825 andrade ave - amazon s3 · 825 andrade ave property description 825 andrade ave calexico, ca...

2635 Camino del Rio S San Diego, CA 92108 www.acicommercial.com

Investment Highlights

Exclusive listing by:

For More Information The Courtney Gabhart Group619-725-3632

825 Andrade Ave825 Andrade Ave, Calexico, CA 92231

Curtis Gabhart, PrincipalDRE# 01316761

Senior VP & PrincipalKeith CourtneySenior VP & Principal

High Leverage (up to 80%)Seller Financing at 5% InterestOnly for 10 Years

■

Potential 16% first year Cash onCash Return

■

Walking Distance to Elementary,Middle and High Schools

■

Good Location near newhousing & shoppingdevelopments

■

Long Term Growth andAffordable Housing

■

Table of Contents

Real Estate Investment Details ..................................................................................... 3

Biography......................................................................................................................... 4

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

Property Photos ............................................................................................................. 6

Maps and Aerials ........................................................................................................... 7

Executive Summary ...................................................................................................... 9

Pro Forma Summary .................................................................................................... 10

Cash Flow Analysis ...................................................................................................... 11

Annual Property Operating Data .................................................................................. 12

Unit Mix Report ............................................................................................................... 13

Property Resale Analysis ........................................................................................... 14

Financial Indicators ...................................................................................................... 15

Investment Return Analysis .......................................................................................... 16

Cumulative Analysis .................................................................................................... 17

Property Equity Analysis ............................................................................................ 18

Equity vs. Debt ............................................................................................................... 19

Cumulative Wealth Analysis .......................................................................................... 20

Gross Income Vs. Operating Expenses ...................................................................... 21

Investment Package .................................................................................... Attachment

Flyer ............................................................................................................... Attachment

Appraisal Report 2007 ................................................................................ Attachment

Real Estate Investment Details

ANALYSIS

Analysis Date: August 2009

PROPERTY

Property: 825 Andrade Ave

Property Address: 825 Andrade AveCalexico, CA 92231

FINANCIAL INFORMATION

Down Payment: $370,000

Passive Loss Rules: No

Closing Costs: $7,500

LT Capital Gain: 15.00%

Federal Tax Rate: 35.0%

State Tax Rate: 10.0%

Discount Rate: 4.00%

PURCHASE INFORMATION

Property Type: Multi-Family

Purchase Price: $1,850,000

Units: 36

Total Rentable Sq. Ft.: 32,690

Resale Valuation 7.0% (capitalization of noi)

Resale Expenses: 6.0%

LOANS

Debt Term Rate Payment LO Costs

Interest Only $1,480,000 10 yrs 5.0% $6,167

INCOME & EXPENSES

Gross Operating Income: $263,640

Monthly GOI: $21,970

Total Annual Expenses: ($118,404)

Monthly Expenses: ($9,867)

CONTACT INFORMATION

Curtis Gabhart, Principal

DRE# 01316761

619-725-3632

[email protected]

Keith Courtney

DRE # 01028193

619-725-3635

DISCLAIMER: All information is believed to be accurate.

The calculations and data presented are deemed to be accurate, but not guaranteed. They are intended for the purpose of illustrative projectionsand analysis. The information provided is not intended to replace or serve as substitute for any legal, accounting, investment, real estate, tax orother professional advice, consultation or service. The user of this software should consult with a professional in the respective legal, accounting,tax or other professional area before making any decisions.

page 3 of 21

Biography825 Andrade Ave

825 Andrade AveCalexico, CA 92231

Curtis Gabhart, Principal619-725-3632

PROFESSIONAL BIO

page 4 of 21

Property Description825 Andrade Ave



Property Description

This is a 36-unit property with a total rentablesquare footage of 32,690 which includes laundryroom, office, and storage. It has a largecourtyard with a concrete deck and grass. Lotsof improvements were made including newconcrete steps,rain gutters,hand railings andblock wall and gate.

*** The information contained herein is fromsources believed to be accurate, but ACICommercial makes no warranty(ies), expressedor implied, regarding same.

AREA DESCRIPTION: CALEXICOCalexico is one of California's best kept secrets. A delightful blend of American and Mexicancultures, Calexico's small-town lifestyle, combined with its convenient proximity to the metropolitanareas of Mexicali and San Diego, make it a great place to live. Calexico's climate is sunny year-round, and offers little to inhibit outdoor recreation. Golfing, water sports, hunting, fishing and hikingare all available in the immediate area, and the beautiful beaches of San Diego and Baja Californiaare easily accessible for day trips or fun-filled vacations. Just across the border, Mexicali is acultural and entertainment center offering ample opportunity for fine dining, theatre, music andmore.

