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Exclusively Presented By:

Roanoke Apartment Homes502-518 E ROANOKE AVENUE, PHOENIX, AZ

KLCommercialGroup.com

ROANOKE APARTMENT HOMES

Senior [email protected]

SCOTT TREVEY, CCIMSenior Associate [email protected]

ARVLE KNIGHT, CCIM

CONFIDENTIAL OFFERING MEMORANDUMExclusively presented by


TABLE OF CONTENTS

2

5Executive Summary6Property Description7Property Details8Complete Highlights9Additional Photos

PROPERTY INFORMATION

11Location Maps12Aerial Maps13Site Plan

LOCATION INFORMATION

15Financial Summary16Investment Summary17Income & Expenses18Rent Roll19Unit Mix Summary

FINANCIAL ANALYSIS

21Sale Comps23Sale Comps Summary24Sale Comps Map

SALE COMPARABLES

26Demographics Map & ReportDEMOGRAPHICS

CONTENTS

3


DISCLAIMER

CONFIDENTIALITY & DISCLAIMER

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

Neither Kasten Long Commercial Group its directors, officers, agents, advisors, or affiliates makes any representation or warranty, express orimplied, as to accuracy or completeness of the any materials or information provided, derived, or received. Materials and information from anysource, whether written or verbal, that may be furnished for review are not a substitute for a party’s active conduct of its own due diligence todetermine these and other matters of significance to such party. Kasten Long Commercial Group will not investigate or verify any such mattersor conduct due diligence for a party 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. Kasten Long Commercial Group makes no warranties and/or representations regarding the veracity, completeness, or relevanceof any financial data or assumptions. Kasten Long Commercial Group does not serve as a financial advisor to any party regarding any proposedtransaction. All data and assumptions regarding financial performance, including that used for financial modeling purposes, may differ fromactual data or performance. Any estimates of market rents and/or projected rents that may be provided to a party do not necessarily mean thatrents can be established at or increased to that level. Parties must evaluate any applicable contractual and governmental limitations as well asmarket conditions,vacancy factors and other issues in order to determine rents from or for the property.

Legal questions should be discussed by the party with an attorney. Tax questions should be discussed by the party with a certified publicaccountant or tax attorney. Title questions should be discussed by the party with a title officer or attorney. Questions regarding the condition ofthe property and whether the property complies with applicable governmental requirements should be discussed by the party with appropriateengineers, architects, contractors, other consultants and governmental agencies. All properties and services are marketed by Kasten LongCommercial Group in compliance with all applicable fair housing and equal opportunity laws.




SECTION 1

PROPERTY INFORMATION

5

PROPERTY HIGHLIGHTS

• Mix of one-bed, two-bed and efficiency floor plans

• New in-suite washer-dryers

• Low-density garden-style setting

• Fenced private back yards

• Lush landscaping and courtyards

• New roofs

• New energy efficient windows

• New electrical service panels

• Copper plumbing

• Exterior makeover: Paint & Landscaping

• New Doors and Windows

• Most units heavily upgraded

• Upside in rents


SECTION 1. PROPERTY INFORMATION

OFFERING SUMMARY

Offering Price: $2,369,000

Number Of Units: 15

Cap Rate: 5.35%

NOI: $126,711

Lot Size: 0.75 Acres

Building Size: 9,035 SF

Year Built: 1955

Renovated: 2018

Zoning: M-H, R-4

Market: Midtown

Sub Market: Phoenix CountryClub

Cross Streets: Thomas and Central

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PROPERTY OVERVIEW

The Roanoke Apartment Homes offer one-bedroom,two-bedroom and efficiency floor plans. This nicely updatedmid-century modern property provides a unique blend ofrefined city living and sophisticated nightlife at the core ofMidtown Phoenix. Significant recent system upgrades includeall new electric service panels, upgraded freshwater supplylines, new roofs, many new AC units, exterior and landscapemakeover, new parking lots, mailboxes, lighting, and upgradedlit covered parking. Most unit interiors have received extensiveremodeling to include new flooring, service panels, cabinets,counters, appliances, fans, fixtures, doors, windows and trim.Nine (9) of the units have been extensively updated, and two(2) more have recently been reconstructed to a contemporarystandard. This leaves 4 'period correct' units for newownership to upgrade for maximum return. Two of these are2-bedroom/2-bath units. While some units are currentlyrented at or near market rents, there are others withsignificant rent upside.

