1112 units - loopnet...of greater ann arbor’s population is within the prime renter age group of...
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49000 Denton Road, Belleville, MI 48111 HarbourClub.berkadiarea.com
1,112 Units
a Berkshire Hathaway and Jefferies Financial Group companyEXCLUSIVE MULTIFAMILY MARKETING
KEVIN P. DILLONSenior Managing [email protected]
JASON KRUGManaging [email protected]
RICK L. VIDRIOManaging [email protected]
CHARLEY [email protected]
CARLY [email protected]
INVESTMENT ADVISORS
28411 Northwestern HighwaySuite 300South�eld, MI 48034Phone: 248.208.3460Fax: 248.646.0320www.berkadia.com
DETROIT OFFICE
INVESTMENT HIGHLIGHTS ........................................................................5
THE ASSET ...................................................................................................34
COMPARABLE PROPERTIES .....................................................................45
FINANCIAL ANALYSIS ...............................................................................54
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offers outstanding investment qualities highly sought after in today’s market.
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Employment trends are positive with over $2.16 billion of new developments in Wayne County and Ann Arbor providing over 18,700 new jobs. This is a major impact in the market. This is referenced in the following sections for Wayne County and Ann Arbor. Amazon opened two Fulfillment Center in Western Wayne County adding 2,600 new jobs in the fall of 2018. The Livonia Center is only 23 minutes and the Romulus center is just 14 minutes east of Providence at Harbour Club. See page 22 for info regarding the Romulus center. The labor market remains extremely strong.
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submarket occupancy of 96.5% and effective rent growth of 2.9%. In addition, South Wayne County has significant constructions s
development
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MARKET HIGHLIGHTS / DEMOGRAPHICS - WAYNE COUNTY SUBURBS
20.2%RENT SHARE OF WALLET
SOUTH WAYNE COUNTYSUBMARKET
(COMPARED TO 25.3% NATIONALLY)
WAYNE COUNTY BOASTS THE
LARGESTLABOR FORCE IN MICHIGAN
93.4COST OF LIVING
INDEX SCORE(COMPARED TO 100 NATIONALLY)
717.8k 164.0k 451.1k 64.8k $55.8k
The Wayne County
suburbs are home to
more than 717,880residents
Approximately 23%
of residents are in the
key renter age group,
between 18 and 35
59% of employed
suburban Wayne County
residents work in white-
collar positions
The number of
households in the Wayne
County suburbs earning
over $100,000 annually
is forecast to increase
by 30.3% by 2023,
surpassing 64,835
The median household
income is projected to
reach $55,811 by 2023,
up 15.7% from 2018
1. DETROIT WORKFORCE - WAYNE COUNTY
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MARKET HIGHLIGHTS / DEMOGRAPHICS - WAYNE COUNTY SUBURBS
MEDIAN INCOME
2010 $47,411
2018* $48,239
2023* $55,811
Growth Rate (2018 - 2023) 15.7%
MEDIAN AGE
2010 36.6
2018* 38.3
2023* 39.0
MEDIAN HOME PRICE*
December - 2017 $164,000
December - 2018 $178,000
Growth Rate Y-o-Y 8.5%
*City of Belleville
RENT VS. OWN
Average Mortgage Payment** $1,110
E�ective Rent $812
Di�erence $298
*Projected**30-yr fixed; 20% down; 5.1% interest rate; 1.71% MI property taxes;$1,000 annual homeowner’s insurance
EMPLOYMENT GROWTH
December - 2017 765,300
December - 2018 774,200
Growth Rate Y-o-Y 1.2%
RENT SHARE OF WALLET
National - 2018 25.3%
South Wayne County - 2018 20.2%
National - 2023* 27.1%
South Wayne County - 2023* 19.2%
*ProjectedAnnual Rent / Median Household Income
1. DETROIT WORKFORCE - DETROIT MARKET
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MARKET HIGHLIGHTS / DEMOGRAPHICS
1ST 35.3MOST EDUCATED
METRO INTHE U.S.
MEDIAN AGEOF RESIDENTS
74% OF WORKERS ARE IN
WHITE-COLLARPOSITIONS METROWIDE
376.5k 122.2k 107.0k 56.5k $68.1k
Greater Ann Arbor’s
population is forecast
to grow 3.7% over
the next five years to
376,523 residents
53% of residents age
25 and older hold a
bachelor's degree or
higher, compared to
30% nationally
Approximately 29%
of Greater Ann Arbor’s
population is within the
prime renter age group
of 18 to 35 years old
36% of Greater Ann
Arbor’s housing units
are renter occupied,
compared to 31%
nationally
The metro area’s median
household income is
projected to reach
$68,126 by 2023, up
3.0% from 2018
1. DETROIT WORKFORCE - ANN ARBOR MARKET
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MARKET HIGHLIGHTS / DEMOGRAPHICS
MEDIAN INCOME
2010 $60,181
2018* $66,171
2023* $68,126
Growth Rate (2018 - 2023) 3.0%
MEDIAN AGE
2010 33.6
2018* 35.3
2023* 36.8
MEDIAN HOME PRICE
November - 2017 $328,584
November - 2018 $346,396
Growth Rate Y-o-Y 5.4%
RENT VS. OWN
Average Mortgage Payment** $2,081
Eective Rent $1,116
Di�erence $965
*Projected**30-yr fixed; 20% down; 5.1% interest rate; 1.71% MI property taxes;$1,000 annual homeowner’s insurance
EMPLOYMENT GROWTH
November - 2017 226,700
November - 2018 229,900
Growth Rate Y-o-Y 1.4%
RENT SHARE OF WALLET
National - 2018 25.3%
Ann Arbor Metro - 2018 20.2%
National - 2023* 27.1%
Ann Arbor Metro - 2023* 25.7%
*ProjectedAnnual Rent / Median Household Income
DETROIT WORKFORCE - ANN ARBOR
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EMPLOYMENT TRENDS
DECEMBER2018 8,900 jobswere created across the
metro division, a 1.2% Y-o-Y
increase
WAYNE COUNTY, MI
LARGEST EMPLOYERS
Ford Motor Company 48,000
General Motors Co. 37,710
Henry Ford Health System 17,610
Rock Ventures 16,620
Ilitch Companies 16,570
Trinity Health Michigan 14,680
Ascension Michigan 11,890
Detroit Medical Center 10,560
U.S. Postal Service 9,860
State of Michigan 9,350
Source: Detroit Regional Chamber - 2017
2. EMPLOYMENT TRENDS AND DEVELOPMENT - WAYNE COUNTY
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AUTOMOTIVE
FORD MOTOR COMPANY HEADQUARTERS 85,710Ford & GM Employees
$63,000+Average Annual Salary
$57 billionEconomic Impact
As the largest employer in Wayne County with 48,000 employees, Ford Motor Company has
a significant presence in the area with the Ford World Headquarters, Regent Court Marketing
Center, the Research and Engineering Center, and the Ford River Rouge Complex in Dearborn.
The massive 600-acre industrial park contains six Ford factories, as well as steel-making
operations run by AK Steel. General Motors operates three production facilities throughout
Wayne County including Romulus Powertrain, Inland Fisher Guide, and Hamtramck Assembly.
HEALTH CARE
ST. JOSEPH MERCY - CANTON 120,300Jobs Supported
Countywide
$8.9 billionTotal Wages & Salaries
$11.1 billionEconomic Impact
Wayne County is Michigan’s health care industry hub, with four of the ten largest companies
being health care related. Those companies including Detroit Medical Center and Henry Ford
Health System employ 54,500 county residents. In Dearborn, the 632-bed Beaumont Hospital
supports an additional 6,170 medical professionals and was named one of the “Best Hospitals in
Michigan.” Canton is home to satellite campuses for the Henry Ford Health System, St. Joseph
Mercy Health, and Beaumont Medical.