Calexico offers the most affordable prime commercial/industrial sites, and energy resources in thestate. Land, water and power are all available at bargain prices unheard of elsewhere in California.Industrial park sites are ready for occupancy or construction, and Calexico's economic developmentprofessionals are eager to cut through the red tape to speed your project down the road to approvaland completion.

page 5 of 21

Property Photos825 Andrade Ave



Property Photos

Spacious Courtyards

Adjacent Apartment Complex Housing Across Street

page 6 of 21

Maps and Aerials825 Andrade Ave



Maps and Aerials

Street Map

Regional Map

page 7 of 21




The Location

page 8 of 21

Executive Summary825 Andrade Ave



ACQUISITION COSTS

Purchase Price, Points and Closing Costs $1,857,500

Investment - Cash $377,500

First Loan $1,480,000

INVESTMENT INFORMATION

Purchase Price $1,850,000

Price per Unit $51,389

Price per Sq. Ft. $56.59

Income per Unit $7,700

Expenses per Unit ($3,289)

INCOME, EXPENSES & CASH FLOW

Gross Scheduled Income $277,200

Total Vacancy and Credits ($13,560)

Operating Expenses ($118,404)

Net Operating Income $145,236

Debt Service ($74,000)

Cash Flow Before Taxes $71,236

Total Interest (Debt Service) ($74,000)

Depreciation and Amortization ($51,772)

Taxable Income (Loss) $19,464

Tax Savings (Costs) ($8,759)

Cash Flow After Taxes $62,477

FINANCIAL INDICATORS

Cash on Cash Return Before Taxes 18.87%

Optimal Internal Rate of Return (yr 1) 47.78%

Debt Coverage Ratio 1.96

Capitalization Rate 7.85%

Gross Rent Multiplier 6.67

Gross Income / Square Feet $8.48

Gross Expenses / Square Feet ($3.62)

Operating Expense Ratio 44.91%

page 9 of 21

Pro Forma Summary825 Andrade Ave



UNIT MIX & ANNUAL SCHEDULED INCOME

Type Units Actual Total Market Total

1 Bed/1 Bath 8 $6,600 $52,800 $6,900 $55,200

2 Bed/1 Bath 28 $7,800 $218,400 $8,100 $226,800

TOTALS 36 $271,200 $282,000

ANNUALIZED INCOME

Actual MarketGross Potential Rent $271,200 $282,000

Less: Vacancy ($13,560) ($14,100)

Misc. Income $6,000 $6,000

Effective Gross Income $263,640 $273,900

Less: Expenses ($118,404) ($118,404)

Net Operating Income $145,236 $155,496

Debt Service ($74,000) ($74,000)

Net Cash Flow after Debt Service $71,236 $81,496

Principal Reduction $0 $0

Total Return $71,236 $81,496

ANNUALIZED EXPENSES

Description Actual MarketProperty Management Fee $13,395 $13,395

On-Site Management $7,500 $7,500

Misc $76,604 $76,604

Taxes - Real Estate $20,905 $20,905

Total Expenses $118,404 $118,404

Expenses Per RSF $3.62 $3.62

Expenses Per Unit $3,289 $3,289

INVESTMENT SUMMARY

Price: $1,850,000

Units: 36

Price/Unit: $51,389

RSF: 32,690

Price/RSF: $56.59

Cap Rate: 7.85%

Pro Forma Cap Rate: 8.41%

GRM: 6.7

Pro Forma GRM: 6.4

FINANCING SUMMARY

Loan Amount: $1,480,000


Loan Type: Interest Only

Interest Rate: 5.00000%

Term: 10 years

Monthly Payment: $6,166.67

page 10 of 21

Cash Flow Analysis825 Andrade Ave



Description Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10

GROSS SCHEDULED INCOME $277,200 $285,576 $294,206 $303,097 $312,257 $321,695 $331,419 $341,437 $351,759 $362,394

Turnover Vacancy ($13,560) ($13,967) ($14,386) ($14,817) ($15,262) ($15,720) ($16,191) ($16,677) ($17,177) ($17,693)

Total Operating Expenses ($118,404) ($121,822) ($125,342) ($128,965) ($132,697) ($136,539) ($140,496) ($144,570) ($148,766) ($153,087)

NET OPERATING INCOME $145,236 $149,787 $154,478 $159,314 $164,298 $169,436 $174,732 $180,190 $185,816 $191,615

Loan Payment ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000)

NET CASH FLOW (b/t) $71,236 $75,787 $80,478 $85,314 $90,298 $95,436 $100,732 $106,190 $111,816 $117,615

Cash On Cash Return b/t 18.87% 20.08% 21.32% 22.60% 23.92% 25.28% 26.68% 28.13% 29.62% 31.16%


Depreciation ($51,772) ($54,031) ($54,031) ($54,031) ($54,031) ($54,031) ($54,031) ($54,031) ($54,031) ($51,781)

Loan Interest ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000)

TAXABLE INCOME (LOSS) $19,464 $21,756 $26,447 $31,283 $36,267 $41,405 $46,701 $52,159 $57,785 $65,834

Income Taxes ($8,759) ($9,790) ($11,901) ($14,077) ($16,320) ($18,632) ($21,015) ($23,472) ($26,003) ($29,625)

