Shorline Apartments 7703 Hare Avenue Jacksonville,...

Offering Memorandum | P a g e | 1

Shorline Apartments7703 Hare Avenue Jacksonville, FL


Table of Contents

Project Highlights .................................................... 3

Aerials...................................................................... 4

Photos ..................................................................... 5

Maps........................................................................ 6

12 Month Trailing Profit & Loss .............................. 7

12 Month Proforma Profit & Loss ........................... 8

Building Information ............................................... 9

Site Plan and Floor Plans ……………………………………10

Area/City Description ............................................ 12

Demographics ....................................................... 10

Multi-Family Market Analysis ............................... 14



Project Highlights

as exclusive marketing advisor, is pleased to present the Shoreline Apartments, a 357-unit value-add opportunity in Jacksonville, FL. Shoreline presents a unique opportunity to acquire a value-add property were the current owner has done the majority of the work. The present owner has spent approximately $3MM renovating the garden style apartments. The occupancy level has been raised to 88%. The new ownership would simply need to lease up the remaining units and bring units up to market rent as current leases expire.

Shoreline JEA Payments. Payments residents make for electrical reimbursement.We charge the residence an Administration fee $9.83/per bill and a Convenience fee $18.93/per bill plus the cost of electric.

Investment Highlights:

Price:

Trailing 12 Month Gross Rents:

Trailing 12 Month NOI:

Capitalization Rate:

Number of Units:

Rentable Square feet:

Price Per Square foot:

$15,500,000

$1,896,957

$1,401,031

9.0%

357

195,400

Land Area:

Year Built/Renovated:

$79.32/rsf

13.93 acres

1960/2015-16



Aerials



Photos



Maps



12 Month Trailing Profit and Loss

Operating Statement Jan. ’16 – Dec. ’16 - Actual

$42,357.55 $47,045.49 $57,139.94 $60,463.62 $63,871.06 $64,640.75 $67,104.17 $104,803.82 $99,895.76 $103,832.33 $109,257.05



T12

$103,742.01 $111,596.01 $116,100.01 $119,301.64 $112,624.06 $114,180.91 $115,604.96 $117,029.01 $118,818.81 $120,609.56 $121,802.76 $123,592.56



Building Information

The subject is an existing multifamily property containing 357 dwelling units. The improvements were constructed in 1960. The site area is 13.93

acres or 606,907 square feet.

Improvement Descriptions

Name of Property

General Property Type

Property Sub Type

Competitive Property Class

Occupancy Type

Percent Leased

Shoreline Apartments

Multifamily

Conventional

C

Multi-Tenant

90%

Number of Buildings

Stories

Construction Class

Construction Type

Construction Quality

Condition

27

1-2

C

Masonry

Average

Average

Number of Units

Units Per Acre (Density)

Gross Building Area (SF)

Rentable Floor Area (SF)

Land Area (SF)

Floor Area Ratio (RFA/Land SF)

Floor Area Ratio (GBA/Land SF)

Building Area Source

357

25.6

209,718

195,400

606,907

0.32

0.35

Engineering Report

Year Built

Year Renovated

Actual Age ((Yrs)

Estimated Effective Age

Estimated Economic Life (Yrs)

Remaining Economic Life (Yrs)

1960

2015/16

56

20

50

30

Number of Parking Spaces

Source of Parking Court

Parking Type

Parking Spaces/Unit

410

Site inspection

Open surface/asphalt paved

1.1

Unit Mix and Occupancy

Floor Plan Units

Studio Units

Studio 254

Total / Average

1br/1ba Units

1br/1ba

254

73

Total / Average

2br /1ba Units

2br/1ba

73

30

Total / Average 30

Total Units 357



Site Plans and Floor Plans

Site Map Photo



Floor Plans

Shorline Garden Apartments7703 Hare Avenue Jacksonville, FL


Area/City Description

Surrounding Area Analysis

Boundaries

The subject is located between the Arlington Expressway and Atlantic Boulevard, east of Arlington Road, within the Greater Arlington Planning District. The boundaries market

area are construed as follows:

North Ft. Caroline Road/St. Johns River

South Beach Boulevard

East Interstate 295 East

West St. Johns River

Additionally, the Greater Arlington Planning District of Jacksonville encompasses all of Duval County’s north of Beach Boulevard, east of the St. Johns River, west of the

Intracoastal Waterway and is bordered on the north by the St. Johns River. The Central Business District of Jacksonville is located approximately three miles west of the subject

market area.

Access and Linkages

The subject market area is highly accessible via a number of roadways and thoroughfares, which are discussed below.