LOCATION OVERVIEW

Located in the Midtown neighborhood between Park Centraland the Phoenix Country Club, The Roanoke ApartmentHomes provide easy access to local businesses, art andculture.

LOCATION DEMAND

Surrounded by office, retail, recreation, museums, nightlifeand fine dining the Roanoke Apartment Homes offer tenantsthe quiet enjoyment of single-level residency with maturetrees, private back yards and updated interiors. Close toeverything, and at a fraction of the rent charged at the newmulti-story apartments, the Roanoke Apartment Homes arethe first choice for mid-town living.

UPSIDE

With tenancy wait lists for occupancy there is easy upside inrent at the property. Value-add can be as simple as adjustingrents to market.

.



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PROPERTY NAME: Roanoke Apartment Homes

PROPERTY ADDRESS: 502-518 E Roanoke AvenuePhoenix, AZ 85004

APN: 118-45-017, 118-45-017-A, 118-45-018, 118-45-018-A

PRICE / SF: $262.20

LOT SIZE: 0.75 AC

BUILDING SIZE: 9,035 SF

BUILDING CLASS: C

ZONING: M-H, R-4

PARKING SPACES: 21

YEAR BUILT: 1955

NUMBER OF STORIES: 1

FOUNDATION: Concrete Slab

WALLS: Block

NUMBER OF UNITS: 15

ROOF: Composition Asphalt



8

PROPERTY HIGHLIGHTS

• Mix of one-bed, two-bed and efficiency floor plans

• Low-density garden-style setting

• Fenced private back yards

• Lush landscaping and courtyards

• New roofs

• New electrical service panels

• Copper plumbing

• Exterior makeover: Paint & Landscaping

• New Doors and Windows

• Most units heavily upgraded

• Upside in rents

• Covered parking

• Premium Mid-town location



9






SECTION 2

LOCATION INFORMATION

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SECTION 2. LOCATION INFORMATION

12



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SECTION 3

FINANCIAL ANALYSIS

15

INVESTMENT OVERVIEW CURRENT RENTS MARKET RENTS

Price $2,369,000 $2,369,000

Price per Unit $157,933 $157,933

GRM 13.8 13.0

CAP Rate 5.4% 5.8%

Cash-on-Cash Return (yr 1) 2.82 % 4.23 %

Total Return (yr 1) $44,517 $54,606

Debt Coverage Ratio 1.19 1.28

OPERATING DATA CURRENT RENTS MARKET RENTS

Gross Scheduled Income $171,780 $182,400

Other Income $500 $500

Total Scheduled Income $163,691 $173,780

Vacancy Cost $8,589 $9,120

Gross Income $163,691 $173,780

Operating Expenses $36,980 $36,980

Net Operating Income $126,711 $136,800

Pre-Tax Cash Flow $20,007 $30,096

FINANCING DATA CURRENT RENTS MARKET RENTS

Down Payment $710,700 $710,700

Loan Amount $1,658,300 $1,658,300

Debt Service $106,704 $106,704

Debt Service Monthly $8,892 $8,892

Principal Reduction (yr 1) $24,510 $24,510


SECTION 3. FINANCIAL ANALYSIS

502-518 E Roanoke Avenue, Phoenix, AZ, 85004

UNITS: 15

LOT SIZE: 0.75 AC

BUILDING SIZE: 9,035 SF

PARCEL: 118-45-017, 118-45-017-A, 118-45-018,118-45-018-A

COOLING/HEATING: Individual package units

PARKING: 21

ROOF: Composition Asphalt

CONSTRUCTION: Block

BUILT: 1955

UTILITIES: Individually Metered Electric

ZONING: M-H, R-4

LAUNDRY: in unit and on-site

Directions: Central Avenue to Thomas Road, east to 5thStreet, south to property.