CASH FLOW (a/t) $62,477 $65,997 $68,577 $71,237 $73,978 $76,804 $79,716 $82,718 $85,813 $87,990

Cash On Cash Return a/t 16.55% 17.48% 18.17% 18.87% 19.60% 20.35% 21.12% 21.91% 22.73% 23.31%

Footnotes: b/t = before taxes;a/t = after taxes

page 11 of 21

Annual Property Operating Data825 Andrade Ave




Rental Income $271,200 $279,336 $287,716 $296,348 $305,238 $314,395 $323,827 $333,542 $343,548 $353,854

Miscellaneous Income $6,000 $6,240 $6,490 $6,749 $7,019 $7,300 $7,592 $7,896 $8,211 $8,540



GROSS OPERATING INCOME $263,640 $271,609 $279,820 $288,279 $296,995 $305,975 $315,228 $324,760 $334,582 $344,702

Expenses

Property Management Fee ($13,395) ($13,797) ($14,211) ($14,637) ($15,076) ($15,528) ($15,994) ($16,474) ($16,968) ($17,477)

On-Site Management ($7,500) ($7,800) ($8,112) ($8,436) ($8,774) ($9,125) ($9,490) ($9,869) ($10,264) ($10,675)

Misc ($76,604) ($78,902) ($81,269) ($83,707) ($86,218) ($88,805) ($91,469) ($94,213) ($97,040) ($99,951)

Taxes - Real Estate ($20,905) ($21,323) ($21,750) ($22,185) ($22,628) ($23,081) ($23,542) ($24,013) ($24,494) ($24,983)

TOTAL OPERATING EXPENSES ($118,404) ($121,822) ($125,342) ($128,965) ($132,697) ($136,539) ($140,496) ($144,570) ($148,766) ($153,087)


page 12 of 21

Unit Mix Report825 Andrade Ave



UNIT MIXES

# Units Type Approx. SqFt Avg. Rents Monthly Mkt Rents Monthly8 1 Bed/1 Bath 0 $550 $4,400 $575 $4,60028 2 Bed/1 Bath 0 $650 $18,200 $675 $18,90036 0 $22,600 $23,500

UNIT MIX UNIT MIX SQUARE FEET

● 1 Bed/1 Bath

● 2 Bed/1 Bath

● 1 Bed/1 Bath

● 2 Bed/1 Bath

UNIT MIX INCOME UNIT MIX MARKET INCOME

● 1 Bed/1 Bath

● 2 Bed/1 Bath

● 1 Bed/1 Bath

● 2 Bed/1 Bath

page 13 of 21

Property Resale Analysis825 Andrade Ave




Projected Property Value $2,139,816 $2,206,834 $2,275,914 $2,347,120 $2,420,515 $2,496,167 $2,574,144 $2,654,517 $2,737,359 $2,822,743

Resale Expenses ($128,389) ($132,410) ($136,555) ($140,827) ($145,231) ($149,770) ($154,449) ($159,271) ($164,242) ($169,365)

Proceeds b/f Debt Payoff $2,011,427 $2,074,424 $2,139,359 $2,206,293 $2,275,284 $2,346,397 $2,419,696 $2,495,246 $2,573,117 $2,653,379

Basis at Acquisition $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500

Depreciation ($51,772) ($105,803) ($159,834) ($213,865) ($267,896) ($321,927) ($375,958) ($429,989) ($484,020) ($535,801)

Adjusted Tax Basis $1,805,728 $1,751,697 $1,697,666 $1,643,635 $1,589,604 $1,535,573 $1,481,542 $1,427,511 $1,373,480 $1,321,699

Resale Tax Gain (Loss) $205,699 $322,727 $441,694 $562,658 $685,681 $810,824 $938,154 $1,067,735 $1,199,637 $1,331,680

Resale Tax Benefit (Cost) ($36,032) ($58,989) ($82,237) ($105,785) ($129,642) ($153,816) ($178,319) ($203,159) ($228,348) ($253,332)

Loan Principal Balance ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) $0

Balloon/Call Payment $0 $0 $0 $0 $0 $0 $0 $0 $0 ($1,480,000)

Net Resale Proceeds $495,395 $535,435 $577,122 $620,507 $665,643 $712,581 $761,377 $812,087 $864,770 $920,047

Footnotes: b/f = before

page 14 of 21

Financial Indicators825 Andrade Ave




Gross Rent Multiplier 7.72 7.73 7.74 7.74 7.75 7.76 7.77 7.77 7.78 7.79

Capitalization Rate 7.85% 8.10% 8.35% 8.61% 8.88% 9.16% 9.44% 9.74% 10.04% 10.36%



Debt Coverage Ratio 1.96 2.02 2.09 2.15 2.22 2.29 2.36 2.44 2.51 2.59

Gross Income per Sq. Ft. $8.48 $8.74 $9.00 $9.27 $9.55 $9.84 $10.14 $10.44 $10.76 $11.09

