hymeadow square office condo...marcus & millichap is pleased to present this 2,277 sf...

HYMEADOW SQUARE OFFICE CONDO12335 Hymeadow Dr, Suite 450 • Austin, TX 78750

Offering Memorandum

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2500 S LAKELINE BLVDCedar Park, TXACT ID ZAA0370416

N O N - E N D O R S E M E N T A N D D I S C L A I M E R N O T I C E

Non-EndorsementsMarcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of anycorporation's logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates orsubsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee informationabout this listing to prospective customers.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

DisclaimerTHIS IS A BROKER PRICE OPINION OR COMPARATIVE MARKET ANALYSIS AND SHOULD NOT BE CONSIDERED AN APPRAISAL. In making any decision that reliesupon my work, you should know that we have not followed the guidelines for development of an appraisal or analysis contained in the Uniform Standards of ProfessionalAppraisal Practice of the Appraisal Foundation. This information has been secured from sources we believe to be reliable, but we make no representations or warranties,express 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 forany inaccuracies. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. Â© 2018 Marcus & Millichap. All rights reserved.

THE TEXAS REAL ESTATE COMMISSION (TREC) REGULATES REAL ESTATE BROKERS AND SALES AGENTS, REAL ESTATE INSPECTORS,HOME WARRANTYCOMPANIES, EASEMENT AND RIGHT-OF-WAY AGENTS AND TIMESHARE INTEREST PROVIDERS. YOU CAN FIND MORE INFORMATION AND CHECK THE STATUSOF A LICENSE HOLDER AT WWW.TREC.TEXAS.GOV. YOU CAN SEND A COMPLAINT AGAINST A LICENSE HOLDER TO TREC. A COMPLAINT FORM IS AVAILABLEON THE TREC WEBSITE. TREC ADMINISTERS TWO RECOVERY FUNDS WHICH MAY BE USED TO SATISFY A CIVIL COURT JUDGMENT AGAINST A BROKER,SALES AGENT, REAL ESTATE INSPECTOR, OR EASEMENT OR RIGHT-OF-WAY AGENT, IF CERTAIN REQUIREMENTS ARE MET. IF YOU HAVE QUESTIONS ORISSUES ABOUT THE ACTIVITIES OF A LICENSE HOLDER, THE COMPLAINT PROCESS OR THE RECOVERY FUNDS, PLEASE VISIT THE WEBSITE OR CONTACTTREC AT:

TEXAS REAL ESTATE COMMISSIONP.O. BOX 12188AUSTIN, TEXAS 78711-2188(512) 936-3000

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12335 Hymeadow Dr., Suite 450

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INVESTMENT

OVERVIEW

• Excellent Location Blocks from US 183 and Retail

Amenities

• High-End Interiors with Vaulted Ceilings, Cherry

Woodwork, Cherry French Doors and Windows Between

Offices, and two ADA-Compliant Restrooms

• Highly Reusable Floor Plan

• Existing Tenant Through 9/30/202 Paying

$4,872.78/month, Allowing Owner/Occupant Time to Plan

its Move-In

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PROPERTY LOCATION

12335 Hymeadow Dr


Amenities







its Move-In

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AERIAL

12335 Hymeadow Dr

12335 Hymeadow, Suite 450

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FLOOR PLAN

12335 Hymeadow Dr

2nd Restroom Added

Marcus & Millichap is pleased to present this 2,277 sf single-tenant office condominium suite. Located in booming NorthwestAustin, the site has excellent access just blocks from US 183 and surrounded by nearby retail amenities. The suite is the mostdesirable in the project, with frontage on Hymeadow Drive, high-end interiors, attic storage, a front and back porch, and 10reserved parking spaces. The floor plan is highly reusable consisting of an attractive entry, 7 private offices, a kitchen/breakroom, acopy/workroom, a central conference room, and two ADA-compliant restrooms. The Interior finishes include abundant cherrywoodwork, cherry French doors, cherry windows between offices, 8’ office doors, and vaulted ceilings. The project consists ofboth medical and general office tenants, each with building signage at their suite.