North/South Routes:

SR 115 (Southside Boulevard) - a four to six-lane roadway that links the Southside area of the city with Arlington to the north. This thoroughfare has emerged as a key

growth corridor in the past ten years that includes a heavy concentration of new commercial, retail and residential development. The roadway also provides access to the

North side of the City via the Dames Point Bridge.

I-295 (former SR 9A) – a four-lane limited access highway and provides a circumferential loop around the entire metropolitan area.

University Boulevard – a four-lane principal arterial; becomes a two-lane collector roadway at the subject’s location.



East/West Routes

Arlington Expressway – A major divided four-lane freeway extending west from Southside Boulevard to the Matthews Bridge into downtown Jacksonville.

Merrill Road - A four-lane minor arterial extending east from University Boulevard on the west to the SR 9A/St. Johns Bluff Road on the east.

Atlantic Boulevard – A major four to six-lane principal arterial diverging and extending east from Beach Boulevard near downtown and extending easterly to Neptune

and Atlantic Beaches. This roadway is heavily traveled commercial roadway through the Greater Arlington Planning District.

Beach Boulevard – A major six and four-lane principal arterial diverging and extending east from Atlantic Boulevard near downtown and extending to Jacksonville

Beach. This roadway is a heavily traveled commercial roadway and is the boundary between the Greater Arlington and Southeast Planning Districts.

The existing roadway improvements provide adequate access within the immediate market area as well as to other regions of the Jacksonville MSA. Overall, vehicular access is

average.

The Jacksonville International Airport is located about 12 miles north of the property; travel time is about 15 minutes, depending on traffic conditions. The Jacksonville CBD, the

economic and cultural center of the region, is approximately three miles from the property.

Demand Generators

Major employers are located in the subject’s market area, and in the surrounding area, largely in the downtown area, with several major employers located within 3-5 miles of the

subject property.

Retail commercial development in the market area is located along Atlantic Boulevard, University Boulevard, and Beach Boulevard which are lined with a wide variety of

community support facilities including offices, restaurants, gas stations/convenience stores strip retail centers, shopping centers, and branch bank facilities

The largest scale retail development in the Greater Arlington Planning District is Regency Square regional mall located east of the subject at the northeast corner of the Arlington

Expressway/Atlantic Boulevard merger and Southside Boulevard. Originally developed in 1967, this regional mall was expanded to just over 1.1 million square feet in 1980, and

expanded again to 1,353,000+ square foot retail center with major anchors including Bealls, Ross Dress for Less, Michael’s, World Market, and an HH Gregg store. The former

Linen and Things store is vacant.



Demographics

A demographic profile of the surrounding area, including population, households, and income data, is presented in the following table.

Surrounding Area Demographics 2015 Es ti ma tes 1-Mi l e Ra di us 3-Mi l e Ra di us 5-Mi l e Ra di us Duva l County, FL Ja cks onvi l l e MSA

Popul a ti on 2010 12,271 83,443 189,677 864,263 1,345,596 Popul a ti on 2015 12,556 84,241 195,197 897,153 1,417,070 Popul a ti on 2020 13,012 86,316 202,879 938,724 1,495,480 Compound % Cha nge 2010-2015 0.5% 0.2% 0.6% 0.7% 1.0% Compound % Cha nge 2015-2020 0.7% 0.5% 0.8% 0.9% 1.1%

Hous ehol ds 2010 4,807 34,020 75,194 342,450 524,146Hous ehol ds 2015 5,102 35,021 78,491 357,775 554,494 Hous ehol ds 2020 5,383 36,273 82,224 375,632 586,681 Compound % Cha nge 2010-2015 1.2% 0.6% 0.9% 0.9% 1.1% Compound % Cha nge 2015-2020 1.1% 0.7% 0.9% 1.0% 1.1%

Medi a n Hous ehol d Income 2015 $30,856 $37,887 $40,148 $45,860 $49,738Avera ge Hous ehol d Si ze 2.4 2.4 2.4 2.5 2.5 Col l ege Gra dua te % 14% 18% 23% 26% 28% Medi a n Age 33 36 36 37 38 Owner Occupi ed % 42% 54% 54% 61% 67% Renter Occupi ed % 58% 46% 46% 39% 33% Medi a n Owner Occupi ed Hous i ng Va l ue $120,079 $127,415 $135,460 $153,330 $169,838 Medi a n Yea r Structure Bui l t 1973 1973 1976 1984 1988 Avg. Tra vel Ti me to Work i n Mi n. 24 24 24 26 28

Source: Cla rita s

As shown above, the current population within a 3 mile radius of the subject is 84,241, and the average household size is 2.4. Population in the area has grown since the 2010

census, and this trend is projected to continue over the next five years.