Expenses per Sq. Ft. ($3.62) ($3.73) ($3.83) ($3.95) ($4.06) ($4.18) ($4.30) ($4.42) ($4.55) ($4.68)

Net Income Multiplier 14.73 14.73 14.73 14.73 14.73 14.73 14.73 14.73 14.73 14.73

Operating Expense Ratio 44.91% 44.85% 44.79% 44.74% 44.68% 44.62% 44.57% 44.52% 44.46% 44.41%

Loan To Value Ratio 69.16% 67.06% 65.03% 63.06% 61.14% 59.29% 57.49% 55.75% 54.07% 0.00%

Footnotes: b/t = before taxes; a/t = after taxes

page 15 of 21

Investment Return Analysis825 Andrade Ave




Cash Flow - To Date $62,477 $128,474 $197,051 $268,288 $342,266 $419,070 $498,786 $581,505 $667,317 $755,307


Invested Capital ($377,500) ($377,500) ($377,500) ($377,500) ($377,500) ($377,500) ($377,500) ($377,500) ($377,500) ($377,500)

Net Return on Investment $180,372 $286,409 $396,673 $511,295 $630,409 $754,151 $882,663 $1,016,092 $1,154,587 $1,297,854

Internal Rate of Return 47.78% 34.77% 30.46% 28.20% 26.77% 25.75% 24.98% 24.37% 23.88% 23.46%

Modified IRR 47.78% 32.87% 27.47% 24.42% 22.36% 20.81% 19.59% 18.59% 17.74% 17.01%

NPV (cash flow + reversion) $167,338 $256,105 $345,670 $435,950 $526,866 $618,344 $710,312 $802,705 $895,457 $988,888

PV (NOI + reversion) $2,073,715 $2,196,058 $2,317,350 $2,437,598 $2,556,809 $2,674,991 $2,792,150 $2,908,296 $3,023,434 $3,137,572

Footnotes: a/t = after taxes; Modified IRR = Modified Internal Rate of Return; PV = Present Value; NPV = Net Present Value; NOI = Net Operating IncomeReversion = Amount received from the resale; Net Return on Investment = Cash Flow (a/t To Date) + Net Proceeds from Resale - Invested Capital.

page 16 of 21

Cumulative Analysis825 Andrade Ave




Equity (appreciation) $289,816 $356,834 $425,914 $497,120 $570,515 $646,167 $724,144 $804,517 $887,359 $972,743

Equity (loan reduction) $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,480,000

CASH FLOW (a/t) $62,477 $128,474 $197,051 $268,288 $342,266 $419,070 $498,786 $581,505 $667,317 $755,307

Totals - To Date $352,293 $485,308 $622,965 $765,408 $912,781 $1,065,237 $1,222,931 $1,386,022 $1,554,676 $3,208,051


ROIC - To Date 93.32% 128.56% 165.02% 202.76% 241.80% 282.18% 323.96% 367.16% 411.83% 849.81%

Footnotes: a/t = after taxes; ROIC = Return On Invested Capital

page 17 of 21

Property Equity Analysis825 Andrade Ave



Year 1 2 3 4 5 6 7 8 9 10

$290,000

$580,000

$870,000

$1,160,000

$1,450,000

$1,740,000

$2,030,000

$2,320,000

$2,610,000

$2,900,000

Legend

Initial Equity Equity (loan reduction) Equity (appreciation)

page 18 of 21

Equity vs. Debt825 Andrade Ave



Year 1 2 3 4 5 6 7 8 9 10

$290,000

$580,000

$870,000

$1,160,000

$1,450,000

$1,740,000

$2,030,000

$2,320,000

$2,610,000

$2,900,000

Legend

Equity Loan Principal Balance

page 19 of 21

Cumulative Wealth Analysis825 Andrade Ave



Year 1 2 3 4 5 6 7 8 9 10

$330,000

$660,000

$990,000

$1,320,000

$1,650,000

$1,980,000

$2,310,000

$2,640,000

$2,970,000

$3,300,000

Legend

Equity (loan reduction) Equity (appreciation) CASH FLOW (a/t)

page 20 of 21

Gross Income Vs. Operating Expenses825 Andrade Ave



Year 1 2 3 4 5 6 7 8 9 10

$37,000

$74,000

$111,000

$148,000

$185,000

$222,000

$259,000

$296,000

$333,000

$370,000

Legend

GROSS SCHEDULED INCOME Total Operating Expenses

page 21 of 21

Investment Package825 Andrade Ave825 Andrade AveCalexico, CA 92231

2635 Camino del Rio S San Diego, CA 92108 www.acicommercial.com


Exclusive listing by:

For More Information The Courtney Gabhart Group619-725-3632

825 Andrade Ave825 Andrade Ave, Calexico, CA 92231

Curtis GabhartSenior VP & Principal

High Leverage (up to 80%)Seller Financing at 5% InterestOnly for 10 Years

■

Potential 16% first year Cash onCash Return

■

Walking Distance to Elementary,Middle and High Schools

■

Good Location near newhousing & shoppingdevelopments

■

Long Term Growth andAffordable Housing

■

Table of Contents

Real Estate Investment Details ..................................................................................... 1

