OFFERING MEMORANDUM 2147-51 TREMONT PL DENVER, CO 80205 - NIK MACCARTER - Nexus Commercial ...
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OFFERING
MEMORANDUM
2147-51 TREMONT PL
DENVER, CO 80205
NIK MACCARTER BRANDON KAUFMAN
Senior Advisor Senior Advisor
nmaccarter@capstone-companies.com bkaufman@capstone-companies.com
303.909.2900 303.547.7357
TABLE OF CONTENTS EXECUTIVE SUMMARY PROPERTY OVERVIEW FINANCIAL OVERVIEW LOCATION OVERVIEW
EXECUTIVE SUMMARY
PROPERTY
HIGHLIGHTS
This B&B has been in business for over 25 years.
Incredible location, situated in a quiet neighborhood across from a
beautiful park while being just minutes from Downtown Denver.
The B&B’s units boast a perfect blend of old-style hospitality
and modern amenities and features.
Green design and features eco-friendly elements.
Backyard seating area for guests along with a front yard garden.
PROPERTY OVERVIEW
AREA STREET MAP
22
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D
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2147-51
PL TREMONT PL
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R
A
L EN
G
PL
T
21
N
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O
EM
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LOCATION MAP
BERKELEY 70
LAKE
2147-51
TREMONT PL
SLOAN LAKE CITY PARK
PARK
DOWNTOWN
DENVER
E COLFAX AVE
CHEESEMAN
PARK
25
W ALAMEDA AVE
HOUSTON
PARK
WASHINGTON
PARK
AREA MAPAREA MAP
22114477--5511
TREMONT PL
NEIGHBORHOOD MAP
DINING
1 Coperta
2 Las Delicias Uptown
N BROADWAY
3 Walter's303 Uptown
4 The British Bulldog
5 Colorado Campfire 2147-2151
6 Frozen Matter 16
TREMONT PL
RETAIL 8
4
7 Safeway
8 Vices 13
7
12
9 7-Eleven 1
10 Marczyk Fine Foods 9 2 3
6 15
11 Denver Pavilions 5
12 16th Street Mall 14
LIFESTYLE 11
10
13 Benedict Fountain Park
14 Choice Market
15 Saint Joseph Hospital E COLFAX AVE
16 Lawson Park
PHOTOS 2147-51 TREMONT PL
PHOTOS 2147-51 TREMONT PL
PHOTOS 2147-51 TREMONT PL
PHOTOS 2147-51 TREMONT PL
FINANCIAL OVERVIEW
PROPERTY DETAILS
2147-51 TREMONT PL
UNIT MIX & CURRENT RENTS
Unit Amount Unit SF Current Avg. Rent Current Rent/SF Market Rent Market Rent/SF
1 Bed / 1 Bath 10 575 $5,700 $9.91 $2,091 $3.64
2 Bed / 1 Bath 4 720 $6,583 $9.14 $3,017 $4.19
14 616 $5,952 $9.69 $2,356 $3.79
BUILDING DETAILS SYSTEMS
Units: 14 Gas/Elec Meters: Master / Individual
Building SF: 10,000 Water: Master
Parking: 7 Trash: Waste Management
Land: 10,591 Roof: Pitched
Zoning: PUD Heating: Boiler
Year Built: 1887 Cooling: A/CINVESTMENT &
DEBT SUMMARY
INVESTMENT SUMMARY DEBT SUMMARY
Purchase Price: $3,600,000 Loan to Value: 65.00%
Units: 14 Loan Amount: $2,340,000
Price Per Unit: $257,143 Loan Term: 60 Months
Total SF: 10,000 Interest Rate: 3.50%
Price Per SF: $360 Amortization: 25 Years
T12 Cap Rate: 6.96%
Year 1 Cap Rate: 4.51%
Year 1 Cash Flows: $21,824
5 Year IRR: 16.56%KEY UNDERWRITING
ASSUMPTIONS
Income:
55% drop in revenue assumed to account for COVID-19 impact.
65% occupancy calculated for normal years.
Yearly room income increasing at 3% annually.
Expenses:
71% decrease in expenses assumed for COVID-19 impact.
Operating expenses increased by 3% year over year.
Debt:
Typical debt quote for asset type.CASHFLOW PROJECTIONS
T12 Year 1 Year 2 Year 3 Year 4 Year 5
REVENUE
Gross Potential Revenue $856,462 $384,615 $856,462 $882,155 $908,620 $935,879
Vacancy ($299,762) ($134,615) ($299,762) ($308,754) ($318,017) ($327,558)
Rental Revenue $556,700 $250,000 $556,700 $573,401 $590,603 $608,321
Effective Gross Revenue $556,700 $250,000 $556,700 $573,401 $590,603 $608,321
EXPENSES
Repairs and Maintenance ($11,900) ($3,400) ($11,900) ($12,257) ($12,625) ($13,003)
Utilities ($12,600) ($3,601) ($12,600) ($12,978) ($13,367) ($13,768)
Insurance ($5,320) ($1,200) ($5,320) ($5,480) ($5,644) ($5,813)
Real Estate Taxes ($34,355) ($34,355) ($34,355) ($35,386) ($36,447) ($37,541)
Property Management ($190,000) ($35,045) ($190,000) ($195,700) ($201,571) ($207,618)
Admin and Other ($51,925) ($10,000) ($51,925) ($53,483) ($55,087) ($56,740)
Total Expenses ($306,100) ($87,601) ($306,100) ($315,283) ($324,741) ($334,484)
Expenses Per Unit ($21,864) ($6,257) ($21,864) ($22,520) ($23,196) ($23,892)
NET OPERATING INCOME $250,600 $162,399 $250,600 $258,118 $265,862 $273,837
Cap Rate 6.59% 4.27% 6.59% 6.79% 7.00% 7.21%
Debt Service-Yr 1 ($140,575) ($140,575) ($140,575) ($140,575) ($140,575) ($140,575)
Total Cash Flow $110,025 $21,824 $110,025 $117,543 $125,287 $133,262
Cash on Cash Return 8.73% 1.73% 8.73% 9.33% 9.94% 10.58%SOLD COMPS
PROPERTY ADDRESS UNITS SF PRICE $ PRICE PER UNIT PRICE PER FOOT CAP RATE
(subject) 2147-51 Tremont Pl 14 10,000 $3,600,000 $257,143 $360 6.96%
1 630 E 16th Ave 21 16,465 $6,250,000 $297,619 $380 6.45%
2 3206 Osage St 20 10,039 $3,700,000 $185,000 $369 6.87%
3 1572 Race St 10 5,654 $1,450,000 $145,000 $256 7.02%
4 1612 Wazee St 17 16,800 $6,050,000 $355,882 $360 6.56%
Averages $4,362,500 $245,875 $341 6.73%
2
25
4
S
1 3
W COLFAX AVELOCATION OVERVIEW
DEMOGRAPHICS
CENSUS 2020 SUMMARY .25m .5m .75m
Population 4,288 13,936 26,541
Households 3,111 8,396 16,378
Families 502 1,487 3,032
Average Household Size 1.30 1.55 1.51
Owner Occupied Housing Units 721 1,763 3,536
Renter Occupied Housing Units 2,390 6,633 12,841
Median Age 34.1 34.0 34.1
Median Household Income $77,149 $68,903 $67,083
Average Household Income $100,057 $92,290 $92,223
CENSUS 2025 SUMMARY .25m .5m .75m
.25 MILE Population 5,829 16,879 31,341
Households 4,163 10,250 19,496
.5 MILE Families 771 1,925 3,706
Average Household Size 1.34 1.56 1.52
.75 MILE Owner Occupied Housing Units 769 1,936 3,883
Renter Occupied Housing Units 3,394 8,315 15,613
Median Age 34.6 34.9 35.1
Median Household Income $91,100 $79,494 $77,052
Average Household Income $114,961 $106,312 $105,799CITY OF DENVER
NOTABLE RANKINGS
#2 BEST PLACES TO LIVE
(U.S. NEWS & WORLD REPORT 2019)
#1 IN ECONOMIC 4th BEST PLACE IN TOP 10 PLACES
& JOB GROWTH AMERICA FOR IN THE U.S. TO TRAVEL
(AREA DEVELOPMENT, 2015) BUSINESS & CAREERS (LONELY PLANET, 2016)
(FORBES, 2019)
#1 IN ECONOMIC 4TH BEST CITY
6TH FASTEST FOR BIKE RIDING
RANKING
(USNEWS.COM, 2019) GROWING METRO IN THE U.S.
AREA IN THE U.S. (WALK SCORE, 2015)
(FORBES, 2016)
3RD HEALTHIEST CITY
IN THE NATION #1 IN THE NATION FOR
(FORBES, 2016)
LARGEST INCREASE IN
RESIDENTS WITH
COLLEGE DEGREES
(U.S. CENSUS BUREAU, 2014)
7TH BEST STATE
IN WHICH TO
MAKE A LIVING 3RD BEST CITY FOR
(FORBES, 2016)
COLLEGE GRADS
(RENT.COM, 2015)DENVER METRO Located on the front range of the Rocky Mountains, the Denver Metro is a thriving urban epicenter famous for its breathtaking views, world-class dining, champion sports teams, exhilarating recreation, and eclectic arts and entertainment. It’s no wonder this metropolis is one of the biggest in the nation! ATTRACTIONS SPORTS Denver Art Museum Basketball: Denver Nuggets Denver Museum of Nature and Science Hockey: Colorado Avalanche Denver Zoo Football: Denver Broncos Denver Aquarium Baseball: Colorado Rockies Six-Flags Elitch Gardens Soccer: Colorado Rapids Hyland Hills Water World Denver Aquarium
DENVER GROWTH
Ranked as the top place to live in the U.S. by U.S. News & World Report, the city of Denver
is home to over 705,439 residents (as of May 2019). An estimated 2.9 million people live
in Denver Metro as a whole, with more people moving to the area each year, as this
number is expected to grow by 12.6 percent over the next five years, compared to 3.7
percent nationally. Currently 100+ pe pleare immigrating to the city each day. The Denver
Metro accounts for over half of the population in the entire state of Colorado, which is
home to an estimated 5.5 million people.
CONSTRUCTION
As one of the fastest-growing metros in the nation, Denver is thriving with new construction.
This new construction will help accommodate the population growth throughout the metro.
Some current projects include:
17th & Peal Apartments, a 315-unit apartment with 9,000 sq. ft. of retail.
Alexan 20th St Station, a 358-unit apartment with street level retail. Block 162, a full
block project that included a 680,000 sq. ft. office tower and separate tower hotel.
Tabor Center Tower Two, a 33 story 700,000 sq. ft. office tower would be the largest
development in Denver since 1985.
Market Station, Lodo, comprised of nearly a full block off the 16th St Mall
in Downtown Denver, the development consists of 80,000 SF retail
space, 95,000 SF office space & 225 apartments.
McGregor Square, Lodo, a project located across the street from Coors Field,
it features 3 connected structures - an 11-story office building, a 13 story
condominium and hotel buildings surrounding a center courtyard.
Lower floors will feature retail tenants.EMPLOYERS IN THE DENVER METRO The Denver metro is a hub for various industries, including aviation, health, business, finance, and technology. Outside of city, state, and school services, major employers in the Denver metro area include: Denver International Airport Kaiser Permanente Lockheed Martin Liberty Tax Service Health ONE Corporation Western Union Centura Health University of Colorado SCL Health Systems Children’s Hospital Comcast Wells Fargo CenturyLink In 2017, Amazon opened up a 1 million sq. ft. fulfillment center in Aurora, creating nearly 1,000 full-time jobs. Google is building a $131 million, four-acre, state-of-the art facility in Boulder, potentially bringing more jobs to the area. Many companies choose to relocate to or expand in the Denver Metro, especially tech and startup companies. Between 2007-2015, approximately 9,000 companies chose to relocate from California to Denver. These employers are attracted to the innovative culture, economic environment, exceptional talent, and deep sense of social responsibility that characterizes the Denver Metro. Forbes ranks Denver as #1 in the nation for business and careers, and Area Development ranks Denver as #1 in the nation for economic and job growth. Denver metro is home to many fast-growing startups, with 113 local companies making the Inc. 5000 list of the nation’s fastest-growing private companies for the year 2017.
LIGHT RAIL
The Regional Transportation District (RTD) operates 365 days a year to quickly connect travelers to their
destination. As part of RTD, the 58-mile rail system features nine rail lines servicing 62 stations along the
Denver metro’s North, East, Southeast, Southwest, and West rail corridors.
Popular destinations include:
Denver International Airport (DIA)
Theatre District
Convention Center
Sports Authority Field at Mile High
Pepsi Center
16th Street Mall
Park Meadows Mall.
RTD’s rail system has transformed people’s commutes and the communities they live in. The 23-mile
stretch from Downtown Denver to DIA is now just a 30-minute ride via light rail. The light rail is also
attributed with revitalizing neighborhoods across the Denver metro, including Five Points and West
Colfax. An average of 64,000 people utilize the light rail each day, making it eighth-largest
system in the country, even though Denver is 21st in the nation in terms of population.DENVER INTERNATIONAL AIRPORT (DIA) Denver International Airport (DEN), also known as DIA, opened to the public on February 28, 1995 and at 34,000 acres, remains the largest and newest commercial airport in the United States, and the 2nd largest airport in the world by size and the 20th busiest airport in the world. It’s known around the world for its striking tented roof structure and technologically advanced operations. Over the past twenty years, DIA has established itself as the primary employer and economic driver in the Denver metro, supporting nearly 190,000 jobs and generating more than $26 billion in annual revenue. Served a record setting 64.5 Million passengers in 2018. The airport serves over 170 destinations including 20 international cities in nine countries. DIA is just 30 minutes from Union Station via the East Rail line. DIA has room to double its current capacity to remain competitive in the growing global aviation marketplace. DIA broke ground in May of 2018 on a $2.0 billion gate expansion project. The project will add 39 gates across all three concourses in the next four years, bringing the total to 150. The expansion will utilize the airport’s original “telescoping” design by expanding astward and westward at the ends. The expansion is expected to be completed by the end of 2022. DIA is among the first airports in North America to secure internationally recognized accreditation for measuring and reducing carbon emissions.
UPTOWN DENVER Uptown Denver is a hip district located just three miles southeast of Downtown Denver. Uptown is Denver’s oldest residential neighborhood and is bounded by Broadway to the west, 23rd Avenue to the north, Park Avenue and Downing to the east, and Colfax Avenue to the south. Uptown includes Colfax Avenue, where renovations and new retail, residential, and office development is changing the landscape and revitalizing the area. Major employers in the area include St. Joseph Hospital, Presbyterian/St. Luke’s Medical Center, and Kaiser Permanente, which together employ more than 10,000 people. Uptown’s convenient location and ample amenities make it a highly desirable neighborhood, attracting young professionals, active singles, and urbanites alike. This highly walkable neighborhood is characterized by an eclectic mix of old and new, including older brick rowhouses and new upscale condos, as well as picturesque places of worship, trendy eateries, popular watering holes, and lots of patios. Anchoring the neighborhood is Restaurant Row, which runs along 17th Avenue from Broadway to City Park. Restaurant Row is lined with cafes, bistros, pubs, and fine dining establishments. Other attractions in the area include: Denver Zoo Denver Museum of Nature and Science Fillmore Auditorium. LTO
CAPSTONE TEAM
2147-51 TREMONT PL
DENVER, CO 80205
NIK MACCARTER BRANDON KAUFMAN
Senior Advisor Senior Advisor
nmaccarter@capstone-companies.com bkaufman@capstone-companies.com
303.909.2900 303.547.7357
KIM HOFF LAUREN ANDERSON
Marketing Manager Sr. Investment Analyst
khoff@capstone-companies.com landerson@capstone-companies.com
612.669.2068 707.484.3320CONFIDENTIALITY DISCLAIMER
Capstone Apartment Partners has been engaged as the exclusive listing Broker representative of the Owner for the sale
of this property. No contact shall be made by any prospective purchaser or agents to the Owner, its executives, staff,
personnel, tenants, or related parties.
This Investment Offering Memorandum is a confidential solicitation of interest, and the information provided herein is
provided for the sole purpose of considering the purchase of the Property. The Owner expressly reserves the right, at its
sole discretion, to reject any or all expressions of interest to purchase the Property or to terminate discussions with any
entity at any time with or without notice. The Owner shall have no legal commitment or obligation to any entity
reviewing the Investment Offering Memorandum or making an offer to purchase the Property unless and until the Owner
executes and delivers a signed Purchase Agreement on terms acceptable to the Owner. By receipt of this Offering
Memorandum, prospective purchaser will be deemed to have acknowledged the foregoing and agrees to release the
Owner from any and all liability with respect hereto. The enclosed materials are being provided solely to facilitate the
prospective purchaser’s own due diligence for which the purchaser shall be fully and solely responsible. All information
contained herein is confidential in nature, and recipient agrees not to photocopy, duplicate, forward, distribute, or solicit
third party interest without written permission and consent from Owner or Capstone Apartment Partners.
Neither Capstone Apartment Partners nor the Owner make any representation or warranty, express or implied, as to the
accuracy or completeness of the information contained herein, and nothing contained herein shall be relied upon as a
promise or representation as to the future performance of the Property.
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