479 4 avenue · 2017. 11. 13. · 479 th4 avenue is a free-market 8-family apartment building...
TRANSCRIPT
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THE
BRENNAN
TEAM [JB] JOHN BRENNAN
Vice President Investments
License: NY: 10401237299
718.475.4373
RICHARD SODEKE
Investment Associate
License: NY: 10401297095
718.475.4365
479 4th Avenue
Brooklyn NY, 11215
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CONFIDENTIALITY
AGREEMENT
CONFIDENTIALITY AND DISCLAIMER
The information contained in the following Marketing Brochure
is proprietary and strictly confidential. It is intended to be
reviewed only by the party receiving it from Marcus & Millichap
and should not be made available to any other person or
entity without the written consent of Marcus & Millichap. This
Marketing Brochure has been prepared to provide summary,
unverified information to prospective purchasers, and to
establish only a preliminary level of interest in the subject
property. The information contained herein is not a substitute
for a thorough due diligence investigation. Marcus & Millichap
has not made any investigation, and makes no warranty or
representation, with respect to the income or expenses for the
subject property, the future projected financial performance of
the property, the size and square footage of the property and
improvements, the presence or absence of contaminating
substances, PCB's or asbestos, the compliance with State and
Federal regulations, the physical condition of the improvements
thereon, or the financial condition or business prospects of any
tenant, or any tenant's plans or intentions to continue its
occupancy of the subject property. The information contained
in this Marketing Brochure has been obtained from sources we
believe to be reliable; however, Marcus & Millichap has not
verified, and will not verify, any of the information contained
herein, nor has Marcus & Millichap conducted any
investigation regarding these matters and makes no warranty
or representation whatsoever regarding the accuracy or
completeness of the information provided. All potential buyers
must take appropriate measures to verify all of the information
set forth herein. Marcus & Millichap is a service mark of Marcus
& Millichap Real Estate Investment Services, Inc. © 2017 Marcus
& Millichap. All rights reserved.
NON-ENDORSEMENT NOTICE
Marcus & Millichap is not affiliated with, sponsored by, or
endorsed by any commercial tenant or lessee identified in this
marketing package. The presence of any corporation'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 or subsidiaries, or any agent, product,
service, or commercial listing of Marcus & Millichap, and is
solely included for the purpose of providing tenant lessee
information about this listing to prospective customers.
ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.
PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR
MORE DETAILS.
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TABLE OF CONTENTS
FINANCIAL ANALYSIS………………………………………….5
PROPERTY OVERVIEW…………………………………………8
MARKET OVERVIEW……………………………………………14
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FINANCIAL ANALYSIS
479 4TH AVENUE Unit Status Type Approx.
Square
Feet
Current Rent Current/SF Lease
Expiration
Pro-Forma
Rent
Pro-Forma
/SF
1 FM 3BR –
Duplex
1,715 $6,500.00 $45.48 11.30.2017 $6,500.00 $46.38
2F FM 2BR 690 $2,950.00 $51.30 10.31.2018 $3,300.00 $57.39
2B FM 2BR 690 $3,100.00 $53.91 12.31.2017 $3,300.00 $57.39
3F FM 2BR 690 $3,100.00 $53.91 10.31.2017 $3,300.00 $57.39
3B FM 2BR 690 $3,000.00 $52.17 4.30.2018 $3,300.00 $57.39
4F FM 2BR 690 $3,100.00 $53.91 10.31.2018 $3,300.00 $57.39
4B FM 2BR 690 $3,000.00 $52.17 6.30.2018 $3,300.00 $57.39
5 FM 3BR – Roof Deck
1,045 $4,250.00 $48.80 8.31.2018 $4,500.00 $51.67
CURRENT MONTHLY $29,000.00 PRO-FORMA MONTHLY $30,800.00
CURRENT ANNUAL $348,000.00 PRO-FORMA ANNUAL $369,600.00
RENT ROLL
PAGE 5
*Pro-forma numbers reflect a projected market rent of $44-$57/SF depending on unit type.
