate 4.50%
RENTON TRIPLEX
QUICK FACTS
Renton is well positioned to be the multifamily market with excellent upside potential. While much of the apartment market has been focused on the close-in locations, investors are now turning their attention to quieter submarkets, like this one, where there is room to upgrade units and increase rents. Situated at the southern end of Lake Washington, Renton is at the mid-point between Downtown Bellevue and the Kent
Valley light industrial center. This makes Renton ideal for commuting to these major centers of employment. Renton is also home to several major employers; among them is a Boeing assembly plant and PACCAR, Inc., a Kenworth truck manufacturer.
Renton offers its residents a quieter lifestyle, along with an abundance of retail and restaurant options. The Landing is a newer, retail village with several anchor tenants including: Target, Dick’s Sporting Goods, Fry’s Electronics Warehouse, and a multiplex Regal Cinema. Old Town Renton
14 miles
is also undergoing a revitalization with a collection of popular bars, restaurants, and boutique shops. Along the shores of Lake Washington is the city-operated Gene Coulon park which offers restaurants, a marina and boat launch, and grassy picnic areas just right for a day at the beach.
FROM DOWNTOWN SEATTLE
SUBMARKET INFORMATION
RENTON TRIPLEX
EMPLOYERS1 Boeing
2 Valley Medical Center
3 Providence
SHOPPING1 The Landing
2 Village Square
3 Fairwood Shopping
Center
4 Target
5 Westfield Southcenter
HEALTHCARE1 Valley Medical Center
2 Pacific Medical Center
RECREATION1 Gene Coulon
Memorial Beach Park
2 Renton Community
Center
3 Heritage Park
4 Cascade Park
5 Petrovitsky Park
1
3
2
1
5
2
3
4
1
5
2 3
4
1 2
TRANSPORTATION SCORES
RENTON MAP
Unit Unit Type Approx Sq Ft Current Rent Current /
Sq Ft Market Rent Market / Sqft
553 2 Bed / 1 Bath 825 $1,000 $1.21 $1,400 $1.70
555 2 Bed / 1 Bath 825 $800 $0.97 $1,400 $1.70
557 1 Bed / 1 Bath 600 $800 $1.33 $950 $1.58
Average 750 $1.17 $1.66
Total Monthly Income $2,600 $3,750
FINANCIAL ANALYSIS
• Rent roll as of July 2017• New roof in 2007• Middle unit was remodeled in 2016• Washer & Dryer in all units
FINANCIAL NOTES
Description Current Pro Forma
Gross Potential Rent $31,200 $45,000
Vacancy - 4% $1,560 5% $2,250 5%
Effective Gross Rent $29,640 $42,750
Other Income
Parking $0 $0
Utility Income $0 $0
Total Other Income $0 $0
Effective Gross Income $29,640 $42,750
Expenses
Property Taxes $5,005 $6,125
Insurance - Proforma $900 $900
Utilities - Proforma $2,700 $2,700
Maintenance & Repairs - Proforma $1,500 $1,500
Resident Manager $0 $0
Professional Management $0 $0
Administrative $0 $0
Reserves $0 $0
Total Expenses $10,105 $3,368 $11,225 $3,742
Net Operating Income $19,535 $31,525
Less Loan Payments $22,117 $22,117
Pre-Tax Cash Flow ($2,582) -2.13% $9,408 7.76%
Principle Reduction $5,868 $5,868
Total Pre-Tax Return $3,286 2.71% $15,276 12.60%
$15,276PRO FORMA PRE-TAX RETURN
1
Property Address Building Name Units Price Sale Date Price / Unit Price / Sq ft Cap Rate Square Footage
555 Index Pl NE Renton Triplex 3 $485,000 Listed $161,667 $214 4.03% 2,270
2821 NE 13th St Duplex 2 $439,000 Pending $219,500 $301 3.17% 1,460
554 Index Pl NE Fourplex 4 $650,650 7/25/2017 $162,663 $197 4.51% 3,300
417 Wells Ave S Triplex 3 $576,500 7/01/2017 $192,167 $250 5.07% 2,310
530 Mill Ave S Fourplex 4 $700,000 03/10/2017 $175,000 $195 4.36% 3,592
Averages $187,332 $236 4.28%
2
3
4
Duplex2821 NE 13th St
1
Fourplex554 Index Pl NE
Triplex417 Wells Ave S
Fourplex530 Mill Ave S
2 3 4
SALES COMPARABLES
RENTON TRIPLEX
1
2
3 4
417 WELLS AVE S
530 MILL AVE S
2821 NE 13TH ST
554 INDEX PL NE
R
SALES COMPARABLES MAP
Seattle is a bustling metropolis that has recently been ranked the 4th fastest growing city in America by Forbes. The largest city in the Pacific Northwest, Seattle is located between Lake Washington and Puget Sound. It’s famous nickname of “The Emerald City” is a tribute to it’s lush, green foliage seen year-round. Spectacular views of both the Olympic and the Cascade mountain ranges ensure a picturesque scene no matter which way you look.
