offering memorandum sonterra professional building

KW COMMERCIAL

1102 E. Sonterra Blvd, Suite 106

San Antonio, TX 78258LUKE LEGRANDAgent0 210.482.3200C [email protected]

Sonterra Professional Building

OFFERING MEMORANDUM

PRESENTED BY:

SAN ANTONIO, TX 78258

OFFERING MEMORANDUM

www.kwcommercial.com 2

KW COMMERCIAL

1102 E. Sonterra Blvd, Suite 106

San Antonio, TX 78258

Confidentiality & Disclaimer

LUKE LEGRANDAgent0 210.482.3200C [email protected]

All materials and information received or derived from KW Commercial its directors, officers, agents, advisors, affiliates and/or any third partysources are provided without representation or warranty as to completeness , veracity, or accuracy, condition of the property, compliance orlack of compliance with applicable governmental requirements, developability or suitability, financial performance of the property, projectedfinancial performance of the property for any party’s intended use or any and all other matters.

Neither KW Commercial its directors, officers, agents, advisors, or affiliates makes any representation or warranty, express or implied, as toaccuracy or completeness of the materials or information provided, derived, or received. Materials and information from any source, whetherwritten or verbal, that may be furnished for review are not a substitute for a party’s active conduct of its own due diligence to determine theseand other matters of significance to such party. KW Commercial will not investigate or verify any such matters or conduct due diligence for aparty unless otherwise agreed in writing.

EACH PARTY SHALL CONDUCT ITS OWN INDEPENDENT INVESTIGATION AND DUE DILIGENCE.

Any party contemplating or under contract or in escrow for a transaction is urged to verify all information and to conduct their own inspectionsand investigations including through appropriate third party independent professionals selected by such party. All financial data should beverified by the party including by obtaining and reading applicable documents and reports and consulting appropriate independentprofessionals. KW Commercial makes no warranties and/or representations regarding the veracity, completeness, or relevance of any financialdata or assumptions. KW Commercial does not serve as a financial advisor to any party regarding any proposed transaction.

All data and assumptions regarding financial performance, including that used for financial modeling purposes, may differ from actual data orperformance. Any estimates of market rents and/or projected rents that may be provided to a party do not necessarily mean that rents can beestablished at or increased to that level. Parties must evaluate any applicable contractual and governmental limitations as well as marketconditions,vacancy factors and other issues in order to determine rents from or for the property. Legal questions should be discussed by theparty with an attorney. Tax questions should be discussed by the party with a certified public accountant or tax attorney. Title questions shouldbe discussed by the party with a title officer or attorney. Questions regarding the condition of the property and whether the property complieswith applicable governmental requirements should be discussed by the party with appropriate engineers, architects, contractors, otherconsultants and governmental agencies. All properties and services are marketed by San Antonio Legacy Group in compliance with allapplicable fair housing and equal opportunity laws.

We obtained the information above from sources we believe to be reliable. However, we have not verified its accuracy and make no guarantee, warranty orrepresentation about it. It is submitted subject to the possibility of errors, omissions, change of price, rental or other conditions, prior sale, lease or financing, orwithdrawal without notice. We include projections, opinions, assumptions or estimates for example only, and they may not represent current or future performance ofthe property. You and your tax and legal advisors should conduct your own investigation of the property and transaction.

OFFERING MEMORANDUM

PRESENTED BY:

SAN ANTONIO, TX

http://www.kwcommercial.com


PROPERTY INFORMATION

1 | PROPERTY INFORMATION

EXECUTIVE SUMMARY

PROPERTY DETAILS

ADDITIONAL PHOTOS

ADDITIONAL PHOTOS

TENANT PROFILES

ADDITIONAL PHOTOS

ADDITIONAL PHOTOS

TENANT PROFILES

ADDITIONAL PHOTOS

1PROPERTY INFORMATIONSONTERRA PROFESSIONAL BUILDING

OFFERING MEMORANDUM


Executive Summary

SONTERRA PROFESSIONAL BUILDING 1 | PROPERTY INFORMATION

PROPERTY OVERVIEWThis nicely finished and well maintained 17,119 square foot officebuilding is located directly across the street from Stone OakMethodist Hospital near Loop 1604 and HWY 281. The SonterraProfessional Building is ideal for an investor looking to acquire aproperty located in a desirable area with a long term tenant in place.Keller Williams Legacy has occupied the majority of the space sinceconstruction was completed in February of 2005 and will sign a newten year lease upon closing of the sale. The remaining space inoccupied by Supreme Lending who has just recently signed a newthree year lease. Supreme Lending's space has been completelyrenovated recently with high end finishes. The building features arock and stucco exterior with a metal roof.