The space is leased by a psychiatrist’s office paying $4,872.78/month through 9/31/2020 providing an owner/occupant time to planits move.

INVESTMENT HIGHLIGHTS

INVESTMENT OVERVIEW


Amenities







its Move-In

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PROPERTY OVERVIEW

12335 Hymeadow Dr, Suite 450

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PHOTOGRAPHS


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PHOTOGRAPHS


PROPERTY NAME

MARKETING TEAM

HYMEADOW SQUARE OFFICE CONDO

DEMOGRAPHICS

Source: © 2018 Experian

Created on September 2019

POPULATION 1 Miles 3 Miles 5 Miles 2023 Projection

Total Population 15,406 108,452 228,794

2018 Estimate


2010 Census


2000 Census


Current Daytime Population

2018 Estimate 17,357 83,514 186,569

HOUSEHOLDS 1 Miles 3 Miles 5 Miles 2023 Projection

Total Households 6,854 46,739 95,743

2018 Estimate


Average (Mean) Household Size 2.31 2.36 2.41

2010 Census


2000 Census


HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles 2018 Estimate

$200,000 or More 3.95% 9.54% 10.91%

$150,000 - $199,999 6.06% 9.87% 11.08%

$100,000 - $149,000 14.67% 21.29% 22.39%

$75,000 - $99,999 18.53% 16.65% 15.44%

$50,000 - $74,999 18.29% 16.89% 16.26%

$35,000 - $49,999 15.48% 10.97% 9.99%

$25,000 - $34,999 9.16% 6.28% 5.94%

$15,000 - $24,999 7.81% 4.78% 4.48%

Under $15,000 10.40% 7.64% 7.30%

Average Household Income $82,473 $111,776 $119,070

Median Household Income $66,132 $85,811 $90,658

Per Capita Income $35,620 $46,731 $48,945

POPULATION PROFILE 1 Miles 3 Miles 5 Miles Population By Age

2018 Estimate Total Population 14,733 99,618 206,105

Under 20 22.44% 24.06% 25.71%

20 to 34 Years 27.78% 23.86% 22.36%

35 to 39 Years 8.59% 8.38% 8.60%

40 to 49 Years 13.06% 15.25% 16.04%

50 to 64 Years 16.97% 18.25% 17.91%

Age 65+ 11.16% 10.19% 9.39%

Median Age 34.89 36.20 36.11

Population 25+ by Education Level

2018 Estimate Population Age 25+ 10,407 69,783 142,150

Elementary (0-8) 0.99% 0.93% 0.94%

Some High School (9-11) 5.15% 2.10% 1.98%

High School Graduate (12) 18.04% 13.10% 12.15%

Some College (13-15) 25.03% 21.89% 21.45%

Associate Degree Only 7.31% 7.56% 7.22%

Bachelors Degree Only 29.55% 34.56% 35.96%

Graduate Degree 13.26% 19.43% 19.91%

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PROPERTY NAME

MARKETING TEAM


DEMOGRAPHICS


Created on September 2019

POPULATION BY TRANSPORTATION TO WORK

1 Miles 3 Miles 5 Miles

2018 Estimate Total Population

Bicycle 0.45% 0.23% 0.20%

Bus or Trolley Bus 1.76% 0.84% 1.01%

Carpooled 8.80% 7.98% 7.63%

Drove Alone 79.41% 81.30% 81.64%

Ferryboat 0.00% 0.00% 0.00%

Motorcycle 0.54% 0.44% 0.40%

Other Means 0.62% 0.64% 0.64%

Railroad 0.00% 0.05% 0.03%

Streetcar or Trolley Car 0.00% 0.00% 0.00%

Subway or Elevated 0.00% 0.00% 0.00%

Taxicab 0.66% 0.15% 0.08%

Walked 1.75% 1.01% 1.04%

Worked at Home 6.00% 7.37% 7.34%

POPULATION BY TRAVEL TIME TO WORK

1 Miles 3 Miles 5 Miles

2018 Estimate Total Population

Under 15 Minutes 21.45% 19.91% 19.63%

15 - 29 Minutes 38.61% 39.86% 39.16%

30 - 59 Minutes 27.32% 26.79% 26.69%

60 - 89 Minutes 2.22% 2.60% 3.12%

90 or More Minutes 1.66% 1.08% 0.99%

Worked at Home 6.00% 7.37% 7.34%