Property Description .................................................................................................... 2

Property Photos ............................................................................................................. 3

Maps and Aerials ........................................................................................................... 4

Executive Summary ...................................................................................................... 6

Pro Forma Summary .................................................................................................... 7

Cash Flow Analysis ...................................................................................................... 8

Annual Property Operating Data .................................................................................. 9

Unit Mix Report ............................................................................................................... 10

Property Resale Analysis ........................................................................................... 11

Financial Indicators ...................................................................................................... 12

Investment Return Analysis .......................................................................................... 13

Cumulative Analysis .................................................................................................... 14

Property Equity Analysis ............................................................................................ 15

Equity vs. Debt ............................................................................................................... 16

Cumulative Wealth Analysis .......................................................................................... 17

Gross Income Vs. Operating Expenses ...................................................................... 18

Real Estate Investment Details

ANALYSIS

Analysis Date: January 2009

PROPERTY

Property: 825 Andrade Ave

Property Address: 825 Andrade AveCalexico, CA 92231

FINANCIAL INFORMATION


Passive Loss Rules: No

Closing Costs: $7,500

LT Capital Gain: 15.00%

Federal Tax Rate: 35.00%

State Tax Rate: 10.0000%

Discount Rate: 4.00%

PURCHASE INFORMATION

Property Type: Multi-Family

Purchase Price: $1,850,000

Units: 36

Total Rentable Sq. Ft.: 32,690

Resale Valuation 7.000% (capitalization of noi)

Resale Expenses: 6.000%

LOANS

Debt Term Rate Payment LO Costs

Interest Only $1,480,000 10 yrs 5.00000% $6,167

INCOME & EXPENSES

Gross Operating Income: $253,380

Monthly GOI: $21,115

Total Annual Expenses: ($118,329)

Monthly Expenses: ($9,861)

CONTACT INFORMATION

Curtis Gabhart

619-725-3688

[email protected]

DISCLAIMER: All information is believed to be accurate.

The calculations and data presented are deemed to be accurate, but not guaranteed. They are intended for the purpose of illustrative projectionsand analysis. The information provided is not intended to replace or serve as substitute for any legal, accounting, investment, real estate, tax orother professional advice, consultation or service. The user of this software should consult with a professional in the respective legal, accounting,tax or other professional area before making any decisions.

page 1 of 18

Property Description825 Andrade Ave


Curtis Gabhart619-725-3688

Property Description

This is a 36-unit property with a total rentablesquare footage of 32,690 which includes laundryroom, office, and storage. It has a largecourtyard with a concrete deck and grass. Lotsof improvements were made including newconcrete steps,rain gutters,hand railings andblock wall and gate.

*** The information contained herein is fromsources believed to be accurate, but ACICommercial makes no warranty(ies), expressedor implied, regarding same.

AREA DESCRIPTION: CALEXICOCalexico is one of California's best kept secrets. A delightful blend of American and Mexicancultures, Calexico's small-town lifestyle, combined with its convenient proximity to the metropolitanareas of Mexicali and San Diego, make it a great place to live. Calexico's climate is sunny year-round, and offers little to inhibit outdoor recreation. Golfing, water sports, hunting, fishing and hikingare all available in the immediate area, and the beautiful beaches of San Diego and Baja Californiaare easily accessible for day trips or fun-filled vacations. Just across the border, Mexicali is acultural and entertainment center offering ample opportunity for fine dining, theatre, music andmore.

Calexico offers the most affordable prime commercial/industrial sites, and energy resources in thestate. Land, water and power are all available at bargain prices unheard of elsewhere in California.Industrial park sites are ready for occupancy or construction, and Calexico's economic developmentprofessionals are eager to cut through the red tape to speed your project down the road to approvaland completion.

page 2 of 18

Property Photos825 Andrade Ave



Property Photos

Spacious Courtyards

Adjacent Apartment Complex Housing Across Street

page 3 of 18




Maps and Aerials

Street Map

Regional Map

page 4 of 18




The Location

page 5 of 18

Executive Summary825 Andrade Ave



ACQUISITION COSTS

Purchase Price, Points and Closing Costs $1,857,500

Investment - Cash $377,500

First Loan $1,480,000

INVESTMENT INFORMATION

Purchase Price $1,850,000


Price per Sq. Ft. $56.59

Income per Unit $7,400

Expenses per Unit ($3,287)

INCOME, EXPENSES & CASH FLOW

Gross Scheduled Income $266,400

Total Vacancy and Credits ($13,020)

Operating Expenses ($118,329)

Net Operating Income $135,051

Debt Service ($74,000)

Cash Flow Before Taxes $61,051

Total Interest (Debt Service) ($74,000)

Depreciation and Amortization ($51,772)

Taxable Income (Loss) $9,279

Tax Savings (Costs) ($4,175)