2. EMPLOYMENT TRENDS AND DEVELOPMENT - WAYNE COUNTY
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INFORMATION TECHNOLOGY
GM AUTONOMOUS VEHICLE DEVELOPMENT 63,000Wayne County
Jobs Supported
$82,700Median Annual Salary
The convergence of automotive manufacturing and software development is transforming
Wayne County into the information technology (IT) hub of Michigan. Nearly 63,000 industry
professionals are located in the area with employment growth exceeding 30% since 2009,
outpacing the national growth rate over the same period, a trend that is expected to continue
through 2025. Wayne County institutions of higher learning award over 300 computer-and-IT
related degrees and certifications annually, with new graduates earning over $50,000 annually.
AVIATION / TRANSPORTATION
DETROIT METROPOLITAN - WAYNE COUNTY AIRPORT $10.2 billionEconomic Impact
35.2 millionPassengers Served
in 2018
86,000Jobs Supported
$684 millionCommitted to Capital
Improvements
Located in Romulus, Detroit Metropolitan-Wayne County Airport (DTW) is the major air
transportation provider for Wayne County residents. The 18th-busiest airport in the nation, DTW
served over 35.2 million passengers in 2018 and handled over 434 million tons of cargo year to
date. DTW supports over 86,000 metro Detroit jobs and generates an economic impact of over
$10.2 billion for the region. The airport has over $684 million committed to capital improvement
projects through 2021.
2. EMPLOYMENT TRENDS AND DEVELOPMENT - WAYNE COUNTY
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CONSTRUCTION AND DEVELOPMENT
FORD DEARBORN CAMPUS MODERNIZATION
$1.2 billionInvestment
7.5 millionSF of Development
Ford Motor Company is consolidating their workers in Dearborn into two
locations on one sprawling campus that will encompass the construction and
renovation of more than 7.5 million square feet. It is anticipated the project will
take more than a decade to build out. Construction of the new product campus
at the Ford Research and Engineering Center is underway and will double the
center’s current employee count to 24,000 when completed in 2023-24. The
second project around Ford World Headquarters will break ground in 2021 with
scheduled completion in 2026. This phase will include a 700,000-square-foot
design center, outdoor space, and a Ford showroom and event venue.
SUBARU TECH CENTER
$48.2 millionInvestment
100Permanent Jobs Created
Looking to compete with companies like Toyota, Nissan, and Hyundai-Kia, who
all have technology development centers in Wayne County, Subaru will be
investing up to $48.2 million to build their own center in Van Buren Township.
The Subaru Tech Center will begin as a 60,000-square-foot facility with 100
employees but could expand to up to 200,000 square feet on 76-acres by
2022. The gradual increase of the center would mirror Nissan’s Farmington
Hills tech center, which opened in 1988 and now employs over 1,200 after $250
million in expansion projects over the past 20 years. Subaru has enjoyed steadily
increasing sales in the United States since 2017, and automotive tech centers
often grow into production support and development facilities.
2. EMPLOYMENT TRENDS AND DEVELOPMENT - WAYNE COUNTY
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ECONOMIC AND DEMOGRAPHIC OVERVIEWBERKADIA
CONSTRUCTION AND DEVELOPMENT - WAYNE COUNTY
FORD FLAT ROCK ASSEMBLY PLANT
$700 millionInvestment
700Permanent Jobs
In January 2017, Ford Motor Company announced plans to invest $700 million
to expand its Flat Rock Assembly Plant located approximately five miles south
of Woodhaven. The expansion of the plant will create 700 new jobs at the
plant, bringing the total number of employees at the facility to over 3,900. New
vehicles produced at the Flat Rock plant will include Ford’s first fully electric
sport utility vehicle that will make its debut in 2020, and a hybrid autonomous
vehicle that is scheduled to be released in 2021. The announcement is part of
Ford’s plan to invest $1.2 billion into its Michigan factories including $850
million for the Michigan assembly plant in Wayne, as the company has begun
production for the rerelease of the Ford Ranger and Ford Bronco models.
KINGFA SCIENCE AND TECHNOLOGY
$60 millionInvestment
150New Permanent Jobs
Kingfa Science and Technology Ltd. is investing $60 million to expand
operations at its facility in Canton Township. The investment will enable the
company to expand its payroll from just over 25 to over 175 employees by
2020. Located on Michigan Avenue, the company utilizes plastic compounds to
make materials for injection molding. The Majority of the company’s product is
distributed to local automobile manufacturing facilities. Demand increased at
Kingfa’s Canton facility as production of automobiles has steadily increased in
Wayne County over the past couple of years.
2. EMPLOYMENT TRENDS AND DEVELOPMENT - WAYNE COUNTY
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METRO EMPLOYMENT TRENDS
Employment Trends
NOVEMBER2018
NOVEMBER2018
2.6%
3,200 jobs
the metro’s monthly
unemployment rate was
down 70 bps annually
were created in the Ann
Arbor metro area, a 1.4%
Y-o-Y increase
ANN ARBOR, MI MSA
LARGEST EMPLOYERS
University of Michigan & Health System 49,120
Trinity Health 6,880
General Motors Milford Proving Grounds 5,500
VA Ann Arbor Health System 2,700
Ann Arbor Public Schools 1,930
Faurecia North America 1,660
Eastern Michigan University 1,630
Washtenaw Community College 1,450
Integrated Health Associates (IHA) 1,390
Washtenaw County 1,250
Sources: SPARK Ann Arbor Top Employers (January 2018); Ann Arbor Public Schools; University of Michigan
2. EMPLOYMENT TRENDS AND DEVELOPMENT - ANN ARBOR
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HEALTH CARE
TECHNOLOGY
MICHIGAN MEDICINE: UM ACADEMIC MEDICAL CENTER
THOMSON REUTERS
Ann Arbor’s health care industry generates more than $2.8 billion in revenue from more
than 1,300 establishments and 24,100 employees. The University of Michigan Health System,
the largest employer in the region, is made up of three hospitals, 40 health centers, and 120
outpatient clinics. The VA Ann Arbor Healthcare System employs about 2,460 residents and
boasts an annual research budget of $10.6 million. UM’s research budget of nearly $1.5 billion is
the second largest in the country.
The technology industry is making significant strides in the Ann Arbor region as a result of local
universities graduating more than 550 students annually with degrees in computer engineering,
computer science, and computer information systems. Over 300 local companies employ more
than 7,000 residents in every aspect of software and IT. The tech sector is attributed with driving
the downtown o©ce space vacancy rate to a historic low of 2.1%, down 150 basis points from
2015, with companies such as Barracuda Networks and Google anchoring the downtown.
$2.8 billionin Revenue from Health
Care Industry
24,100Employees
$1.5 billionUM Research Budget
$74,190Annual Mean Wage
7,000+Employees
300+Local Technology
Companies
550Annual Computer
Science Graduates
$73,080Annual Mean Wage
2. EMPLOYMENT TRENDS AND DEVELOPMENT - ANN ARBOR
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AUTOMOTIVE
LIFE SCIENCES
TOYOTA TECHNICAL CENTER
UM COLLEGE OF PHARMACY
Washtenaw County is home to more than 100 automotive firms employing more than 8,200
people. Greater Ann Arbor and the University of Michigan are at the forefront of the most
innovative research in the automotive industry. The area is host to autonomous vehicle test sites,
the American Center for Mobility and Mcity, and home to the Center for Automotive Research
and the U-M Transportation Research Institute. Over the next four years, the Toyota Research
Institute will grant the University of Michigan $22 million to boost research and development.