SITE INFORMATION

PROPERTY DESCRIPTION

The Roanoke Apartment Homes offer efficiency, one-bedroom, andtwo-bedroom floor plans. This nicely updated mid-century modern propertyprovides a unique blend of refined city living and sophisticated nightlife atthe core of Midtown Phoenix. Significant recent system upgrades include allnew electric service panels, upgraded freshwater supply lines, new roofs,many new AC units, new energy efficient windows, exterior and landscapemakeover, new parking lots, mailboxes, lighting, and upgraded lit coveredparking. Most unit interiors have received extensive remodeling to includenew flooring, service panels, cabinets, counters, appliances, fans, fixtures,doors, windows and trim. Nine (9) of the units have been extensivelyupdated, and two (2) more have recently been reconstructed to acontemporary standard. This leaves 4 'period correct' units for newownership to upgrade for maximum return. Two of these are 2-bedroom/2-bath units. While some units are currently rented at or near market rents,there are others with significant rent upside.

Located in the Midtown neighborhood between Park Central and the PhoenixCountry Club, The Roanoke Apartment Homes provide easy access to localbusinesses, art and culture.

$2,369,000 Offering Price$710,700 Down Payment

$1,658,300 Proposed Loan (4.99%)

Projected Cash Flow$136,800 NOI

- $106,704 Loan Payments$30,096 Annual Cash Flow

Return on Investment$30,096 / $710,700 4.23% (Cash on Cash)

INCOME & EXPENSESCURRENT PROFORMA

Units Mix Size (sf) Rent Rent/sf Total Rent Total

2 2/1 Basic 860 $827 $0.96 $1,654 $1,050 $2,1002 1/1 Basic 635 $773 $1.22 $1,546 $900 $1,8002 1/1 Ins Renov 635 $921 $1.45 $1,842 $1,000 $2,0006 1/1 Renovated 635 $1,129 $1.78 $6,774 $1,150 $6,9001 0/1 Renovated 380 $800 $2.11 $800 $800 $8002 0/1 Renovated 300 $800 $2.67 $1,600 $800 $1,600

15 9,050 14,216 15,200

Current Rents Market RentsGross Monthly Income $14,315 $15,200Gross Rents $171,780 $182,400

Other Income $500 $500Vacancy -$8,589 -$9,120

Gross Operating Income $163,691 $173,780Less Estimated Expenses -$36,980 -$36,980

Net Operating Income $126,711 $136,800

Estimated Annual ExpensesInsurance $3,195 $3,195Management $7,860 $7,860Repair & Maint $7,500 $7,500Utilities: Water & Sewer $10,880 $10,880Utilities: Electricity $695 $695Utilities: Gas $788 $788Utilities: Trash $1,731 $1,731Property Taxes $4,331 $4,331

TOTAL $36,980 $36,980

Per Unit / SF $2,465 / $4.09 $2,465 / $4.09

FINANCING AND INVESTMENT RETURN

Current Rents Proforma RentsOffering Price $2,369,000 $2,369,000Price / Unit $157,933 $157,933Price / sf $262.20 $262.20Cap Rate 5.4% 5.77%GRM 13.8 12.99