Cash Flow After Taxes $56,876

FINANCIAL INDICATORS

Cash on Cash Return Before Taxes 16.17%

Optimal Internal Rate of Return (yr 5) 21.57%

Debt Coverage Ratio 1.83

Capitalization Rate 7.30%

Gross Rent Multiplier 6.94

Gross Income / Square Feet $8.15

Gross Expenses / Square Feet ($3.62)

Operating Expense Ratio 46.70%

page 6 of 18

Pro Forma Summary825 Andrade Ave



UNIT MIX & ANNUAL SCHEDULED INCOME

Type Units Actual Total Market Total

1 Bed/1 Bath 8 $6,300 $50,400 $6,600 $52,800

2 Bed/1 Bath 28 $7,500 $210,000 $7,800 $218,400

TOTALS 36 $260,400 $271,200

ANNUALIZED INCOME

Actual MarketGross Potential Rent $260,400 $271,200

Less: Vacancy ($13,020) ($13,560)

Misc. Income $6,000 $6,000

Effective Gross Income $253,380 $263,640

Less: Expenses ($118,329) ($118,869)

Net Operating Income $135,051 $144,771

Debt Service ($74,000) ($74,000)

Net Cash Flow after Debt Service $61,051 $70,771

Principal Reduction $0 $0

Total Return $61,051 $70,771

ANNUALIZED EXPENSES

Description Actual MarketProperty Management Fee $13,320 $13,560

On-Site Management $7,500 $7,800

Misc $76,604 $76,604

Taxes - Real Estate $20,905 $20,905

Total Expenses $118,329 $118,869

Expenses Per RSF $3.62 $3.64

Expenses Per Unit $3,287 $3,302

INVESTMENT SUMMARY

Price: $1,850,000

Units: 36

Price/Unit: $51,389

RSF: 32,690

Price/RSF: $56.59

Cap Rate: 7.3%

Pro Forma Cap Rate: 7.83%

GRM: 6.9

Pro Forma GRM: 6.7

FINANCING SUMMARY

Loan Amount: $1,480,000


Loan Type: Interest Only

Interest Rate: 5.00000%

Term: 10 years

Monthly Payment: $6,166.67

page 7 of 18

Cash Flow Analysis825 Andrade Ave






Total Operating Expenses ($118,329) ($121,748) ($125,268) ($128,893) ($132,626) ($136,469) ($140,428) ($144,504) ($148,701) ($153,024)


Loan Payment ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000)

NET CASH FLOW (b/t) $61,051 $65,294 $69,667 $74,175 $78,822 $83,612 $88,549 $93,638 $98,884 $104,290



Depreciation ($51,772) ($54,031) ($54,031) ($54,031) ($54,031) ($54,031) ($54,031) ($54,031) ($54,031) ($51,781)

Loan Interest ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000) ($74,000)

TAXABLE INCOME (LOSS) $9,279 $11,263 $15,636 $20,144 $24,791 $29,581 $34,518 $39,607 $44,853 $52,509

Income Taxes ($4,175) ($5,068) ($7,036) ($9,065) ($11,156) ($13,311) ($15,533) ($17,823) ($20,184) ($23,629)

CASH FLOW (a/t) $56,876 $60,225 $62,631 $65,110 $67,666 $70,300 $73,016 $75,815 $78,700 $80,661


Footnotes: b/t = before taxes;a/t = after taxes

page 8 of 18

Annual Property Operating Data825 Andrade Ave




Rental Income $260,400 $268,212 $276,258 $284,546 $293,082 $301,875 $310,931 $320,259 $329,867 $339,763

Miscellaneous Income $6,000 $6,240 $6,490 $6,749 $7,019 $7,300 $7,592 $7,896 $8,211 $8,540



GROSS OPERATING INCOME $253,380 $261,041 $268,935 $277,068 $285,448 $294,081 $302,977 $312,142 $321,585 $331,315

Expenses

Property Management Fee ($13,320) ($13,723) ($14,137) ($14,565) ($15,005) ($15,459) ($15,926) ($16,408) ($16,904) ($17,415)

On-Site Management ($7,500) ($7,800) ($8,112) ($8,436) ($8,774) ($9,125) ($9,490) ($9,869) ($10,264) ($10,675)

Misc ($76,604) ($78,902) ($81,269) ($83,707) ($86,218) ($88,805) ($91,469) ($94,213) ($97,040) ($99,951)

Taxes - Real Estate ($20,905) ($21,323) ($21,750) ($22,185) ($22,628) ($23,081) ($23,542) ($24,013) ($24,494) ($24,983)

TOTAL OPERATING EXPENSES ($118,329) ($121,748) ($125,268) ($128,893) ($132,626) ($136,469) ($140,428) ($144,504) ($148,701) ($153,024)


page 9 of 18

Unit Mix Report825 Andrade Ave



UNIT MIXES

# Units Type Approx. SqFt Avg. Rents Monthly Mkt Rents Monthly8 1 Bed/1 Bath 0 $525 $4,200 $550 $4,40028 2 Bed/1 Bath 0 $625 $17,500 $650 $18,20036 0 $21,700 $22,600

