Download - BRAND NEW MODERN CONSTRUCTION · 01.28.2016 building department resubmittal 1 03.04.2016 building department resubmittal 2 03.25.2016 building department resubmittal 3 05.17.2016

BRAND NEW MODERN CONSTRUCTION

11 LUXURY TOWNHOMES | SANTA CRUZ, CA

CONFIDENTIAL OFFERING MEMORANDUM

Estimated Date of Final Completion: October 2017

OCEAN STREET TOWNHOMES2

1804 Ocean StSanta Cruz, CA

Confidential Offering Memorandum

Contents

Executive Summary ........................ 4

Property Description ...................... 5

Location Overview .......................... 9

Market Overview ...........................12

Financial Overview ........................16

RYAN [email protected]

Lic. 01760602

BENJAMIN [email protected]

Lic. 01406462

KALAH [email protected]

Lic. 01760602

EXCLUSIVELY OFFERED BY:

Executive SummaryOFFERINGColliers International, as the exclusive advisor, in association with Ow Commercial, is pleased to present the opportunity to acquire 1804 Ocean Street, an 11-unit apartment community in Santa Cruz, CA. The property is ideally located less than an hour from the core of Silicon Valley and in one of the most desirable ocean communities in the world.

OCEAN STREET TOWNHOMES

PROPERTY HIGHLIGHTS

11-unit apartment townhome property

Extremely large, spacious floorplans with vaulted top floor ceilings

> (5) 3br-3ba Townhomes (or 2br-3ba with office/den), 1,421 SF each

> (6) 2br-2.5ba Townhomes, 1,623 SF each

Ideally located with easy access to Highway 1, and less than an hour from

Silicon Valley

In-unit washer and dryer hookups

Garages pre-wired for electric car charging stations

Property pre-plumbed for roof solar panels

Modern, contemporary interior finishes

Large patios / balconies off each unit

INVESTMENT HIGHLIGHTS 4.5% Cap on projected market rents

Priced competitively at $511/SF

Townhome mapped and recorded with the Department of Real Estate

Excellent 1031 exchange opportunity

Passive, turnkey asset

PROPERTY1804 Ocean Street offers investors a rare opportunity to acquire a brand new development within the highly desirable Santa Cruz market. This modern, luxury townhome development project is truly a turnkey pride-of-ownership asset. Santa Cruz is a high-demand rental market offering current and long-term appeal to residents seeking a beach-town lifestyle and proximity to some of the best jobs in the country.

1804 Ocean Street is being offered for $8,600,000, representing a current cap rate of 4.5% on projected rents. At $511 per SF, 1804 Ocean St is competitively priced with other like-kind assets that have recently transacted and are on the market currently.

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SECTION TITLE

EXECUTIVE SUMMARY | 5

Property Description1804 OCEAN STREETAddress 1804 Ocean Street

City, State Santa Cruz, CA

Lot Size 8,668 SF (per county records)

APNs

008-721-05; 008-721-04;

008-721-03; 008-721-01;

008-721-11; 008-721-10;

008-721-09; 008-721-08;

008-721-07; 008-721-06;

008-721-13

Year Built In construction 2017

Units 11

Average SF 1,532

Total SF 16,843

Unit Mix # of Units Square Feet

3BR/3BA (or 2BR/3BA w/office 5 1,421

2BR/2.5 BA 6 1,623

Totals/AVG. 11 1,531

Parking Summary

6 Attached 2-car tandem garage

5 Attached 1-car garage

3 Guest, uncovered

2 Accessible, uncovered

5 Open, unassigned

TOTAL: 27 Spaces


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122 E. ARRELLAGASANTA BARBARA

805 962 2746CALIFORNIA 93101

BlatterHochhauser

ARCHITECTURE

AND PLANNING

SHEET

PROJECT NO:

THIS DRAWING IS COPYRIGHTEDMATERIAL UNDER THE SOLE OWNERSHIPOF HOCHHAUSER BLATTER ARCHITECTURE& PLANNING. ANY USE WITHOUTEXPRESSED WRITTEN CONSENT OFHOCHHAUSER BLATTER IS PROHIBITED.

