| EXCLUSIVE OFFERING€¦ · Best City for Millennials Tech Jobs Extremely Livable Family Friendly Carlsbad placed among the “Best Cities for Young Professionals” - Forbes San

Adams and Hoover StreetCarlsbad, CA 92008

For Real-Time Property Information go to:CarlsbadCoastal.BerkadiaREA.com

$3,500,000 THREE SUBDIVIDED LOTS - OCEAN AND BAY VIEWS

| EXCLUSIVE OFFERING a Berkshire Hathaway and Leucadia National company

EXCLUSIVE OFFERING

THREE SUBDIVIDED LOTS - OCEAN AND BAY VIEWS Adams and Hoover Street, Carlsbad, California 92008

EDWARD KIM | Managing Director | 949.622.9252 | [email protected]

FINANCING

MATTHEW HAUSERAssociate [email protected] BRE License #01996149

INVESTMENT ADVISORS

Carlsbad Bay and Ocean Views

Premier Coastal Location

Recently Subdivided to Allow for Three 16,000-Square-Foot Lots

1.16 Acres

Near Transportation, Retail, Employment Centers, and TopEntertainment Venues

Located in a Strong North San Diego County Growth Market

For Real-Time Property Information visit:CarlsbadCoastal.BerkadiaREA.com

PROPERTY HIGHLIGHTS

PETER M. HAUSER Senior Director [email protected] BRE License #00856966Peter M. Hauser

Principal [email protected] RE License #00856966

Matthew [email protected] RE License #01996149

INVESTMENT ADVISORS

Premier Coastal LocationCarlsbad Bay and Ocean Views

Market Positioning 15

Market Overview 20

The Opportunity 5

The Asset 6

TABLE OF CONTENTS

PREMIER COASTAL LOCATIONCarlsbad Bay and Ocean Views

The Carlsbad Ocean View Lots represent an outstanding development opportunity for a builder to construct three (3) single-family homes with both bay and ocean views.

The property consists of 1.16 gross acres that have been subdivided into three 16,000-square-foot lots.

The property is located in a prime, irreplaceable section of Carlsbad near the Pacific Ocean, Aqua Hedionda Lagoon, Legoland, and top employment and entertainment

venues of North San Diego County.

THE OPPORTUNITY

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LOCATION HIGHLIGHTS

The Carlsbad Ocean View Lots site is located a short distance from California's Pacific

Ocean coastline, Camp Pendleton, and LEGOLAND California. The site is also within

close proximity to Highway 78 and Interstate 5 providing easy access to attractions and

employment hubs within Greater San Diego. Numerous dining, shopping, and

entertainment venues that abound in the area include The Shoppes at Carlsbad and

Carlsbad Premium Outlets. Nearby recreational facilities include The Crossings at

Carlsbad, Hidden Canyon Community Park, Maxton Brown Park, Goat Hill Park, and

El Camino Country Club. Other area highlights include:

LEGOLAND California is among the top employers and economic drivers within the

region's hospitality sector.

Camp Pendleton is the Marine Corps' largest expeditionary training facility on the West

Coast, generating an annual economic impact of $6.1 billion.

The Highway 78 Corridor is home to numerous INC. 5000 companies and more than

283,000 employees.

Thermo Fisher Scientific Inc., employs more than 1,500 employees.

ViaSat Inc. is headquartered in Carlsbad and supports 1,900 jobs.

Ocean Ranch Corporate Center is a 400-acre business park in Oceanside.

Omni La Costa Resort & Spa is a 600-room luxury resort, employing 1,180 people.

With an annual economic impact of $9.9 billion, San Diego International Airport

served 20.7 million passengers in 2016.

Tri-City Medical Center is a 388-bed acute-care hospital with approximately 2,400

employees.

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COMPARABLE SALE PROPERTIES

CARLSBAD OCEAN VIEW LOTS Adams and Hoover StreetCarlsbad, CA 92008

P C $69.27L T P C $3,500,000

OT

1.16 Acres / 50,529 Lot SF

438 TAMARACK AVENUE 438 Tamarack AvenueCarlsbad, CA 92008

P C $95.24OL O $1,600,000

CLO O 11/16

OT

0.39 Acres / 16,800 Lot SF

1833 BUENA VISTA WAY 1833 Buena Vista WayCarlsbad, CA 92008

P C $29.72OL O $4,000,000

CLO O 4/17

OT

3.09 Acres / 134,600 Lot SF

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HAYMAR DRIVE Haymar DriveCarlsbad, CA 92008

P C $51.95OL O $34,500,000

CLO O 10/16

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15.25 Acres / 664,159 Lot SF

330 SOUTH CEDROS AVENUE 330 South Cedros AvenueSolana Beach, CA 92075

P C $134.32OL O $5,500,000

CLO O 4/17

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0.94 Acres / 40,946 Lot SF

HARRISON STREET Harrison StreetCarlsbad, CA 92008

P C $51.89OL O $999,000

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0.44 Acres / 9,254 Lot SF

* Currently On-Market* Just fell out of escrow @ $849,999* Bay frontage

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ADAMS STREET Adams StreetCarlsbad, CA 92008

