Offering Memorandum - LoopNetimages2.loopnet.com/d2/FcuRoh5ec8L89vQQVDS6Lmn5lQTGRvGj7... · 2017-07-25 · these matters and makes no warranty or representation whatsoever regarding

HILLSIDE INDUSTRIAL CENTERHILLSIDE INDUSTRIAL CENTER2222 Hillside Ave • Indianapolis, IN 462182222 Hillside Ave • Indianapolis, IN 46218

Offering Memorandum

N O N - E N D O R S E M E N T A N D D I S C L A I M E R N O T I C E

Confidentiality and DisclaimerThe information contained in the following Marketing Brochure is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Marcus & Millichap and should not be made available to any other person or entity without the written consent of Marcus & Millichap. This Marketing Brochure has been prepared to provide summary, unverified information to prospective purchasers, and to establish only a preliminary level of interest in the subject property. The information contained herein is not a substitute for a thorough due diligence investigation. Marcus & Millichap has not made any investigation, and makes no warranty or representation, with respect to the income or expenses for the subject property, the future projected financial performance of the property, the size and square footage of the property and improvements, the presence or absence of contaminating substances, PCB's or asbestos, the compliance with State and Federal regulations, the physical condition of the improvements thereon, or the financial condition or business prospects of any tenant, or any tenant's plans or intentions to continue its occupancy of the subject property. The information contained in this Marketing Brochure has been obtained from sources we believe to be reliable; however, Marcus & Millichap has not verified, and will not verify, any of the information contained herein, nor has Marcus & Millichap conducted any investigation regarding these matters and makes no warranty or representation whatsoever regarding the accuracy or completeness of the information provided. All potential buyers must take appropriate measures to verify all of the information set forth herein. Marcus & Millichap is a service mark of Marcus & Millichap Real Estate Investment Services, Inc. Â© 2017 Marcus & Millichap. All rights reserved.

Non-Endorsement NoticeMarcus & Millichap is not affiliated with, sponsored by, or endorsed by any commercial tenant or lessee identified in this marketing package. The presence of any corporation's logo or name is not intended to indicate or imply affiliation with, or sponsorship or endorsement by, said corporation of Marcus & Millichap, its affiliates or subsidiaries, or any agent, product, service, or commercial listing of Marcus & Millichap, and is solely included for the purpose of providing tenant lessee information about this listing to prospective customers.

ALL PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.PLEASE CONSULT YOUR MARCUS & MILLICHAP AGENT FOR MORE DETAILS.

HILLSIDE INDUSTRIAL CENTERIndianapolis, INACT ID Y0260130

TABLE OF CONTENTS

SECTION

INVESTMENT OVERVIEW 01 Offering Summary Regional Map Local Map

Aerial Photo

Floor Plan

FINANCIAL ANALYSIS 02 Tenant Summary

Lease Expiration Summary

Operating Statement

Notes

Pricing Detail

Acquisition Financing

MARKET OVERVIEW 03 Market Analysis

Demographic Analysis

HILLSIDE INDUSTRIAL CENTER


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INVESTMENT

OVERVIEW


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OFFERING SUMMARY

5

EXECUTIVE SUMMARY

EXPENSES

CURRENT $/SF PRO FORMA $/SF

CAM/Utilities $180,451 $0.35 $180,451 $0.35

Insurance $77,336 $0.15 $77,336 $0.15

Real Estate Taxes $200,000 $0.39 $200,000 $0.39

Management Fee $69,869 $0.14 $69,869 $0.14

Total Expenses $527,656 $1.02 $527,656 $1.02

VITAL DATA

CURRENT PRO FORMA

Price $8,000,000 CAP Rate -6.60% 12.71%

Down Payment 100% / $8,000,000 Net Operating Income ($527,656) $1,016,448

Loan Amount $0 Net Cash Flow After Debt Service -6.60% / ($527,656) 12.71% / $1,016,448

Loan Type Proposed New Total Return -6.60% / ($527,656) 12.71% / $1,016,448

Interest Rate / Amortization 0.00% / 0 Years

Rentable SF 515,575

Price/SF $15.52

Current Occupancy 100.0%

Year Built 1957

Lot Size 17.92 acre(s)

DEMOGRAPHICS

1-Miles 3-Miles 5-Miles

2016 Estimate Pop 8,784 116,178 269,777

2010 Census Pop 8,404 110,635 257,794

2016 Estimate HH 3,552 50,182 111,829

2010 Census HH 3,385 47,574 106,825

Median HH Income $22,978 $28,934 $32,728

Per Capita Income $14,502 $19,645 $21,082

Average HH Income $35,189 $44,352 $49,780


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OFFERING SUMMARY

§ Rare, 515,575 SF value-add industrial warehouse opportunity

§ Situated within immediate proximity to the North Keystone Avenue / Interstate 70