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FINANCIAL ANALYSIS
CURRENT PRO-FORMA
Gross Scheduled Rent $348,000.00 $369,600
Less: Vacancy/ Deduction 3.00% ($10,440.00) 3.00% ($11,088.00)
Total Effective Rental Income $337,560.00 $358,512.00
Other Income $0 $0
Effective Gross Income $337,560.00 $358,512.00
Taxes $13,751.00 $13,751.00
Fuel $0.00* $0.00*
Water & Sewer $4,756.00* $4,756.00*
Insurance $7,911.76* $7,911.76*
Electric $1,427.23* $1,427.23*
Repairs $4,000.00** $4,000.00**
Payroll $3,200.00** $3,200.00**
Management $10,126.80** $10,755.36
Less: Total Expenses 13.38% ($45,172.79) 12.78% ($45,801.35)
Net Operating Income $292,387.21 $312,710.68
CAP Rate 4.50% 4.81%1
Debt Service $210,153.00 $210,153.00
Net Cash Flow After Debt Service %3.16 $82,234.00 %3.94 $102,558.00
Principal Reduction $74,846.00 $77,508.00
Total Return 6.04% $157,080.00 6.93% $180,066.00
OPERATING STATEMENT
*Actual Expense Experienced by Owner
** Projected Expense 1 Pro-forma cap rate factors in projected market rent of $44-$57/SF depending on unit type.
PAGE 6
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FINANCIAL ANALYSIS
$6,500,000 8 Residential Units
7,874 Total Gross Square Feet
5,086 Square Feet of Available Air Rights
$812,500 Per Unit
$672.53 Per Square Foot
$501.54 Per Buildable Square Foot
PRO-FORMA METRICS CAP RATE……………………….…… 4.81%1
GRM ………………………………….17.59
CASH-ON-CASH …………………….3.94%
CURRENT METRICS CAP RATE……………………… 4.50%
GRM …………………………….18.68
CASH-ON-CASH ………………3.16%
FINANCING QUOTE Loan Amount: $3,900,000
Term: 5 years
Interest Rate 3.50%
Monthly Payment $17,513
Amortization 30 Years
Debt Coverage Ratio: 1.46
Non-Recourse
Fixed-rate loans with terms of 7, 10, 15 and 20 years may also be available for this asset. Additionally, other non-standard terms
may be available including reduced pre-payment costs, interest-only periods, and expedited funding timelines.
*For Financing Inquiries, please contact Lior Goldberg of Marcus & Millichap Capital Corporation – 718.475.4375
60%
40%
LTV
Debt Equity
1Pro-forma cap rate factors in projected market rent of $44-$57/SF depending on unit type.
PAGE 7
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PROPERTY OVERVIEW
Marcus & Millichap has been exclusively engaged to represent ownership in the sale of 479 4th Avenue, a
five story apartment buildings located between 11th and 12th Streets in the Park Slope neighborhood of
Brooklyn, NY (Block: 1022, Lots: 05). The property is comprised of 8 residential units of occupied high-quality
residential apartments. 479 4th Avenue is entirely deregulated from rent-stabilization.
479 4th Avenue is a free-market 8-family apartment building totaling approximately 7,874 gross square feet,
with 5,086 square feet of unused air rights. This building measures 27 feet wide by 64 feet deep. The actual
collected income of this property is $348,000 per year.
The subject offering is a rare opportunity to acquire a cash-flowing & highly financeable apartment
buildings in one of New York City’s premier submarkets. The asset is a turn-key investment with extensive
upgrades throughout, allowing a new investor to attract high-quality housing demand for the foreseeable
future. 479 4th Avenue offers a new investor multiple options to reposition this asset, or can simply be held at
an attractive 4.50% cap rate with minimal management.
This is a section of Park Slope where condo units are achieving a sell-out scenario of $1100-$1300/SF. With
numerous ongoing development projects in a few block radii, the property also offers a new purchaser
considerable unused air-rights to be developed.
The building is situated two blocks away from the 4th Avenue - 9th Street (F, G, R) train stations and five
blocks away from the Prospect Avenue (R) train station, providing flexible commute options into
Manhattan and other parts of Brooklyn.
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Investment Highlights
▪ Park Slope 8 Unit Trophy Offering
▪ Modern Luxury-Style Residential Units Generating Annual Gross Income:
$348,000/Year
▪ 8 Free-Market Apartments
▪ 5 Story Walk-Up Pre-War Apartment Buildings
▪ Total of 5,086 SF Additional Unused Air Rights Based on R8A Zoning
▪ Professionally Maintained Real Estate with 0 DOB Violations
▪ Turn-Key Assets with Absolutely No Capital Expenditure Needed
▪ Immediate 4.50% Capitalization Rate with Multiple Exit Strategies & Creative
Upside Options
▪ Realistic Condo Conversion Candidate with High-End Condo Units Trading
Upwards of $1200/SF
▪ Annual Current Tax Bill - $13,751 Current Annual
▪ Multiple Transit Options in Immediate Vicinity: 9th St. (F, G, R) Station
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PROPERTY OVERVIEW
479 4th Avenue
Zoning R8A, C2-4, EC-1
Block/Lot 1022-05
Building Dimensions 27 ft. x 64 ft.