Ann Arbor’s life sciences industry includes more than 100 firms and 3,200 employees. The
University of Michigan received $832 million in research funding from the federal government,
$502 million of which came from the National Institutes of Health (NIH), equating to 56% of
their total research funding. The University houses four large research institutes, and in 2016, U-M
launched the MTRAC for Life Science Innovation Hub with an initial operating budget exceeding
$4 million.
$22 millionResearch Funding from
Toyota
100+Automotive Firms
8,200Employees
$61,090Annual Mean Wage
$502 millionin Research Funding
from NIH
3,200Industry Employees
100+ Local Companies
$57,810Annual Mean Wage
2. EMPLOYMENT TRENDS AND DEVELOPMENT - ANN ARBOR
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CONSTRUCTION AND DEVELOPMENT
UNIVERSITY OF MICHIGAN AMERICAN CENTER FOR MOBILITY
$430 million+in Development
$135 millionProject
690,000+SF Campus Wide
500-acreSite
The University of Michigan leads the region in construction activity with more
than 20 active projects under construction or in the planning stages. Major
projects around the university include the following:
n Dearborn Engineering Lab Building - $90 million, 123,000 square feet,
opening in summer 2020
n Stephen M. Ross Athletics Facility - $168 million, 280,000 square feet,
completed in the winter of 2018
n Ford Motor Company Robotics Building - $75 million, 140,000 square feet,
estimated completion in the winter of 2020
n Alexander G. Ruthven Museum - $100 million, 150,000 square feet, opened
in the fall of 2018
The historic Willow Run site in Ypsilanti Township is being redeveloped as The
American Center for Mobility and opened its first phase in December 2017.
The revamped facility is one of 10 national proving grounds for the research,
development, and implementation of driverless vehicles. The multiphase
development will give manufacturers a variety of controlled testing environments
and is expected to generate more growth in the automotive and mobility
industry, regionwide. The first users of the $135 million project on the 500-
acre site are Visteon and Toyota. Phase II of the development got underway in
spring 2018, featuring an urban driving environment, followed by the center’s
headquarters, and a technology park for users.
2. EMPLOYMENT TRENDS AND DEVELOPMENT- ANN ARBOR
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CONSTRUCTION AND DEVELOPMENT
NEXIENT ANN ARBOR HOTELS
$4.2 millionInvestment
$50 millionTotal Investment
300Total Jobs Created
350+New Hotel Rooms
Silicon Valley company Nexient is looking to expand their technology hub in Ann
Arbor. The $4.2 million investment will cover improvements to infrastructure,
equipment, and hiring 300 people over the next three years. After the
company’s recent facility expansion, Nexient currently occupies 75,000 square
feet of space and has enough room to accommodate up to 600 employees.
Ann Arbor was the more attractive option for the expansion for its quality of life
and existing talent pool. Today, the company continues to serve Fortune 500
companies such as Williams Sonoma.
Three hotels in Ann Arbor are set for construction or are in the final stages of
the approval process. In June 2017, the city council approved a 114-room, $6
million Holiday Inn Express that will be built between the recently completed
Staybridge Suites and Hyatt Place hotels on State Street. The 162-room hotel
dubbed The Glen broke ground downtown in late 2018. The hotel is part of a
$40 million mixed-use project that will include ground-floor restaurants and
retail space, with a four-level underground parking garage along Glen Avenue.
A 107-room Homewood Suites Hotel, also located on State Street, is awaiting
city council approval.
EMPLOYMENT TRENDS AND DEVELOPMENT - ANN ARBOR
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An announcement was made on February 26, 2019 confirming Fiat ChryslerAutomobiles investment of $4.5 billion in five of its existing plants, with additionalplans to work with the city of Detroit to build a new assembly plant within city limits.The newly proposed projects are anticipated to create nearly 6,500 new jobs. Thebenefits are far-reaching. With the influx of employees comes development:housing, restaurants, shops, and myriad other businesses will be needed to supportthe massive growth.
Development plans include investing $1.6 billion to convert the two plants existingat the Mack Avenue Engine complex into a future assembly site for the next JeepGrand Cherokee, the all-new three-row Jeep SUV and plug in hybrid (PHEV)models. An anticipated 3,500 new jobs will be added to support production at thefirst new plant to be built in the city of Detroit in nearly 30 years. Construction of thenew Detroit facility will begin by the end of Q2 2019 with the first three-row vehiclesexpected to roll off the line by the end of 2020, followed in the first half of 2021 bythe all-new Grand Cherokee.
Also announced was the creation of an additional 1,100 jobs at the Jefferson NorthAssembly Plant as part of a $900 million investment to retool and modernize thefacility to buld the Dodge Durango and next generation Jeep Grand Cherokee.Another $119 million investment will relocate the Pentastar engines currently built atthe Mack Avenue Engine Compex to the Dundee Engine Plant.
FCA also confirms the investment at the Warren Truck Assembly Plant to retool forproduction of the all-new Jeep Wagoneer and Grand Wagoneer, announced in2017, along with their electrified counterparts, would increase to $1.5 billion.Launching production in early 2021, the plant would continue building the Ram1500 classic in addition to the new Jeep models. This investment would support thecreation of another 1,400 new jobs.
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L Y NT T N S AN L NT
LANN L NTS
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RENT / OCCUPANCY
EFFECTIVERENT
$812in the fourth quarter of 2018, up
2.9% from one year prior
OCCUPANCYRATE 96.5%
through December 2018, up 30bps Y-o-Y
Limited construction activity in the South Wayne County apartment submarket
has aided an increase in the average occupancy rate over the past five years.
Development in the submarket has totaled just over 200 units, all of which
came online in 2016 and 2017. When paired with net leasing activity averaging
150 units per year since 2013, the average occupancy rate has increased
from 94.6% in 2013 to 96.5% at the end of 2018. The submarket’s prime
location, which includes Interstates 275 and 94, a�ords residents quick access
to employment nodes in Dearborn, Ann Arbor, and Romulus. Shifting renter
demographics in areas like Canton, Belleville, and Westland help set the stage
for increased demand in the submarket, as more than half the submarket’s
inventory lies within these areas, which also contain roughly 60% of the
submarket’s residents. Despite an a�ordable single-family home market, the
two largest demographic groups in the submarket, Baby Boomers and Gen
Xers, are choosing multifamily rentals instead of purchasing single-family
homes.
E�ective rent growth in the submarket has seen substantial gains in recent
years, increasing 2.9% annually to $812 per month as of the end of 2018.
Since 2013, e�ective rent has increased by roughly 3.2% annually, making the
South Wayne County submarket one of the more consistent performers in
the Detroit metro market. With e�ective rent roughly 18.9% below the metro
average, South Wayne County is one of the more a�ordable submarkets in
Greater Detroit. With a lack of new supply and one of the lowest e�ective
rents in the market, future growth in the submarket will likely not be hindered
in the near term.
SOUTH WAYNE COUNTYAPARTMENT SUBMARKET
3. FAVORABLE LIFESTYLE AND RENTAL MARKET - WAYNE COUNTY
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EDUCATION
HIGHEREDUCATION 123,000
students in institutions of higher
learning countywide
DEGREES ANDCERTIFICATIONS 380+
o�ered at Wayne State University
With more than 123,000 students attending area colleges and universities, Wayne County
is home to nearly 25% of all students enrolled at institutions of higher learning throughout
Michigan.
With an enrollment upwards of 27,000, Wayne State University (WSU), located in midtown
Detroit, is one of the largest universities in Michigan. The university is distinguished as a
Carnegie-rated research institution, with post-graduate programs including law and medical
schools and over 380 degree and certification programs.