PROPERTY FEATURESIdeal location with easy access to Loop 1604 and Hwy 281

Countless Dining and Quick Service Restaurants Nearby

Total Population within 5 miles is 182,811

Average Household Income within 5 Miles is $100,353

Average House Value within 5 Miles is $260,253

SALE PRICE: $6,000,000

CAP RATE: 6.89%

NOI: $413,426

LOT SIZE: 1.47 Acres

BUILDING SIZE: 17,119 SF

BUILDING CLASS: B

YEAR BUILT: 2005

ZONING: C3

MARKET: San Antonio

SUB MARKET: Far North Central



Property Details



PROPERTY NAME: Sonterra Professional Building

STREET ADDRESS: 1102 E. Sonterra Blvd.

CITY, STATE, ZIP: San Antonio, TX 78258

PROPERTY TYPE: Office

APN: 17225-003-0050

LOT SIZE: 1.47 AC

BUILDING CLASS: B

ZONING: C3

PARKING SPACES: 64

PARKING RATIO: 3.63

CROSS STREETS: Sonterra Blvd & Hardy Oak

YEAR BUILT: 2005

NUMBER OF STORIES: 1



Keller Williams Legacy Lease Space




Additional Photos Of Keller Williams Space



• Training Magazine ranks KW #1 training

organization across all industries

• Forbes ranks KW #3 on list of Happiest

Companies to Work for in 2017

• Entrepreneur Magazine Moved KW up 63

spots on Franchise 500 list of top

franchises

Tenant Profiles


Keller Williams Legacy

Keller Williams Legacy has occupied the majority of the building since its completion in 2005 and willsign a new 10 year lease with 3 five year renewal options prior closing and funding of the sale. Leaseto be executed will be a NNN lease with Landlord responsibilities to include roof and structure.

Keller Williams Legacy is one of three Keller Williams franchises located in San Antonio, TX and hometo over 300 real estate agents.

Founded in 1983 in Austin, Texas, Keller Williams had a total of 32 agents that year who closed $28million in volume. Keller Williams has now surged past industry giants like RE/MAX, Coldwell Banker,and Berkshire Hathaway HomeServices to become the number one real estate franchise in agentcount, closed units, and closed sales volume in the United States. In 2017, the company’s 155,000U.S. agents closed more than 1 million units, generating more than $300 billion in sales revenue. Thisachievement in growth and volume is driven by the commitment and excellence of Keller Williams’agents and is among many the company has enjoyed.

At the core of Keller Williams' success lies the commitment to shared prosperity – a priority forgedmore than 30 years ago in that first ALC meeting. Each month, market centers share roughly half oftheir profit with the team members who helped achieve those gains. Since the inception of the profitshare program, Keller Williams has distributed more than $1 billion to associates who have helped thecompany grow. In 2017, the company distributed more than $174 million. In just the past four years,profit sharing has totaled more than in the preceding 21 years combined. As more agents and teamshave joined Keller Williams' ranks, the company has continued its climb, leading to its currentposition as the U.S. leader in agent count, closed units, and closed sales volume.

In the San Antonio market in 2017, the three Keller Williams offices closed 13,881 transactionstotaling $3.436 billion in sales volume surpassing its closest competition by over $2.2 billion in salesvolume . Keller Williams has a 20% market share in the San Antonio market with its closetcompetition being Re/Max at 7.16% market share, Coldwell Banker at 4.52% market share, andHome Team at 2.42% market share. Of the top five real estate offices in San Antonio, Keller Williamstook the top three spots.

Keller Williams Legacy Agent Count & Sales Volume By Year Since 19991999 - 27 Agents - $66M in written sales2000 - 43 Agents - $122M in written sales2001 - 52 Agents - $111M in written sales2002 - 78 Agents - $151M in written sales2003 - 113 Agents -$223M in written sales2004 - 153 Agents -$302M in written sales2005 - 144 Agents -$351M in written sales2006 - 184 Agents -$422M in written sales2007 - 207 Agents -$389M in written sales2008 - 211 Agents -$326M in written sales2009 - 222 Agents -$307M in written sales2010 - 212 Agents -$325M in written sales2011 - 210 Agents -$323M in written sales2012 - 215 Agents -$351M in written sales2013 - 208 Agents -$434M in written sales2014 - 261 Agents -$474M in written sales2015 - 279 Agents -$617M in written sales2016 - 302 Agents -$676M in written sales2017 - 323 Agents -$799M in written sales

