kinneman square - loopnet...located here, and hillsboro’s airport is the second-largest in oregon....

OFFERING MEMOR ANDUM

KINNEMAN SQUARE12 Units • Beaverton, Oregon

Kinneman Square is a 12-unit townhome community on the west side of Beaverton. The property offers spacious two-bedroom townhome floor plans of nearly 1,000 square feet. These units offer in-unit washers and dryers, new countertops and appliances, as well as a private patio and deck for each unit.

Kinneman Square is across the street from Aloha High School and just a few blocks from Kinneman Elementary School. Also nearby is Butternut Park, Arnold Park, and Butternut Creek. The property is centrally located between downtown Beaverton and Hillsboro. Nike World Headquarters and Intel—with a combined total of more than 32,000 area employees—are both nearby.

The owners of Kinneman Square have maintained the property over the years with several capital improvements. New windows and painting throughout the entirety of the property nicely complement the updated interiors of the units. The property’s spacious two-bedroom units have new flooring throughout and the kitchens have newer countertops. Select units have received updated appliances.

Kinneman Square’s rents currently average $1,250 per unit or $1.28 per square foot. Kinneman Square’s large units—with new finishes and amenities throughout—make the property an attractive site for tenants living in the Beaverton and Aloha areas.

INVESTMENT SUMMARY

PROPERTY HIGHLIGHTS• Newly remodeled units

• 24-hour emergency maintenance

• On-site laundry room

• Granite countertops

• New Durban Oak flooring

• New appliances

• Scenic green spaces

• Private deck & patio for each unit

2 HFO INVESTMENT REAL ESTATE

ASSET SUMMARYProperty Kinneman SquareLocation 4445 SW 188th Avenue

Beaverton, OR 97007

County WashingtonTotal Units 12Year Built 1974Stories 2 storiesApprox. NR Sq Ft 11,700Average Sq Ft 975Acreage 0.63

PRICINGPrice $2,220,000

Price Per Unit $185,000

Per Square Foot $190

Cap Rate 5.38%

INVESTMENT SUMMARY

FOR MORE INFORMATION Rob Marton • [email protected]

Greg Frick • [email protected]

HFO Investment Real Estate2424 SE 11th Avenue, Portland, Oregon 97214www.hfore.com • (503) 241.5541 • Fax: (503) 241.5548

Brokers licensed in Oregon and Washington.

3KINNEMAN SQUARE • 12 UNITS • BEAVERTON, OR

Every unit at Kinneman Square features a deck and patio that extend the living area. The covered patio is great for autumn, with an open deck to complement the summertime.


217

10

8 Tualatin Hills Nature Park

Providence St Vincent

Medical Center

Beaverton High School

Beaverton Town Square

Hillsboro High School

Aloha High School

Sunset High School

Washington Square

Tanasbourne Town Center

Orenco Station

Hillsboro Airport

BEAVERTON

HILLSBORO

BEAVERTON

Walker Rd

Baseline Rd

Cornell Rd

Murray Blvd

River Rd

Johnson St

Brookwood Pkwy

Cornelius Pass Rd

Farmington St185th Ave

170th Ave

2295th Ave

26

Cedar Hills Crossing

Employee Store

LIFESTYLE CONVENIENCES AND EMPLOYERS

Kinneman Square


The City of Beaverton (pop. 97,514) is a major economic hub in the Portland metro area, along with being Portland’s second-largest suburb and the fifth-largest city in Oregon. Over the past two decades, Beaverton has attracted numerous high-tech businesses, and is one of Oregon’s fastest-developing areas. Between 2010 and 2017, the city’s population has increased by 8.6%.

For those looking for job prospects, few cities are likely to offer more opportunities than Beaverton, which is a 15-20 minute drive from downtown Portland. In 2015 and 2016, employment in Beaverton increased by 8.3%, faster than in all but a few dozen other U.S. cities. The national job growth rate over the same period was 3.5%. Money magazine ranked Beaverton #9 on its list of Best Places to Live for 2016, for providing ample opportunities for its residents to find employment, raise a family, and stay active. Indeed, Business Week proclaimed the city the best place in the country to raise children, due to its network of public parks, its 25-mile grid of bike paths, and its highly-regarded public and private schools.