P C $33.83OL O $1,599,000

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1.08 Acres / 47,260 Lot SF

* Currently On-Market* Down the street; lagoon side of Adams* Approved plans for 5,000 SF 5-bed / 5-bathsingle-family home

BRISTOL COVE 4547 Cove DriveCarlsbad, CA 92008

P C $277.90OL O $1,300,000

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0.107 Acres / 4,678 Lot SF

* Currently On-Market* Variable Price of $1,200,000 - $1,300,000* Approved plans for two condos with dock

BUENA VISTA CIRCLE Buena Vista CircleCarlsbad, CA 92008

P C $62.76OL O $1,695,000

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0.62 Acres / 27,007 Lot SF

* Currently On-Market* Variable Price of $1,395,000 - $1,695,000

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LA COSTA AVENUE La Costa AvenueCarlsbad, CA 92009

P C $56.67OL O $750,000

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0.30 Acres / 13,234 Lot SF

* Currently On-Market* Variable Price of $700,000 - $750,000

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Subject: Carlsbad Ocean View LotsSoutheast Corner of Adams Street and Hoover StreetCarlsbad, CA 92008

La Costa AvenueLa Costa AvenueCarlsbad, CA 92009

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Buena Vista CircleBuena Vista CircleCarlsbad, CA 92008

8.

Bristol Cove4547 Cove DriveCarlsbad, CA 92008

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Adams StreetAdams StreetCarlsbad, CA 92008

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Harrison StreetHarrison StreetCarlsbad, CA 92008

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330 South Cedros Avenue330 South Cedros AvenueSolana Beach, CA 92075

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Haymar DriveHaymar DriveCarlsbad, CA 92008

3.

1833 Buena Vista Way1833 Buena Vista WayCarlsbad, CA 92008

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438 Tamarack Avenue438 Tamarack AvenueCarlsbad, CA 92008

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INTRODUCTIONLocated along the San Diego North County coastline, the city of Carlsbad is known for its picturesque scenery, coastal distinction, and strong local economy. Due to its location, relatively low population density, and high-performing school districts, Carlsbad offers an extremely high quality of life for local residents and was named one of the most desirable places to live in America by Money magazine. With a population approaching 115,000 residents, the city is an integral part of the San Diego-Carlsbad-San Marcos MSA, the fourth-most populated metropolitan area in the state of California. Carlsbad is a vital component in the area known more informally as “North County”, which includes Camp Pendleton, and the cities of Oceanside and Vista. In total, North County includes nine cities and numerous unincorporated areas within the metropolitan area.

Carlsbad is highly regarded as an innovative business center fostered by world-class universities and colleges. The area is a major draw for companies in the defense, aerospace, communications, manufacturing, life sciences, and active lifestyle-related industry sectors.

Best City for Millennials

Tech Jobs

Extremely Livable

Family Friendly

Carlsbad placed among the “Best Cities for Young Professionals”- Forbes

San Diego MSA ranked No. 3 among the “Best Places for Tech Jobs”- Forbes

Carlsbad placed among the top “Extremely Livable” cities in California due to local amenities, a stable housing market, sunny weather, and low crime rates- Areavibes

Carlsbad was named a top destination to “Raise a Family in California”- Areavibes

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DEMOGRAPHICS

5TH 53%LARGEST CITY

IN SAN DIEGO COUNTY

OF RESIDENTS HOLD A BACHELOR’S DEGREE

OR HIGHER

80% OF CITY WORKERS ARE IN

WHITE-COLLARPOSITIONS

114.6k 46.9k 21.4k 15.8k$103.6k

The city of Carlsbad’s population is forecast to grow 4.0% over thenext five years

The city’s total number of households is projected

to increase 4.0% by

2022

47% of Carlsbad’shouseholds earn $100,000 or more annually, compared to 23% nationally

33% of Carlsbad’soccupied housing units are renter-occupied

The city’s median household income is projected to reach $103,571 by 2022, up

10.8% from 2017

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METRO INDUSTRY BREAKDOWN

0 60,000 120,000 180,000 240,000 300,000

Information

Other Services

Financial Activities

Mining, Logging, and Construction

Manufacturing

Leisure and Hospitality

Education and Health Services

Trade, Transportation, and Utilities

Professional and Business Services

Government

April-16 April-17

JOBGROWTH 6,200 jobscreated in the Government sector(Y-o-Y Apr '17)

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EMPLOYMENT TRENDS

(90,000)

(60,000)

(30,000)