SALE INFORMATION



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INCOME SUMMARY CURRENT RENTS PER UNIT MARKET RENTS PER UNIT

Gross Rents $171,780 $11,452 $182,400 $12,160

Other Income $500 $33 $500 $33

Vacancy -$8,589 -$572 -$9,120 -$608

GROSS INCOME $163,691 $10,912 $173,780 $11,585

EXPENSE SUMMARY CURRENT RENTS PER UNIT MARKET RENTS PER UNIT

Insurance $3,195 $213 $3,195 $213

Management $7,860 $524 $7,860 $524

Repair & Maint $7,500 $500 $7,500 $500

Utilities: Water & Sewer $10,880 $725 $10,880 $725

Utilities: Electricity $695 $46 $695 $46

Utilities: Gas $788 $52 $788 $52

Utilities: Trash $1,731 $115 $1,731 $115

Property Taxes $4,331 $288 $4,331 $288

GROSS EXPENSES $36,980 $2,465 $36,980 $2,465

NET OPERATING INCOME $126,711 $8,447 $136,800 $9,120



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UNITNUMBER

UNITBED

UNITBATH

UNITSIZE (SF)

CURRENTRENT

CURRENTRENT (PER SF)

MARKETRENT

MARKETRENT/SF

502-1 Basic 2 1 860 $818 $0.95 $1,050 $1.22

502-2 Basic 1 1 635 $778 $1.23 $900 $1.42

502-3 (Ren) 1 1 635 $1,177 $1.85 $1,150 $1.81

504-4 (Ren) 0 1 300 $900 $3.00 $800 $2.67

506-5 Basic 2 1 860 $835 $0.97 $1,050 $1.22

506-6 (Ins) 1 1 635 $921 $1.45 $1,000 $1.57

506-7 (Ins) 1 1 635 $921 $1.45 $1,000 $1.57

512-4 Basic 1 1 620 $767 $1.24 $900 $1.45

512-5 (Ren) 1 1 645 $1,100 $1.71 $1,150 $1.78

512-6 (Ren) 1 1 635 $1,150 $1.81 $1,150 $1.81

512-7 (Ren) 0 1 380 $800 $2.11 $800 $2.11

518-1 (Ren) 1 1 635 $1,150 $1.81 $1,150 $1.81

518-2 (Ren) 1 1 635 $1,073 $1.69 $1,150 $1.81

518-3 (Ren) 1 1 635 $1,125 $1.77 $1,150 $1.81

518-4 (Ren) 0 1 300 $800 $2.67 $800 $2.67

Totals/Averages 9,045 $14,315 $1.58 $15,200 $1.78



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UNIT TYPE COUNT % TOTAL SIZE (SF) RENT RENT/SF MIN RENT MAX RENT MARKET RENT MARKET RENT/SF

2/1 Basic 2 13.3 860 $827 $0.96 $818.00 $835.00 $1,050 $1.22

1/1 Basic 2 13.3 635 $773 $1.22 $767.00 $778.00 $900 $1.42

1/1 Ins Renov 2 13.3 635 $921 $1.45 $921.00 $921.00 $1,000 $1.57

1/1 Renovated 6 40.0 635 $1,129 $1.78 $1,073.00 $1,177.00 $1,150 $1.81

0/1 Renovated 1 6.7 380 $800 $2.11 $800.00 $800.00 $800 $2.11

0/1 Renovated 2 13.3 300 $800 $2.67 $800.00 $800.00 $800 $2.67

Totals / Averages 15 100% 9,050 $14,216 $1.57 $13,850.00 $14,530.00 $15,200 $1.68






SECTION 4

SALE COMPARABLES

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SUBJECT PROPERTY502-518 E Roanoke Avenue | Phoenix, AZ 85004

$2,369,000Sale Price: 1955Year Built:

9,035 SFBuilding SF: $262.20Price PSF:

15No. Units: $157,933Price / Unit:

13.79GRM: 5.35%Cap:

$126,711NOI:

18 ON EIGHTEEN3311 N 18th St | Phoenix, AZ 95016


17,100 SFBuilding SF: $169.59Price PSF

18No. Units $161,111Price / Unit

6.01%CAP: 09/09/2018Closed:

100%Occupancy:

1

1

fully renovated, 2-bed / 1.5 bath units

14 ON ELEVENTH4020 N 11th St. | Poenix, AZ 85014




6%CAP: 05/15/2017Closed:

90%Occupancy:

2

2

fully renovated property, 100% 2/1 units

MARIPOSA APARTMENTS38 E Mariposa St | Phoenix, AZ 85012




5.33%CAP: 01/31/2018Closed:

100%Occupancy:

3

3

Minor updating completed: mix of 1 and 2 bed units


SECTION 4. SALE COMPARABLES

22

TURNEY756-802 W Turney Ave | Phoenix, AZ 85013




5.5%CAP: 10/09/2018Closed:

90%Occupancy:

4

4

100% 1/1 units: fully renovated w in-unit washer-dryers

CAMPBELL APARTMENTS2417 E Campbell Ave | Phoenix, AZ 85016




08/01/2018Closed: 90%Occupancy:

5

5

Partial Renovation completed, mix of studio, 1/1 and 2/1 units

MODERN RETRO LIVING2104-2122 E Fairmount Ave | Phoenix, AZ 85016




6%CAP: 06/12/2017Closed:

100%Occupancy:

6

6

Fully renovated: mix of 1/1 and 2/1 units



23

SUBJECT PROPERTY PRICE PRICE/SF PRICE/UNIT CAP GRM # OF UNITS CLOSERoanoke Apartment Homes502-518 E Roanoke AvenuePhoenix, AZ 85004

$2,369,000 $262.20 $157,933 5.35% 13.79 15 -

SALE COMPS PRICE BLDG SF PRICE/SF PRICE/UNIT CAP GRM # OF UNITS CLOSE

118 on Eighteen3311 N 18th StPhoenix, AZ 95016

$2,900,000 17,100 SF $169.59 $161,111 6.01% - 18 09/09/2018

214 on Eleventh4020 N 11th St.Poenix, AZ 85014

$2,240,000 10,452 SF $214.31 $160,000 6% - 14 05/15/2017

3Mariposa Apartments38 E Mariposa StPhoenix, AZ 85012

$1,020,000 5,398 SF $188.96 $145,714 5.33% - 7 01/31/2018

4Turney756-802 W Turney AvePhoenix, AZ 85013

$3,750,000 14,550 SF $257.73 $156,250 5.5% - 24 10/09/2018

5Campbell Apartments2417 E Campbell AvePhoenix, AZ 85016

$3,150,000 15,252 SF $206.53 $131,250 - - 24 08/01/2018

6Modern Retro Living2104-2122 E Fairmount AvePhoenix, AZ 85016

$3,500,000 17,467 SF $200.38 $152,173 6% - 23 06/12/2017

PRICE PRICE/SF PRICE/UNIT CAP GRM # OF UNITSTOTALS/AVERAGES $2,760,000 $206.43 $150,572 5.77% - 18.33



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502-518 E Roanoke Avenue | Phoenix, AZ 85004SUBJECT PROPERTY

1 3311 N 18th StPhoenix, AZ 95016

18 ON EIGHTEEN 2 4020 N 11th St.Poenix, AZ 85014

14 ON ELEVENTH 3 38 E Mariposa StPhoenix, AZ 85012

MARIPOSA APARTMENTS

4 756-802 W Turney AvePhoenix, AZ 85013

TURNEY 5 2417 E Campbell AvePhoenix, AZ 85016

CAMPBELL APARTMENTS 6 2104-2122 E Fairmount AvePhoenix, AZ 85016

MODERN RETRO LIVING






SECTION 5

DEMOGRAPHICS

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POPULATION 1 MILE 3 MILES 5 MILES

Total population 14,300 144,239 361,388

Median age 36.6 32.4 32.0

Median age (Male) 36.3 32.5 31.8

Median age (Female) 36.8 32.5 32.2

HOUSEHOLDS & INCOME 1 MILE 3 MILES 5 MILES

Total households 7,037 58,618 135,242

# of persons per HH 2.0 2.5 2.7

Average HH income $57,890 $50,631 $53,742

Average house value $349,361 $322,247 $339,831

* Demographic data derived from 2010 US Census


SECTION 5. DEMOGRAPHICS

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