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Salinas Investment Located in an Opportunity Zone
21 W. ALISAL STREETSalinas, California
PRICE: $2,495,000 VALUE-ADD OPPORTUNITY 63% OCCUPIED
Michael Schoeder | 831 647 2105 | [email protected] | lic. 00989268
Greg Findley | 831 755 1639 | [email protected] | lic. 01170453
Erik HallgrimsonExecutive Managing Director+1 408 615 [email protected] #01274540
Michael Schoeder Managing Principal D 831 647 2105 M 831 595 1010 [email protected] lic. 00989268
Greg Findley Managing Principal D 831 755 1639 M 831 594 5400 [email protected] lic. 01170453
1 Lower Ragsdale Drive Building 1, Suite 100 Monterey, CA 93940
ph: +1 831 375 8000 fx: +1 831 647 2116
cushmanwakefield.com
TABLE OF CONTENTS:
Investment Opportunity 1
Investment Highlights 1
Offering Summary 2
Operations Statement 3
Rent Roll 4
Parcel Map & Zone Map 5
Floor Plans 6
Aerials 7
Location Overview 10
Confidentiality & Disclaimer 14
21 W. Alisal Street, Salinas, CA
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21 W. Alisal Street, Salinas, CA
Investment OpportunityCushman & Wakefield, is pleased to present to the market the opportunity to acquire 21 W. Alisal Street, Salinas, California (the “Property”), a one-story office building located in Downtown Salinas. The subject property is located in the heart of downtown Salinas on E. Alisal Street and Salinas Street.
Investment Highlights• Property is located in an Opportunity Zone
• Salinas Downtown Vibrancy Plan
• Salinas is the largest city in the county with a growing population over 157,000 residents.
• Heart of downtown Salinas situated at a four-way signalized hard corner
• A 19,500 SF parcel located in the heart of downtown Salinas
• Current in-place CAP Rate of 4.02% (below market rents with substantial re-positioning upside, 63% occupied - See Rent-Roll/Proforma)
https://www.cityofsalinas.org/downtown-vibrancy-plan
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21 W. Alisal Street, Salinas, CA
Offering Summary
Property Information
Legal Address 21 W. Alisal Street, Salinas, CA
County Monterey County
APN 002-341-019
Number of Stories 1 + Small Mezzanine
Total Building (SF) Approx. 18,141 SF
Land Area (SF) Approx. 19,500 SF
Land Use Office Building
Type of Ownership Fee Simple
Year Built Approx. 1924
Zoning Mixed Use (MX)
Number of Suites 25
Ceiling Height 8’ to 14’
HVAC Nine (9) units
RoofEither composition shingle or built-up composition
ConstructionConcrete with metal and wood framing along the store fronts
Foundation Concrete Slab
Property Details
Price $2,495,000
In-Place Cap Rate 4.02%
Operations Summary Current Estimate
Estimated Effective Income $249,524
Estimated Operating Expenses
$100,272Estimated Net Operating Income
$149,252
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21 W. Alisal Street, Salinas, CA
Operations Statement
Estimated Income In-Place
Scheduled Gross Rent $238,392
Expense Reimbursement $11,132
Total Gross Income $249,524
Estimated Operating Expenses
Repairs & Maintenance $9,000
Real Estate Taxes (Tax Rate - 0.011) $27,445
PG&E $51,945
HVAC R&M $5,500
Janitorial $23,000
Water and Sewer $10,019
Pest Control $900
Trash $6,000
Management Fee (4.5%) $11,229
Insurance $4,214
Total Estimated Operating Expenses $149,252
Estimated Total Expenses
% Scheduled Gross Income% Scheduled Gross Income 6060%%
Estimated Net Operating Income $100,272
21 W. Alisal Street, Salinas, CA
Rent Roll / Proforma
Suite Tenant Leasable SF
Lasertech RSF Lease
Lease Expire
Current Monthly
Rent
Market Rent PSF
Security Deposit Operating Expenses O/E
Options
Parking A & B Ariel Theater (2 spaces) mo to mo $80.00 $80
Unit 45Weyant Staffing LLC DBA Express Employment
971 971 04/15/2019 02/15/2022 $1,603.00 $1.65 $2.10 $2,039 $1,603.00Landlord pays for all O/E, including limited janitorial.
1-3 YR. on 2/15/2019 | 2-3 YR. Option? @ CPI; 30 days notice
Unit 100Robert Pitman, Jeffrey Gobell, W. Scott Erdbacher Attorney at law
1128 1369 6/1/2002 mo to mo $1,769.21 $1.57 $2.00 $2,738 Landlord pays for all O/E, including limited janitorial.
Unit 101 Fred F. Sprinz / S & B Financial Inc. 1089 1056 10/1/1997 mo to mo $1,355.00 $1.24 $1.80 $1,901 10% load factor; Landlord pays for all O/E, including limited janitorial.
Unit 104 Vacant / Office 1368 1558 $2.00 $3,116
Unit 107 Mercado, Joel / J&J Investment, LLC 507 553 7/11/2017 mo to mo $870.81 $1.72 $2.10 $1,161 $837.00Landlord pays for all O/E, including limited janitorial.
Unit 108Pereira, Louie / Skillet Creek Weapon Systems
351 351 05/01/2019 4/30/2021 $545.00 $1.55 $2.25 $790 $545.00Landlord pays for all O/E, including limited janitorial.
2-3 YR. @ CPI; 30 days notice
Unit 110 Osbaldo Lucero / Salad Bytes Media 351 345 7/1/2019 7/1/2021 $570.00 $1.62 $2.25 $776 $570.00Landlord pays for all O/E, including limted janitorial.
1-1 YR. @ CPI; 30 days notice
Parking Wruck, Maureen (2 spaces) mo to mo $80.00 $80
Unit 111 Wruck, Maureen 1062 1062 1/1/2016 mo to mo $1,610.00 $1.52 $1.80 $1,912 $500.00Landlord pays for all O/E, including limited janitorial.
Unit 115 Central Coast Engineers, Inc. 330 354 2/9/16 01/31/2020 $545.00 $1.65 $2.25 $797 $545.00Landlord pays for all O/E, including limited janitorial.
2-3 YR. @ CPI; 30 days notice
Unit 116 Wruck, Maureen / Storage 141 166 $2.00 $332
Unit 116 (B)Noland Hamerly / Storage
184 216 $1.00 $216
Unit 117 Bakos, John 330 428 11/1/2017 10/31/2020 $545.00 $1.65 $2.10 $899 $545.002-3 YR. @ CPI; 30 days notice
Parking Sutton, Susan (1 spaces) 5/1/2017 mo to mo $40.00 $40
Unit 118 Sutton, Susan 461 540 2/1/2001 mo to mo $649.00 $1.41 $2.00 $1,080 Landlord pays for all O/E, including limited janitorial.
Unit 118A Sutton, Susan 357 418 mo to mo $503.00 $1.41 $1.90 $794 Landlord pays for all O/E, including limited janitorial.
Unit 119 Central Coast Engineers, Inc. 697 801 6/1/2005 mo to mo $1,046.10 $1.50 $2.00 $1,602 $1,046.10Landlord pays for all O/E, including limited janitorial.
Unit 120 Building Maint & Jan Room/Noland Hamerly/Storage
403 472 11/25/2015 mo to mo $500.20 $1.24 $2.00 $944
Unit 121 Noland Hamerly / Storage 274 320 $2.25 $720
Unit 122 Watson, Edward (Ted) E. 390 329 7/01/2018 6/30/2020 $650.00 $1.67 $2.25 $740 $1,254.00Landlord pays for all O/E, inluding limited janitorial.
Unit 125 Pitman, Robert / Storage 154 181 $2.25 $407
Unit 132Noland Hamerly - 2 spaces / Fred Sprinz / Storage
637 746 $1.00 $746
Unit 311 Flow Cryotherapy, LLC 1411 1477 9/9/2016 mo to mo $2,101.19 $1.49 $2.10 $3,102 $3,000.00Landlord pays for all O/E, including limited janitorial.
Unit 313 & 313 MZ
Vacant / Office 1040 1290 $1.70 $2,193
Unit 317 Herbalife 950 1064 11/3/2017 10/31/2020 $2,318.00 $2.44 $2.10 $2,234 $1,950.00Landlord pays for all O/E, inluding limited janitorial.
2-3 YR. @ CPI; 30 days notice
Unit 319 Zarazua, Blanca 908 943 6/1/2010 mo to mo $1,200.00 $1.32 $2.00 $1,886 $1,200.00
Unit 321 Mama Lupitas Restaurant 1131 1131 12/21/2001 mo to mo $1,285.00 $1.14 $2.15 $2,432 Garbage: $172.21, PG&E: $600, Parking: $40, Utilities: $115.43
16,625 18,141 $19,866 $35,757
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Monthly Rent PSF
Proforma Monthly Rent
$1,000.00
$2,000.00
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21 W. Alisal Street, Salinas, CA
Parcel Map Salinas Opportunity Zone Map
Tract 145
Tract 5.02Tract 18.02
Tract 4
Tract 13
Opportunity ZoneSalinas City LimitsCensus Tracts
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21 W. Alisal Street, Salinas, CA
Floor Plan │ First Floor: ±17,767 SF Floor Plan │ Mezzanine: ±412 SF
ALISAL STREET
SALINAS STREET
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21 W. Alisal Street, Salinas, CA
Aerial
W. ALISAL STREETW. ALISAL STREET
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21 W. Alisal Street, Salinas, CA
E. GABILAN STREET
E. ALISAL STREET
E. MARKET STREET
E. SAN LUIS STREET
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BANK OF AMERICABANK OF AMERICA
RABOBANKRABOBANK
CHASE BANKCHASE BANK
WELLS FARGOWELLS FARGO BANK BANK
FED EXFED EX
COMERICACOMERICA BANK BANK
RESIDENTIAL DEVELOPERRESIDENTIAL DEVELOPER
MAYA CINEMAS MAYA CINEMAS
FOX THEATERFOX THEATER
CHAMBER OF COMMERCECHAMBER OF COMMERCE
CSUMBCSUMB
FIRST CAPITAL BANKFIRST CAPITAL BANKSALINAS CITY HALLSALINAS CITY HALL
SALINASSALINASPOLICE DEPARTMENTPOLICE DEPARTMENT
MONTEREY COUNTYMONTEREY COUNTYSUPERIOR COURTSUPERIOR COURT
Surrounding Businesses
TAYLOR FARMSTAYLOR FARMSGROWERS EXPRESSGROWERS EXPRESS
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21 W. Alisal Street, Salinas, CA
Community Assets and Major Employers
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Education: CSUMB (Cal State University Monterey Bay) Hartnell CollegeAgriculture: Taylor Farms Indus Holdings Mann Packing Nunes Company Produce Growers Express Fresh Express ProduceHealthcare: SVMH (Salinas Valley Memorial Hosp) Natividad Medical CenterProfessional:
JRG Law Noland Hamerly Law Hayashi & Wayland Accounting Brandon & Tibbs Accounting SV Chamber of Commerce
Local Banks: First Capital Bank Rabobank Pinnacle Bank Pacific Valley BankCivic Places: Salinas City Hall County of Monterey Superior Court of California TAMC (Transportation Agcy for Monterey County)Significant Places: Salinas Airport Salinas Sports Complex & Rodeo Grounds
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21 W. Alisal Street, Salinas, CA
Downtown Salinas Vibrancy PlanDowntown Salinas is undergoing major redevelopment through the City’s Downtown Salinas Vibrancy Plan. The hope of this plan is to attract more businesses and residetial to Downtown Salinsas. Among the planned improvements are converting all downtown streets to two-way thoroughfares, enhancing the pedestrian environment to include more outdoor seating areas, improve street lighting and build additional parking structures. With these improvements the City anticipates the development of several new mixed-use projects and hundreds of new residential units.
Taylor Farm completed their new five-story, 100,000 square foot headquarters in Downtown Salinas. In July 2018, Silicon Valley Partners announced plans to build a $50 million, 206,000 square foot state-of-the-art warehouse and distribution center adjacent to the Salinas Airport called Thrive Business Park. Once complete, the park will consist of nine industrial building: six for research, development and incubator ventures, and three buildings for warehouse and distribution. Thrive Business Park aims to be the premier Ag Tech hub in the Western U.S. and create 1,000 new jobs.
Salinas Moves Forward With Downtown Revitalization PlansTo describe their view of what Salinas downtown could look like, city planners invoke Little Italy in San Diego: gateway arches at entrances, outdoor dining at chic brewpubs, patrons strolling up-and-down friendly, walkable streets. It’s an ideal documented in the Salinas Downtown Vibrancy Plan, approved in 2015, and that moved another step closer to reality after the Salinas City Council recently approved a contract to re-design the looks of Main Street.
SOURCE: Monterey Herald Please visit http://www.montereyherald.com/2017/12/12/salinas-moves-forward-with-downtown-revitalization-plans for the full article
SOURCE: http://www.salinascitycenter.com
PROPOPROPOSED ADDITIONS
BENEFIT ZONE 1
BENEFIT ZONE 2
“We’re still a year out from the start of construction,” Councilman Steve McShane said. “This meeting was the first attempt to reach out to the community as we enter the design phase.” The meeting McShane is referring to was held Monday at Salinas City Hall, and it was attended by nearly 100 people. During the 90-minute meeting, city planners and officials described the major changes that are coming to downtown Salinas as officials attempt to transform it into a “destination.”
For starters, Main Street will become a two-way street, according to the plan. Planners say that drivers slow down on a two-way street, which would make the street safer and friendlier for pedestrians and shoppers. “It increases revenue for merchants, it improves security. It’s all positive,” said Andrew Easterling, traffic engineer. Parking along Main Street will change to a mix of parallel and diagonal parking. The sidewalks will be torn up to make other infrastructure upgrades such as water lines, said Don Reynolds, assistant public works director. As many trees as possible will be saved. Traffic patterns will be changed not just on Main Street but several streets in the downtown area. The $905,000 contract with Kimley-Horn and Associates for engineering services was approved Dec. 5. The actual work to be done downtown is estimated to cost $12 million and expected to last for about two years.
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http://www.montereyherald.com/2017/12/12/salinas-moves-forward-with-downtown-revitalization-plans
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21 W. Alisal Street, Salinas, CA
Location Overview
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21 W. Alisal Street, Salinas, CA
Salinas Photos
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21 W. Alisal Street, Salinas, CA
Demographics & ProfileSalinas is the capital of the Salinas Valley, which has long been known as “The Salad Bowl of the World” for its fresh produce, and which is also renowned for its flowers and vineyards. More recently, the region is emerging as a world hub of agricultural technology, or agtech.
Although agriculture is the foundation of the local economy, more than 100 manufacturing firms call Salinas home. Some of the largest employers in the area include: Dole Fresh Vegetable, the County of Monterey, Taylor Farms, and Salinas Valley Memorial Hospital.
History
In the mid-1800s, Salinas’ agricultural industry began to grow. In 1867, several local businessmen laid out a town plan and enticed the Southern Pacific Railroad to build its tracks through Salinas.
Agriculture continued as the area’s major industry and by the end of World War I, the “green gold” growing in the fields helped make Salinas one of the wealthiest cities (per capita) in the United States. Today, the agriculture industry in Monterey County generates $8.1 billion annually to the local economy.
In 1924 Salinas had the highest per capita income of any city in the United States. During the growing seasons of the Great Depression, the volume of telephone and telegraph transmissions originating in Salinas was greater than that of San Francisco. This activity was reflected in a burst of building construction, many employing the streamlined shapes and organic patterns of Art Deco or Art Moderne. Many examples remain, including the National Register-listed Monterey County Courthouse and the Salinas Californian newspaper building.
2018 Demographics
Population 155,388
Daytime Population 145,955
Median Household Income $55,202
Median Home Value $395,088
Per Capita Income $20,049
Median Age 30.0
Housing
Salinas is a community of neighborhoods with a wide variety of housing options. With Victorians and the historic Spanish influence, Salinas provides renters and homebuyers a housing assortment, from modest cottages and modern townhouses to spacious “rancheros” nestled in the oak-dotted countryside.
Newer developments provide attractive and imaginative tract homes and condominiums alongside the many modern homes in well-established neighborhoods. Newcomers and longtime residents will find a neighborhood to their liking, regardless of whether they are looking for something larger to accommodate a growing family, or simply want to find smaller quarters for their retirement years.
Salinas offers approximately 39,175 housing units of which 20,881 are detached single family residences, 2,863 are attached single family residences, 3,341 two to four unit multifamily complexes, 10,833 apartment units, and 1,257 mobile homes. The residential vacancy rate is approximately 3½% at any time during the year.
Source: http://www.cityofsalinas.org
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21 W. Alisal Street, Salinas, CA
CONFIDENTIALITY & DISCLOSURES
Cushman & Wakefield has been engaged as exclusive advisor to the Seller, in connection with Seller’s solicitation of offers for the purchase of 21 W. Alisal Street located in Salinas, California (“The Property”). Said solicitation and potential sale to be governed by this Confidential Offering Memorandum, as it may be modified or supplemented (the “Offering Memorandum”) and a purchase agreement. Prospective purchasers are advised that as part of the solicitation process, Seller will be evaluating a number of factors including the current financial qualifications of the prospective purchaser. Prospective purchasers are further advised that the Seller expressly reserves the right in its sole and absolute discretion to evaluate the terms and conditions of any offer and to reject any offer without providing a reason therefore. Further, Seller reserves the right to terminate the solicitation process at any time prior to final execution of a purchase agreement. The Property is being offered on an “AS IS” basis. This Offering Memorandum is furnished to prospective purchasers on a confidential basis solely for the purpose of prospective purchasers determining whether to submit an offer to purchase the Property. The information contained herein, or any other related information provided by Seller may not be reproduced or redistributed or used in whole or in part for any other purpose. No person has been authorized to give any information or to make any representation or warranty, either express or implied, other than those contained in an executed purchase agreement subject to any disclaimer or limitations set forth therein, and if given or made in any other form, such information or representation should not be relied upon. While Seller has no reason to believe that the information provided herein, or in the due diligence materials, contain any material inaccuracies, neither Seller nor any of its respective officers, directors, shareholders, owners, employees, agents, members, managers, etc., make any representations or warranties, express or implied, as to the validity, accuracy or completeness of the information provided or to be provided except as may be set forth in an executed purchase agreement, subject to any disclaimers or limitations set forth therein. Without limiting the generality of the foregoing sentence, nothing
herein shall be deemed to constitute a representation, warranty or promise by Seller nor any of its respective officers, directors, shareholders, owners, employees, agents, members, managers, etc., as to the future performance of the Property or any other matters set forth herein. A prospective purchaser’s sole and exclusive rights with respect to this prospective transaction, the Property, or information provided herein or in the Due Diligence Materials, shall be limited to those expressly provided in an executed purchase agreement and shall be subject to the terms thereof. In no event shall a prospective purchaser have any other claims against Seller or any of its officers, directors, shareholders, owner’s employees, agents, members, managers, etc., for any damages, liability, or causes of action relating to this solicitation process or the marketing or sale of the Property. Prospective purchasers are not to construe the contents of this Offering Memorandum, any Due Diligence Materials or any prior or subsequent communications from Seller or any of its respective officers, directors, shareholders, owners, employees, agents, members, managers, etc. as legal, tax or other advice. Prior to submitting an offer, prospective purchasers should consult with their own legal counsel and personal and tax advisors to determine the consequences of an Investment in the Property and arrive at an independent evaluation of such investment.
CONTACTMichael Schoeder Managing Principal D 831 647 2105 M 831 595 1010 [email protected] lic. 00989268
Greg Findley Managing Principal D 831 755 1639 M 831 594 5400 [email protected] lic. 01170453