offering memorandum - loopnet · 9th & ash street, san diego, ca 92101 exclusive advisors. doug...

1

Offering MeMOranduM

Rendering is a hypothetical. This is not an entitled site.

Doug Ceresia, CCIM, SIORd: 619 241 2388 | [email protected] license # 01314250

Josh Buchholzd: 619 241 2380 | [email protected] # 01761228

Matt Midurad: 619 241 2383 | [email protected]

license # 01826378

9th & Ash

2

NAI San Diego (hereinafter “NAI”) has been retained as the exclusive advisor and broker by Share and Be Fair, LLC and Cabrillo Garden Inn, LLC (collectively, “Owner”) to market for the sale of the fee simple interest in the properties with the Assessor Parcel Numbers (“APN”) 534-045-09, 534-061-03, 534-045-05 and including, but not limited to the main property addresses 833 Ash Street and 840 A Street, San Diego, California 92101 (referred herein collectively as “9th & Ash” and the “Property”).

The evaluation materials have been prepared by NAI for use by a limited number of parties and does not purport to provide a necessarily accurate summary of the Property or any of the documents related hereto, nor does it purport to be all-inclusive or to contain all of the information which prospective investors may need or desire. All measurements referenced herein are estimates. Prospective investors shall perform their own independent investigation to determine actual sizes and dimensions of Property and Structure. All projections have been developed by NAI, the Owner, and designated sources and are based upon assumptions relating to the general economy, competition, and other factors beyond the control of the Owner and, therefore, are subject to variation. No representation is made by NAI or Owner as to the accuracy or completeness of the information contained herein, and nothing contained herein is, or shall be relied on as, a promise or representation as to the future performance of the Property. Although the information contained herein is believed to be correct, NAI San Diego, Owner and its employees disclaim any responsibility for inaccuracies and expect prospective purchasers to exercise independent due diligence in verifying such information. Further, NAI, Owner and its employees disclaim any and all liability for representations and warranties, expressed and implied, contained in, or for omission from, the evaluation material or any other written or oral communication transmitted or made available to the recipient. The evaluation material does not constitute a representation that there has been no change in the business or affairs of the Property or the Owner since the date of preparation of the package. Analysis and verification of the information contained in this package is solely the responsibility of the prospective purchaser.

Additional information and an opportunity to inspect the Property will be made available upon written request to interested and qualified prospective buyers who have completed and delivered signed confidentiality agreements to NAI San Diego.

Owner and NAI each expressly reserve the right, at their sole discretion, to reject any and all expressions of interest or offers regarding the Property and/or terminate discussions with any entity at any time with or without notice. Owner shall have no legal commitment or obligation to any entity reviewing the evaluation materials or making an offer to purchase the Property unless and until a written agreement for the purchase of the Property has been fully executed, delivered and approved by Owner and its legal counsel and any conditions to Owner’s obligations hereunder have been satisfied or waived. NAI is not authorized to make any representations or agreements on behalf of the Owner.

The evaluation materials and the contents, except such information which is a matter of public record or is provided in sources available to the public (such contents as so limited here in called the “Contents”), are of a confidential nature. By accepting the package, you agree (i) to hold and treat it in the strictest confidence, (ii) not to photocopy or duplicate it, (iii) not to disclose the package or any of the contents to any other entity (except to outside advisors retained by you, if necessary, for your determination of whether or not to make a proposal and from whom you have obtained an agreement of confidentiality) without the prior written authorization of Owner or NAI, (iv) not use the package or any of the contents in any fashion or manner detrimental to the interest of Owner or NAI, and (v) to return it to NAI immediately upon the request of NAI or Owner.

OFFERING STATEMENT / DISCLAIMER

9th & Ash

3

EXECUTIVE SUMMARY

PROPERTY DESCRIPTION

MARKET OVERVIEW

YIELD STUDY

1

2

3

4

Of f e r i n g MeM O r an d u MSale and Redevelopment Opportunity9th & Ash Street, San Diego, CA 92101

Exclusive Advisors

Doug Ceresia, SIOR, CCIMSenior Vice President619.241.2388 | [email protected] # 01314250

Josh BuchholzSenior Vice President619.241.2380 | [email protected] #01161038

Matt MiduraSenior Director619.241.2383 | [email protected] # 01826378

Architectural Advisors

Joseph O. Wong, FAIAFounder & Architect619.233.6777 | [email protected]

Christoph FasslerSenior Associate619.233.6777 | [email protected]

Table of ConTenTs

4

The opporTuniTy

NAI San Diego has been retained on an exclusive basis by Share and Be Fair LLC, and Cabrillo Garden Inn, LLC (collectively, “Owner”) to market for sale the (3) three parcels located on 9th & Ash to qualified principals.