Located on the former estate of Henry Ford, the University of Michigan-Dearborn
(UMD) supports 1,080 sta� and faculty positions and boasts an enrollment of just over
9,130 students. UMD o�ers 115 undergraduate and graduate degree programs across four
academic colleges.
University of Detroit-Mercy (UDM) has three campuses in Wayne County, one located in the
residential northwest area of Detroit and two in the downtown area. Combined, all three
campuses are home to more than 4,800 students.
WAYNE COUNTY, MI
LARGEST HIGHER EDUCATION
Wayne County Community College District 28,680
Wayne State University 27,090
Henry Ford Community College 26,430
Schoolcraft College 18,560
University of Michigan - Dearborn 9,130
University of Detroit - Mercy 4,880
Madonna University 4,400
Davenport University 2,500
Marygrove College 1,100
Source: Listed University Websites
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LIFESTYLE AND ENTERTAINMENT
DOWNTOWNBELLEVILLE 50+
shops & restaurants
FAIRLANETOWN CENTER 1.2m
SF shopping center
The Wayne County suburbs have some of the most active downtowns
in Michigan, many of which have great festivals and activities including
shopping and dining at locally owned establishments that draw in people
from all over Southeastern Michigan.
Nestled on the shores of Belleville Lake, the City of Belleville features a
traditional American downtown, which is home to over 50 restaurants and
retail establishments. The city has four major parks which feature boat
landings, picnic areas, playgrounds, and athletic courts. Downtown Belleville
also hosts activities over 200 days per year including a Polar Plunge, Farmers
Market, and a classic car show each Monday between June and September.
Van Buren Township o�ers a number of recreational programs for residents
of all ages. The township operates five parks, including Van Buren Park, which
features a beach area, picnic shelters, and concert pavilion. The Belleville
Area Museum features small-scale replicas of many historical buildings that
were once located in the tri-community area of Belleville, Sumpter, and Van
Buren Townships.
Among the largest of the suburban Wayne County cities, Dearborn is home
to nearly 100 restaurants, bars, and shopping destinations in the downtown
area. The Fairlane Town Center spans over 1.2 million square feet and 150
shops and services. One of the largest malls in Michigan, the superregional
shopping center is home to prominent retailers including Macy’s, JCPenney,
MAC, and AMC Theaters.
FAIRLANE TOWN CENTER
3. FAVORABLE LIFESTYLE AND RENTAL MARKET - WAYNE COUNTY
7
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
TRANSPORTATION - WAYNE COUNTY
DTWAIRPORT 35.2m
passengers served in 2018
SMARTPASSENGERS 36k
average weekday ridership
Wayne County o�ers immediate access to Canada via the Ambassador
Bridge and the Detroit-Windsor Tunnel. Major interstates include I-94, I-96,
and I-75.
Major air transportation for Wayne County residents is provided by the
Detroit Metropolitan Wayne County Airport (DTW). DTW served over 35.2
million passengers in 2018, an annual increase of 1.4%. The airport directly
and indirectly supports over 86,000 jobs and generates an economic impact
of over $10.2 billion
Public transit is provided by the Detroit Department of Transportation and
Suburban Mobility Authority for Regional Transportation (SMART), o�ering
44 fixed-route bus lines around Wayne County. The Detroit People Mover
(DPM) is a light rail system operating on an elevated loop in Detroit’s Central
Business District, and the QLINE light rail began operations in May of 2017,
running north through the city on Woodward Avenue.
DETROIT METROPOLITAN WAYNE COUNTY AIRPORT
Sources: Berkadia; Tetrad; U.S. Census Bureau; U.S. Bureau of Labor Statistics; City of Southgate; Wayne State University;Wayne County Michigan; Detroit Regional Chamber; Michigan Bureau of Labor Market Information and Strategic Initiatives;Curbed Detroit; Detroit Free Press; District Detroit; Packard Plant Project; Michigan State Medical Society; Michigan School Data; University of Michigan - Dearborn; Henry Ford Community College; Wayne County Community College; Crain’sDetroit Business; Down River Association of Realtor’s; Michigan Association of Realtor’s; U.S. Mortgage Calculator; Forbes; Wallethub; Nerdwallet; Axiometrics
3. FAVORABLE LIFESTYLE AND RENTAL MARKET - WAYNE COUNTY
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
RENT / OCCUPANCY - ANN ARBOR
EFFECTIVERENT
OCCUPANCYRATE
$1,116 98.2%through December of 2018, up
4.1% from one year prior through 4Q18, up 20 basis points
year over year
As the largest employer in the area and with 46,720 students enrolled, the
University of Michigan (UM) is a driving force behind the metro’s solid
apartment fundamentals. The university o�ers a limited number of residential
units for its students, leaving 78% of the student body in need of o�-campus
housing. Additionally, UM’s abundance of educational and professional
resources attract major tech and research companies to the metro area,
including Google and Nexient. With a highly skilled workforce, low cost of
living, and 29% of the population within the key renter age group of 18 to 35
years old, the Ann Arbor metro’s economy is consistently strong, boasting a
median household income 16.1% above the national average. However, recent
home appreciation increased 5.4% over the past year, making homeownership
less obtainable. Traditionally, occupancy rates in Ann Arbor’s apartment
market remain high due to the metro’s young population and job market
growth outpacing the national average.
Through December of 2018, e�ective rent in the Ann Arbor metro apartment
market was $1,116 per month, up 4.1% from the previous year. E�ective rent in
this market is projected to reach $1,147 per month by year-end 2019, equating
to an additional annual increase of 3.7%.
Bolstered by elevated leasing activity, the average occupancy rate in this
market was 98.2% through the end of 2018, up 20 basis points year over
year. An influx of new units and a projected decrease in demand for 2019 is
expected to push the occupancy rate in the Ann Arbor market down to a still-
healthy 97.0% by the end of 2019.
ANN ARBOR METRO APARTMENT MARKET
3. FAVORABLE LIFESTYLE AND RENTAL MARKET - ANN ARBOR
9
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
EDUCATION - ANN ARBOR
HIGHEREDUCATION
RESEARCHEXPENDITURES78,600+ $1.5b
students metrowide awarded to the University of
Michigan
The University of Michigan - Ann Arbor (UM) is the largest employer in Ann Arbor,
and the number one public research university according to the National Science
Foundation. In fall 2018, UM enrolled a record 46,720 students, up 1.6% annually.
The university o�ers 19 top-ranked schools and colleges, generates nearly $1.5
billion in research expenditures, and had 444 new invention reports in fiscal
year 2017. The University's football team draws a crowd larger than 107,600 for
their home games and produces an economic impact of more than $822 million
in Washtenaw County.
Eastern Michigan University (EMU), located in Ypsilanti, is the fifth-largest
university in Michigan. EMU employs about 1,630 faculty and sta� who educate
more than 20,300 students. More than 200 undergraduate and 150 graduate
degree programs are o�ered across seven schools and colleges.
The area is also home to Washtenaw Community College, which welcomes
approximately 12,350 students annually and o�ers more than 100 programs.
Ann Arbor Public Schools serve 18,140 total students, split among 32 elementary,
middle, and high schools in Greater Ann Arbor.
MICHIGAN STADIUM
3. FAVORABLE LIFESTYLE AND RENTAL MARKET - ANN ARBOR
3
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
LIFESTYLE AND ENTERTAINMENT - ANN ARBOR
STATE ST.DISTRICT
CRISLERCENTER100+ 12,707
shops and restaurants seat capacity
In addition to being a bustling university town, Ann Arbor is a culinary hotspot
and tech hub that features one of the most walkable downtowns, which supports
a world class arts and culture scene.