Average Travel Time in Minutes 27 27 27

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FINANCIAL

ANALYSIS


FINANCIAL ANALYSIS

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FINANCIAL ANALYSIS ASSUMPTIONS


FINANCIAL ANALYSIS

Projected Investment Cash Flow

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MARKET

OVERVIEW


AUSTINOVERVIEW

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The Austin-Round Rock metro covers about 4,225 square miles andconsists of five counties in central Texas: Travis, Williamson, Hays,Caldwell and Bastrop. The population of the metro increasedsignificantly in recent decades and now exceeds 2.1 million residents.Growth stemmed mainly from in-migration due to job gains. TravisCounty holds more than half of the metro’s population and is home toAustin, the capital of Texas. The 32,000-square-mile Texas HillCountry begins in the metro and stretches approximately 150 miles tothe west. Austin is the largest city with a population of 928,500 people,followed by Round Rock with 115,600 residents.

MARKET OVERVIEW

METRO HIGHLIGHTS

MAJOR TECHNOLOGY PRESENCETech companies are drawn to one of the nation’s most educated labor pools, boosting professional and business services growth. Firms with local presence include Dell, IBM, Oracle and VMWare.

EMPLOYMENT GROWTHThe metro ranks above the nation for employment gains, with payrolls expected to exceed the U.S. growth rate during the next five years.

STRONG POPULATION GAINSEmployment opportunities will attract skilled job seekers to the region, boosting the number of residents.


ECONOMY Located within a border state, the metro benefits significantly from international trade due

to the North American Free Trade Agreement (NAFTA). The government is a significant driver in the local economy, as Austin is the state capital

and home to an IRS regional processing center as well as military bases. The metro is a vibrant technology hub with industries that include semiconductor and

related equipment manufacturing, along with computer and software development. High-tech firms with local operations include Facebook, Apple, Dropbox and Amazon.

SHARE OF 2018 TOTAL EMPLOYMENT

MAJOR AREA EMPLOYERS

Dell Inc.

Advanced Micro Devices

Seton Healthcare Network

IBM Corp.

Apple.

NXP Semiconductors

Applied Materials

AT&T

National Instruments

Flex* Forecast

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MANUFACTURING5%

GOVERNMENT

HEALTH SERVICESEDUCATION AND

+OTHER SERVICES

4%

LEISURE AND HOSPITALITY FINANCIAL ACTIVITIES

18%AND UTILITIES

TRADE, TRANSPORTATION CONSTRUCTION

PROFESSIONAL ANDBUSINESS SERVICES

3%INFORMATION

17%

6%

17% 12% 6%

12%


DEMOGRAPHICS

SPORTS

EDUCATION

ARTS & ENTERTAINMENT

The metro is expected to add nearly 208,000 people through 2023, resulting in the formation of roughly 93,500 households and generating demand for housing.

Rising home prices contribute to a homeownership rate of 58 percent, compared with the national rate of 64 percent.

The local population age 25 and older includes 41 percent of bachelor’s degree holders; of those residents,14 percent also have earned a graduate or professional degree.