0

30,000

60,000

0%

3%

6%

9%

12%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017*

Unemployment Rate Jobs Added / Lost*PROJECTED

APRIL2017

APRIL2017

3.4%

18,200 jobs

the city’s monthly unemployment rate was down 80 basis points Y-o-Y

were created metrowide, a 1.3% Y-o-Y increase

CARLSBAD, CA

LARGEST EMPLOYERSLegoland California, LLC 2,300

ViaSat, Inc 1,900

Thermo Fisher Scientific, Inc. 1,510

Omni La Costa Resort & Spa 1,180

Carlsbad Unified School District 910

Gemological Institute of America, Inc 860

City of Carlsbad 670

OptumRX, Inc 670

Park Hyatt Aviara Resort 640

Genoptix, Inc 610

Source: City of Carslbad CAFR 2016

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MILITARY AND DEFENSE

LEISURE AND HOSPITALITY

CAMP PENDLETON

LEGOLAND CALIFORNIA RESORT

Located less than five miles from Carlsbad in the city of Oceanside, Camp Pendleton is the Marine Corps’ largest expeditionary training facility on the West Coast and an economic staple in North San Diego County. Over 77,000 retired personnel live within a 50-mile radius of the base, and its daytime population exceeds 70,000 military and civilian personnel. Defense related spending supports over 328,000 jobs countywide, while the direct military presence contributes over $24.8 billion to the economy. Camp Pendleton has an annual economic impact of $6.1 billion.

Carlsbad is a tourist destination in North County, welcoming over three million visitors annually. LEGOLAND California Resort is a family theme park based on the Lego toy brand. Ninjago is the park’s newest attraction and provides hands-on Ninja training and an interactive virtual ride, the first like its kind in North America. Other park expansions recently completed or currently under construction include a second hotel with 250 rooms, a water park expansion, and an expansion of Star Wars Miniland. LEGOLAND is the city’s largest employer, supporting 2,300 jobs.

$6.1 billionEconomic Impact

42,000Active Personnel

2,300LEGOLANDJobs Supported

3 million+City Visitors Annually

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HIGHWAY 78 CORRIDOR

HIGHWAY 78 CORRIDOR CONT.

24 HOUR FITNESS HEADQUARTERS

VIASAT, INC. HEADQUARTERS

The California Highway 78 corridor, “The 78”, in Northern San Diego County which includes Vista, San Marcos, Oceanside, parts of Carlsbad, and Escondido, is one of the most sought after submarkets in San Diego County. The corridor is home to approximately 624,350 residents with an average income of $71,600. Nearly 20% of all jobs in San Diego County are located along The 78 and the area has seen annual job growth of 2.5%, outpacing the metro average by 120 basis points. Seven of the 109 Inc. 5000 companies in metro San Diego call the corridor area home.

Boasting 55.3 million square feet of commercial and office space, The 78 hosts a wide variety of companies, with each city along the corridor supporting various employment sectors. Nearby San Marcos, considered the educational hub of Northern San Diego County, is home to CSU San Marcos. Oceanside, part of the Biotech Beach corridor is home to biotech, pharmacy, and medical technology companies. Viasat, a global broadband and technology company is headquartered in Carlsbad and is the city’s second-largest employer, supporting 1,900 jobs.

$71,600 Average Annual Income

283,100Jobs Supported

624,350Total Residents

2.5% Y-o-Y Job Growth

6.1 billionEconomic ImpactCorridor Tech Cluster

43.3 millionSF of Industrial Space

245+ Life Science Companies

12 million SF of Office Space

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CONSTRUCTION AND DEVELOPMENT

CARLSBAD VICTORY PARK THE SHOPPES AT CARLSBAD

$90 millionNorth County Investment

$300 millionEstimated Investment

55,573SF Industrial Park

Fall 2017Estimated Completion

Badiee Development is on schedule to complete Carlsbad Victory Industrial Park, a 55,573-square-foot industrial project located within the Carlsbad Raceway Business Park in the summer of 2017. The highly coveted industrial space will be comprised of two suites for warehouse and office use. Th e industrial park was the first to break ground in Badiee Development’s $90 million, 425,000-square-foot industrial pipeline portfolio in North County. Industrial space that serves small business and start-up companies in the advanced manufacturing, technology and e-commerce industry sectors are in high demand throughout North County.

Los Angeles-based Rouse Partners is in the final phase of renovation and additions to The Shoppes at Carlsbad. Capital improvements to the 1.1 milion-square-foot mall entail coastal-inspired exterior and interior upgrades featuring common area modernization, a new streetscape design, new fine-dining establishments, and a family-centered water-themed play area. Dave and Buster’s and The Cheesecake Factory recently opened, while Yard House and Zara will be open for businesses at the mall later this year. Estimated completion: fall of 2017.

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UPTOWN BRESSI NORTH CITY

17-acreMixed Use Development

$1 billionDevelopment

88,675SF of Commerical Space

700,000SF of Commercial Space

Approval was granted in early 2017 for Shea Home’s 17-acre, mixed-use development located on the corner of Palomar Airport Road and Gateway Road in the master-planned Bressi Ranch community. The lifestyle center will be comprised of 35,060 square feet of retail space, a 16,454-square-foot pharmacy with drive-thru, a 28,000-square-foot grocery store, and 9,160 square feet of outdoor dining and plaza space, and resident amenities. In addition, 21 luxury townhome buildings with four to six units per building have been proposed, as well as two, three-story buildings with a total of 33 single-level flats with elevator service and parking for 491 spaces. The estimated average home sale price at this community is $600,000.