Anchored by the University of Michigan Museum of Art (UMMA), the Ann Arbor
art and culture scene is second to none. UMMA welcomes over 250,000 annual
visitors and is one of the largest university art museums in the nation. The venue
features roughly 19,000 works of art spanning cultures, eras, and media. Ann
Arbor’s Michigan Theater is the go-to place for screenings of independent films,
stage productions, and live music in an intimate 1,700-seat setting. Every July
the Ann Arbor Art Fair brings thousands of artists to downtown Ann Arbor to
showcase their work, transforming downtown into one of the largest art galleries
in the Midwest.
A foodie paradise, Ann Arbor is home to over 300 restaurants that have
something to please even the most refined palate. Zingerman’s Deli is perhaps
the most famous restaurant in Ann Arbor o�ering a wide variety of sandwiches,
plates, and even specialty groceries. The State Street District is home to over 100
shops and restaurants including farmers markets and pet-friendly outdoor patios.
For the sports enthusiast, the University of Michigan supports 27 Division One
athletic teams ranging from Olympic sports to football, hockey, and basketball.
Michigan Stadium boasts a capacity of 107,600 for UM football games, while the
Crisler Center supports just over 12,700 spectators for the Wolverine basketball
and hockey programs.
STATE STREET DISTRICT
3. FAVORABLE LIFESTYLE AND RENTAL MARKET - ANN ARBOR
31
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
TRANSPORTATION
AAATA /THE RIDE
DTWAIRPORT6.6m 34.7m
passengers served annually passengers served annually
An extensive transportation network leading in and out of Metro Detroit
serves the region. Two major highways span the Ann Arbor metro area, I-94
and U.S. Highway 23. Other highways in the region include U.S. 12, Michigan
Highway 14, M-17, M-52, and M-53.
Local air travel is o�ered at Ann Arbor Municipal Airport and Willow
Run Airport, a 2,600-acre freight, corporate, and general aviation airport,
providing 210,000 flights annually, and transporting more than 200
million pounds of cargo. Major commercial air travel is available at Detroit
Metropolitan Wayne County Airport (DTW), located approximately 25 miles
east of Ann Arbor. DTW serves about 34.7 million passengers annually and
o�ers nonstop service to nearly 140 destinations.
The Ann Arbor Area Transportation Authority (AAATA / The Ride) serves
6.6 million riders per year throughout the city and neighboring Ypsilanti.
ANN ARBOR MUNICIPAL AIRPORT
Sources: Berkadia; Tetrad; U.S. Census Bureau; U.S. Bureau of Labor Statistics; Fortune/Money.CNN.com; Forbes; Moody’s; Wikipedia; Axiometrics; Ann Arbor SPARK; City of Ann Arbor; Ann Arbor Chamber of Commerce; Washtenaw County;Eastern Michigan State University; Ann Arbor Convention and Visitors Bureau; Washtenaw Development Council; DiscoverOurTown.com; U.S. Department of Housing & Urban Development; State of Michigan; Ann Arbor Area Board of Realtors; Michigan Live LLC; University of Michigan; Washtenaw Community College; Peterson’s; AnnArbor.com; Detroit Free Press; PR Newswire; The Detroit News; M2 Communications; Crain Communications; MHN Online; MLive.com; and The Baron;Ann Arbor Association of Realtors; Mortgage Calculator; Yahoo Finance; Michigan Peninsula News; AreaDevelopment.com
3. FAVORABLE LIFESTYLE AND RENTAL MARKET - ANN ARBOR
3
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33
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
4 75
3 6retur of i vest e t
1average re t pre iu
4 1
34
T ASS T
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
Bldgs 1-35 -
Bldgs 36-44 -Electric Forced Air Furnaces
(Magic Pak) / Central AC
36
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i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
■ ■ ■ ■ ■ ■ ■ ■ ■
3
■ Units Apartment Homes
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
39
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
■ ■ ■ ■ ■ ■ ■ ■ ■ ■ ■
4
■ 9 Hole Golf Course On Site
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
41
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
4
L LANS
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
PROVIDENCE AT HARBOUR CLUB
NEIGHBORHOOD QUICK FACTS
BELLEVILLE, MIDEMAND DRIVER
or Motor
FROM THE
PROPERTY0. mi
JOBS
SUPPORTED
0.
JOBS
SUPPORTED
7.1mi
2.4k
DEMAND DRIVER
Visteon Corporation - Headquarters
FROM THE
PROPERTY
DEMAND DRIVER
Detroit Metropolitan Airport
FROM THE
PROPERTY
JOBS
SUPPORTED
10.1mi
1.6k
$191.8kMedian Housing Unit Value
(Within Three Miles)
$50.3kMedian Household Income
(Within Three Miles)
4.6%County Unemployment Rate
(November 2018)
29.8kPopulation
(Within Three Miles)
36%Renter Occupied Housing Units
(Within Three Miles)
DEMAND DRIVER
o e nt re
FROM THE
PROPERTY9. mi
JOBS
SUPPORTED1
JOBS
SUPPORTED
9.9mi
k
DEMAND DRIVER
A a on M ltiple Mi i an o ation
FROM THE
PROPERTY
DEMAND DRIVER
ni er it o Mi i an an ealt te
FROM THE
PROPERTY
JOBS
SUPPORTED
1 . mi
9. k
43
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
DEMAND DRIVER
ni er it o Mi i an
FROM THE
PROPERTY1 .1mi
JOBS
SUPPORTED
DD.