Building Gross Square
Feet
7,874 SF
Lot Dimensions 27 ft. x 80 ft.
Residential FAR 6
Facility FAR 6
FAR as built 3.65
Additional Air Rights 5,086 SF
Annual Tax Bill $13,751
Tax Class 2B
Status Free-Market
Tax Abatement None
PAGE 10
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INTERIOR PICTURES
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INTERIOR PICTURES
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MECHANICALS & COMMON AREAS
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EXTERIOR PICTURES
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FLOOR PLANS
APT
#1
LAYOUT
APTS
#4F & 3F
LAYOUTS
PAGE 15
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BROOKLYN OVERVIEW
HIGH POPULATION DENSITY Were it to be counted as a standalone city,
Brooklyn would be the fourth largest in the
nation.
CULTURALLY DIVERSE There are almost 100 different ethnic groups
offering unparalleled diversity and access to the
cultures of the world.
COMPETITIVE BUSINESS COSTS Brooklyn has lower business costs than Manhattan
and is easily accessible to the tri-state marketplace.
METRO HIGHLIGHTS
SPORTS
ARTS & ENTERTAINMENT
EDUCATION
Located across the East River from Manhattan, Brooklyn
is the most populous of the five New York City boroughs.
Brooklyn covers 71 square miles of the land mass shared
with Queens. Brooklyn is bordered to the east and south
by the Atlantic Ocean, to the west by the Upper New
York Bay and the East River, and to the north by the
borough of Queens. The borough of Brooklyn, with a
population of more than 2.5 million, is located entirely
within Kings County and is divided into 18 community
districts, many of which have been made famous in
movies, books and television. Some of the most well-
known neighborhoods include Williamsburg, Brooklyn
Heights, Park Slope and Coney Island.
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BROOKLYN OVERVIEW
34.5
2016 MEDIAN AGE:
U.S. Median: 37.7
$47,100
2016 MEDIAN HOUSEHOLD INCOME:
U.S. Median: $54,500
2.7M
2016 POPULATION:
Growth 2016-2021*:
1.8%
995K
2016 HOUSEHOLDS:
2.6%
Growth 2016-2021*:
PAGE 17
2016 Population by Age
0-4 YEARS 8%
5-19 YEARS 18%
20-24 YEARS 7%
25-44 YEARS 32%
45-64 YEARS 23%
65+ YEARS 12%
Ongoing revitalization efforts boroughwide have spawned a modest rebirth of the local
economy. As the maritime industry’s impact wanes, borough officials are developing
creative ways to capitalize on the desirable waterfront location such as in the Brooklyn
Navy Yard, Erie Basin/Sunset Park, Newtown Creek and the Red Hook Marine Terminal.
Residents and visitors have a number of entertainment, sports and cultural venues to
choose from. The Brooklyn Nets and New York Islanders play in the Barclays Center.
Cultural and academic institutions include Brooklyn Academy of Music, the Brooklyn
Museum, the New York Aquarium, Prospect Park and the Brooklyn Botanic Garden.
DEMOGRAPHICS
QUALITY OF LIFE
SHARE OF 2016 TOTAL EMPLOYMENT
MANUFACTURING 3%
GOVERNMENT
HEALTH SERVICES EDUCATION AND +
OTHER SERVICES 5%
LEISURE AND HOSPITALITY FINANCIAL ACTIVITIES
19% AND UTILITIES TRADE, TRANSPORTATION CONSTRUCTION
PROFESSIONAL AND BUSINESS SERVICES
2% INFORMATION
8%
4%
14% 8% 5%
33%
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EXCLUSIVE LISTING AGENTS
JOHN BRENNAN Vice President Investments
1 MetroTech Center Suite 2001
Brooklyn NY 11201
TEL: 718.475.4373
FAX: 718.475.4310
License: NY 10401237299
RICHARD SODEKE Investment Associate
1 MetroTech Center Suite 2001
Brooklyn NY 11201
TEL: 718.475.4365
FAX: 718.475.4310
License: NY 10401297095