Home to a diverse and robust community, Seattle is the cultural and business center of the Pacific Northwest. Multiple large companies call Seattle home including: Microsoft, Nordstrom, Expedia, Starbucks and Amazon. This ensures a thriving technology sector and much higher than average incomes and wages. Employment and population growth are both stable and strong.
Founded on the rough, outdoorsy values of fishing, logging and coal mining, Seattle is a predominatly ecofriendly city. It is also heavily influenced by the University of Washington - an extremely well ranked school and the largest single campus in the state.
Between 2014 and 2015 Seattle grew an astonishing 2.3%, making it the 4th fastest growing city in the United States. Seattle has never before sat that high on a population growth list and has a current population of 684,451. With the city buzzing with new infrastructure, new jobs and new residents, Seattle will continue to grow, expand and thrive.
MAJOR EMPLOYERSq Boeing
q Microsoft
q Amazon
q Starbucks
q Nordstrom
ECONOMIC STRONGHOLDq 4th fastest growing city in US
q Current population: 684,451
q Strong & stable employment
q Highest ranked software engineer pay in
the country
q 2.3% growth from 2014 to 2015
WORLD CLASS HEALTHCAREq Swedish Hospital
q UW Medical Center
q Harborview Medical Center
MAJOR ATTRACTIONSq Space Needle
q CenturyLink Field
q Pike Place Market
q Mt. Rainier
q Safeco Field
REGIONAL INFORMATION
“Throughout the Puget Sound region we’re seeing a subtle
shift among millennials, especially those with young
families, toward greater affordability, access to
schools and recreational amenities,”
-JJ Shephard, JLL.
BROKER - PRINCIPLE REAL ESTATE
STEVE MCWILLIAMS
Steve McWilliams has over 25 years of experience in the Seattle-Metro real estate market as both a broker and a commercial appraiser. Steve possesses an intricate understanding of the property valuation process and the dynamic trends within each submarket.
As a broker, Steve has worked with developers and homebuilders in identifying residential properties that match their expectations and fulfill their objectives. As an appraiser, Steve has years of experience working on valuations of land, multi-family, and single-family properties for lenders and investors. Steve’s areas of expertise also include seller and buyer representation, land acquisition and residential appraisal.
Outside of work, Steve enjoys golfing, biking, playing poker, and spending time with friends and family.
CELL: 425.417.6162EMAIL: [email protected]
CASEY ZEJDLIK
PRINCIPAL
Since beginning his real estate career in 2005, Casey has listed and sold over $175 million in multi-family and commercial transactions. He has also purchased and repositioned several properties in partnerships and assisted numerous clients in repositioning their existing properties to maximize returns. His dedication and drive to provide accurate and essential information, as well as impeccable service, has proven him to be an invaluable resource to his clients.
Casey’s vast knowledge of in-city investment properties stems from his extensive market research and hands-on experience as an apartment owner. He has guided numerous clients through the value-add process and enjoys taking an analytical yet creative approach to investing.
Prior to his career in real estate, Casey spent six years in the Navy in the Nuclear Engineering field. He holds a B.S. in Nuclear Engineering Technology and is a two-time recipient of the Navy Achievement Medal.