JOBS
SUPPORTED
DD
.9mi
7. k
7
DEMAND DRIVER
a ne tatea ni er it
FROM THE
PROPERTY
DEMAND DRIVER
Eastern Michigan University
FROM THE
PROPERTY
JOBS
SUPPORTED
STUDENTS
ENROLLED
7.2mi
1.6k
20.3k
1.9
44
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
45
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
L AL INTS INT ST
46
A A L TI S
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
Property CityDistance (mi.)from Subject Units Built Occupancy
Avg.SF
AskingRent
Rent /SF
Harbour Club Belleville 1112 1972 90.0% 905 $885 $0.98
Lake Shore Ypsilanti 2.37 1027 1969 97.0% 901 $991 $1.10
Westlake Belleville 2.08 510 2003 98.0% 910 $1.065 $1.17
Southport Belleville 2.87 768 1991 97.7% 823 $858 $1.04
Green Meadows Belleville 1.32 144 1995 96.0% 928 $968 $1.04
Belleville Pointe Belleville 1.46 120 1976 93.0% 969 $929 $0.96
Totals / Averages* 0.90 2.02 514 96.0% 884 $962 $1.09
1
2
4
3
5
S
A A L NTAL TI S
4
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
S
49000 Denton Road, Belleville, MI 48111
Units: 1112
Built: 1972
Occupancy: 89.6%
Fully Equipped Kitchen Lakefront Living* Free Tanning
Faux Hardwood Floors* Business Center On-site Cardio Fitness Center
Washer / Dryer * Relaxing Sauna Sparkling Swimming Pool
Golf Course Views* Clubhouse with FullyEquipped Kitchen andFireplace
Laundry Facilities
* In Select Homes
HARBOUR CLUB
Property Summary
Unit Mix & Rent Schedule
Unit Mix Breakdown
1 Bed / 1 Bath 47%
2 Bed / 2 Bath 53%47%
53%
Amenities
49
A A L NTAL TI S
UNITS TYPE SF ASKING RENT RENT / SF NOTES
3 0/1.00 505 $665 $1.32 Studio
374 1/1.00 805 $783 $0.97 Huron
144 1/1.00 835 $878 $1.05 Erie
429 2/2.00 945 $928 $0.98 St. Clair
162 2/2.00 1,100 $1,019 $0.93 Superior1,112 905 $885 $0.98
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
1
2500 Lakeshore, Ypsilanti, MI 48198
Distance (mi): 2.37
Units: 1027
Built: 1969
Occupancy: 97%
NITS TY S AS IN NT NT S N T S
96 0/1.00 555 $869 $1.57
96 1/1.00 700 $766 $1.09
96 1/1.00 710 $776 $1.09
116 1/1.00 800 $841 $1.05
84 1/1.00 820 $861 $1.05
96 1/1.00 965 $962 $1.00
128 2/1.00 970 $1,066 $1.10
82 2/2.00 1,057 $1,245 $1.18
82 2/2.00 1,086 $1,036 $0.95
79 2/2.00 1,115 $1,111 $1.00
36 3/2.00 1,250 $1,538 $1.23
36 3/2.00 1,360 $1,587 $1.17
1027 901 $991 $1.10
Fully Equipped Kitchen Sand Volleyball Court Car Wash Area with Vacuum
Modern Light Fixtures Boat Docks and Storage Free Fitness Classes
Faux Hardwood Floors Pet Wash and Bark Parks Tennis Court
Business Center Community Garden Two Sparkling Heated Pools
LAKE SHORE
Property Summary
Unit Mix & Rent Schedule
Unit Mix Breakdown
Studio / 1 Bath 9%
1 Bed / 1 Bath 48%
2 Bed / 1 Bath 12%
2 Bed / 2 Bath 24%
3 Bed / 2 Bath 7%
9%
24%
12%48%
Amenities
A A L NTAL TI S
5
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
2
10341 Westlake Circle , Belleville, MI 48111
Distance (mi): 2.08
Units: 510
Built: 2003
Occupancy: 98%
NITS TY S AS IN NT NT S N T S
169 1/1.00 770 $968 $1.26
1 1/1.00 850 $950 $1.12
170 2/1.00 940 $1,068 $1.14
170 2/2.00 1,020 $1,158 $1.14
510 910 $1,065 $1.17
Fully Equipped Kitchen Fitness Center
Washer / Dryer Swimming Pool
Lakefront Patio / Balcony Pet Friendly
Clubhouse
WESTLAKE
Property Summary
Unit Mix & Rent Schedule
Unit Mix Breakdown
1 Bed / 1 Bath 33%
2 Bed / 1 Bath 34%
2 Bed / 2 Bath 33%
33%33%
34%
Amenities
51
A A L NTAL TI S
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
3
10830 Oak Lane, Belleville, MI 48111
Distance (mi): 2.87
Units: 768
Built: 1991
Occupancy: 97.7%
NITS TY S AS IN NT NT S N T S
408 1/1.00 755 $805 $1.07 sq.ft 740-770
360 2/1.00 900 $918 $1.02
768 823 $858 $1.04
Fully Equipped Kitchen Cathedral Ceilings Clubhouse
Washer / Dryer Carports Available Pet Friendly
Private Entry Scenic Lake Views
Lakefront Balcony / Patio Swimming Pool
SOUTHPORT
Property Summary
Unit Mix & Rent Schedule
Unit Mix Breakdown
1 Bed / 1 Bath 53%
2 Bed / 1 Bath 47%47%
53%
Amenities
A A L NTAL TI S
5
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
4
11551 Quirk Road, Belleville, MI 48111
Distance (mi): 1.32
Units: 144
Built: 1995
Occupancy: 96%
NITS TY S AS IN NT NT S N T S
48 1/1.00 770 $820 $1.06
72 2/2.00 957 $985 $1.03
24 3/2.00 1,159 $1,210 $1.04
144 928 $968 $1.04
Private Entry Fully Equipped Kitchen Pet Friendly
Patio Washer / Dryer Hookups BBQ / Picnic Area
Walk-In Closets Clubhouse Playground
Central Heat and AirConditioning
Sparkling Outdoor Pool withSundeck
Internet Cafe with WiFi
GREEN MEADOWS
Property Summary
Unit Mix & Rent Schedule
Unit Mix Breakdown
1 Bed / 1 Bath 33%
2 Bed / 2 Bath 50%
3 Bed / 2 Bath 17%
33%
17%
50%
Amenities
53
A A L NTAL TI S
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
5
46020 Lake Villa Drive, Belleville, MI 48111
Distance (mi): 1.46
Units: 120
Built: 1976
Occupancy: 93%
NITS TY S AS IN NT NT S N T S
20 1/1.00 730 $765 $1.05
70 2/2.00 930 $870 $0.94
30 3/2.00 1,220 $1,175 $0.96
120 969 $929 $0.96
Gourmet Kitchen Updated Light Fixtures Swimming Pool with Deck
Pantry* Walk-In Closets Laundry Facility in EveryBuilding
Balcony / Patio Central Heat
Additional Storage Space Central Air Conditioning
BELLEVILLE POINTE
Property Summary
Unit Mix & Rent Schedule
Unit Mix Breakdown
1 Bed / 1 Bath 17%
2 Bed / 2 Bath 58%
3 Bed / 2 Bath 25%
17%25%
58%
Amenities
A A L NTAL TI S
54
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
ST
UD
IO$1,000
$875
$750
$625
$500
$375
$250
$125
$0
Har
bour
Clu
b |
$660
Lake
Sho
re |
$86
9
ON
E B
ED
$1,000
$875
$750
$625
$500
$375
$250
$125
$0
Har
bour
Clu
b |
$749
Belle
ville
Poi
nte
| $7
65
Sout
hpor
t | $
805
Gre
en M
eado
ws
| $8
20
Lake
Sho
re |
$84
1
Wes
tlake
| $
968
TW
O B
ED
$1,200
$1,050
$900
$750
$600
$450
$300
$150
$0
Belle
ville
Poi
nte
| $8
70
Har
bour
Clu
b |
$877
Sout
hpor
t | $
918
Gre
en M
eado
ws
| $9
85
Lake
Sho
re |
$1,
109
Wes
tlake
| $
1,11
3
Average$869 Average
$845
Average$1,032
55
A A L NTAL TI S
INAN IAL ANALYSIS
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
57
NIT IX A IN AN X NS S
Units Type Unit SF Total SFActual
RentMonthly
Mkt RentAnnual
Mkt Rent Rent/SF3 Studio 505 1,515 $665 $1,995 $23,940 $1.32
374 1 Bed / 1 Bath 805 301,070 $783 $292,842 $3,514,104 $0.97144 1 Bed / 1 Bath 835 120,240 $878 $126,432 $1,517,184 $1.05429 2 Bed / 2 Bath 945 405,405 $928 $398,112 $4,777,344 $0.98162 2 Bed / 2 Bath 1,100 178,200 $1,019 $165,078 $1,980,936 $0.93
1112 905 1,006,430 $885 $984,459 $11,813,508 $0.98
IncomeBerkadia
ProFormaJan 2019
T-3 AnnualizedJan 2019
T-12 2017
Scheduled Market Rent $11,813,508 $11,813,508 $11,467,577 $10,327,3216.00% ($708,810) ($789,151) ($522,659) $272,1395.00% ($590,675) ($1,492,581) ($1,574,654) ($908,170)1.50% ($177,203) ($221,250) ($374,062) ($152,911)1.50% ($177,203) ($308,688) ($170,863) ($188,035)
Less: Loss-to-LeaseLess: VacancyLess: ConcessionsLess: Non-Rev/Bad Debt/AdjustPlus: Year-One Rent Growth (Value Add 250 units $128) $384,000
Net Rental Income $10,543,617 $9,001,838 $8,825,339 $9,350,344
T-12 Income$655,008 $635,930 $635,930 $635,950$483,001 $468,933 $468,933 $481,731
Plus: Fee IncomePlus: RUBS IncomePlus: Other Income $120,433 $116,925 $116,925 ($10,846)