SHEET CONTENTS

ISSUANCE OR REVISIONDATE:

09.10.2015 BUILDING DEPARTMENTSUBMITTAL

11.09.2015 BUILDING DEPARTMENTSUBMITTAL

01.28.2016 BUILDING DEPARTMENTRESUBMITTAL 1



05.17.2016 BUILDING DEPARTMENTRESUBMITTAL

OCEA

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1804

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A1.1

SITE PLAN

9784

1/8" = 1'-0" 1SITE PLAN

BUILDING B

BUILDING A

BUILDING C

BUILDING D

NNPROJECT NORTH TRUE NORTH

BUILDINGS LABELLED A, B, C, & D FOR GRAPHIC AND PRESENTATION PURPOSES ONLY

BUILDINGS A & B TO BE TREATED AS ONE BUILDING FOR THE PURPOSE OF CODE COMPLIANCE

NOTES:

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PERIMETER FENCE

Full Project Site Plan

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PROPERTY DESCRIPTION |

Sample Floor Plans - Units 1-5 Sample Floor Plans - Units 6-11

First Level

Second Level

Third Level

Second Level

First Level

CONSTRUCTION TYPE Timber and steel frame over concrete slab platform

SIDING MATERIAL Stucco and manufactured wood siding

FOUNDATION Concrete slab

ROOF TYPE Standing seam metal roof

WINDOWS Oversized dual-pane, floor-to-ceiling in living areas

DISHWASHERS In all units

DISPOSALS In all units

HEATING Forced-air heat pumps

HOT WATER Individual tankless on-demand units

WASHER & DRYER Individual hookups in each unit

APPLIANCES All electric and stainless steel

FLOORING Hardwood luxury flooring, carpeting in bedrooms

CABINETRY High-quality soft-close doors

HARDWARE Brushed nickel

INTERIOR LIGHTING Recessed LED and CFL lighting in all renovated

EXTERIOR LIGHTING High-end LED and CFL copper fixtures

KITCHEN COUNTERTOPS Quartz countertops

PLUMBING All copper and surgical plastic

ELECTRICAL All copper, 200 AMP panels

KITCHEN COUNTERTOPS Quartz countertops

GARAGES For all units, see parking breakdown, 27 total parking spaces

CABLE All units wired for cable and internet

SMOKE DETECTORS In all units, 100% code compliant

Co2 DETECTORS In all units

Physical Property Summary


PROPERTY DESCRIPTION | 7


East Elevations West Elevations

Buildings C & D

Buildings A & B Buildings A & B

Buildings C & D

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SECTION TITLE

PROPERTY DESCRIPTION |

North Elevations

Buildings B & D

South Elevations

Buildings A & C

Kaiser Permanente Arena

San Lorenzo Park Plaza Shopping CenterARTISAN’S GALLERYBranciforte

Middle School

Santa Cruz Small Craft Harbor

Seabright State BeachAldo Harbor

Santa Cruz Beach Boardwalk

Santa Cruz Wharf

Santa Cruz High School

Mission Hills Middle School

County JailAdministration

SC Laboratories International Academy of Dance

Grant Park

Neary Lagoon Park

Subject Property1804 OCEAN STREET

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Santa CruzElks Lodge

COLLIGAN THEATER AT THE TANNERY

ARTS CENTER

RADIUS GALLERY

Pasatiempo Golf Course

Harvey West Park

STEPHANIE SCHRIVER STUDIO

In state tuition: $14,024Out if State Tuition: $28,014

On-Campus Room & Board: $16,056Off-Campus Room & Board: $12,198

Average annual salary for professors: $193,352

Georgiana Bruce Kirby Preparatory School

13LOCATION OVERVIEW |

The San Francisco Bay Area consists of nine

counties with a total population of 7.34 million

representing almost 20% of California’s total

population. Of the nine counties, Santa Cruz

County is the second least populated county in

the state. The San Francisco Bay Area has the

unique distinction of being the most innovative

place in America. The Bay Area is one of the most

inventive, competitive economies in the world

based on a productive and educated workforce,

deep venture capital pool, concentration of

research organizations, culture of innovation,

and receptivity to new ideas.

Knowledge-Based Economy

With its long-standing reputation for cutting-

edge innovation, the Bay Area has always

required one of the most specialized and

educated work forces in the country. The Bay

Area has the highest share of population with

a bachelor’s degree and the largest number

of top 10 graduate programs. For the more

specialized industries, academic excellence

ensures an ongoing supply of highly-educated

researchers. In fact, one in four of California’s

biotech firms were founded by University of

California scientists.