Located adjacent to California State University - San Marcos, work is underway on the $1 billion master-planned development dubbed North City. The project could eventually encompass more than 200 acres, 3,400 residential units, a hotel, 700,000 square feet of commercial space including 300,000 square feet of retail space. North City’s first two residential projects have been completed and work is underway on a 60,000-square-foot Class A office building, an additional residential community, and a 21,000-square-foot brew house. Considered to be North County’s downtown, North City will also feature over 30 acres of parks and one mile of urban trails.

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RENT / OCCUPANCY

AVERAGERENT

OCCUPANCYRATE

$2,154 96.2%in the first quarter of 2017, up 3.3% from one year prior through March of 2017, up 40

basis points Y-o-Y

The average occupancy rate in the North Beaches apartment submarket was 96.2% in the first quarter of 2017, up 40 basis points from the same period one year prior as well as 40 basis points higher than Greater San Diego’s metro apartment occupancy rate of 95.8%. The submarket’s average apartment occupancy rate is forecast to settle at 95.7% by year-end.

An increase in occupancy has encouraged operators to raise rents. Average rent in this submarket was $2,154 through the first quarter of 2017, an increase of 3.3% year over year. Average rent is expected to increase to more than $2,190 by December of this year, appreciating 0.8% annually.

$1,6

63

$1,7

20

$1,7

93

$1,9

39

$2,0

52

$2,1

75

$2,1

93

$500

$1,000

$1,500

$2,000

$2,500

95%

95%

96%

96%

97%

2011 2012 2013 2014 2015 2016 2017*

Occupancy & Ask Rent

Rent Occupancy*PROJECTED

NORTH BEACHES APARTMENT SUBMARKET

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EDUCATION

HIGHEREDUCATION

DEGREESCERTIFICATIONS258,000 70+

students metrowide Offered at CSUSM

Over 35 institutions of higher learning are located throughout the San Diego MSA. Combined, these institutions support a population of more than 258,000 students giving metro San Diego one of the highest student populations in the country. California State University San Marcos (CSUSM) and Palomar College (PC), are located in neighboring San Marcos and boast a combined enrollment of 44,300 students.

The University of Southern California’s Marshall executive MBA program, based in Carlsbad, is a 22-month program designed for senior managers and highly-skilled professionals.

Palomar College offers more than 200 associate degrees and certificate programs to 30,000 full- and part-time students.

Established in 1989, California State University San Marcos (CSUSM) is one of the fastest growing schools in California. The student population has doubled to approximately 14,300 in the past decade and offers 62 bachelor’s and 15 master’s degree programs. Over 85% of CSUSM graduates remain in the San Diego area, fueling economic growth and providing the region with a pool of skilled workers.

SAN DIEGO MSA

LARGEST HIGHER EDUCATIONUC San Diego 35,820

San Diego State University 33,780

San Diego Mesa College 31,600

Palomar College 30,000

Southwestern Community College District 25,560

Grossmont College 18,240

San Diego City College 16,670

UC San Diego Expansion 16,390

MiraCosta College 14,770

California State Universtiy San Marcos 14,180

Source: Listed Academic Institutional Websites

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TRANSPORTATION

NCTTRANSIT

SANAIRPORT12m 20.7m

passengers served in 2016 passengers served in 2016

Carlsbad is easily accessible via Interstate 5 and Highway 78. Transportation is provided by the region’s extensive freeway network, including interstates 5, 15, 805, and 8, along with mass transit, railroad, and trolley systems.

The North County Transit District provides mass transit options to Carlsbad residents including BREEZE bus transportation, Amtrak, SPRINTER, and COASTER commuter rail services.

The region boasts the world’s largest regional airport system, with six major urban airports and several smaller airports. Carlsbad’s McClellan-Palomar Airport is one of the busiest single-runway airports in the nation and serves the metropolitan area of northern San Diego County and the Southern California region in general. San Diego International Airport (SAN) is a key economic generator for the area, with a total annual impact of $9.9 billion on the region. The airport served 20.7 million passengers in 2016.