The region contains lakes, hills, trails, an eclectic arts community, theaters, museums,

bookstores, a vibrant live music scene and a favorable climate. The metro is know as

“The Live Music Capital of the World” and hosts the South by Southwest festival. The

University of Texas has nationally ranked programs in football, basketball, baseball,

swimming, volleyball, and track and field. In addition, Austin is home to the Texas Stars

Hockey and the minor-league baseball team Round Rock Express. Cultural institutions

include the Elisabet Ney Museum, the Austin Symphony, Ariel Dance Theatre and the O.

Henry Museum, which holds many of the author’s possessions. Austin is also home to the

Texas Memorial Museum, the Contemporary Austin and the Paramount Theatre.

QUALITY OF LIFE

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* Forecast Sources: Marcus & Millichap Research Services; BLS; Bureau of Economic Analysis; Experian; Fortune; Moody’s Analytics; U.S. Census Bureau


2018 Population by Age

0-4 YEARS

7%5-19 YEARS

20%20-24 YEARS

7%25-44 YEARS

33%45-64 YEARS

23%65+ YEARS

10%

34.42018

MEDIAN AGE:

U.S. Median:

38.0

$72,1002018 MEDIAN

HOUSEHOLD INCOME:

U.S. Median:

$58,800

2.1M2018

POPULATION:

Growth2018-2023*:

9.8%

807K2018

HOUSEHOLDS:

11.6%

Growth2018-2023*:

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Suburban office space gaining momentum as downtown Austin faces challenges. Arapidly expanding populace and strong employment growth continue to support theAustin office market. While the core boasts a plethora of office space, high-pricedhousing and traffic congestion have pushed many business professionals out ofdowntown. Employers including Apple and Amazon having taken note of this, settingup shop in Northwest Austin where workers can find more affordable dwellings anddramatically shorten their commutes. Demand for suburban office space will keeppushing rents higher throughout the year, particularly as more suburban employmenthubs are established. Suburbs like Cedar Park, Kyle and Manor are gaining residentsat a quick pace, enticing more businesses to the area and driving office demand.

Construction scattered as builders follow performance trends. This year’s six largestcompletions will be located in northern parts of the metro, adding to the influx ofspace completed here over the past several years. Domain 12 and the Domain Tower— a pair of 300,000-plus square-foot office buildings — highlight the slate ofdeliveries. East Austin welcomes an array of other notable completions totaling morethan 600,000 square feet. This area remains in a transitioning stage as morebusinesses migrate from the city center to adjacent neighborhoods where the talentpool is close yet office rents are generally more affordable. New supply will also bewidespread in Southwest Austin where developers look to capitalize on strong rentgrowth and strengthening demand. Investment Trends

Office 2019 OutlookBusinesses Looking Toward the Suburbs;

Population Growth to Lead the Nation This Year

AUSTIN METRO AREA

3.6 million sq.

ft. will be completed

3.0% increase in

asking rents

50 basis point

increase in vacancy

Construction:

Rents:

Vacancy:

* Cap rates trailing 12 months through 1Q19Sources: CoStar Group, Inc.; Real Capital Analytics

Development will reach its highest level since2015 when 4.3 million square feet wascompleted. The core and northern parts ofthe metro are set to receive the bulk of thenew supply.

Rent growth clocks in at roughly half theprevious five-year average, nudging theaverage effective rent up moderately to$36.09 per square foot.

Vacancy will move up considerably inresponse to strong construction efforts,moving the market rate to 11.9 percent. Thisfollows a 30-basis-point rise in 2018.

• With Northwest Austin welcoming a collection of high-profile companies,trades in this area have accelerated. Most deals are price motivated asinstitutions are offering long-time owners large sums of capital to dispose oftheir assets so they can be operationally improved and further amenitized tocompete with new Class A product. Here, cap rates sit in the low-6 percentband, just below the market average.

• Areas adjacent to the CBD are garnering more investor interest, specificallythe East Cesar Chavez, Riverside and Travis Heights neighborhoods.Revitalization is encouraging more commercial development, provokinghigher levels of investment as more residents and businesses are priced outof the core.