Total Operating Income (EGI) $11,802,059 $10,223,626 $10,047,127 $10,457,180
Expenses Per UnitJan 2019
T-12 AnnualizedJan 2019
T-12 2017$350 $389,200 $480,571 $480,571 $405,152
$82 $91,127 $88,904 $88,904 $110,475$1,158 $1,287,861 $1,256,450 $1,256,450 $1,207,707
$704 $782,816 $763,723 $763,723 $724,6923.00% $318 $354,062 $445,658 $445,658 $524,503
$966 $1,074,518 $1,048,311 $1,048,311 $902,091$77 $85,505 $83,419 $83,419 $118,838
$1,271 $1,413,402 $1,127,281 $1,127,281 $1,127,281$294 $327,272 $319,290 $319,290 $350,535
AdministrativeAdvertising & PromotionPayrollRepairs & Maintenance/TurnoverManagement FeeUtilitiesContracted ServicesReal Estate TaxesInsuranceReplacement Reserve $300 $333,600 $333,600 $333,600 $333,600
Total Expenses $6,139,364 $5,947,207 $5,947,207 $5,804,874
Per Unit: $5,521 $5,348 $5,348 $5,220Per SF: $6.10 $5.91 $5.91 $5.77
Net Operating Income $5,662,695 $4,276,419 $4,099,920 $4,652,306
IMPORTANT INFORMATION & DISCLAIMER: The information contained herein is assumed to be correct and market-supported. Output produced from this model should not be considered an appraisal. Projections are forecasts and are not to be considered fact. The information contained in this file is privileged and confidential; it is intended only for use by Berkadia and their clients. This file may not be reproduced physically or in electronic format without the expressed written consent of Berkadia. CAUTION: Security codes have been included into this file and unauthorized use may render this file useless. Berkadia Employees, affiliates, and contractors are instructed to hard-code this model for reproduction and distribution. Not responsible for errors and omissions. COPYRIGHT 2019. All Rights Reserved. DRAFT REPORT: Privileged & Confidential, For Discussion Purposes Only
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
▪
▪
▪ 90%
▪
▪
▪
▪
▪
▪ 802059
▪
▪
▪
▪
N T S T A
5
▪ Value Add Appreciation: Rent premiums are included for 250 units at $128per month. This is illustrated in the Rent Growth line in the Pro Forma.
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
▪
▪
▪
▪
▪
▪
▪ 662,695
59
N T S T A
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Y A AS L TI N
6
Acquisition EOY 1 EOY 2 EOY 3 EOY 4 EOY 5 EOY 6 EOY 7 EOY 8 EOY 9 EOY 10 EOY 11IncomeScheduled Market Rent $11,813,508 $12,563,433 $12,940,336 $13,328,546 $13,728,403 $14,140,255 $14,564,462 $15,001,396 $15,451,438 $15,914,981 $16,392,431
($708,810) ($125,634) ($129,403) ($133,285) ($137,284) ($141,403) ($145,645) ($150,014) ($154,514) ($159,150) ($163,924)($590,675) ($628,172) ($647,017) ($666,427) ($686,420) ($707,013) ($728,223) ($750,070) ($772,572) ($795,749) ($819,622)($177,203) ($125,634) ($129,403) ($133,285) ($137,284) ($141,403) ($145,645) ($150,014) ($154,514) ($159,150) ($163,924)($177,203) ($188,451) ($194,105) ($199,928) ($205,926) ($212,104) ($218,467) ($225,021) ($231,772) ($238,725) ($245,886)
Less: Loss-to-Lease Less: Vacancy Less: Concessions Less: Non-Rev/Bad Debt/Adjust Plus: Year-One Rent Growth (Value Add 250 units $128) $384,000
Net Rental Income $10,543,617 $11,495,541 $11,840,408 $12,195,620 $12,561,488 $12,938,333 $13,326,483 $13,726,278 $14,138,066 $14,562,208 $14,999,074
$655,008 $674,659 $694,898 $715,745 $737,218 $759,334 $782,114 $805,578 $829,745 $854,637 $880,276$483,001 $497,491 $512,415 $527,788 $543,622 $559,930 $576,728 $594,030 $611,851 $630,206 $649,113
Plus: Fee Income Plus: RUBS Income Plus: Other Income $120,433 $124,046 $127,767 $131,600 $135,548 $139,615 $143,803 $148,117 $152,561 $157,138 $161,852
Total Operating Income (EGI) $11,802,059 $12,791,737 $13,175,489 $13,570,753 $13,977,876 $14,397,212 $14,829,129 $15,274,002 $15,732,223 $16,204,189 $16,690,315
Operating Expenses($389,200) ($398,930) ($408,903) ($419,126) ($429,604) ($440,344) ($451,353) ($462,636) ($474,202) ($486,057) ($498,209)
($91,127) ($93,405) ($95,740) ($98,134) ($100,587) ($103,102) ($105,679) ($108,321) ($111,029) ($113,805) ($116,650)($1,287,861) ($1,320,058) ($1,353,059) ($1,386,886) ($1,421,558) ($1,457,097) ($1,493,524) ($1,530,863) ($1,569,134) ($1,608,363) ($1,648,572)
($782,816) ($802,387) ($822,447) ($843,008) ($864,083) ($885,685) ($907,827) ($930,523) ($953,786) ($977,630) ($1,002,071)3% ($354,062) ($383,752) ($395,265) ($407,123) ($419,336) ($431,916) ($444,874) ($458,220) ($471,967) ($486,126) ($500,709)
($1,074,518) ($1,101,381) ($1,128,916) ($1,157,139) ($1,186,067) ($1,215,719) ($1,246,112) ($1,277,265) ($1,309,196) ($1,341,926) ($1,375,474)($85,505) ($87,643) ($89,834) ($92,079) ($94,381) ($96,741) ($99,160) ($101,638) ($104,179) ($106,784) ($109,454)
($1,413,402) ($1,441,670) ($1,470,503) ($1,499,914) ($1,529,912) ($1,560,510) ($1,591,720) ($1,623,555) ($1,656,026) ($1,689,146) ($1,722,929)($327,272) ($335,454) ($343,840) ($352,436) ($361,247) ($370,278) ($379,535) ($389,023) ($398,749) ($408,718) ($418,936)
AdministrativeAdvertising & PromotionPayrollRepairs & Maintenance/TurnoverManagement FeeUtilitiesContracted ServicesReal Estate TaxesInsuranceReplacement Reserve ($333,600) ($333,600) ($333,600) ($333,600) ($333,600) ($333,600) ($333,600) ($333,600) ($333,600) ($333,600) ($333,600)
Total Expenses ($6,139,364) ($6,298,280) ($6,442,107) ($6,589,444) ($6,740,376) ($6,894,992) ($7,053,384) ($7,215,645) ($7,381,869) ($7,552,155) ($7,726,604)
Net Operating Income (NOI) $5,662,695 $6,493,457 $6,733,381 $6,981,310 $7,237,500 $7,502,220 $7,775,744 $8,058,358 $8,350,354 $8,652,034 8,963,711
IMPORTANT INFORMATION & DISCLAIMER: The information contained herein is assumed to be correct and market-supported. Output produced from this model should not be considered an appraisal. Projections are forecasts and are not to be considered fact. The information contained in this file is privileged and confidential; it is intended only for use by Berkadia and their clients. This file may not be reproduced physically or in electronic format without the expressed written consent of Berkadia. CAUTION: Security codes have been included into this file and unauthorized use may render this file useless. Berkadia Employees, affiliates, and contractors are instructed to hard-code this model for reproduction and distribution. Not responsible for errors and omissions. COPYRIGHT 2019. All Rights Reserved. DRAFT REPORT: Privileged & Confidential, For Discussion Purposes Only
i te t i e re to o in t e rotation orientation t a to e on er t an t e ta te t in or e r to re i ter o a i n t i not a a o i e
IMPORTANT INFORMATION & DISCLAIMER: The information contained herein is assumed to be correct and market-supported. Output produced from this model should not be considered an appraisal. Projections are forecasts and are not to be considered fact. The information contained in this file is privileged and confidential; it is
intended only for use by Berkadia and their clients. This file may not be reproduced physically or in electronic format without the expressed written consent of Berkadia. CAUTION: Security codes have been included into this file and unauthorized use may render this file useless. Berkadia Employees, affiliates, and contractors are