COASTER COMMUTER RAIL SERVICE

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BY THE NUMBERS

TOTAL POPULATION2010 105,713

2017* 114,582

2022* 119,144

Growth Rate (2017 - 2022) 4.0%

TOTAL HOUSEHOLDS2010 41,295

2017* 45,101

2022* 46,919

Growth Rate (2017 - 2022) 4.0%

MEDIAN INCOME2010 $82,260

2017* $93,513

2022* $103,571

Growth Rate (2017 - 2022) 10.8%

MEDIAN AGE2010 41.0

2017* 42.5

2022* 43.5

MEDIAN HOME PRICEApril 2016 $730,000

April 2017 $815,000

Growth Rate Y-o-Y 11.6%

RENT VS. OWNAverage Mortgage Payment** $4,243

Average Rent $2,154

Difference $2,089

*Projected**30-yr fixed; 20% down; 4.15% interest rate; 1.75% property taxes;$1,000 homeowner’s insurance

Sources: Berkadia; Tetrad; U.S. Census Bureau; U.S. Bureau of Labor Statistics; Fortune/Money.CNN.com; Forbes; Moody’s; Wikipedia; Axiometrics; California Department of Finance; California Division of Tourism; City of Carlsbad; Carlsbad Economic Development; Greater San Diego Chamber of Commerce; San Diego Economic Development Corporation; Sandiegobusiness.org; San Diego Union-Tribune; San Diego Business Journal; North County Times; Carlsbad Unified School District

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$235.8b GMPSan Diego's Gross Metropolitan Product (GMP) is projected to reach $235.8 billion in 2017; increasing 14.3% from 2014- IHS Global Insight

Favorite CitySan Diego ranked No. 2 among "America's Favorite Cities"- Bloomberg

Job GrowthSan Diego was named one of the "Best Cities for Job Growth" - NewGeography.com

Fortune 500Home to two Fortune 500 headquarters: Qualcomm (No. 110) and Sempra Energy (No. 279)- Fortune Magazine

INTRODUCTIONThe San Diego-Carlsbad, CA Metropolitan Statistical Area (MSA) encompasses over 4,500 square miles and is comprised entirely within San Diego County, spanning 70 miles of California coastline from the border of Mexico to the shores of Orange County. Home to more than 3.3 million residents, the San Diego MSA is the fourth-most populated metro in the state and the 17th-largest MSA in the United States. The dynamic and positive business environment of the San Diego metro area makes it one of the world’s leading business locations, in addition to being a center for high-tech innovation fostered by world-class universities and colleges.

With an active labor force of over 1.4 million workers, the highly educated, diverse, and growing San Diego metro area is one of the major population centers of Southern California. Key industries in this dynamic region include: Cleantech, Communication / Information Technology, Defense, Education, Life Science, Health Care, Maritime, and Tourism / Hospitality.

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4TH 36.2

DEMOGRAPHICS

SAN DIEGO HAS THE NATION'S

SECOND-LARGESTMILLENNIAL POPULATION

MOST POPULATED METRO IN

CALIFORNIAMEDIAN AGEIN THE MSA

3.4m

Greater San Diego’s population is forecast to grow 3.3% over thenext five years

763.9k

35% of residents age25 and older hold a bachelor’s degree or higher, compared to 29% nationally

384.2k

Nearly 33% of metroSan Diego households earn $100,000 or more annually, compared to 24% nationally

828.9k

25% of the region'spopulation is in the key renter age group, between 18 and 35, compared to 23% nationally

$75.9k

The metro area’s median household income is projected to reach $75,900 by 2022, up

11.1% from 2017

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0 75,000 150,000 225,000 300,000

Information

Other Services

Financial Activities

Mining, Logging, and Construction

Manufacturing

Leisure and Hospitality

Education and Health Services

Trade, Transportation, and Utilities

Professional and Business Services

Government

March-16 March-17

created in the Government sector(Y-o-Y Mar. '17)

6,700 jobsJOB

GROWTH

METRO INDUSTRY BREAKDOWN

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METRO EMPLOYMENT TRENDS

the metro's monthly unemployment rate was down 70 basis points Y-o-Y

were created metrowide, a

2.1% Y-o-Y increase

4.2%

29,600 jobs

MARCH2017

MARCH2017

(80,000)

(40,000)

0

40,000

80,000

0%

3%

6%

9%

12%

2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017*

Unemployment Rate Jobs Added / Lost*Projected

SAN DIEGO MSA

LARGEST EMPLOYERSNaval Base San Diego 38,460

University of California, San Diego 30,670

Sharp Healthcare 17,810

County of San Diego 17,380

Scripps Health 14,860

San Diego Unified School District. 14,120

Qualcomm Inc. 11,600

City of San Diego 11,350

Kaiser Permanente 8,410

UC San Diego Health 7,440

Sources: San Diego Business Journal, July 2016; City of San Diego CAFR, June 2016

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San Diego is one of the premier life sciences hubs in the nation, generating a $33.6 billion economic impact while supporting over 133,000 jobs directly and indirectly metrowide. The region boasts over 1,200 life sciences companies and 80 research institutions, drawing employees from a pool of more than 7,000 annual STEM graduates. Along with biotech firms, metro San Diego life sciences companies received approximately 66% of the nearly $1.1 billion invested metrowide by venture capitalists in 2016, the largest of any sector in the region.