UNIT MIX UNIT MIX SQUARE FEET

● 1 Bed/1 Bath

● 2 Bed/1 Bath

● 1 Bed/1 Bath

● 2 Bed/1 Bath

UNIT MIX INCOME UNIT MIX MARKET INCOME

● 1 Bed/1 Bath

● 2 Bed/1 Bath

● 1 Bed/1 Bath

● 2 Bed/1 Bath

page 10 of 18

Property Resale Analysis825 Andrade Ave




Projected Property Value $1,989,908 $2,052,384 $2,116,785 $2,183,168 $2,251,595 $2,322,127 $2,394,829 $2,469,766 $2,547,006 $2,626,619

Resale Expenses ($119,394) ($123,143) ($127,007) ($130,990) ($135,096) ($139,328) ($143,690) ($148,186) ($152,820) ($157,597)

Proceeds b/f Debt Payoff $1,870,514 $1,929,241 $1,989,778 $2,052,178 $2,116,499 $2,182,800 $2,251,139 $2,321,580 $2,394,186 $2,469,022

Basis at Acquisition $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500 $1,857,500

Depreciation ($51,772) ($105,803) ($159,834) ($213,865) ($267,896) ($321,927) ($375,958) ($429,989) ($484,020) ($535,801)

Adjusted Tax Basis $1,805,728 $1,751,697 $1,697,666 $1,643,635 $1,589,604 $1,535,573 $1,481,542 $1,427,511 $1,373,480 $1,321,699

Resale Tax Gain (Loss) $64,786 $177,544 $292,112 $408,543 $526,895 $647,227 $769,597 $894,069 $1,020,706 $1,147,323

Resale Tax Benefit (Cost) ($14,895) ($37,212) ($59,800) ($82,668) ($105,824) ($129,277) ($153,035) ($177,109) ($201,508) ($225,679)

Loan Principal Balance ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) ($1,480,000) $0

Balloon/Call Payment $0 $0 $0 $0 $0 $0 $0 $0 $0 ($1,480,000)


Footnotes: b/f = before

page 11 of 18

Financial Indicators825 Andrade Ave




Gross Rent Multiplier 7.47 7.48 7.49 7.49 7.50 7.51 7.52 7.53 7.53 7.54

Capitalization Rate 7.30% 7.53% 7.77% 8.01% 8.26% 8.52% 8.79% 9.06% 9.35% 9.64%



Debt Coverage Ratio 1.83 1.88 1.94 2.00 2.07 2.13 2.20 2.27 2.34 2.41

Gross Income per Sq. Ft. $8.15 $8.40 $8.65 $8.91 $9.18 $9.46 $9.74 $10.04 $10.34 $10.65

Expenses per Sq. Ft. ($3.62) ($3.72) ($3.83) ($3.94) ($4.06) ($4.17) ($4.30) ($4.42) ($4.55) ($4.68)

Net Income Multiplier 14.73 14.73 14.73 14.73 14.73 14.73 14.73 14.73 14.73 14.73

Operating Expense Ratio 46.70% 46.64% 46.58% 46.52% 46.46% 46.41% 46.35% 46.29% 46.24% 46.19%

Loan To Value Ratio 74.38% 72.11% 69.92% 67.79% 65.73% 63.73% 61.80% 59.92% 58.11% 0.00%

Footnotes: b/t = before taxes; a/t = after taxes

page 12 of 18

Investment Return Analysis825 Andrade Ave




Cash Flow - To Date $56,876 $117,101 $179,732 $244,842 $312,508 $382,808 $455,824 $531,639 $610,339 $691,000



Net Return on Investment $54,994 $151,630 $252,209 $356,852 $465,683 $578,831 $696,428 $818,610 $945,517 $1,076,844

Internal Rate of Return 14.57% 19.63% 21.00% 21.45% 21.57% 21.54% 21.44% 21.31% 21.16% 21.01%

Modified IRR 14.57% 18.65% 19.04% 18.68% 18.12% 17.53% 16.94% 16.40% 15.89% 15.41%

NPV (cash flow + reversion) $42,375 $122,515 $203,532 $285,344 $367,871 $451,038 $534,772 $619,007 $703,677 $789,101

PV (NOI + reversion) $1,928,428 $2,042,333 $2,155,266 $2,267,232 $2,378,238 $2,488,291 $2,597,397 $2,705,564 $2,812,797 $2,919,103

Footnotes: a/t = after taxes; Modified IRR = Modified Internal Rate of Return; PV = Present Value; NPV = Net Present Value; NOI = Net Operating IncomeReversion = Amount received from the resale; Net Return on Investment = Cash Flow (a/t To Date) + Net Proceeds from Resale - Invested Capital.

page 13 of 18

Cumulative Analysis825 Andrade Ave




Equity (appreciation) $139,908 $202,384 $266,785 $333,168 $401,595 $472,127 $544,829 $619,766 $697,006 $776,619

Equity (loan reduction) $0 $0 $0 $0 $0 $0 $0 $0 $0 $1,480,000

CASH FLOW (a/t) $56,876 $117,101 $179,732 $244,842 $312,508 $382,808 $455,824 $531,639 $610,339 $691,000

Totals - To Date $196,784 $319,485 $446,516 $578,010 $714,103 $854,935 $1,000,653 $1,151,405 $1,307,345 $2,947,619


ROIC - To Date 52.13% 84.63% 118.28% 153.12% 189.17% 226.47% 265.07% 305.01% 346.32% 780.83%

Footnotes: a/t = after taxes; ROIC = Return On Invested Capital

page 14 of 18

Property Equity Analysis825 Andrade Ave



Year 1 2 3 4 5 6 7 8 9 10

$270,000

$540,000

$810,000

$1,080,000

$1,350,000

$1,620,000

$1,890,000

$2,160,000

$2,430,000

$2,700,000

Legend

Initial Equity Equity (loan reduction) Equity (appreciation)

page 15 of 18

Equity vs. Debt825 Andrade Ave



Year 1 2 3 4 5 6 7 8 9 10

$270,000

$540,000

$810,000

$1,080,000

$1,350,000

$1,620,000

$1,890,000

$2,160,000

$2,430,000

$2,700,000

Legend

Equity Loan Principal Balance

page 16 of 18

Cumulative Wealth Analysis825 Andrade Ave



Year 1 2 3 4 5 6 7 8 9 10

$300,000

$600,000

$900,000

$1,200,000

$1,500,000

$1,800,000

$2,100,000

$2,400,000

$2,700,000

$3,000,000

Legend

Equity (loan reduction) Equity (appreciation) CASH FLOW (a/t)

page 17 of 18

Gross Income Vs. Operating Expenses825 Andrade Ave



Year 1 2 3 4 5 6 7 8 9 10

$35,000

$70,000

$105,000

$140,000

$175,000

$210,000

$245,000

$280,000

$315,000

$350,000

Legend

GROSS SCHEDULED INCOME Total Operating Expenses

page 18 of 18

Flyer825 Andrade Ave825 Andrade AveCalexico, CA 92231

825 Andrade Ave, Calexico, CA 92231


Seller Financing at 80% LTV 5% InterestOnly Due in 10 Years

■

Great Unit Mix■

Many Recent Improvements■

Plenty of Parking■

Beautiful Large Courtyards■


DRE# 01316761Senior VP & Principal619-725-3632(619) 299-8536 (fax)[email protected]

Keith Courtney

DRE # 01028193Senior VP & Principal619-725-3635(619) 299-8536 (fax)

Price $1,850,000

Units 36


Year Built 1964

Lot Size 45,738

Current Cap Rate 7.85%

Market Cap Rate 8.41%

Current GRM 6.7

Market GRM 6.4

Current Total Return 19.3%

Market Total Return 22.0%

825 Andrade Ave, Calexico, CA 92231


DRE# 01316761Senior VP & Principal619-725-3632(619) 299-8536 (fax)[email protected]

Keith Courtney

DRE # 01028193Senior VP & Principal619-725-3635(619) 299-8536 (fax)

UNIT MIX AND RENT SCHEDULE

Mix No. Units Current Rents Current Total Market Rents Market Total1 Bed/1 Bath 8 $550 $4,400 $575 $4,6002 Bed/1 Bath 28 $650 $18,200 $675 $18,90036 $22,600 $23,500

INCOME, EXPENSE AND CASHFLOW

Current Market Gross Potential Rent $271,200 $282,000 Less: Vacancy $13,560 $14,100 Plus: Misc. Income $6,000 $6,000 Effective Gross Income $263,640 $273,900 Less: Expenses $118,404 $118,404

Net Operating Income $145,236 $155,496 Debt Service ($74,000) ($74,000)

NCF After Debt Service $71,236 $81,496 Principal Reduction $0 $0 Total Return $71,236 $81,496

FINANCIAL SUMMARYDown Payment: $370,000Loan Amount: $1,480,000Loan to Value: 80%Interest Rate: 5.0Amortization: 10 YearsDebt Coverage Ratio: 1.963

EXPENSESProperty Management Fee $13,395On-Site Management $7,500Misc $76,604Taxes - Real Estate $20,905

Total Expenses $118,404Expenses Per RSF $3.62Expenses Per Unit $3,289

INVESTMENT OVERVIEWLots of improvements were made to this property located in Calexico. It has great unit mix, 28 2Bed/1Bath and 81Bed/1Bath. ***The information contained herein is from sources believed to be accurate, but ACI Commercial makes nowarranty(ies), expressed or implied, regarding same.

Appraisal Report 2007825 Andrade Ave825 Andrade AveCalexico, CA 92231

825 andrade ave - amazon s3 · 825 andrade ave property description 825 andrade ave calexico, ca...

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