Bay Area Highlights include:

■ Over 7.34 million residents and the highest

percentage of graduate and professional

degrees in the nation

■ Home to 29 Fortune 500 companies and 32 of

Inc. 500’s fastest growing private companies

■ Superb quality of life with a Mediterranean

climate, world-famous wine country, world-

class cultural resources, and the stunning

natural beauty of the Pacific Ocean and the

Sierra Nevada Mountains

■ Highest concentration of venture capital firms

in the world which have invested an average

of $10 billion annually in 1,100 local area firms

■ Proximity to outstanding education and

research institutions at Stanford University,

University of California at Berkeley, University

of California Santa Cruz, University of

California at San Francisco, University of

California at Davis, Santa Clara University,

and California State University San Jose

Location Overview Location OverviewSan Francisco Bay Area Overview

Kaiser Permanente Arena

San Lorenzo Park Plaza Shopping CenterARTISAN’S GALLERYBranciforte

Middle School

Santa Cruz Small Craft Harbor

Seabright State BeachAldo Harbor

Santa Cruz Beach Boardwalk

Santa Cruz Wharf

Santa Cruz High School

Mission Hills Middle School

County JailAdministration

SC Laboratories International Academy of Dance

Grant Park

Neary Lagoon Park

Subject Property1804 OCEAN STREET

OC

EA

N S

TR

EE

T

SA

N L

OR

EN

ZO

RIV

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Santa CruzElks Lodge

COLLIGAN THEATER AT THE TANNERY

ARTS CENTER

RADIUS GALLERY

Pasatiempo Golf Course

Harvey West Park

STEPHANIE SCHRIVER STUDIO

In state tuition: $14,024Out if State Tuition: $28,014

On-Campus Room & Board: $16,056Off-Campus Room & Board: $12,198

Average annual salary for professors: $193,352

Georgiana Bruce Kirby Preparatory School


Santa Cruz County Overview

Santa Cruz County, established in 1850, was one of the

original counties of California. Today, Santa Cruz County

has a total population of 262,382 and is the second

smallest county in California by land area and third

smallest by total area. It has an ideal Mediterranean

climate with low humidity and 300 days of sunshine per

year.

Santa Cruz County has 29 miles of coastline and

boasts numerous state parks and beaches. The State of

California maintains 42,334 acres of parks within Santa

Cruz County, and the county maintains an additional

1,400 acres of public park space. There are many cultural

draws as well, including Santa Cruz County Symphony,

the Cabrillo Music Festival, Shakespeare Santa Cruz, the

McPherson Museum of Art and History, the University

of California Performing Arts Center, and the Henry

J. Mello Center for the Performing Arts. Additionally,

the county is home to a multitude of recreational and

leisure activities such as fishing, sailing, golfing, surfing,

kayaking and hiking.

Per capita income in Santa Cruz County is $32,862, with

a median income of $65,666. Median single family home

value in the county is $858,000. Santa Cruz County is

the gateway to Monterey Bay National Marine Sanctuary

and one of the most desirable places to live in California.

City of Santa Cruz

1804 Ocean Street is located at the base of the serene

mountains in Santa Cruz. The city is know for its

quaint feel and boutique shops and restaurants. It is a

recreational haven, and is home to surfers and nature

enthusiasts alike. Situated just 35 miles from Silicon

Valley, Santa Cruz is a reprieve from the hustle and

bustle of daily life for many tech workers.

Santa Cruz has many entertainment options for families,

tourists and residents. The Santa Cruz Beach Boardwalk

is one of the most famous boardwalks nationally. A

California Historical Landmark which encompasses 24

acres along the coast of Monterey Bay, the Boardwalk

offers live entertainment on evenings and weekends,

and a plethora of carnival rides for all ages. The

University of Santa Cruz resides in the city. Established

in 1965, UC Santa Cruz is a top school with national and

international recognition for the quality of its research

programs and teaching. The university is famous for its

student-selected official mascot, The Banana Slug.