§ Partially new roof, high-efficiency lighting, new HVAC, and new parking lot

§ Industrial & Office Space Available for Lease-Up Flexibility

§ 43 dock & 4 drive-in doors | Clear heights - 13.7 to 24 | 13.5 acres | Fully-Fenced

INVESTMENT HIGHLIGHTS

Marcus & Millichap is pleased the Hillside Industrial Center, a 515,575 square foot industrial warehouse facility located on the southwest side of the intersection of East

25th Street and North Keystone Avenue with immediate proximity to the North Keystone Avenue / Interstate 70. The Property is situated directly adjacent to the Keystone

Enterprise Park, a fully-occupied industrial seven-building industrial park, is within immediate proximity the Massachusetts Avenue industrial corridor, and is within the

Brookside Center Industrial submarket which consists of approximately 260 buildings and over 7,250,000 square feet of warehouse space with a current vacancy rate of

4.8% according to Costars Q1 2017 report.

The Hillside Industrial Center is comprised of 515,575 total square feet with 441,132 square feet of traditional warehouse / distribution space and approximately 74,443

square feet of second floor office warehouse space on the south end of the building. The building is currently partially occupied by a third-party logistics company that

has expressed interest in renewing their lease on approximately half of the first floor / warehouse space, but the landlord has the option to retain or replace that tenant as

they choose.

The Hillside Industrial Center has benefited from substantial improvements over the past five years, including new HVAC units, all new motion-sensored, high efficiency

fluorescent lighting, and a new roofing system over half of the building including decking, and substantial work on the parking lot around the facility. The property features

clear heights from 13 7 to 24, 43 dock doors, 4 drive-in doors, and 13.64 acres that are fully fenced in. Being within the Brookside Industrial submarket, which boasts 4.8

percent current vacancy and average rents of over $3.00 per square foot, the Hillside Industrial Center is a rare value-add industrial warehouse opportunity in one of the

strongest industrial markets in the country and should prove to be a very profitable investment for a value-add investor.

INVESTMENT OVERVIEW

6


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PROPERTY SUMMARY

OFFERING SUMMARY

THE OFFERING

Property Hillside Industrial Center

Price $8,000,000

Property Address 2222 Hillside Ave,Indianapolis,IN

Assessors Parcel Number 49-07-30-125-019.000-101

Zoning ZO01

SITE DESCRIPTION

Number of Floors 2

Year Built/Renovated 1957

Rentable Square Feet 515575

Ownership Fee Simple

Parcel Size 17.92 acre(s)

Parking 200 Free Surface Spaces

Topography Flat

UTILITIES

Gas Municipal

Electric Municipal

Water Municipal

Sewer Municipal

CONSTRUCTION

Foundation Concrete Slab

Framing Masonry

Parking Surface Asphalt

Roof Rubber Membrane

Ceiling Height 13'7"-24'

Sprinkler System Wet

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MECHANICAL

Elevators None

Power 1,600a/240-265v 3p 4w Heavy

REGIONAL MAP


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LOCAL MAP


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AERIAL PHOTO


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PROPERTY PHOTO


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PROPERTY PHOTO


12

Marcus & Millichap closes

more transactions than any

other brokerage firm.

12


13

PROPERTY PHOTO

FLOOR PLANS


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15

FINANCIAL

ANALYSIS

FINANCIAL ANALYSIS


LEASE-UP PRO-FORMA

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OFFERING SUMMARY COST PROJECTIONS

Asking Price: $8,000,000 Acquisition Price: $8,000,000.00 Square Footage: 515,575 SF Projected Deal Costs: Asking Price per Square Foot: $15.52 Soft Costs:Projected NOI Year 1: Legal: $25,000.00

STABILIZED PROJECTIONS Leasing Commissions: $304,934.52Projected Stabilized Net Rents: $2.50 Hard Costs:Projected Gross Potential Rent: $1,288,937.50 Capital Improvements: $780,000.00Vacancy Factor: (15.00%) $272,489.10 Tenant Improvements: $0.50 / SF $257,787.50Projected Stabilized NOI: $1,016,448 Carrying Costs for Projected Lease-Up Time: 1.25 Years Per Sqaure Foot: $1.97 *Projected Annual Expenses: $527,656.50Projected Exit Cap Rate: 8.00% Estimated Total Based on Lease-Up Time: $659,570.63Projected Disposition Value: $12,705,605 Total Projected Deal Costs: $2,027,292.65

Projected Price per Square Foot: $24.64 Acquisition Price + Total Projected Deal Costs: $10,027,292.65