instructed to hard-code this model for reproduction and distribution. Not responsible for errors and omissions. COPYRIGHT 2019. All Rights Reserved. DRAFT REPORT: Privileged & Confidential, For Discussion Purposes Only
61
A A IS N
IncomeBerkadia
ProForma NET CHANGEJan 2019
T-3 Annualized Jan 2019 T-12 2017Scheduled Market Rent $11,813,508 0.0% $11,813,508 $11,467,577 $10,327,321 Less: Loss-to-Lease 6.00% ($708,810) ($789,151) ($522,659) $272,139 Less: Vacancy 5.00% ($590,675) ($1,492,581) ($1,574,654) ($908,170) Less: Concessions 1.50% ($177,203) ($221,250) ($374,062) ($152,911) Less: Non-Rev/Bad Debt/Adjust 1.50% ($177,203) ($308,688) ($170,863) ($188,035)
$384,000 Plus: Year-One Rent Growth (Value Add 0.00%Net Rental Income $10,543,617 17.1% $9,001,838 $8,825,339 $9,350,344
$655,008 3.0% $635,930 $635,930 $635,950$483,001 3.0% $468,933 $468,933 $481,731
Plus: Fee Income Plus: RUBS Income Plus: Other Income $120,433 3.0% $116,925 $116,925 ($10,846)Total Operating Income (EGI) $11,802,059 15.4% $10,223,626 $10,047,127 $10,457,180
$878,635 $750,153 $735,445 $779,195$983,505 $851,969 $837,261 $871,432
Net Rental Income / MonthTotal Operating Income (EGI) / MonthTotal Operating Income (EGI) / Unit $884 $766 $753 $784
Expenses Per UnitJan 2019
T-12 Annualized Per UnitJan 2019
T-12 Per Unit 2017 Per Unit$350 $389,200 -19.0% $480,571 $432 $480,571 $432 $405,152 $364
$82 $91,127 2.5% $88,904 $80 $88,904 $80 $110,475 $99$1,158 $1,287,861 2.5% $1,256,450 $1,130 $1,256,450 $1,130 $1,207,707 $1,086
$704 $782,816 2.5% $763,723 $687 $763,723 $687 $724,692 $652$318 $354,062 -20.6% $445,658 $401 $445,658 $401 $524,503 $472$966 $1,074,518 2.5% $1,048,311 $943 $1,048,311 $943 $902,091 $811
$77 $85,505 2.5% $83,419 $75 $83,419 $75 $118,838 $107$1,271 $1,413,402 25.4% $1,127,281 $1,014 $1,127,281 $1,014 $1,127,281 $1,014
$294 $327,272 2.5% $319,290 $287 $319,290 $287 $350,535 $315
AdministrativeAdvertising & PromotionPayrollRepairs & Maintenance/TurnoverManagement FeeUtilitiesContracted ServicesReal Estate TaxesInsuranceReplacement Reserve $300 $333,600 0.0% $333,600 $300 $333,600 $300 $333,600 $300
Total Expenses $6,139,364 3.2% $5,947,207 $5,947,207 $5,804,874
Net Operating Income $5,662,695 32.4% $4,276,419 $4,099,920 $4,652,306
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T TAL ST TAL TAXA L AL
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T TALA
T T ST T T
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T TAL ST TAL TAXA L AL
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T TAL
T T A T A T I
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TAX ANALYSIS
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Disclaimer andConfidentiality AgreementThe material contained in this document is confidential, furnished solely for the purpose of considering investment in the property described therein and is not to be copied and/or used for any purpose or made available to any other person without the express written consent of Berkadia Real Estate Advisors LLC and Berkadia Real Estate Advisors Inc. In accepting this, the recipient agrees to keep all material contained herein confidential.
This information package has been prepared to provide summary information to prospective purchasers and to establish a preliminary level of interest in the property described herein. It does not, however, purport to present all material information regarding the subject property, and it is not a substitute for a thorough due diligence investigation. In particular, Berkadia Real Estate Advisors LLC and Berkadia Real Estate Advisors Inc. and seller have not made any investigation of the actual property, the tenants, the operating history, financial reports, leases, square footage, age or any other aspect of the property, including but not limited to any potential environmental problems that may exist and make no warranty or representation whatsoever concerning these issues. The information contained in this information package has been obtained from sources we believe to be reliable; however, Berkadia Real Estate Advisors LLC and Berkadia Real Estate Advisors Inc. and Seller have not conducted any investigation regarding these matters and make no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. Any pro formas, projections, opinions, assumptions or estimates used are for example only and do not necessarily represent the current or future performance of the property.
Berkadia Real Estate Advisors LLC and Berkadia Real Estate Advisors Inc. and Seller strongly recommend that prospective purchasers conduct an in-depth investigation of every physical and financial aspect of the property to determine if the property meets their needs and expectations. We also recommend that prospective purchasers consult with their tax, financial and legal advisors on any matter that may affect their decision to purchase the property and the subsequent consequences of ownership.
All parties are advised that in any property the presence of certain kinds of molds, funguses, or other organisms may adversely affect the property and the health of some individuals. Berkadia Real Estate Advisors LLC and Berkadia Real Estate Advisors Inc. recommend, if prospective buyers have questions or concerns regarding this issue, that prospective buyers conduct further inspections by a qualified professional.
The Seller retains the right to withdraw, modify or cancel this offer to sell at any time and without any notice or obligation. Any sale is subject to the sole and unrestricted approval of Seller, and Seller shall be under no obligation to any party until such time as Seller and any other necessary parties have executed a contract of sale containing terms and conditions acceptable to Seller and such obligations of Seller shall only be those in such contract of sale.
For more information on these and other Berkadia® exclusive listings, please visit our website at www.Berkadia.com
Berkadia®, a joint venture of Berkshire Hathaway and Jefferies Financial Group, is an industry leading commercial real estate company providing comprehensive capital solutions and investment sales advisory and research services for multifamily and commercial properties. Berkadia® is amongst the largest, highest rated and most respected primary, master and special servicers in the industry.
© 2019 Berkadia Real Estate Advisors LLC and Berkadia Real Estate Advisors Inc. Berkadia® and Berkadia Commercial Mortgage® are trademarks of Berkadia Commercial Mortgage LLC. Investment sales and real estate brokerage businesses are conducted exclusively by Berkadia Real Estate Advisors LLC and Berkadia Real Estate Advisors Inc. Commercial mortgage loan origination and servicing businesses are conducted exclusively by Berkadia Commercial Mortgage LLC and Berkadia Commercial Mortgage Inc. For state licensing details for the above entities, visit: www.berkadia.com/legal/licensing.aspx
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