SANTA CRUz BEACH BOARDWALk

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SECTION TITLE

15LOCATION OVERVIEW |

Demographics

EDUCATiON

2016Bachelor’s Degree 46%

2016Master’s Degree 23%

TOTAL mEDiAN hOUSEhOLD iNCOmE

2016

$65,6662021

$69,875

TOTAL POPULATIONSANTA CRUz COUNTY

TOTAL POPULATIONSANTA CRUz

262k

2010

277k

2016

289k

2021

60k

2010

62k

2016

64k

2021

2016

$61,3262021

$68,419

TOTAL mEDiAN hOUSEhOLD iNCOmE

EDUCATiON

2016Bachelor’s Degree 51%

2016Master’s Degree

21%

market Overview

A

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E


14 Fife Ct Santa Cruz

Type SF RENT $ / SF 3 BR | 2.5 BA 1000 $3,600 $3.60

716 Darwin St Santa Cruz


Pacific Shores Santa Cruz

Type SF RENT $ / SF 2 BR | 2BA 1035 $3,721 $3.60

Lance Court Santa Cruz

Type SF RENT $ / SF 3 BR | 2 BA 1550 $3,800 $2.45

Newly developed townhome in Silver Oaks neighborhood. Next to Cabrillo College with new, modern interiors.

Located in a 15 unit boutique condominium and townhome community located in the Seabright District. New, modern construction with contemporary interiors.

One story apartment unit with dated interior finishes in a 200+ unit multifamily building. Located blocks from

Two story, three bedroom house with dated interiors.

Tyler Court @ Elk Santa Cruz


1804 Ocean St Santa Cruz

Type SF RENT $ / SF 3BR | 3 BA 1522 $3,950 $2.50

95 B Fredrick Santa Cruz


126 Pryce Santa Cruz


Vintage interiors and exteriors. Townhome Style Located 1/4 mile from subject property.

Townhome located in Heritage Landing, a gated community. Dated interiors, with light wood flooring and open floorplan.

Brand new townhomes, with live/work option. Attached two-car garage. Modern, sleek interior and exterior finishes.

Two story home with original, vintage interiors.

Rent Comparables

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SECTION TITLE

17MARkET OVERVIEW |

1010 Pacific Santa Cruz


718 Seabright Ave Santa Cruz


315 Village Cir Santa Cruz


Charming townhouse located near UCSC. Newer construction with two car attached garage and large yard.

Brand new modern townhomes in the Seabright District. Modern, luxury interior finishes. Two car attached garage with built in electric chargers.

One story apartment penthouse in a multifamily complex. Located in downtown Santa Cruz. Built in 2004 with original interiors.

i K

J

1010 Pacific Santa Cruz


718 Seabright Ave Santa Cruz


Brand new modern townhomes in the Seabright District. Modern, luxury interior finishes. Two car attached garage with built in electric chargers.

One story apartment penthouse in a multifamily complex. Located in downtown Santa Cruz. Built in 2004 with original interiors.

$3,000

$3,200

$3,400

$3,600

$3,800

$4,000

$4,200

$4,400

$4,600

$4,800

$5,000

14 Fife Ct 716 DarwinSt

PacificShores

Lance Court Tyler Court@ Elk

1804 OceanSt

95 BFredrick

126 Pryce 1010 Pacific 718Seabright

Ave

315 VillageCir

2 BR Units - Rental Comparison


Rental Comparison - 2 Bedroom & 3 Bedroom Units

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SECTION TITLE

19MARkET OVERVIEW |

Unit # Floorplan S. F. Parking Projected Rents Rent / SF

1 3br / 3ba (or 2br / 3ba w/Office) 1,421 1 Garage \ 1 open $3,995 $2.81





6 2br - 2.5ba 1,623 2-Car tandem garage $3,995 $2.46






TOTALS 11 - 16,843 16 Garages $43,945

ANNUALizED $527,340

Unit Mix

PRiCE $$ / UNiT $$ / SF CAP RATE GRm

$8,600,000 $781,818 $511 4.5% 16.3

Rental income

Residential Income per Rent Roll, $3,950/mo average $527,340

Less: Residential Vacancy @ 2.5% ($13,184)