Beaverton is a large, robust community that is home to major companies as Nike Inc. and Columbia Sportswear. Several high-tech employers including Intel and Genentech are located along the Highway 26/Sunset Corridor, which includes nearby Hillsboro. The growing tech hub west of Portland includes more than 300 high-tech businesses who have made their home in what is called the “Silicon Forest.” As an increasing number of high skilled workers are drawn to the area, Beaverton rents have been increasing, and are forecast to continue this trend at a healthy pace. As of March 2018, Beaverton’s unemployment rate was 3.6%, below Oregon’s statewide average of 4.1%.

Nike is currently undergoing a major expansion rumored to cost approximately $1 billion. It plans to open its new 3.2 million square foot building by the end of 2018. The new additions to Nike’s campus include more office and parking space as well as landscaping improvements. In addition, Intel recently completed their R4 Building, a seven-story structure on its Ronler Acres complex in Hillsboro.

BEAVERTON SUBMARKET OVERVIEWLike the Portland metro area, Beaverton has experienced historically low vacancies, with a Spring 2018 vacancy rate of 4.6% reported by Multifamily NW. Housing options in Beaverton include many apartment complexes and urban-core condominiums near shops and MAX light-rail stations. Whether they are drawn to Beaverton for the schools, shopping or the outdoors, individuals and families will find a wide range of opportunities to fit their needs. With its stable, sustainable economy, Beaverton remains attractive and poised for future growth.

• 2018 All-America City Finalist

• Best Places to Live (Money Magazine) 2016

• Adopted a “Diversity, Equity, and Inclusion Plan” (2015)

• Joined the National Welcoming Cities and Counties Initiative, becoming the first city in Oregon to nationally declare itself a Welcoming City (2015)

• Tied with Cupertino, CA for a first-place City Cultural Diversity Award by The National League of Cities (2015)

• Unanimously passed a “Resolution to Declare Support for the Muslim Community & Reaffirm Beaverton as a Welcoming City” (2016)


Hillsboro, just west of Portland, is home to many high-tech companies, including Intel, and their thousands of employees. Once a tiny settlement extending three blocks in each direction from its county courthouse, Hillsboro grown to become the fifth-largest city in Oregon, and the county seat of Washington County. Its population increased 15.9% from 2010 to 2017, when it reached 106,894.

Hillsboro has retained its small-town charm and tradition, while at the same time offering convenient access to large employers and transportation options. Intel has three campuses located here, and Hillsboro’s airport is the second-largest in Oregon.

For decades, the west side of the Portland Metro Area has been referred to as part of the “Silicon Forest”—a cluster of prominent high-tech companies that have had a positive impact on Oregon’s economy and population. A major economic center of Washington County, Hillsboro has attracted many high-tech businesses in the last two decades. It’s been referred to as “the tallest tree in the Silicon Forest.”

Most of its high-tech development is located along the Highway 26/Sunset Corridor, which connects Hillsboro with its neighboring city, Beaverton. Hillsboro residents are prosperous, with an estimated median household income of $70,180.

According to the Spring 2018 Multifamily NW report, Hillsboro saw an average rent per square foot of $1.42 and an average vacancy rate of 4.5%, below the 4.85% average for the metro area.

HILLSBORO SUBMARKETOther leading employers in the Hillsboro area include Salesforce, Nike, the Hillsboro and Beaverton School Districts, Providence Hospital, and Comcast Cable.

TriMet’s MAX Blue Line train makes stops at nine locations in the Hillsboro area, enabling an easy commute to and from the downtown Portland area. Hillsboro is an ideal place to live for the employees of its myriad businesses, as well as their families.

Residents and visitors enjoy Hillsboro’s farmers’ markets, dog parks, arts venues, community gardens and its locally-owned restaurant and shopping options. It is the host of the second-largest Fourth of July parade in Oregon State. Other annual events include its Latino Cultural Festival, Celebrate Hillsboro and the Oregon International Air Show. Hillsboro is also home to the Metro area’s only pro baseball team, the Hillsboro Hops.