KELLER WILLIAMS 2017 AWARDS




Supreme Lending Lease Space




Additional Photos Of Supreme Lending Lease Space



• Mortgage Executives Rank Supreme

Lending in the top 100 mortgage

companies in America over the last 6 years

• Supreme Lending ranks 23rd in top overall

volume

• Supreme Lending rank 16th in top retail

volume

Tenant Profiles


Supreme Lending

Supreme Lending has just recently signed a new three year lease that willexpire in June of 2021 showing their commitment to the space. In addition,Supreme Lending has two (2) 36 month options to extend at market rent.The current lease with Supreme Lending is at $20.27/RSF which bumps to$20.98/RSF in June of 2019. Due to Supreme Lending's investment into thespace they were able to obtain a rental rate approximately 20% belowmarket. Landlord responsibilities in Supreme Lending's lease include roof,structure, fire sprinkler system maintenance, landscaping maintenance,parking lot, plumbing and electrical systems, & pest control. SupremeLending has 8 parking spots dedicated to their space per the lease.

Supreme Lending, one of the most respected Mortgage Bankers, wasestablished in 1999 by Scott Everett. Having an extensive business andmortgage background, Mr. Everett has secured the respect of mortgageprofessionals and is committed to attracting not only the most professionalloan officers but also the most cutting-edge loan products. With itsheadquarter located in Dallas, TX, Supreme Lending has an estimated 1,336employees and $306.5M in revenue. Supreme continues to grow by addingbranches, loan officers and support staff throughout the United States. WithSupreme Lending’s ever-expanding branch network and expert mortgageprofessionals, they take pride in offering their customers a wide variety ofloan products and committed to helping them achieve their dream of homeownership.

Supreme Lending is a mortgage originator and has built a level of trust withtheir investors, which translates into Supreme Lending’s ability tounderwrite, close, and fund loans that investors will buy. For the consumer itmeans low interest rates and closing costs, with fast turnaround time. Allloans are handled by licensed mortgage originators who personalize theloan process, while providing timely and informed communication with thecustomer.

The Supreme culture is one where the customer comes first. It is SupremeLending’s goal to build customers for life by helping home buyers achievetheir dreams. Supreme can offer competitive rates because it isstructured as a banker. They also have strong, lasting relationships with theinvestors that purchase their loans.

TENANT HIGHLIGHTS




Common Areas



LOCATION INFORMATION

2 | LOCATION INFORMATION

REGIONAL MAP

LOCATION MAPS

ADDITIONAL PHOTOS

ADDITIONAL PHOTOS

ADDITIONAL PHOTOS

ADDITIONAL PHOTOS

2LOCATION INFORMATIONSONTERRA PROFESSIONAL BUILDING

OFFERING MEMORANDUM

1102 E. Sonterra Blvd.

Regional Map

SONTERRA PROFESSIONAL BUILDING 2 | LOCATION INFORMATION




Location Maps




Aerial Photos




Additional Aerial Photos



DEMOGRAPHICS

3 | DEMOGRAPHICS

DEMOGRAPHICS MAP

3DEMOGRAPHICSSONTERRA PROFESSIONAL BUILDING

OFFERING MEMORANDUM


* Demographic data derived from 2010 US Census

Demographics Map

SONTERRA PROFESSIONAL BUILDING 3 | DEMOGRAPHICS

ETHNICITY 1 MILE 3 MILES 5 MILES

% HISPANIC 26.4% 28.3% 30.6%

RACE 1 MILE 3 MILES 5 MILES

% WHITE 84.5% 84.4% 84.1%

% BLACK 3.0% 3.5% 3.8%

% ASIAN 5.7% 4.7% 4.1%

% HAWAIIAN 0.0% 0.0% 0.0%

% INDIAN 0.2% 0.5% 0.6%

% OTHER 4.3% 4.2% 4.9%

POPULATION 1 MILE 3 MILES 5 MILES

TOTAL POPULATION 6,395 72,165 182,811

MEDIAN AGE 38.2 36.8 36.2

MEDIAN AGE (MALE) 36.9 36.5 35.6

MEDIAN AGE (FEMALE) 39.3 37.3 36.7

HOUSEHOLDS & INCOME 1 MILE 3 MILES 5 MILES

TOTAL HOUSEHOLDS 2,416 27,276 69,725

# OF PERSONS PER HH 2.6 2.6 2.6

AVERAGE HH INCOME $104,895 $105,391 $100,353

AVERAGE HOUSE VALUE $264,674 $253,005 $260,253


FINANCIAL ANALYSIS

4 | FINANCIAL ANALYSIS

RENT ROLL

INCOME & EXPENSES

FINANCIAL SUMMARY

4FINANCIAL ANALYSISSONTERRA PROFESSIONAL BUILDING

OFFERING MEMORANDUM

Rent Roll

SONTERRA PROFESSIONAL BUILDING 4 | FINANCIAL ANALYSIS

TENANTNAME

UNITNUMBER

UNITSIZE (SF)