• Owner/user office buildings in Southwest Austin are becoming highlytargeted as the average asking rent is pushing $40 per square foot andcontinues to quickly rise. When tenants acquire the space in which theyoperate, it can create more long-term economic value in contrast toexperiencing significant rental increases every several years.


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• Austin employers staffed 21,400 new workers over the past year with professional and business services leading the way. Approximately 5,600 employees were added to payrolls in this sector, well above most other subsets.

• Hiring activity has slowed each of the past four years, hindered by a tight unemployment rate. Since last March, the measure fell 10 basis points to 2.9 percent.

EMPLOYMENT

• Completions dipped slightly on an annual basis from 2.8 million square feet in the prior period. Construction was focused on northern parts of Austin.

• North Austin received the most new office space with the addition of 640,000 square feet. The Far Northwest and Northeast submarkets also recorded strong development as 400,000 and 390,000 square feet were finalized, respectively.

CONSTRUCTION

• Net absorption of just 1.2 million square feet propelled market vacancy up to 12.7 percent —still 60 basis points below the national rate.

• With more than 2.1 million square feet of luxury office space completed during the past 12 months, Class A vacancy rose 220 basis points to 14.7 percent. Availability among Class B/C space increased modestly during the same time.

VACANCY

• The influx of Class A supply supported a strong boost to the average asking rent to $35.01 per square foot. One year earlier, rents logged a 4.7 percent increase.

• Suburban rents continue to rise as the average asking rent moved up 5.7 percent to $32.34 per square foot. The CBD measure sits almost $20 above this, ticking up 3.1 percent over the past year.

RENTS

AUSTIN METRO AREA

increase in the average asking rent Y-O-Y

5.0%basis point increase in vacancy Y-O-Y120square feet

completedY-O-Y

2.7 millionincrease in totalemployment Y-O-Y2.0%

* Forecast

1Q19 – 12-Month Trend


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Suburban Office Properties a Hot Item;Cap Rates Stay Glued to Downward Trend

Outlook: Suburban submarkets willcontinue to garner significant investorinterest as population and job growth inthese areas accelerate. Here, initialreturns generally sit in the upper-6percent band.

VacancyRate

Y-O-YBasisPoint

ChangeSubmarket

AskingRent

Y-O-Y %Change

Georgetown 4.3% 150 $27.86 8.6%

Round Rock 6.6% -20 $30.28 4.1%

Southeast 7.3% -230 $23.80 -0.8%

South 8.4% 130 $34.54 12.8%

CBD 8.8% -90 $48.62 3.1%

Hays County 10.4% -20 $27.72 -3.5%

West Central 10.6% 180 $36.52 -8.1%

Far Northwest 11.5% 300 $29.53 -2.6%

Central 12.0% 80 $31.54 11.7%

North 12.8% 220 $29.60 6.7%

Overall Metro 12.7% 120 $35.01 5.0%

Submarket Trends

Lowest Vacancy Rates 1Q18

Sales Trends

AUSTIN METRO AREA

• Sales velocity increased roughly 45 percent year over year as many price-motivatedsellers put their assets on the market. Additionally, cap rates dipped 20 basis points to6.5 percent.

• Values steadily climbed, with the average price per square foot rising 5.0 percentsince last March to $313. Since 2015, this measure has inched up about 21 percent,faster than the national reading of approximately 16.0 percent.