Known as a "vacationer's paradise", San Diego is one of the world's top visitor and convention destinations featuring over 70 miles of coastline, plenty of hotel and convention space, and numerous entertainment options. Revenue-wise, tourism is the region’s second-largest industry and supports 185,300 jobs; nearly 13% of all county jobs. A record 34.9 million people visited San Diego in 2016, who spent a record $10.4 billion and generated $704.6 million in tax revenues. The region has over 60,600 hotel rooms with 17.1 million room nights sold in 2016.

LIFE SCIENCES

TOURISM

1,200+Life Sciences Firms

34.9 millionVisitors in 2016

133,000+Jobs Supported


$704.6 millionTax Revenues

$33.6 billion Economic Impact

$10.4 billion Visitor Spending

LA JOLLA

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The San Diego region has the largest concentration of military in the world. Serving as the principal homeport to the Pacific Fleet with five active duty military bases and two reserve bases, the Department of Defense (DoD) plays a massive role in the San Diego economy. The military generates $44.7 billion of Gross Regional Product (GRP) for the county representing 20% of the region’s total GRP. This sector supports 301,000 jobs; one out of every five jobs. In 2016, direct spending related to defense totaled $23.3 billion, forecast to rise 2.4% in 2017.

Metro San Diego offers some of the most sophisticated health care facilities in the country. With 25 hospitals and 7,000 physicians, one in every 10 jobs in the metro area is health service related. One of the biggest health care systems in the area, UC San Diego Health, has three medical facilities with a combined 563-bed capacity. Another UCSD facility, the $943 million Jacobs Medical Center, opened in November 2016 with 245 beds. UCSD Health, Sharp Memorial Hospital, and Scripps hospitals and clinics have also earned national recognition for excellence.

MILITARY

HEALTH CARE

109,500Active Duty Military Personnel

25Hospitals

60,000Retired Military Employees


301,000 Military Related Jobs

$44.7 billionGross Regional Product

UCSD MEDICAL CENTER

NAVAL BASE SAN DIEGO

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San Diego County Regional Airport Authority approved a multi-phase proposal to renovate and expand the San Diego International Airport. Under the $2.2 billion plan, phase one will replace 26 gates, build 10 additional gates, as well as add an additional runway, baggage claim area, and ticket kiosks in Terminal 1. Phase two will add two parking garages with 7,000 spaces each, a centralcustoms inspection station and a five-gate expansion of Terminal 2 to includeadditional international gates. Prior to construction, officials are co nductingan environmental review for the airport development plan, which could becomplete by the summer or fall of 2017.

SAN DIEGO INTERNATIONAL AIRPORT

1,000+Construction Jobs

$2.2 billionConstruction Costs

In 2012, phase one of the University Town Center (UTC) expansion was completed with a $180 million renovation of the center's facade and public spaces. Phase two of the expansion began construction in 2015. The $585 million expansion will add 395,000 square feet of retail space including 90 new shops and a two-level Nordstrom department store, 15,000 square feet of event space, parking, and a new transit center for the future Mid-Coast Trolley extension. A third phase will focus on adding 300,000 square feet of retail space and 300 residential units. Construction on phase two is slated to be complete in June 2017. Once the Blue Line trolley extension is complete in 2021, UTC is expected to become the region's second-most transit-oriented office market.

UNIVERSITY TOWN CENTER

$585 millionInvestment

695,000Additional SF

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Construction has begun on the 3.2 million-square-foot Ballpark Village. The centerpiece of the project is a 37-story residential tower, which will have 439 luxury residential units. An additional 274 units will be built in surrounding mid-rise buildings. The project will also contain 45,000 square feet of commercial space, which will surround a 12,000-square-foot plaza. Future phases call for the construction of a 1,600-room hotel. The project will infuse $1.5 billion into the local area, while creating more than 1,000 construction and permanent jobs.

BALLPARK VILLAGE

$1.5 billionEconomic Impact

1,000+Jobs Generated

In April 2017, a new state-of-the-art Kaiser Permanente San Diego Central Hospital opened in the neighborhood of Kearny Mesa, the only 100% LEED certified, sustainable medical facility in the world. The seven-story hospital opened with 253 beds but has the capacity for 321 beds. The 565,000-square-foot facility, serving the Greater San Diego area, also includes 10 operating rooms, an emergency room, labor and delivery center, and will offer robotic surgery. The project supported 900 construction jobs and generated 1,000 permanent hospital jobs.

SAN DIEGO CENTRAL HOSPITAL

1,000Permanent Jobs

565,000SF

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Construction is currently underway on the $2.1 billion Mid-Coast Trolley expansion, adding 11 miles and nine new stations including a terminus at Westfield UTC mall. The expansion will extend services from Downtown San Diego to the University City community. In the process, services will pass through major activity hubs, such as Old Town, UCSD, and Westfield UTC. In addition to mitigating the congestion from the projected 19% increase in population and 12% increase in employment predicted by the year 2030, the expansion will also create approximately 24,000 jobs. The expansion is slated to open by 2021.