Multi Family Market Analysis

Metro Area Overview

The subject is located in the Jacksonville metro area as defined by REIS. Supply and demand indicators, including inventory levels, absorptions, vacancy, and rental rates for all classes of space are

presented below.

The current vacancy rate in the metro area is 6.70%; the vacancy rate has decreased by 4.30% over the past five years.

Effective rent averages $863/Unit in the metro area, and future rent values are expected to increase by 10.78% over the next 5 years to $956/Unit.

5 year forecast project a 6.70% vacancy rate in the metro area, representing no change over the next 5 years.

Over the past 5 years, the inventory in the metro area has increased by 6.76% while the occupied stock has increased by 11.88%.

Over the past 5 years, completions have averaged 913 Units annually and reached a peak of 1,668 Units in 2013.

In a 5 year period, absorption figures reached a peak of 3,037 Units in 2010 and a low of 1,136 Units in 2014.



Class B/C Multifamily Market

The subject is a Class C Property as defined by REIS. Supply and demand indicators, including inventory levels, absorption, vacancy, and rental rates for all Class B/C space in the Jacksonville metro area are presented below.

Jacksonville Multifamily Market Trends and Forecasts

Year Inventory

Units

Occupied

Units

Vacancy

Units

Completions

Units

Absorption

Units Vacancy %

Effective

Rent

($/Unit)

Effective

Rental Rate

(% Change)

Gross

Revenue

($/Units)

2005 63,588 61,164 2,424 700 -912 3.80% $729 2.9% $732

2006 63,008 59,592 3,416 1,058 -1,572 5.40% $750 3.0% $739

2007 64,293 57,941 6,352 1,538 -1,651 9.90% $756 0.7% $717

2008 66,431 58,271 8,160 2,138 330 12.30% $757 0.1% $701

2009 68,560 58,714 9,846 2,489 443 14.40% $754 -0.4% $690

2010 69,352 61,751 7,601 792 3,037 11.00% $755 0.2% $709

2011 69,510 63,045 6,465 158 1,294 9.30% $760 0.6% $724

2012 69,762 64,634 5,128 252 1,589 7.40% $786 3.5% $759

2013 71,430 66,625 4,805 1,668 1,991 6.70% $816 3.8% $792

2014 72,576 67,761 4,815 1,146 1,136 6.60% $836 2.4% $809

2015 74,040 69,088 4,952 1,464 1,327 6.70% $863 3.2% $834

2016 75,090 70,223 4,867 1,050 1,135 6.50% $885 2.6% $859

2017 75,497 70,462 5,035 407 239 6.70% $904 2.1% $876

2018 76,186 71,098 5,088 689 636 6.70% $921 1.9% $895

2019 76,316 71,472 4,844 130 374 6.30% $939 2.0% $916

2020 77,254 72,041 5,213 938 569 6.70% $956 1.8% $933

2005 - 2015 Avera ge 68,414 62,599 5,815 1,218 637 8.50% $778 1.8% $746

The current vacancy rate for Class B/C properties in the metro area is 4.80%; the vacancy rate has decreased by 7.50% over the past 5 years.

Asking rent currently averages $727/Unit and has increased by 8.51% over the past 5 years.

Over the past 5 years, Class B/C metro area inventory has remained constant while the occupied stock has increased by 8.53%

Over the past 5 years, completions have averaged 72 Units annually and reached a peak of 432 Units in 2010.

Gross revenue for class B/C properties in the metro area averaged $638/Unit and has increased by 17.76% over the past 5 years.


In case you missed it, Realtor.com released its rankings of the hottest housing markets in 2017 with Jacksonville landing at #6 in terms of both price appreciation and growth in the number of sales (see the report below). This is due in large part to Jacksonville’s rapidly expanding economy (3rd highest job growth in the U.S.) and tremendous populaton growth. A relatively low cost of living and superior quality of life compared to other locales are important factors as well.

The strength of Jacksonville’s for-sale housing market should signal continued momentum in Jacksonville’s apartment market. Both rising home prices and higher interest rates will likely skew the rent vs. own decision in favor of renting, particularly for Jacksonville’s large millenial population who are typically burdened with high levels of debt. This dynamic in the housing market combined with a muted pipeline of new apartment supply should allow Jacksonville’s rental market to continue outperforming many markets across the country.

http://www.realtor.com/news/trends/top-real-estate-markets-2017/


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