INTEL D1X FABRICATION PLANT


NEED UPDATE

MAJOR RETAILERS

STREETS OF TANASBOURNE (4.1 Miles from Kinneman Square)

Streets of Tanasbourne, at 19350 NW Emma Way in Hillsboro, evokes the feeling of a classic American downtown, with 55 stores, restaurants and services in a friendly, open-air environment. Retailers include REI, Bath & Body Works, Zumiez, Macy’s and Banana Republic.

WASHINGTON SQUARE SHOPPING (6.6 miles from Kinneman Square)

Washington Square Shopping Mall, at 9585 SW Washington Square Rd., is anchored by Macys, Nordstrom and JC Penney department stores. It also includes retailers such as Abercrombie & Fitch, The Apple Store and Dick’s Sporting Goods. The two-story mall is among Portland’s most popular shopping centers.

CEDAR HILLS CROSSING(3.7 Miles from Kinneman Square)

Cedar Hills Crossing, at 3205 SW Cedar Hills Blvd, is a sprawling retail complex that features Powell’s Books, McMenamins Pub, New Seasons Market, Sports Authority and Crafts Warehouse.

Shopping in Portland is a great way to burn off those inevitable calories racked up while enjoying the city’s outstanding food and drink. The City of Roses offers a diverse range of retail options—from high-end, nationally-known chains to humble local merchants of hand-made goods. Here is a quick tour of some of Washington County’s prime shopping destinations a short distance from Kinneman Square:

Tanasbourne Town Center, at Sunset Highway (US 26) and NW 185th Avenue, is a regional shopping hub with nearly 570,000 square feet of retail. Its location at the intersection of Highway 26 and NW 185th make Tanasbourne Towncenter one of the busiest retail centers in the Portland metro area. National retailers can be found throughout the center including Target, Nordstrom Rack, ULTA and Trader Joe’s.

TANASBOURNE TOWN CENTER (2.0 Miles from Westview Heights)


APARTMENT MARKETThe Portland Metro Area consistently ranks among the nation’s lowest for apartment vacancy rates according to the U.S. Census Bureau and other third-party services like REIS, MPF Research, and Axiometrics. The U.S. Census ranked Portland as having the 6th lowest vacancy rate in the nation for the first quarter of 2018 at 3.6%.

REIS reports 2017 Portland metro year-over-year rents grew 3.3%. Overall rents have increased every quarter since Q1 2010.

SKILLED WORKFORCE & STRONG EMPLOYMENT54% of Portland workers have an associate’s degree or higher, outpacing the national average of 38%.

According to the State of Oregon’s Employment Department, Portland enjoys one of the fastest job growth rates in the Pacific Northwest, and the entire nation, having added 31,000 jobs in 2016 and 28,000 jobs in 2017.

The Portland Metro Area’s unemployment rate as of May 2018 is 3.7%—the lowest since 1995.

TOP 10 LISTSPortland consistently receives glowing reviews and rankings from the media.

2018 lists include: • #4 Best City for Biking (Fast Company)• #6 Best Place to Live (U.S. News and World Report)• #10 Most Entrepreneurial State (Amazon.com)

2017 lists include: • #3 City with Best Opportunities for Job Seekers

This Year (Fast Company)

2016 lists include: • America’s Best City for Summer Travel (Travel +

Leisure)• Best City for Electric Cars in the U.S.

(The Christian Science Monitor)• Best Places to Live 2016 (Money Magazine)• #8 Greenest City in the Nation (Wallethub)• #8, World’s Best Cities for Millennials (Matador

Network)• Food and Drink Capital of America (The Telegraph

– London)• World’s #10 Best City to Live In (Metropolis Magazine)

DIVERSIFIED ECONOMYPortland is home to the headquarters of Fortune 500 companies Nike, Precision Castparts and Lithia Motors. Fortune 1000 companies headquartered here include Stancorp Financial, Greenbrier Companies, Columbia Sportswear, Schnitzer Steel Industries, and Portland General Electric.

Tech and software companies continue to relocate their operations here or open major outposts in Portland. These companies enjoy Portland’s educated workforce, affordable high quality of life, and a low cost of doing business compared to the Bay Area.

Companies which recently opened major branches in Portland include Airbnb, Google, Squarespace, Mozilla, Simple, Survey Monkey, SalesForce and New Relic, Inc. Portland’s tech startup companies include Viewpoint, Jama Software, Thetus, Urban Airship, Acquia, Elemental Technologies, Act-On, Puppet Labs, and The Clymb.

