17 UNITS | SACRAMENTO, CA

REYAL APARTMENTS Value-Add Opportunity

TABLE OF CONTENTS

INVESTMENT SUMMARY / PG. 1

PROPERTY DESCRIPTION / PG. 4

LOCATION OVERVIEW / PG. 8

APARTMENT MARKET / PG. 12

FINANCIAL ANALYSIS / PG. 18

PROPERTY TOURS OFFERING TERMS & DUE DATE

Central Valley Multifamily Advisory Group

MICHAEL MATHIOSSenior Directormichael.mathios@cushwake.com +1 916 288 4522 LIC #01252862

400 Capitol Mall, Suite 1800Sacramento, CA 95814+1 916 288 4800cushmanwakefield.com

Tuesday, March 12, 201910:00 am to 12:00 noon

Thursday, March 14, 201911:00 am to 1:00pm

Friday, March 22, 201912:00pm to 2:00pm

All property tours must be arranged with Michael Mathios. Please do not approach or contact the tenants or on-site personnel.

Prospective buyers are encouraged to visit the subject property prior to submitting offers. Tour dates are as follows:

Property will be delivered free and clear. The timeline for the buyer’s due diligence and closing will be part of the consideration in the buyer selection process

All offers are due by 5:00pm March 29, 2019 and are to be sent to Michael Mathios via email at michael.mathios@cushwake.com.

CONTACTS

INVESTMENTSUMMARY

Investment Summary 1.

OFFERING

The Cushman & Wakefield Central Valley Multifamily Advisory

Group is pleased to present the exclusive listing of the 17 Unit Reyal

apartment community located in Sacramento, CA. This asset is

situated in the Midtown submarket within the City of Sacramento.

Built in 1960, The Reyal Apartments offer an excellent opportunity

to invest in a true value add property.

Address 2311 U Street, Sacramento, CA 95818

County Sacramento County

Number of Units 17 Units

Year Built 1960

Rentable Area 10,275 SF

Avg. Unit Size 604 SF

Site Size 0.29 Acres

Pro Forma Avg. Market Rent $1,519

Pro Forma Avg. Market Rent/SF $2.51

Occupancy 29%

Investment Summary 2.

INVESTMENT HIGHLIGHTS & INVESTMENT SUMMARY

• Rare opportunity to purchase a truly value added community in Midtown

Sacramento. Currently the property has only four tenants along with

one owner-occupied unit, therefore the renovation can begin immedi-

ately upon taking ownership. Transforming the exterior into a vibrant lush

oasis and upgrading the interiors with modern finishes will allow the new

owner to reposition the property in this strong rental sub-market to com-

pete for the tenants who want a premium quality living environment. The

higher paying tenant is looking for a clean, sleek, modern designed space

to call home.

• The maintenance room provides the opportunity to add storage lock-

ers/interior bike racks for the tenants to utilize. This is a potentially

unique amenity which would only enhance the rent desirability for

future tenants.

• The property is located within the Poverty Ridge neighborhood, which

contains some of the most stately historic homes in Midtown. The sur-

rounding tree lined streets are comprised of mostly single family homes

offering a quiet outdoor atmosphere for tenants to enjoy.

• Midtown/Downtown is the preferred submarket to reside in due to its

convenient access to the region’s major freeways, goods and services,

entertainment venues and employment opportunities. The CBD of

Sacramento contains a daily workforce of more than 120,000 people and

is the primary location for the regions nightlife and social scene.

REYAL APARTMENTS

Asking Price $2,875,000

Estimated Down Payment 100% $2,875,000

Price Per Unit $169,118

Price Per Room $52,273

Price Per Square Foot $279.81

Stabilized Cap Rate *N/A

Stabilized GRM *N/A

Investment Highlights & Summary 3.

*Due to low occupancy CAP and GRM are not applicable at time of purchase

PROPERTYDESCRIPTION

Property Description4.

PROPERTY SUMMARY

Number of Units 17 Units

Year Built 1960

Land Area 0.29 acres

APN 010-0105-018-0000

Stories Two Stories

Net Rentable Area 10,275 SF

Average Unit Size 604 SF

Parking Nine Open Parking Spaces

UTILITIES

SERVICE/UTILITY SOURCE/COMPANY PAID BY

Gas PG&E Resident

Electric SMUD Resident

Hot Water (Gas) PG&E Owner

Water City of Sacramento Owner

Sewer Sacramento County Owner

Trash Removal Atlas Disposal Owner

UNIT MIX SUMMARY

TYPE # UNITS % UNITS SIZE (SF)*

1 BR-1 BA 13 76% 575 SF

2 BR-1 BA 4 24% 700 SF

TOTAL/AVG. 17 Units 100% 10,275 SF / 604 SF AVG.

CONSTRUCTION DETAIL

Roof Pitched Composition Shingle

Exterior Walls Stucco with Brick Accent

Structure Wood frame

Foundation Raised

Windows Single Pane Aluminum Sliders

StairsConcrete treads with steel stringer

and wood framed stairsoverlaid with ceramic tiles

Hot Water Delivery One 100 gallon gas heated hot water heater

HVAC In wall gas heat and through wall air conditioning

SITE

Address 2311 U Street, Sacramento, CA 95818

County Sacramento County

Size/Density 0.29 Acres/ 58.6 Du/Acre

Zoning R-1B

* Unit square footages are estimates and are to be determined by purchaser

Property Description5.

• One laundry facility with two washers and two dryers (leased)

• Nine open parking spaces at the rear of the property access

via alleyway

• Courtyard with mature landscaping

• Perimeter fenced with ornate wrought iron entry gate

• Automatic in ground irrigation system

• Maintenance room

• Carpet flooring

• Fabric curtains in some units

• Linen cupboard in hallway

• Coat closet in hallway

• Standing shower/tub combination with ceramic tile surround

• Ceramic tile flooring

• Ceramic tile countertops

• Exhaust fan

• Linoleum flooring

• Porcelain sink

• Ceramic tile countertop

• Solid wood cabinetry

• Extra storage cabinetry

in dinning nook area

(select units)

COMMUNITY FEATURES

UNIT FEATURES

Living Room/ Bedroom/ Hallway

Bathroom

Kitchen• Electric range

• Electric wall oven (in some units)

• Refrigerator (in some units)

• Hood-vent

• Ceiling fan in some units

• Garbage disposal

Property Description6.

INTERIOR FEATURES

Property Description7.

LOCATION OVERVIEW

Location Overview8.

LOCATION MAP

SACRAMENTO MIDTOWNAREA DEMOGRAPHICS 1 Mile 3 Mile 5 Mile

2018 Total Population 24,451 140,643 385,233

2018 Total Daytime Population 48,713 270,425 534,607

2018 Average Household Income $70,900 $78,786 $71,286

Owner Occupied Housing Units 20.9% 38.2% 38.8%

Renter Occupied Housing Units 70.4% 53.5% 53.5%

2018 Average Home Value $483,965 $468,198 $388,227

Median Age 37.3 38.0 34.7

LOCATION OVERVIEW

U S

50

REYAL APARTMENTSBUSINESS

80LOOP

R StreetRevitalizationCorridor

DOWNTOWN

CALIFORNIA STATE CAPITOL

THERAILYARDSN

APARTMENT MARKET

Apartment Market12.

ONE BEDROOM

PROPERTY YEAR BUILT # OF UNITS UNIT TYPE SQ.FT. ASKING RENT RENT/SQ.FT.

2222 I StreetSacramento, CA

1974 3 1 Bed / 1 Bath 600 $1,825 $3.04

1325 18th StSacramento, CA

1959 25 1 Bed / 1 Bath 500 $1,695 $3.39

2727 I StreetSacramento, CA

1940 3 1 Bed / 1 Bath 650 $1,495 $2.30

1724 T StreetSacramento, CA 1952 8 1 Bed / 1 Bath 500 $1,495 $2.99

2216 P StSacramento, CA 1905 1 1 Bed / 1 Bath 650 $1,495 $2.30

820 26th StSacramento, CA 1 1 Bed / 1 Bath 850 $1,450 $1.71

2713 T StSacramento, CA 1955 9 1 Bed / 1 Bath 550 $1,450 $2.64

2619 T StSacramento, CA

1972 8 1 Bed / 1 Bath 550 $1,410 $2.56

Averages 536 $1,579 $2.94

RENT COMPARABLES

Apartment Market13.

TWO BEDROOM

PROPERTY YEAR BUILT # OF UNITS UNIT TYPE SQ.FT. ASKING RENT RENT/SQ.FT.

616 21st St Sacramento, CA

1940 1 2 Bed / 1 Bath 1,000 $1,950 $1.95

1317 F St Sacramento, CA

1968 2 2 Bed / 1 Bath 900 $1,895 $2.11

1627 H St Sacramento, CA

1964 1 2 Bed / 1 Bath 850 $1,750 $2.06

1700 26th St Sacramento, CA 4 2 Bed / 1 Bath 900 $1,700 $1.89

519 T Street Sacramento, CA 2017 1 2 Bed / 1 Bath 775 $1,595 $2.06

2010 4th St Sacramento, CA 1 2 Bed / 1 Bath 1,050 $1,575 $1.50

1718 F Street Sacramento, CA 2 2 Bed / 1 Bath 725 $1,550 $2.14

2713 T Street Sacramento, CA 1955 1 2 Bed / 1 Bath 750 $1,550 $2.07

2122 S Street Sacramento, CA

1974 4 2 Bed / 1 Bath 700 $1,525 $2.18

Averages 828 $1,659 $2.00

RENT COMPARABLES

Apartment Market14.

[j

_

£¤50£¤50 £¤50

C St

E St

T St

K St

N St

F St

26th

St

33r d

St

D St

H St

G St

R St

Land

Pa

rkDr

O St

24th

St

28th

St

7th

St

V St

S St

UV99

UV160

UV160

UV275

H St

CapitolAve

Q St

G St

P St

L St

J St

Broadway

11th St

W St

Broadway

30th

St

3rdSt

2 9thSt

StocktonBlvd

X St

I St

N St

5th

St

12th

St

1 0t h

St

19th

St

21st

St

Alh

amb

raB

lvd

9th

St

Riv

ersi

de

Blv

d

FolsomBlvd

Sacramento

Capitol Park

EastSacramento

Alk

OldSacramento

BoulevardPark

Curtis ParkUpperLandPark

Downtown

MarshallSchool

Land Park

Midtown -Winn Park

Capital Avenue

NorthOak Park

SouthsidePark

New Era Park

Newton Booth

chards

RichmondGrove

South American RiverIndustrial Park

Mansion Flats

AlhambraTriangle

1

2

3

4

5

6

78

9

10

11

12

1314

15

16

§̈¦5

§̈¦5

§̈¦5

Reyal Apartments2311 U Street, Sacramento

U St

# PROPERTY1 2222 I Street, Sacramento 2 1325 18th St, Sacramento3 2727 I Street, Sacramento4 1724 T Street, Sacramento5 2216 P St, Sacramento6 820 26th St, Sacramento7 2713 T St, Sacramento8 2619 T St, Sacramento9 616 21st St, Sacramento

10 1317 F St, Sacramento11 1627 H St, Sacramento12 1700 26th St, Sacramento13 519 T Street, Sacramento14 2010 4th St, Sacramento15 1718 F Street, Sacramento16 2122 S Street, Sacramento

RENT COMPARABLES MAPN

SALES COMPARABLES

Apartment Market16.

PROPERTYYEAR BUILT / YEARRENOVATED

# OF UNITS SALES PRICE PRICE /

UNITPRICE / ROOM

PRICE / SQ. FT. GRM CAP EXPENSE /

SQ.FT.DOWN

PAYMENT SALE DATE

2711 F StSacramento, CA

1965 / 2018 8 $1,900,000 $237,500 $67,857 $313.32 13.3 4.8% $8.16 84% 1/30/2019

2412 Q StSacramento, CA

1963 / 2018 8 $2,075,000 $259,375 $74,107 $340.72 14.3 4.6% $7.82 100% 12/14/2018

1801 P StSacramento, CA

6 $1,500,000 $250,000 $83,333 $227.89 33% 12/6/2018

2207 N StSacramento, CA 1990 10 $3,325,000 $332,500 $79,167 $331.31 17.5 3.7% $6.59 70% 11/30/2018

Nantasket Place1711-1715 N StSacramento, CA

1957 16 $3,598,000 $224,875 $69,192 $323.07 12.3 4.6% $11.37 100% 11/7/2018

1714 T StSacramento, CA 1974 / 2015 7 $1,755,000 $250,714 $59,492 $268.60 44% 6/22/2018

Averages $257,327 $72,191 $300.82 14.3 4.4% $8.49 72%

Reyal 1960 17 $4,250,000 $250,000 $77,273 $413.63 13.0 4.8% Est. Value AfterRenovation

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j

[j [j

[j

[j

_

£¤50£¤50 £¤50

C St

E St

T St

K St

N St

F St

26th

St

33r d

St

D St

H St

G St

R St

Land

Pa

rkDr

O St

24th

St

28th

St

7th

St

V St

S St

UV99

UV160

UV160

UV275

H St

CapitolAve

Q St

G St

P St

L St

J St

Broadway

11th St

I St Brg

W St

Broadway

30th

St

3rdSt

2 9thSt

StocktonBlvd

X St

I St

N St

5th

St

12th

St

1 0t h

St

19th

St

21st

St

Alh

amb

raB

lvd

9th

St

Jibboom

St

Riv

ersi

de

Blv

d

FolsomBlvd

Sacramento

Capitol Park

Triangle

EastSacramento

Alkali Flat

OldSacramento

BoulevardPark

Curtis ParkUpperLandPark

Downtown

MarshallSchool

Land Park

Midtown -Winn Park

Capital Avenue

NorthOak Park

SouthsidePark

New Era Park

Newton Booth

Richards

RichmondGrove

South American RiverIndustrial Park

Mansion Flats

AlhambraTriangle

1

2

3

45

6

§̈¦5

§̈¦5

§̈¦5

Reyal Apartments2311 U Street, Sacramento

# PROPERTY1 2711 F St, Sacramento2 2412 Q St, Sacramento3 1801 P St, Sacramento4 2207 N St, Sacramento5 Nantasket Place, 1711-1715 N St, Sacramento6 1714 T St, Sacramento

U St

SALES COMPARABLES MAP

N

FINANCIALANALYSIS

Financial Analysis18.

It is our opinion this will require an ALL CASH offer to purchase because of low occupancy situation.Financial Analysis19.

Type Units % of Units Sq.Ft. Rent Sq.Ft.1Bed/1Bath 13 76% 575 $1,495 $2.602Bed/1Bath 4 24% 700 $1,595 $2.28Total 17 100% 10,275 $25,815Averages 604 $1,519 $2.51

Income Gross Potential Rent Other Income Utility Income ($45 per unit per month) Parking Income (Nine spaces at $50 per month)Total Rental Income Less Vacancy - 3% Less Non Revenue Units (Onsite staff unit at $500 off rent per month)Effective Gross Income*Less Estimated ExpensesNet Operating IncomeLess Debt ServiceCash Flow

Per Unit / Per Year

Total Yearly

*Estimated Expenses Property Taxes $1,897 ($32,256)

Direct Levies 107 (1,813) Insurance 350 (5,950) Utilities 1,560 (26,520) Management Fee 600 (10,200) Payroll 444 (7,550) Administrative / Office 350 (5,950) Advertising / Promotions 0 0 Make Ready/Turnover 228 (3,868) Repairs/Maintenance 285 (4,845) Service Contracts 318 (5,400) Replacement Reserves 200 (3,400)Total Estimated Expenses $6,338 ($107,752)

$10.4935%

Expense Per Foot:Expense Percentage Ratio:

(107,752)$202,856

$202,856

(9,792)

0

$310,608(6,000)

$309,7802,0409,1805,400

Projected Rents After Renovation

Stabilized Projected Rents After Renovation and Pro

Forma Expenses

Annual Property Operating Data

Pro Forma

$326,400

Reyal2311 U Street

Sacramento, CA

Financial Analysis

Unit Mix Monthly Income

Page 3 of 6

Type Units % of Units Sq.Ft. Rent Sq.Ft.1Bed/1Bath 13 76% 575 $1,495 $2.602Bed/1Bath 4 24% 700 $1,595 $2.28Total 17 100% 10,275 $25,815Averages 604 $1,519 $2.51

Income Gross Potential Rent Other Income Utility Income ($45 per unit per month) Parking Income (Nine spaces at $50 per month)Total Rental Income Less Vacancy - 3% Less Non Revenue Units (Onsite staff unit at $500 off rent per month)Effective Gross Income*Less Estimated ExpensesNet Operating IncomeLess Debt ServiceCash Flow

Per Unit / Per Year

Total Yearly

*Estimated Expenses Property Taxes $1,897 ($32,256)

Direct Levies 107 (1,813) Insurance 350 (5,950) Utilities 1,560 (26,520) Management Fee 600 (10,200) Payroll 444 (7,550) Administrative / Office 350 (5,950) Advertising / Promotions 0 0 Make Ready/Turnover 228 (3,868) Repairs/Maintenance 285 (4,845) Service Contracts 318 (5,400) Replacement Reserves 200 (3,400)Total Estimated Expenses $6,338 ($107,752)

$10.4935%

Expense Per Foot:Expense Percentage Ratio:

(107,752)$202,856

$202,856

(9,792)

0

$310,608(6,000)

$309,7802,0409,1805,400

Projected Rents After Renovation

Stabilized Projected Rents After Renovation and Pro

Forma Expenses

Annual Property Operating Data

Pro Forma

$326,400

Reyal2311 U Street

Sacramento, CA

Financial Analysis

Unit Mix Monthly Income

Page 3 of 6

ANNUAL PROPERTY OPERATING DATA

FINANCIAL ANALYSIS

CONFIDENTIALITY STATEMENTThis Offering Memorandum (OM) was prepared by Cushman & Wakefield (Broker) and has been reviewed by the Owner. The OM is confidential, furnished solely for the purpose of considering the acquisition of the Property described herein, and is not to be used for any other purpose or made available to any other person without the express written consent of Broker. An opportunity to inspect the Property will be made available to qualified prospective purchasers.

The information contained herein has been obtained from sources deemed reliable, and we have no reason to doubt its accuracy. However, no warranty or representation, expressed or implied, is made by the Owner or Broker or any related entity as to the accuracy or completeness of the information contained herein, including but not limited to financial information and projections, and any engineering and environmental information. Prospective purchasers should make their own investigations, projections, and conclusions. It is expected that prospective purchasers will conduct their own independent due diligence concerning the Property, including such engineering inspections as they deem necessary to determine the condition of the Property and the existence or absence of any potentially hazardous materials used in the construction or maintenance of the building(s) or located at the land site, including but not limited to lead-based products (for compliance with “Target Housing” regulation for multifamily housing constructed prior to 1978), asbestos, etc.

The Owner and Broker expressly reserve the right, at their sole discretion, to reject any or all expressions of interest or offers to purchase the Property and/or terminate discussions with any party at any time with or without notice. The Owner shall have no legal commitment or obligation to any purchaser unless a written agreement for the purchase of the Property has been delivered, approved, and fully executed by the Owner, and any conditions to the Owner’s obligations thereunder have been satisfied or waived. Broker is not authorized to make any representations or agreements on behalf of the Owner. Broker represents the Owner in this transaction and makes no representations, expressed or implied, as to the foregoing matters. The depiction of any persons, entities, signs, logos, or properties (other than Broker’s client and the Property) is incidental only and not intended to connote any affiliation, connection, association, sponsorship, or approval by or between that which is incidentally depicted and Broker or its client.

This OM is the property of Cushman & Wakefield and may be used only by parties approved in writing by Broker. The information is privately offered and, by accepting this OM, the party in possession hereon agrees (i) to return it to Cushman & Wakefield immediately upon request of Broker or the Owner and (ii) that this OM and its contents are of a confidential nature and will be held and treated in the strictest confidence. No portion of this OM may be copied or otherwise reproduced and/or disclosed to anyone without the written authorization of Broker and Owner. The terms and conditions set forth above apply to this OM in its entirety.

17 UNITS | SACRAMENTO, CA

REYAL APARTMENTS Value-Add Opportunity