The Property consists of three contiguous lots (approximately 30,000 SF of land). All are located within same block at 833 Ash Street and 840 A Street.It is zoned CCPD - ER (Centre City Planned District - Employment/Residential Mixed Use), which allows for multi-family development. In addition, small-scale businesses, offices, services, and ground-floor active commercial uses are allowed, subject to size and area limitations. A recent redevelopment yield study (by JWDA) suggests the site may provide for an approximate 280 unit multi-family development.

9th & Ash offers an exciting opportunity to develop a significant project in Cortez Hill at a time when the area is experiencing a vast amount of growth and available development opportunities of this size in Cortez Hill are rare.

4

executive suMMaryE

xecu

tive

Sum

mar

y

5

This Fee-Simple Property is being marketed for sale “unpriced,” without debt to assume, and will be sold on an “as-is”, “where-is” basis to qualified purchaser. The Owner, at its sole discretion, may at any time and for any reason elect to not sell the Property. The prospective purchaser will be selected by the Owner in its absolute discretion, the Owner can at any time and for any reason accept, reject or counter any offer.

Owner requests all offers to be delivered to NAI San Diego on or before Wednesday, August 30th by 1:00 PM .

The Owner may evaluate each offer considering, without limitation, the following criteria:

• Purchase price• Certainty of closing and experience with similar transactions in the City of San Diego • The amount & source of earnest money deposit, and timing of its non-refundable release to Owner• An outline of the proposed schedule for due diligence and closing• A description of any existing physical conditions assumptions, as well as Purchaser’s future plans which affect the price being offered, if any• A list of any contingencies, including future entitlements or Purchaser’s investment committee approval required to close the transaction• The source of Purchaser’s capital• Conformity to the terms and conditions of these “Transaction Guidelines and Limiting Conditions” and to the Purchase and Sale Agreement form to be provided by

Owner’s legal counsel• The terms of the sale are all cash to Owner at the close of escrow

transactiOn guidelines and liMiting cOnditiOnsE

xecu

tive

Sum

mar

y

6

Exe

cuti

ve S

umm

ary

site infOrMatiOn

Ownership:

Share and Be Fair, LLC

Address: 833 Ash SreetSan Diego, CA 92101

Location: The Properties are located at the corner of Ash Street & 9th Avenue and the corner of A Street & 9th Avenue within the historic neighborhood of Cortez Hill.

Zoning: CCPD-ER (Centre City Planned District - Employment/Residential Mixed-Use)

APN/Square Footage: 534-045-09 / ±15,000 SF

FAR: Minimum 5.0; Maximum 8.0; Maximum with Bonuses 10.0With Affordable Housing Bonus 14.0

Ownership:

Cabrillo Garden Inn, LLC

Address: 840 A StreetSan Diego, CA 92101

APN/Square Footage: 534-061-03 & 534-045-05 / ±15,000 SF

Hotel Name: Days Inn

Hotel Name: Best Western

7

Share and Be Fair LLC, owns the property referred to as 833 Ash Street with the following APN: 534-045-09

Cabrillo Garden Inn, LLC owns the property referred to as 840 A Street with the following APN’s:

534-061-03 534-045-05

The Owners have agreed to jointly market their individual fee-simple ownership interests in their respective property holdings to a purchaser.

Exe

cuti

ve S

umm

ary

Ownership suMMary

8

Exe

cuti

ve S

umm

ary

current iMprOveMents

833 Ash StreetDays Inn

Location: Northwest corner of 9th Avenue & A Street

Property Name: Best Western - Cabrillo Garden Inn

Owner: Cabrillo Garden Inn, LLC

Year Built/Renovated 1953/2003

Building Size: 10,026 SF

Land Size: 0.34 AC (15,000 SF)

Stories: 2

# of Rooms: 30

Parking: 17 Surface Spaces

Comments: Ask agent for Operating Statements and Franchise Agreement. 2003 renovation included new windows, new tile parapet and ADA updates.

840 A StreetBest Western - Cabrillo Garden Inn

Location: Southwest corner of Ash Street & 9th Avenue

Property Name: Days Inn

Owner: Share and Be Fair, LLC

Year Built: 1978

Building Size: 25,548 SF

Land Size: 0.34 AC (15,000 SF)

Stories: 4

# of Rooms: 44 (plus 1 on-site manager residence)

Parking: 25 Surface Spaces

Comments: Ask agent for Operating Statements and Franchise Agreement.