PORTLAND REGIONOregon’s largest city, Portland, is near the confluence of the Willamette and Columbia Rivers. The Portland Metro Area consists of four counties: Multnomah, Washington, Clackamas, and Clark County, Washington.

PORTLAND METRO SNAPSHOT


GOVERNMENTThe U.S. Federal Government is Portland metro’s overall largest employer, with 20,500 workers. The State of Oregon gives employment to an additional 14,000 residents.

HIGH TECH & CHIP MANUFACTURINGAttracted by the Portland area’s educated workforce and relative low cost of doing business, tech companies continue moving to Portland—opening major branches and, in some cases, relocating to the area entirely.

With over 19,300 employees, Intel is the area’s largest private employer. Intel acquired its first Portland location in 1974. The company is currently expanding its presence with forthcoming D1X microprocessor chip facilities at the Ronler Acres Campus in Hillsboro. This is part of a five-year, $6 billion expansion, and is part of the company’s long-term plans for growth. Intel is the largest property taxpayer in Washington County, with payments of approximately $30 million a year.

Other notable Portland-area high-tech companies include ON Semiconductor and Tektronix.

SPORTSWEARNike has its world headquarters in Beaverton and employs 12,000 Portland-area residents. The company designs, develops and manufactures footwear, apparel, equipment and accessories. From here, Nike orchestrates production and design for one of the world’s most recognizable brands. In January, 2015, Nike began a $1 billion expansion of its Washington County campus, adding three buildings with a collective 1.3 million square feet and more than 3,300 parking stalls. Nike recently released artists’ renderings of the completed expansion, which is estimated to open in 2018.

Nike’s two key competitors have a major local presence as well. Those employers include the North American headquarters of Adidas’ with 1,200 employees, and a new 70,000 SF outpost of Under Armour. Under Armour has moved 100 employees into an iconic former YMCA.

HEALTHCARE AND RESEARCHHealth services are another major employment sector for the Portland area. The top healthcare employers in the area are Providence Health Systems, with 17,543 employees, and The Oregon Health Sciences University (OHSU), with 16,200 workers. OSHU is the recent recipient of a total of $1 billion in donations for cancer research from over 10,000 Oregon donors. Grants from the National Institutes of Health totaled $182.7 million in 2016.

MANUFACTURINGIn trucking and transportation, Daimler Trucks—with nearly 3,000 area workers—has big plans for the Portland area. The company recently spent $150 renovating its Portland facility and invests heavily in research and development, including autonomous driving.

PORTLAND MARKET SNAPSHOTMAJOR EMPLOYERS


OPERATIONS ANALYSISKINNEMAN SQUARE • 12 UNITS • BEAVERTON, OREGON

Income Current Scheduled Rents Projected Operations Notes

Scheduled Gross Rent $180,058 $15,005 $189,360 $15,780 1

Less: Vacancy/Credit Loss -$9,003 -$750 -5.0% -$9,468 -$789 -5.0% 2

Net Rental Income $171,055 $14,255 $179,892 $14,991

Other Income $11,858 $988 $11,858 $988 3Includes: Utility Billing (RUBs) $7,158 $597 $7,158 $597Includes: Miscellaneous $4,188 $349 $4,188 $349

Gross Operating Income $182,912 $15,243 $191,750 $15,979

Expenses Projected Operations

Per Unit % GOI Projected Operations

Per Unit % GOI

Real Estate Taxes $13,480 $1,123 7.4% $13,480 $1,123 7.0% 4

Insurance $2,808 $234 1.5% $2,808 $234 1.5% 5

Total Utilities $16,942 $1,412 9.3% $16,942 $1,412 8.8% 6

Fee Management $14,633 $1,219 8.0% $15,340 $1,278 8.0% 7

Landscaping $3,979 $332 2.2% $3,979 $332 2.1%

Maintenance/Repairs $6,600 $550 3.6% $6,600 $550 3.4%

Turnover $2,100 $175 1.1% $2,100 $175 1.1%

Reserves $3,000 $250 1.6% $3,000 $250 1.6% 8Total Expenses -$63,542 -$64,249

Expenses per Unit -$5,295 -$5,354

% of Gross Operating Income 35% 34%

Net Operating Income (NOI) $119,370 $127,501


1. RENTS Rents are based on a June 2018 rent roll. Current scheduled rents average $1,250 per unit or $1.28 per sq ft. The projected rents are based on the most recently signed leases at the highest achieved rate. Projected rents average $1,315 or $1.35 per square foot.