Residing in Queen Anne, Casey, his wife and two children enjoy exploring new restaurants, spending time enjoying the outdoors, and getting together with friends and family.
“My net worth has increased 300% to 400% since Casey started helping me with my real estate investments. I highly recommend his service. With his help I’m retired, I’m 55 and financially secure.”Scot & Teresa Worden – five time clients
PHONE: 206.566.6599CELL: 206.280.1871EMAIL: [email protected]
PRINCIPAL
JASON KONO
Jason Kono has been in multifamily brokerage for the past 12 years. During that time, he has been on two teams that have collectively closed over $245 million in transactions.
Shortly after entering the brokerage business, he witnessed the impact that real estate investing had in the accumulation of wealth for his clients. Jason realized he not only wanted to invest in real estate himself, but also wanted to manage apartments as an opportunity to more intimately understand the business. As a result, Jason has been an investing in and then managing multifamily properties for nearly a decade. What started out as small investment in one building and subsequent management of that property, has now turned into the asset management of a portfolio approaching $100 million in value comprised of twenty buildings and over 400 units. This management portfolio consists of partnerships that Jason has invested in, as well as properties he manages for select clients. Many of these properties have undergone significant renovation and which have led to substantial increases in income and subsequent value.
Jason attributes much of his success in the industry to the invaluable experience he has gained through this combination of brokerage, management and investment of apartment buildings. Jason attended the University of Colorado and has completed the University of Washington’s Commercial Real Estate Program. In addition, he is working towards the coveted CCIM designation and is currently half way through that coursework.
When not working, Jason enjoys travelling, boating and attending Seahawks games with his wife and new son. Jason also enjoys cycling and golfing in the summer and skiing in the winter.
PHONE: 206.566.6595CELL 206.920.0187EMAIL: [email protected]
Pilot Ventures is a boutique real estate investment firm in Seattle, Washington specializing in multifamily real estate ventures. With over 30 years of combined experience in the multifamily industry, Pilot Ventures might be small in size but we aren’t small in results. Our focus on long-term client success is at the core of everything we do.
Here at Pilot Ventures, our focus is always long-term. We don’t just build equity, we build relationships. Our number one priority is to provide clients end-to-end solutions. We use a cohesive platform of services – everything from analyzing deals before they begin, to consulting throughout the purchase, to renovation and management of a property – to ensure our clients’ long-term success.
Acquisition & DispositionRarely does Pilot Ventures do only a single deal with a client. We are a cohesive team of professionals dedicated to building your portfolio over time. We utilize an end-to-end approach with our services, ensuring that you are guided through the investment process from acquisition, to man-agement, to resale.
At Pilot Ventures, we believe that buying or selling, you should take pride in your investment. From buyer and tenant representation to owner and landlord representation, Pilot Ventures’ Seattle commercial real estate brokerage team engages with every client in a goal-oriented manner. Pilot Ventures works with each client to enhance their portfolio and maximize results, all with a mindset that enhances the present while always looking forward.
Consulting ServicesPilot Ventures knows that investing smartly is the easiest way to acheive your long-term goals. We provide Seattle investors with commercial real estate consulting and advisory services. We apply systematic market research and financial analysis to product feasibility solutions for all types of real estate projects.
Investment PartnershipsCollaborating with professionals who have both industry and financial knowledge can only strengthen your investment. Pilot Ventures has more than three decades of experience forming successful partnerships for Seattle commercial real estate investing. Our financial expertise and pro-fessional management allows individuals, families, partnerships and trusts to invest in income producing properties without needlessly worrying about their day-to-day operations. Pilot Ventures offers a full compliment of Seattle commercial real state investing services, including consulting, brokerage, development and property management.
Property Management Managing property can be overwhelming. Pilot Ventures has extensive experience taking a property from acquisition, to renovation, to man-agement and eventually to resale. We know how to best streamline your processes and maximize your cash flow, letting you direct the goals of your property while we handle the day-to-day operations.
Steve McWilliamsC: [email protected]
Casey ZejdlikC: 206.280.1871P: [email protected]
Jason KonoC: 206.920.0187P: [email protected]
150 Nickerson St Suite 211Seattle, WA 98109www.pilotnw.com