9

PROPERTY DESCRIPTION

A STREET

ASH STREET

8TH

AV

EN

UE

9TH

AV

EN

UE

10TH

AV

EN

UE

7TH

AV

EN

UE

EL CORTEZ CONDOS14 Floors85 Units

ARIA CONDOS23 Floors137 Units

AVA APARTMENTS

15 Floors299 Units

VANTAGE POINT APARTMENTS

40 Floors678 Units

THE REY | PHASE l APARTMENTS

25 Floors478 Units

7TH & AAPARTMENTS

PROPOSED24 Floors281 Units

THE HERITAGEAPARTMENTS

4 Floors230 Units

CORTEZ BLU CONDOS20 Floors67 Units

TEN FIFTY B ST APARTMENTS

23 Floors229 Units

THE REY | PHASE ll APARTMENTS

25 Floors464 Units

Exe

cuti

ve S

umm

ary

the neighbOrhOOd

SYMPHONY TERRACE CONDOS9 Floors56 Units

10

Exe

cuti

ve S

umm

ary

elevated site views

150 Feet - Northern View 200 Feet - Western View

250 Feet - Northeastern View 250 Feet - Southern View

11

DOWNTOWN

POINT LOMA

LA JOLLA

OLD TOWN

BALBOA PARK

MISSION VALLEY

UTC

LITTLE ITALY

Drive Times

Interstate 5 & Highway 1635 Minutes

Airport10 Minutes

Beaches15 Minutes

CORTEZ HILL

9th & Ash

Exe

cuti

ve S

umm

ary

12

san diegO cOunty Overview

San Diego County with more than 3.3 million residents is the fifth largest county in America. Bordered by the Pacific Ocean to the west, the Anza-Borrego Desert and the Laguna Mountains to the east, Marine Corps Base Camp Pendleton to the North and Mexico to the south, the diverse neighborhoods of San Diego are spread out over 4,200 square miles. With its year-round warm climate, 60 miles of coastline and appealing work, live, play lifestyle, the city is highly desirable.

Referred to as America’s finest City, the City of San Diego boasts a citywide population of nearly 1.3 million residents and more than 3 million residents county-wide. It encompasses 18 incorporated cities and numerous other charming neighborhoods and communities, including downtown’s historic Gaslamp Quarter, Little Italy, Coronado, La Jolla, Del Mar, Carlsbad, Escondido, La Mesa, Hillcrest, Barrio Logan and Chula Vista just to name a few.

The city is the heart of San Diego County and is the economic center of the region as well as the San Diego–Tijuana metropolitan area. San Diego’s main economic engines are military and defense-related activities, tourism, international trade, manufacturing and the especially rapidly growing high tech industry.

San Diego hosts several major producers of wireless cellular technology. Qualcomm was founded and is headquartered in San Diego and is one of the largest private-sector employers in San Diego. The presence of the University of California, San Diego (UCSD), with the affiliated UCSD Medical Center, has helped make the area a center of research in biotechnology.

Recently, San Diego was designated by a Forbes columnist as the best city in the country to launch a small business or startup company.

Mar

ket

Ove

rvie

w

Market Overview

13

deMOgraphics

Population

3.3 million people, San Diego is the fifth largest county in the United States and the second largest in California.

During the last year, the county’s total population rose by more than 35,000, an increase of 1.1 percent. But it was the City of San Diego that experienced the highest growth rate, out-pacing even the region’s traditionally fast-growing suburban cities.

By 2050, the region is expected to grow by roughly 1 million residents, 500,000 jobs and 330,000 housing units. As the population increases, new growth and development will continue to cluster around and concentrate within the existing urbanized areas.

Income

According to most recent United States Internal Revenue Service data, the median household income in San Diego County is $63,400 and the unemployment rate for May2017 was at 4%, lower than the national rate of 4.3%.

The California Department of Transportation is forecasting real average salaries rising by an average of 1.4 percent per year to 2019.

Real Estate

In 2017 the median price of a house in San Diego County was $572,000. The costs of housing continued to rise in San Diego in the first half of 2017 both for renters and for owners. With many residents unable to afford detached single family homes, some are choosing to buy condominiums or rent apartments.

Rising rents in the County has lead to a high demand for apartments at all price points. In the last year the average apartment rent in the county has risen 4.5% to $1,986 as the occupancy rate reached 96.3%.