2. VACANCY, CONCESSIONS, AND BAD DEBT/RECOVERY

Kinneman Square experienced above market-rate vacancy due to the renovations at the property. The projected operations stabilized the vacancy at 5.0%.

3. OTHER INCOME Other Income includes administrative fees, month-to-month income, laundry income and utility charges (RUBs). Projected other income totals $11,858.

RENT ROLL ANALYSIS: MARKET RENTS

Unit Type Unit Count

Square Feet

Average Scheduled

Rents

Average Scheduled

Rents per Sq Ft

Average Market Rent

Average Market Rent

per Sq Ft

% Change

2 Bedroom / 1.5 Bathroom Townhome 12 975 $1,250 $1.28 $1,315 $1.35 4.9%Totals / Averages 12 975 $1,250 $1.28 $1,315 $1.35 4.9%



4. PROPERTY TAXESOregon’s property taxes are evaluated on a fiscal year starting July 1. Property tax values for the 2017-2018 tax year are published October 15. Projected operations include current taxes for the 2017-2018 property tax year.

In Oregon, property taxes are not reassessed on sale and are limited to a 3% annual increase at the state level. The gross property taxes for Kinneman Square total $13,480. Property taxes paid prior to November 15th each year receive a 3% discount. Most investors take advantage of this discount. The 2018-2019 tax year starts July 1. Therefore gross taxes are used in the projected operations in anticipation of pending assessments for the next tax cycle.

5. INSURANCE Property insurance reflects the current policy premium of $2,808 annually or $234 per unit.

6. UTILITIES Utilities have been adjusted for garbage costs. The garbage expense is above market rate, in part, due to the on-going renovations and hauling charges. Projected utilities total $16,942 annually or $1,412 per unit.

7. MANAGEMENT FEE The fee management includes administration, advertising, and payroll costs. The management fee has been adjusted to reflect costs for a property that is managed by an independent, third-party management company. The total management cost totals $14,633 or 8% of GOI (Gross Operating Income).

8. RESERVES Lenders require reserves be set aside to address future capital costs associated with any property as it ages. The projected operations include reserves of $250 per unit or $3,000 annually.


TAX HISTORYTax Year 2016/2017 2017/2018Account #

R208000 13,395 13,480

Total $13,395 $13,480

% Change 6.33% 0.63%


KINNEMAN SQUARE

PRICINGPrice $2,220,000

Price Per Unit $185,000

Per Square Foot $190

Cap Rate 5.38%

TOURS AND INQUIRIES Please do not disturb tenants.

All tours and inquiries regarding Kinneman Square are to be directed to HFO Investment Real Estate at (503) 241.5541.

Rob Marton • [email protected]

Greg Frick • [email protected]

Jack Stephens • [email protected]

Tyson Cross • [email protected]

Lee Fehrenbacher • [email protected]

Todd Tully • [email protected]

Adam Smith • [email protected]

Brokers licensed in Oregon and Washington.

ASSET SUMMARYProperty Kinneman SquareLocation 4445 SW 188th Avenue

Beaverton, OR 97007County WashingtonTotal Units 12Year Built 1974Average Sq Ft 975

12 UNITS • BEAVERTON, OREGON


HFO Investment Real Estate

2424 SE 11th Avenue • Portland, OR 97214www.hfore.com • 503.241.5541

Passion • Collaboration • Specialization

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed or implied, as to the accuracy of the information. References to square footage or age are approximate. Buyer must verify the information and bears all risk for any inaccuracies. Parties who receive this information from unauthorized parties shall not be recognized. ©2018 HFO Investment Real Estate LLC. Build your legacy is a service mark of HFO

Investment Real Estate. Licensed in the states of Oregon and Washington.

kinneman square - loopnet...located here, and hillsboro’s airport is the second-largest in oregon....

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