* Includes submarkets with more than 100,000 square feet of inventory** Trailing 12 months through 1Q19 over previous time periodPricing trend sources: CoStar Group, Inc.; Real Capital Analytics


*1Q19**2018

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AUSTIN METRO AREA


• Ongoing trade concerns weigh on growth outlook; Fed plots next steps. Amid risingtrade tensions between the U.S. and China and slowing global growth, the outlook has turnedmore cautious. Market volatility, along with a flight to safety trade, has flattened the yield curvedramatically, with the 10-Year Treasury trading below 2.2 percent. This has pushed thebroader yield curve into inversion, a closely watched precursor to a potential recession.Meanwhile, many measures of the domestic economy remain buoyant, including continuedjob and wage growth, historically low unemployment and muted inflationary pressure. Theseconditions have prompted a dichotomy, with Federal Reserve officials signaling moreaccommodative policies. The impending end of quantitative tightening in September, coupledwith potential cuts to the Fed funds rate in the second half of the year, highlight the shift in Fedpolicy. As a result, long-term interest rates are likely to remain subdued, with Fed policyleaning toward accommodation.

• Conservative underwriting balances abundant marketplace liquidity. While debtavailability for office assets remains widely available from a wide range of sources includinglocal, regional and national banks and insurance companies, sentiment surrounding the healthof the economy has fallen somewhat in recent months. Lenders remain broadly cautious inunderwriting, with loan-to-value (LTV) ratios typically in the 55 to 70 percent range, dependingon the borrower, asset and location. The conservative approach has filtered into a focus onproven property results, with much less willingness to lend against pro forma rents. This hasprompted investors to turn toward short-term mezzanine debt and bridge loans to covercapital improvements, while seeking long-term solutions once returns have been solidified.Construction origination remains muted, with lenders focusing on core locations with provendemand. * Trailing 12 months through 1Q19

Include sales $2.5 million and greaterSources: CoStar Group, Inc.; Real Capital Analytics

Capital Markets

IncomeIn 2018, the median household income for your selected geography is$66,132, compare this to the US average which is currently $58,754.The median household income for your area has changed by 20.57%since 2000. It is estimated that the median household income in yourarea will be $78,625 five years from now, which represents a changeof 18.89% from the current year.

The current year per capita income in your area is $35,620, comparethis to the US average, which is $32,356. The current year averagehousehold income in your area is $82,473, compare this to the USaverage which is $84,609.

PopulationIn 2018, the population in your selected geography is 14,733. Thepopulation has changed by 27.12% since 2000. It is estimated thatthe population in your area will be 15,406.00 five years from now,which represents a change of 4.57% from the current year. Thecurrent population is 49.76% male and 50.24% female. The medianage of the population in your area is 34.89, compare this to the USaverage which is 37.95. The population density in your area is4,692.37 people per square mile.

HouseholdsThere are currently 6,361 households in your selected geography. Thenumber of households has changed by 37.51% since 2000. It isestimated that the number of households in your area will be 6,854five years from now, which represents a change of 7.75% from thecurrent year. The average household size in your area is 2.31 persons.

EmploymentIn 2018, there are 7,339 employees in your selected area, this is alsoknown as the daytime population. The 2000 Census revealed that72.58% of employees are employed in white-collar occupations inthis geography, and 27.47% are employed in blue-collar occupations.In 2018, unemployment in this area is 3.72%. In 2000, the averagetime traveled to work was 27.00 minutes.

Race and EthnicityThe current year racial makeup of your selected area is as follows:70.60% White, 7.90% Black, 0.12% Native American and 9.41%Asian/Pacific Islander. Compare these to US averages which are:70.20% White, 12.89% Black, 0.19% Native American and 5.59%Asian/Pacific Islander. People of Hispanic origin are countedindependently of race.

People of Hispanic origin make up 22.98% of the current yearpopulation in your selected area. Compare this to the US average of18.01%.

PROPERTY NAME

MARKETING TEAM


HousingThe median housing value in your area was $203,328 in 2018,compare this to the US average of $201,842. In 2000, there were2,302 owner occupied housing units in your area and there were2,325 renter occupied housing units in your area. The median rent atthe time was $719.


DEMOGRAPHICS

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DEMOGRAPHICS

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hymeadow square office condo...marcus & millichap is pleased to present this 2,277 sf...

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