LEASESTART

LEASEEND

ANNUALRENT

% OFBUILDING

PRICEPER SF/YR

Keller Williams Legacy 106 14,163 2/1/05 2/1/29 $353,508 81.18 $24.96

Supreme Lending 103 2,956 12/1/16 6/30/21 $59,918 16.94 $20.27

TOTALS/AVERAGES 17,119 $413,426 $24.15



INCOME SUMMARY SONTERRA PROFESSIONAL BUILDING PER SF

Keller Williams Legacy Lease $353,508 $20.26

Supreme Lending Lease $59,918 $3.43

CAM & Expense Reimbursements $151,246 $8.67

GROSS INCOME $564,673 $32.37

EXPENSE SUMMARY SONTERRA PROFESSIONAL BUILDING PER SF

Common Area & Exterior Maintenance $8,402 $0.48

Insurance $5,973 $0.34

Management & Professional Fees $8,480 $0.49

Association Dues $4,286 $0.25

Taxes $94,202 $5.40

Utilities $11,196 $0.64

Repairs & Maintenance $13,032 $0.75

Miscellaneous / Security System Install $5,672 $0.33

GROSS EXPENSES $151,246 $8.67

NET OPERATING INCOME $413,426 $23.70

Income & Expenses




INVESTMENT OVERVIEW SONTERRA PROFESSIONAL BUILDING

Price $6,000,000

Price per SF $343.90

CAP Rate 6.89%

Cash-on-Cash Return (yr 1) 6.89 %

Total Return (yr 1) $413,426

Debt Coverage Ratio -

OPERATING DATA SONTERRA PROFESSIONAL BUILDING

Gross Scheduled Income $413,426

CAM & NNN Reimbursment $151,246

Total Scheduled Income $564,673

Vacancy Cost $0

Gross Income $564,673

Operating Expenses $151,246

Net Operating Income $413,426

Pre-Tax Cash Flow $413,426

FINANCING DATA EXAMPLE @ 70/30 LTV - 5% INTEREST WITH 20 YR AMORTIZATION SONTERRA PROFESSIONAL BUILDING

Down Payment $1,800,000

Loan Amount $4,200,000

Debt Service Annual $332,617.68

Debt Service Monthly $27,718.14

Principal Reduction (yr 1) $115,248.94

Financial Summary




ADDITIONAL INFORMATION

5 | ADDITIONAL INFORMATION

ADDITIONAL PHOTOS

FLOOR PLANS

FLOOR PLANS

FLOOR PLANS

FLOOR PLANS

SITE PLAN

CITY INFORMATION

INFORMATION ABOUT BROKERAGE SERVICES

5ADDITIONAL INFORMATIONSONTERRA PROFESSIONAL BUILDING

OFFERING MEMORANDUM


Exterior Photos

SONTERRA PROFESSIONAL BUILDING 5 | ADDITIONAL INFORMATION


Overall Floor Plan




KW Legacy Floor Plan - 13,142 SF OR 14,163 RSF




Supreme Lending Floor Plan-2743 SF OR 2,956 RSF




Common Areas - 1234 SF




Site Plan




City Information



San Antonio, TX

San Antonio is the seventh largest city in the United States, with an estimated 2017

city population of over 1,500,000 and an estimated 2017 metro area population of

over 2,500,000. This metro area, known as Greater San Antonio, is continuously

expanding and has become one of the three fastest growing areas in the country.

The major employers in San Antonio help drive the city’s dynamic and diverse

economy with a healthy mix of business services and a rapidly growing biomedical

and biotechnology sector. San Antonio boasts an emerging new energy economy

and a varied manufacturing sector, producing goods that range from aircraft to

semiconductors to trucks, to name a few. Located in the southwest corner of The

Texas Triangle, San Antonio has historically been the economic hub of the region.

Many corporations have relocated to the Greater San Antonio Area, which is the

home of several Fortune 500 Companies like Valero Energy Corp., Tesoro

Corporation, USAA, CST Brands Inc., NuStar Energy, and Clear Channel

Communications as well as the Methodist Healthcare System and four military

bases. San Antonio’s economy is focused primarily within military, healthcare,

government civil service, oil and gas, tourism, financial services, cybersecurity,

aerospace, and automobiles. Recent companies to have expanded into this

market, which have added to the demand for housing, include Petco, Oracle,

Microsoft, Boeing, Toyota, and Medtronic. Also, large private companies such as

H-E-B, the 14th largest private company in the United States, create a bigger

demand for housing. San Antonio’s employment in 2016 was approximately

1,100,000, compared to 990,000 one year prior. The city’s unemployment rate is

3.2%, down from 3.7% one year ago, and lower than the national average of 5.0%

and the national average from a year ago of 5.7%.