In a recent study conducted by the National Multifamily Housing Council and the National Apartment Association, the San Diego metropolitan area will need 72,775 new apartments by 2030 to keep up with demand for the vastly growing population in San Diego.

According to Axiometrics, a real estate data firm, 1,857 investment-grade apartment units were built each year between 2011 & 2016 in San Diego. To attain the projected 2030 demand an average of 5,198 units will need to be built annually.

Sources: United States Department of Labor Statistics, USD Burnham-Moores Center for Real Estate’s Index of Leading Economic Indicators, Civic San Diego, California Department of Finance, Downtown San Diego Partnership, Internal Revenue Services, San Diego Business Journal

Mar

ket

Ove

rvie

w

14

dOwtOwnM

arke

t O

verv

iew

15

Downtown San Diego currently has 34,550 residents. Nestled along the San Diego Bay, and surrounded by office, retail, nightlife and endless amenities the area is highly desirable for residents looking for a work,live,play lifestyle. The recent growth and development of Downtown and its immediate surrounding areas has created a lure for smaller start up companies looking for creative office space that is conveniently located for its employees.

Downtown San Diego serves as the cultural, financial center and central business district of San Diego County with more than 5,000 businesses, over 91,000 jobs and nine districts. Three freeways (Interstate 5, Highway 163 and Highway 94) either pass through or start/end in Downtown San Diego. The area is served by the San Diego Metropolitan Transit System and the San Diego Trolley. Commuter trains also link downtown with northern San Diego County. The San Diego International Airport is located directly north of Downtown.

In recent years the area has become a revitalized, vibrant community and one of the most sought-after development opportunities in the nation. All of the current development activity is concentrated in the East Village and Little Italy. Cranes now mark where new office towers, luxury condos, apartments and hotels will soon join the skyline. There are approximately 25,000 housing units and 76% of those units are occupied by renters and downtown’s population has grown by 97% since 2000. Restaurants with upscale comfort-food menus and trendy bars are lining the streets and prospective residents are eager to become part of the new urban Downtown San Diego lifestyle.

24,744 Housing Units 76% Renters $2,261 Average Rent

Mar

ket

Ove

rvie

w

16

cOrtez hillM

arke

t O

verv

iew

17

Cortez Hill neighborhood is located at the highest point of Downtown, providing spectacular views of the Downtown skyline, the San Diego Bay, Pacific Ocean, beautiful Balboa Park, and eastern mountains of San Diego County. This historic district was named after its feature attraction, the El Cortez Hotel. The friendly environment of Cortez Hill’s primarily bedroom community is known for its varied housing options, quiet streets, but most of all its walkability to many areas, such as; Balboa Park, Downtown Business District, Entertaining Gaslamp Quarter, Little Italy, waterfront and Petco Park. It is home to appealing sidewalk shops and cafes, churches, and a variety of residential properties. These many unique features are reasons why Cortez Hill is one of the most sought after neighborhoods for Downtown residents.

17

9th & Ash

Mar

ket

Ove

rvie

w

19

Broadstone Little Italy Address: 1980 Kettner Boulevard199 Units/200 Parking StallsStories: 6Year Built: 2014Average Unit: 823 SFOccupancy: 94%Ownership: InvescoManagement: Alliance Communities

CurrentAddress: 1551 Union Street144 Units/144 Parking StallsStories: 11Year Built: 2007Average Unit: 1,186 SFOccupancy: 98.6%Ownership: UDRManagement: UDR

LOFTS/STUDIOS(70)

SF Range Monthly Rent Rent/SF

HIGH 725 $3,075 $4.83

LOW 517 $2,310 $3.41

AVERAGE 628 $2,693 $4.12

ONE BEDROOM(69)


HIGH 1,195 $3,332 $4.99

LOW 668 $2,704 $2.58

AVERAGE 932 $3,018 $3.78

TWO BEDROOM(63)


HIGH 1,295 $4,387 $4.07

LOW 970 $3,514 $3.22

AVERAGE 1,133 $3,951 $3.65

THREE BEDROOM


HIGH N/A N/A N/A

LOW N/A N/A N/A

AVERAGE N/A N/A N/A

Amenities: Business Center, Cabana, Clubhouse, Elevator, Fitness Center, Grill, Pool, Property Manager on Site, Spa

Amenities: Business Center, Clubhouse, Concierge, Fitness Center, Media Center/Movie Theatre, Playground, Pool, Property Manager on Site

LOFTS/STUDIOS(3)


HIGH 460 $1,853 $4.03

LOW 460 $1,853 $4.03

AVERAGE 460 $1,853 $4.03

ONE BEDROOM(64)