MID-COAST TROLLEY

$2 billionInvestment

24,000Jobs Created

Developers have begun construction on the new 400-room, downtown Intercontinental Hotel. The 18-story hotel will have 23,000 square feet of meeting space, which can also serve as a ballroom. In addition, 32,850 square feet of commercial space will be featured along Broadway and Pacific Highway. A subterranean garage will provide 686 spaces of garage parking, 271 of which will be available to the public. The $217 million hotel is scheduled to open in the fall of 2018.

INTERCONTINENTAL HOTEL

400Guest Rooms

$217 millionHotel

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The Port of San Diego Board of Commissioners a $1.2 billion plan to redevelop Seaport Village, replacing the 36-year-old Seaport Village retail center with a mixed-use development; dubbed Seaport San Diego. The 70-acre redevelopment project on the downtown waterfront will include: three hotels (a 500-room Virgin Hotel, a 350-room Yotel hotel, and a 475-bed hostel), a 480-foot observation tower (SkySpire), a 151,000-square-foot aquarium (OdySea San Diego Aquarium), a 600-student charter high school, 19,000 square feet of office space, 39 0,000 square fe et of re tail and re staurant space, and an enlarged and upgraded commercial fishing industry. Construction is slated to begin in 2020 and completed in phases between 2022 and 2025.

SEAPORT SAN DIEGO

70-acreMixed-Use Development

$1.2 billionInvestment

More than $1 billion in aviation and commercial amenities are planned for Brown Field Municipal Airport in the Otay Mesa neighborhood of San Diego. Expected to start in late 2017, the development known as Metropolitan Airpark will be constructed in four phases to include aviation facilities with up to 200 hangars, over 1.3 million square feet of industrial and commercial space, a solar field, as well as hotels and restaurants. Among the first elements on the 331-acre site will be a new fixed-base operations facility. The entire project is expected to create 4,000 permanent jobs and generate over $500 million annually to the local economy. The Metropolitan Airpark is positioned to become a major commercial hub between U.S. and Mexico.

METROPOLITAN AIRPARK

$1 billionInvestment

4,000 Jobs Generated

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According to the U.S. Census, permits for 640 multifamily apartment units, including both apartments and condominiums, five or more units, were issued in the San Diego MSA through March 2017. According to Moody's, permitting volume is projected to reach 5,708 multifamily units by year-end 2017.

Approximately 400 apartment units were added in the San Diego metro area through the first three months of 2017. By year-end, nearly 4,130 units are scheduled to be added across the metro.

In 2017, net move-ins in the San Diego metro apartment market are expected to outpace new deliveries by 4.6%, totaling 4,320 new move-ins. Absorption levels have continued to improve faster than deliveries since 2009.

were completed through the first three months of 2017

400 unitsNEW

DELIVERIES were issued in the first quarter of 2017

640 unitsMULTIFAMILY

PERMITS

PERMITS / ABSORPTION / DELIVERIES

0

2,000

4,000

6,000

8,000

2011 2012 2013 2014 2015 2016 2017*

Construction vs. Absorption

Deliveries Absorption Permits*PROJECTED

SAN DIEGO MSA APARTMENT MARKET

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Positive absorption totals have enabled the local apartment market to see improved occupancy rates. The San Diego market's average apartment occupancy rate was 95.8% in the first quarter of 2017, up 10 basis points from one year prior and 130 basis points above the national rate of 94.5%. Occupancy is expected to drop slightly and settle between 95.3% and 95.5% by year-end.

Encouraged by robust occupancy rates, operators have raised rents. As of March 2017, average rent in the San Diego metro apartment market was $1,908, up 2.3% from one year prior. Average rent is expected to increase 1.8% annually through year-end 2017, ending the year at $1,947. Average rent in this market has increased 27.6% since 2011.

in the first quarter of 2017, up 2.3% from one year prior

$1,908AVERAGERENT

through March 2017, up 10 basispoints from the previous year

95.8%OCCUPANCY

RATE

RENT / OCCUPANCY

$1,4

99

$1,5

50

$1,6

03

$1,7

00

$1,8

63

$1,9

12

$1,9

47

$0

$400

$800

$1,200

$1,600

$2,000

88%

90%

92%

94%

96%

98%

2011 2012 2013 2014 2015 2016 2017*

Occupancy & Ask Rent

Rent Occupancy*PROJECTED

SAN DIEGO MSA APARTMENT MARKET

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Many higher-education options are available to San Diego residents. Combined, these institutions support a population of more than 258,500 students, thus generating strong demand for local apartments.

One of the best universities in the area is the University of California San Diego. In addition to being one of the best all-around schools in the world, the university’s programs are also highly ranked. Recently, the school’s engineering, life sciences, and natural sciences programs were all ranked among the top 30 programs in the world. In addition, U.S. News & World Report ranked the school’s pharmacology and toxicology programs fifth in the nation, and their biomedical engineering doctorate program sixth for 2017. The impact of this education is evident in the local economy, where more than 650 regional biotech companies have implemented technology developed or utilized by the alumni, faculty, and staff of UC San Diego.

students metrowide

258,500HIGHEREDUCATION

among the top public schools in the nation

No. 10UCSAN DIEGO

EDUCATION

SAN DIEGO MSA

LARGEST HIGHER EDUCATIONUniversity of California, San Diego 35,820

San Diego State University 33,780

San Diego Mesa College 31,610

Palomar College 30,000

Southwestern Community College District 26,560

Grossmont College 18,240

San Diego City College 16,670

UC San Diego Extension 16,390

MiraCosta College 14,770

California State University San Marcos 14,180

Source: listed college websites

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San Diego residents have access to an extensive transportation network linking major employment centers, entertainment, and recreation. Key interstates serving the county include: 5, 8, 15, and 805, with numerous state routes also available. In addition, three border crossings provide a direct link to Mexico.

Mass transit options include Amtrak, MetroLink, and SPRINTER and COASTER commuter rail services. The San Diego Trolley and San Diego Metropolitan Transit System also serve area residents. In order to meet the demands of projected population growth, approximately $2 billion will be invested to expand the Mid-Coast Trolley, expected to be fully operational in 2021.

San Diego International Airport (SAN) is a key economic generator for the area, with a total annual impact of $9.9 billion on the region. The airport served 20.7 million passengers in 2016, up 3.2% y-o-y. SAN is the 26th-busiest airport in the U.S. and ranked third among the "Best Airports in the U.S.".

generated by SAN

$9.9bECONOMIC

IMPACT

in 2016, up 3.2% Y-o-Y

20.7mAIRPORT

PASSENGERS

TRANSPORTATION

SAN DIEGO INTERNATIONAL AIRPORT

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Peter M. HauserSenior [email protected] License #00856966

46

Peter M. HauserPrincipal [email protected] RE License #00856966


INVESTMENT ADVISORS

DISCLAMER & CONFIDENTIALITY AGREEMENT

The material contained in this document is confidential, furnished solely for the purpose of considering investment in the property described therein and is not to be copied and/or used for any purpose or made available to any other person without the express written consent of Avison Young. In accepting this, the recipient agrees to keep all material contained herein confidential.

This information package has been prepared to provide summary information to prospective purchasers and to establish a preliminary level of interest in the property described herein. It does not, however, purport to present all material information regarding the subject property, and it is not a substitute for a thorough due diligence investigation. In particular, Avison Young and seller have not made any investigation of the actual property, the tenants, the operating history, financial reports, leases, square footage, age or any other aspect of the property, including but not limited to any potential environmental problems that may exist and make no warranty or representation whatsoever concerning these issues. The information contained in this information package has been obtained from sources we believe to be reliable; however, Avison Young and Seller have not conducted any investigation regarding these matters and make no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. Any pro formas, projections, opinions, assumptions or estimates used are for example only and do not necessarily represent the current or future performance of the property.

Avison Young and Seller strongly recommend that prospective purchasers conduct an in-depth investigation of every physical and financial aspect of the property to determine if the property meets their needs and expectations. We also recommend that prospective purchasers consult with their tax, financial and legal advisors on any matter that may affect their decision to purchase the property and the subsequent consequences of ownership.

All parties are advised that in any property the presence of certain kinds of molds, funguses, or other organisms may adversely affect the property and the health of some individuals. Avison Young recommends, if prospective buyers have questions or concerns regarding this issue, that prospective buyers conduct further inspections by a qualified professional.

The Seller retains the right to withdraw, modify or cancel this offer to sell at any time and without any notice or obligation. Any sale is subject to the sole and unrestricted approval of Seller, and Seller shall be under no obligation to any party until such time as Seller and any other necessary parties have executed a contract of sale containing terms and conditions acceptable to Seller and such obligations of Seller shall only be those in such contract of sale.

For more information on these and other Avison Young exclusive listings, please call or visit our website at www.avisonyoung.com.

Avison Young is the world’s fastest-growing commercial real estate firms, focused exclusively on creating the best solutions for our clients to deliver long-term success. All information contained herein is from sources deemed to be reliable; however, it is not guaranteed. Printed in the USA. All rights reserved.

@2017 AvisonYoung-Southern California, Ltd.

Avison Young Irvine Office

2030 Main Street, Suite 150 Irvine, CA 92614 949.757.1190 949.757.1844 fax

avisonyoung.com

AERIAL

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Peter M. HauserPrincipal [email protected] RE License #00856966


INVESTMENT ADVISORS Avison Young Irvine Office

2030 Main Street, Suite 150 Irvine, CA 92614 949.757.1190 949.757.1844 fax

avisonyoung.com

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About Avison Young

Avison Young is the world’s fastest-growing commercial real estate services firm. Headquartered in Toronto, Canada, Avison Young is a collaborative, global firm owned and operated by its principals.

Founded in 1978, the company comprises 2,400 real estate professionals in 80 offices, providing value-added, client-centric investment sales, leasing, advisory, management, financing and mortgage placement services to owners and occupiers of office, retail, industrial, multi-family and hospitality properties.

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