Net Rental Income $514,157

Expenses

Real Estate Taxes @ 1.075% $8,600,000 value $92,450

Special Assessments (Approx. $400/unit) $4,400

Insurance @ $500/unit $5,500

Off-site Management (Est.) $10,000

Replacement Reserves @ $275 / Unit $3,025

Fire Service and Alarm Testing $2,000

Repairs & Maintenance (Est. @ $500/unit) $6,000

Common Area Electric $1,000

Garbage (water paid by residents) $3,200

Total Expenses $127,575

NET OPERATiNG iNCOmE $386,582

Financial Overview


SECTION TITLE

21

CONFIDENTIALITY & DISCLAIMERThis Confidential Offering Memorandum (the “Memorandum”) has been prepared and presented to the recipient (the “Recipient”) by Colliers International (“Colliers”) as part of Colliers’ efforts to market for sale the real property located at 1804 Ocean St, Santa Cruz, California 95060 (the “Property”). Colliers is the exclusive agent and broker for the owner(s) of the Property (the “Owner”). Colliers is providing this Memorandum and the material contained in it to the Recipient solely to assist the Recipient in determining whether the Recipient is interested in potentially purchasing all or part of the Property. Colliers also is providing this Memorandum and the material in it to the Recipient with the understanding that the Recipient will independently investigate those matters that it deems necessary and appropriate to evaluate the Property and that the Recipient will rely only on its own investigation, and not on Colliers, the Owner or this Memorandum, in determining whether to purchase the Property. The Recipient’s use of this Memorandum and the material in it is strictly governed by the terms and conditions of the Registration and Confidentiality Agreement that the Recipient previously executed and delivered to Colliers.

PLEASE NOTE THE FOLLOWING:

Colliers, the Owner and their respective agents, employees, representatives, property managers, officers, directors, shareholders, members, managers, partners, joint venturers, corporate parents or controlling entities, subsidiaries, affiliates, assigns and predecessors and successors-in-interest make no representations or warranties about the accuracy, correctness or completeness of the information contained in this Memorandum. The Recipient is urged not to rely on the information contained in this Memorandum

and to make an independent investigation of all matters relating to the Property.

This Memorandum includes statements and estimates provided by or to Colliers and/or the Owner regarding the Property. Those statements and estimates may or may not be accurate, correct or complete. Nothing contained in this Memorandum should be construed as a representation or warranty about the accuracy, correctness or completeness of such statements and estimates. Further, nothing contained in this Memorandum should be construed as representation or warranty about any aspect of the Property, including, without limitation, the Property’s (1) past, current or future performance, income, uses or occupancy, (2) past, current or prospective tenants, (3) physical condition, (4) compliance or non-compliance with any permit, license, law, regulation, rule, guideline or ordinance, or (5) appropriateness for any particular purpose, investment, use or occupancy. Again, the Recipient is urged not to rely on this Memorandum and the statements and estimates in it and to make an independent investigation regarding the Property and the statements and estimates contained herein.

This Memorandum may include statements regarding, references to, or summaries of, the nature, scope or content of contracts and/or other documents relating to the Property. Those statements, references or summaries may or may not be accurate, correct or complete. Additionally, Colliers may not have referenced or included summaries of each and every contract and/or other document that the Recipient might determine is relevant to its evaluation of the Property. Nothing contained in this Memorandum should be construed as a representation or warranty about the

accuracy, correctness or completeness of such statements, representations or summaries. On request and as available, and subject to the Owner’s consent, Colliers will provide the Recipient with copies of all referenced contracts and other documents. Colliers assumes no obligation to supplement or modify the information contained in this Memorandum to reflect events or conditions occurring on or after the date of its preparation of this Memorandum.

This Memorandum does not constitute an offer to sell, or a solicitation of an offer to buy, an interest in the Property. Nothing contained in this Memorandum may be construed to constitute legal or tax advice to a Recipient concerning the Property.

More detailed information regarding the anticipated terms, conditions and timing of any offering by the Owner relating to the Property will be provided in due course by separate communication. Colliers and/or the Owner reserve the right to engage at any time in discussions or negotiations with one or more recipients of this Memorandum and/or other prospective purchasers of the Property without notice or other obligation to the Recipient.

The Owner reserves the right to change the terms of any offering relating to the Property or to terminate without notice that offering. The Owner also reserves the right to operate the Property in its sole and absolute discretion prior to the completion of any sale of the Property. Colliers reserves the right to require the return of this Memorandum and the material in it and any other material provided by Colliers to the Recipient at any time. Acceptance of this Memorandum by the Recipient constitutes acceptance of the terms and conditions outlined above.

RYAN [email protected]

Lic. 01760602

BENJAMIN [email protected]

Lic. 01406462

KALAH [email protected]

Lic. 01760602

EXCLUSIVELY MARkETED BY: