HIGHLAND APARTMENTS - LoopNet€¦ · EXECUTIVE SUMMARY ASSET SUMMARY Location 555 W Agee Street -...

OFFERING MEMOR ANDUM28 Units • Roseburg, Oregon

HIGHLAND APARTMENTS

2 HFO INVESTMENT REAL ESTATE

EXECUTIVE SUMMARYASSET SUMMARYLocation 555 W Agee Street - 26 Units

Location 2375 Foothill Drive - 2 Units

City, State Roseburg, OR 97470

County Douglas

Total Units 28

Year Built 1971

Approx. NR Sq Ft 20,664Average Unit Size 738 Sq. Ft.APN R13905 & R13696

PRICE SUMMARYPrice $1,875,000

Price Per Unit $66,964

Per Square Foot $91

Cap Rate 5.46%

Projected Cap Rate 6.58%

DETAILED UNIT MIXUnit Type Unit Count Average Sq Ft Total Sq Ft % of Total Units1 Bed / 1 Bath 4 510 2,040 14.3%2 Bed / 1 Bath 16 630 10,080 57.1%2 Bed / 1.5 Bath 4 1,088 4,352 14.3%3 Bed / 1.5 Bath 2 1,280 2,560 7.1%2 Bed / 1 Bath House 2 816 1,632 7.1%

Total / Averages 28 738 20,664 100.0%

TOURS AND INQUIRIES Adam Smith • [email protected]

Greg Frick • [email protected]

2424 SE 11th Avenue, Portland, Oregon 97214www.hfore.com • (503) 241.5541 • Fax: (503) 241.5548

Please do not disturb tenants.

The Highland Apartments are comprised of 26 units located at 555 West Agee Street and an additional duplex located on an adjacent lot on the NW corner at 2375 Foothills Drive for a total of 28 units. The property boasts spacious one-, two-, and three-bedroom floor plans with quality finishes.

With rents currently averaging $596 per unit, or $0.81 per sq. ft., Highland Apartment’s comfortable units, and upside in location make the property an especially attractive investment opportunity. Projected rents are based on the highest achieved leases at Highland Apartments and are 10% higher than in-place rents.

The Highland Apartments is located within walking distance of numerous retail amenities – including a Grocery Outlet, Denny’s, and McMenamins, among others.The asset is just a short commute away from major employment centers throughout the Interstate-5 corridor. This major thoroughfare also acts as home to many retail stores, restaurants and shopping centers in southwestern Oregon.

Highland Apartment’s convienent location, combined with its potential to continue increasing rents make the property an ideal opportunity for investors seeking stable, quality assets in the the Pacific Northwest.

3HIGHLAND APARTMENTS • 28 UNITS • ROSEBURG, OREGON

ROSEBURGFounded in 1851 in the scenic Umpqua River Valley by Aaron Rose, a homesteader originally from New York, Roseburg (pop. 22,013) is both the county seat of Douglas County (pop. 110.283) and the principal city of the Roseburg area. Aaron Rose and his family ran a tavern and inn for travelers heading south toward the California gold rush after heading west on the Oregon Trail. The rich farmland in the area and burgeoning trade economy led to Roseburg’s growth.

By 1872 the Oregon and California Railroad had developed a stop in Roseburg bringing additional residents and exposure. During the 20th Century, Roseburg developed a robust economy based on the timber industry, with companies taking advantage of the vast, untouched forests of the area. In 1970 the success of the timber industry in the area prompted the city to brand itself as “The Timber Capital of the Nation.” The city’s current top employer is Roseburg Forest Products, employing more than 1,100 people.

The total population of Roseburg is 22,013. Including surrounding towns, the Roseburg Micropolitan area has a population of 107,576. The median household income in Roseburg was reported at $42,507 for 2017, while the median income in Douglas county was $44,023.

Despite its relatively small population, Roseburg is home to Umpqua Community College, a two-year college with an enrollment of 3,334 credit students, 2,760 full-time equivalent students, and 2,760 part-time students drawn from the greater Douglas county area.

One of the largest employers in Roseburg is the Oregon Justice Department Support Enforcement. The agency employs 4,000 area employees who process around $1 million per day in court ordered medical and child support payments.

The Roseburg area has access to many outdoor amenities and activities. A 2-hour drive east can take residents to Crater Lake National Park, home of the deepest lake in the United States. Roseburg residents also enjoy fishing in Deer Creek and the Umpqua River, along with mountain biking, the nearby Wildlife Safari, and over 25 wineries.

ROSEBURG, OREGON


OPERATIONS ANALYSISIncome Current Scheduled Rents Projected Operations Note

Scheduled Gross Rent $200,323 $7,154 $219,360 $7,834 1Less: Vacancy/Credit Loss -$10,016 -$358 -5.0% -$10,968 -$392 -5.0% 2

Net Rental Income $190,307 $6,797 $208,392 $7,443 Other Income $4,240 $151 $9,033 $323 3

Includes: Utility Billing (RUBs) $0 $0 0% $4,793 $171 25.0% Includes: Miscellaneous $4,240 $151 $4,240 $151

Gross Operating Income $194,547 $6,948 $217,425 $7,765

Expenses Projected Operations

Per Unit % GOI Projected Operations

Per Unit % GOI

Real Estate Taxes $18,343 $655 9.4% $18,343 $655 8.4% 4Insurance $5,320 $190 2.7% $5,320 $190 2.4%Total Utilities $20,278 $724 10.4% $20,278 $724 9.3% Fee Management $15,564 $556 8.0% $17,394 $621 8.0% 5Landscaping $6,107 $218 3.1% $6,107 $218 2.8% Maintenance/Repairs $12,600 $450 6.5% $12,600 $450 5.8%Turnover $8,400 $300 4.3% $8,400 $300 3.9%Reserves $5,600 $200 2.9% $5,600 $200 2.6% 6

Total Expenses -$92,212 -$94,042 Expenses per Unit -$3,293 -$3,359% of Gross Operating Income -48% -43%

Net Operating Income (NOI) $102,334 $123,382


OPERATIONS ANALYSIS1. RENTS Rents are based on a January 2019 rent roll. Current scheduled rents average $596 per unit, or $0.81 per sq

ft. The projected rents are based on highest achieved lease rates in 2018 & 2019. Projected rents average $653 or $0.88 per sq ft - a 10% increase in rent.

2. VACANCY The projected operations include a market-rate vacancy of 5.0%.

3. OTHER INCOME Other Income includes miscellaneous charges and a projection for resident utility bill-backs.

• RUBs. Highland Apartments currently does not charge for resident utility bill-backs, (RUBs). Residents are projected to average $15 per unit per month for water, sewer, and garbage expenses. The property is individually metered for electric. This conservative projection captures 25% of the property’s utility expenses.

4. PROPERTY TAXES Oregon’s property taxes are evaluated on a fiscal year starting July 1. In Oregon, property taxes are not reassessed on sale and are limited to a 3.0% annual increase at the state level. Property taxes paid prior to November 1 each year receive a 3.0% discount. Property tax values for the 2018-2019 tax year are published October 15, and Highland Apartment’s property taxes decreased 8.71% over the 2017-2018 taxes and total $18,343. The community includes two separate tax lots, R13905 & R13969.

5. FEE MANAGEMENT The management fee is inclusive of all administrative, payroll, and advertising expenses associated with the property. We project it to be 8.0% of the GOI.

6. RESERVES Lenders require reserves be set aside to address future capital costs associated with any property as it ages. The projected operations include reserves of $200 per unit or $5,600 annually.

Type Units Count Avg Sq FtAverage Scheduled

RentsScheduled Rents per

Sqft Projected Rents Projected Rents per Sq Ft

1 Bed / 1 Bath 4 510 $503 $0.99 $525 $1.03

2 Bed / 1 Bath 16 630 $559 $0.89 $625 $0.99

2 Bed / 1.5 Bath 4 1,088 $676 $0.62 $765 $0.70

3 Bed / 1.5 Bath 2 1,280 $823 $0.64 $850 $0.66

2 Bed / 1 Bath House 2 816 $693 $0.85 $710 $0.87

Total / Average 28 738 $596 $0.81 $653 $0.89


OFFER TERMS

QUESTIONS & TOUR REQUESTS:

All tours and inquiries regarding Highland Apartments are to be directed to HFO Investment Real Estate at (503) 241.5541. Please do not disturb tenants.

Adam Smith • [email protected]

Greg Frick • [email protected]

Tyson Cross • [email protected]

Jack Stephens • [email protected]

Lee Fehrenbacher • [email protected]

Todd Tully • [email protected]

Khari Gates • [email protected]

Rand Hoffman • [email protected]

HFO Investment Real Estate 2424 SE 11th AvenuePortland, Oregon 97214

www.hfore.com

ASSET SUMMARYLocation 555 W Agee Street

City, State Roseburg, OR 97470

Total Units 28

PRICE SUMMARYPrice $1,875,000

Price Per Unit $66,964

Per Square Foot $91

Cap Rate 5.46%

Projected Cap Rate 6.58%


HFO Investment Real Estate

2424 SE 11th Avenue • Portland, OR 97214www.hfore.com • 503.241.5541

Passion • Collaboration • Specialization

This information has been secured from sources we believe to be reliable, but we make no representations or warranties, expressed 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 for any inaccuracies. Parties who receive this information from unauthorized parties shall not be recognized. ©2019 HFO Investment Real Estate LLC. Build your legacy is a service mark of HFO Investment Real Estate. Licensed in the states of Oregon and Washington.

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