11-2-2015

Information About Brokerage Services Texas law requires all real estate license holders to give the following informaƟon about

brokerage services to prospecƟve buyers, tenants, sellers and landlords.

TYPES OF REAL ESTATE LICENSE HOLDERS: .• A BROKER is responsible for all brokerage acƟviƟes, including acts performed by sales agents sponsored by the broker. • A SALES AGENT must be sponsored by a broker and works with clients on behalf of the broker.

A BROKER’S MINIMUM DUTIES REQUIRED BY LAW (A client is the person or party that the broker represents): • Put the interests of the client above all others, including the broker’s own interests; • Inform the client of any material informaƟon about the property or transacƟon received by the broker; • Answer the client’s quesƟons and present any offer to or counter-offer from the client; and • Treat all parƟes to a real estate transacƟon honestly and fairly.

A LICENSE HOLDER CAN REPRESENT A PARTY IN A REAL ESTATE TRANSACTION:

AS AGENT FOR OWNER (SELLER/LANDLORD): The broker becomes the property owner's agent through an agreement with the owner, usually in a wriƩen lisƟng to sell or property management agreement. An owner's agent must perform the broker’s minimum duƟes above and must inform the owner of any material informaƟon about the property or transacƟon known by the agent, including informaƟon disclosed to the agent or subagent by the buyer or buyer’s agent.

AS AGENT FOR BUYER/TENANT: The broker becomes the buyer/tenant's agent by agreeing to represent the buyer, usually through a wriƩen representaƟon agreement. A buyer's agent must perform the broker’s minimum duƟes above and must inform the buyer of any material informaƟon about the property or transacƟon known by the agent, including informaƟon disclosed to the agent by the seller or seller’s agent.

AS AGENT FOR BOTH - INTERMEDIARY: To act as an intermediary between the parƟes the broker must first obtain the wriƩen agreement of each party to the transacƟon. The wriƩen agreement must state who will pay the broker and, in conspicuous bold or underlined print, set forth the broker's obligaƟons as an intermediary. A broker who acts as an intermediary:

• Must treat all parƟes to the transacƟon imparƟally and fairly; • May, with the parƟes' wriƩen consent, appoint a different license holder associated with the broker to each party (owner and

buyer) to communicate with, provide opinions and advice to, and carry out the instrucƟons of each party to the transacƟon. • Must not, unless specifically authorized in wriƟng to do so by the party, disclose: ᴑ that the owner will accept a price less than the wriƩen asking price; ᴑ that the buyer/tenant will pay a price greater than the price submiƩed in a wriƩen offer; and ᴑ any confidenƟal informaƟon or any other informaƟon that a party specifically instructs the broker in wriƟng not to

disclose, unless required to do so by law.

AS SUBAGENT: A license holder acts as a subagent when aiding a buyer in a transacƟon without an agreement to represent the buyer. A subagent can assist the buyer but does not represent the buyer and must place the interests of the owner first.

TO AVOID DISPUTES, ALL AGREEMENTS BETWEEN YOU AND A BROKER SHOULD BE IN WRITING AND CLEARLY ESTABLISH: • The broker’s duƟes and responsibiliƟes to you, and your obligaƟons under the representaƟon agreement. • Who will pay the broker for services provided to you, when payment will be made and how the payment will be calculated.

LICENSE HOLDER CONTACT INFORMATION: This noƟce is being provided for informaƟon purposes. It does not create an obligaƟon for you to use the broker’s services. Please acknowledge receipt of this noƟce below and retain a copy for your records.

Licensed Broker /Broker Firm Name or Primary Assumed Business Name

License No. Email Phone

Designated Broker of Firm License No. Email Phone

Licensed Supervisor of Sales Agent/Associate

License No. Email Phone

Sales Agent/Associate’s Name License No. Email Phone

Regulated by the Texas Real Estate Commission

Buyer/Tenant/Seller/Landlord Initials

InformaƟon available at www.trec.texas.gov IABS 1-0

Date

TAR 2501

Keller Williams Legacy 504634 [email protected] 210-482-3200

Steven Gragg 315971 [email protected] 210-482-3200

Lisa LeGrand [email protected]

[email protected] LeGrand 210-843-5853

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offering memorandum sonterra professional building

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