HIGH 1400 $4,265 $3.68

LOW 602 $2,011 $2.31

AVERAGE 1025 $3,138 $3.00

TWO BEDROOM(77)


HIGH 1,740 $4,650 $3.10

LOW 1,260 $3,483 $2.36

AVERAGE 1,430 $4,067 $2.73

THREE BEDROOM


HIGH N/A N/A N/A

LOW N/A N/A N/A

AVERAGE N/A N/A N/A

Mar

ket

Ove

rvie

w

apartMent rental cOMparables

20

Strata Address: 969 Market Street163 Units/100 Parking StallsStories: 23Year Built: 2009Average Unit: 1,312 SFOccupancy: 95.7%Ownership: UDRManagement: UDRAmenities: Business Center, Clubhouse, Elevator, Fitness Center, Grill, Pool, Media Center, Property Manager on Site, Spa

The ReyAddress: 801 A Street478 Units/525 Parking StallsStories: 25Year Built: 2017Average Unit: 687 SFOccupancy: 80% (In Lease-Up)Ownership: Wood Partners Management: Berkshire Group Amenities: Concierge, Doorman, Fitness Center, Laundry Facilities, Maintenance on site, Sky Deck, Pool, Property Manager on Site, Spa, Bike and Surf Storage Space

LOFTS/STUDIOS


HIGH N/A N/A N/A

LOW N/A N/A N/A

AVERAGE N/A N/A N/A

ONE BEDROOM(80)


HIGH 1,443 $3,836 $4.04

LOW 710 $2,636 $2.27

AVERAGE 1,143 $3,236 $3.16

TWO BEDROOM(65)


HIGH 1859 $7,082 $4.03

LOW 1206 $3,508 $2.28

AVERAGE 1544 $5,295 $3.16

THREE BEDROOM(18)


HIGH 1225 $3,843 $3.14

LOW 1225 $3,843 $3.14

AVERAGE 1225 $3,843 $3.14

LOFTS/STUDIOS(116)


HIGH 470 $1,897 $4.15

LOW 401 $1,665 $3.85

AVERAGE 436 $1,781 $4.00

ONE BEDROOM(277)


HIGH 866 $3,937 $4.78

LOW 600 $2,125 $3.16

AVERAGE 733 $3,031 $3.97

TWO BEDROOM(85)


HIGH 1027 $3,575 $3.48

LOW 930 $3,060 $3.16

AVERAGE 979 $3,318 $3.32

THREE BEDROOM


HIGH N/A N/A N/A

LOW N/A N/A N/A

AVERAGE N/A N/A N/A

Mar

ket

Ove

rvie

w

apartMent rental cOMparables cOnt.

21Rendering is a hypothetical. This is not an entitled site.

Yield Study courtesy of JWDA. This is not an entitled site. Neither Broker nor Owners guaranty or warrant that a mulit-family development as described herein may be constructed. The information shown on the following page is deemed reliable but no representation or warranty is to be inferred from these projections from JWDA. These assumptions represent a predicition of future events which may or may not occur and may not be relied on to indicate the actual

project that may be developed.

Multi-faMily develOpMent

prOject data: Site Area: ±30,000 SFMAX FAR: 10 with Bonus DensityConstruction Type: Type I High-RiseHeight: 24 Stories over 3.5 Levels Below GradeGross Building Area: 300,000 SF

Retail: 8,000 SFLobby: 5,000 SFFitness & Amenity: 6,000 SF

Net Residential Rentable: 243,000 SFTotal Units: 280+Total Parking: 400 (3.5 Levels Below & 3 Levels Above Grade)

yield study

22

Yie

ld S

tudy

Multi-faMily develOpMent

sectiOn:

*Yield Study courtesy of JWDA. This is not an entitled site.

23

Of f e r i n g MeM O r an d u MSale and Redevelopment9th & Ash Street, San Diego, CA 92101

Exclusive Advisors

Doug Ceresia, SIOR, CCIMSenior Vice President619.241.2388 | [email protected] # 01314250

Josh BuchholzSenior Vice President619.241.2380 | [email protected] #01161038

Matt MiduraSenior Director619.241.2383 | [email protected] # 01826378

Architectural Advisors

Joseph O. Wong, FAIAFounder & Architect619.233.6777 | [email protected]

Christoph FasslerSenior Associate619.233.6777 | [email protected]

offering memorandum - loopnet · 9th & ash street, san diego, ca 92101 exclusive advisors. doug...

Documents