UPSIDE PROJECTIONS

Projected Stabilized Value: $12,705,605.00Projected Sale Costs: (3.50%) $444,696.18Projected Net Proceeds After Sale Costs: $12,260,908.83Initial Equity: $10,027,292.65Projected Annual Return on Initial Equity if Held: 10.14%Projected Profit Upon Stabilized Sale: $2,233,616.18

FINANCIAL ANALYSIS


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TENANT SUMMARY

LEASE EXPIRATION SUMMARY

FINANCIAL ANALYSIS


OPERATING STATEMENT

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FINANCIAL ANALYSIS


PRICING DETAIL

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ACQUISITION FINANCING


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MARCUS & MILLICHAP CAPITAL CORPORATION CAPABILITIESMMCC—our fully integrated, dedicated financing arm—is committed to providing superior capital market expertise, precisely managed execution, and unparalleled access to capital sources providing the most competitive rates and terms.

We leverage our prominent capital market relationships with commercial banks, life insurance companies, CMBS, private and public debt/equity funds, Fannie Mae, Freddie Mac and HUD to provide our clients with the greatest range of financing options.

Our dedicated, knowledgeable experts understand the challenges of financingand work tirelessly to resolve all potential issues to the benefit of our clients.

National platform operating

within the firm’s brokerage offices

$5.1 billion total national

volume in 2016

Access to more capital sources than any other firm in the industry

Optimum financing solutions to enhance value

Our ability to enhance buyer pool by expanding finance options

Our ability to enhance seller control

• Through buyer qualification support

• Our ability to manage buyers finance expectations

• Ability to monitor and manage buyer/lender progress, insuring timely, predictable closings

• By relying on a world class set of debt/equity sources and presenting a tightly underwritten credit file

WHY MMCC?

Closed 1,651 debt and equity

financings in 2016


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MARKET

OVERVIEW

PROPERTY NAME

MARKETING TEAM


DEMOGRAPHICS

Source: © 2016 Experian

Created on June 2017

POPULATION 1 Miles 3 Miles 5 Miles§ 2021 Projection

Total Population 8,516 113,378 265,662

§ 2016 Estimate


§ 2010 Census


§ 2000 Census


§ Daytime Population

2016 Estimate 7,991 208,744 397,059

HOUSEHOLDS 1 Miles 3 Miles 5 Miles§ 2021 Projection

Total Households 3,464 49,643 111,053

§ 2016 Estimate


Average (Mean) Household Size 2.41 2.20 2.30

§ 2010 Census


§ 2000 Census


HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles§ 2016 Estimate

$200,000 or More 1.04% 1.77% 1.95%

$150,000 - $199,000 0.27% 1.35% 2.05%

$100,000 - $149,000 3.50% 5.06% 6.15%

$75,000 - $99,999 5.04% 6.19% 7.17%

$50,000 - $74,999 10.25% 12.70% 14.72%

$35,000 - $49,999 13.91% 14.55% 15.12%

$25,000 - $34,999 13.42% 14.14% 13.65%

$15,000 - $24,999 17.29% 14.89% 15.22%

Under $15,000 35.29% 29.34% 23.97%

Average Household Income $35,189 $44,352 $49,780

Median Household Income $22,978 $28,934 $32,728

Per Capita Income $14,502 $19,645 $21,082

POPULATION PROFILE 1 Miles 3 Miles 5 Miles§ Population By Age

2016 Estimate Total Population 8,784 116,178 269,777

Under 20 26.83% 23.37% 24.70%

20 to 34 Years 21.44% 26.80% 25.86%

35 to 39 Years 6.03% 6.73% 6.48%

40 to 49 Years 12.80% 13.05% 12.52%

50 to 64 Years 18.94% 19.42% 19.18%

Age 65+ 13.96% 10.62% 11.27%

Median Age 36.35 34.90 34.64

§ Population 25+ by Education Level

2016 Estimate Population Age 25+ 5,858 79,297 180,258

Elementary (0-8) 4.10% 3.92% 4.12%

Some High School (9-11) 21.89% 16.68% 15.17%

High School Graduate (12) 35.38% 31.22% 30.88%

Some College (13-15) 20.94% 19.67% 18.58%

Associate Degree Only 3.46% 5.62% 5.64%

Bachelors Degree Only 8.01% 12.84% 15.12%

Graduate Degree 3.36% 8.66% 9.21%

§ Time Travel to Work

Average Travel Time in Minutes 24 24 24

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IncomeIn 2016, the median household income for your selected geography is $22,978, compare this to the US average which is currently $54,505. The median household income for your area has changed by 0.94% since 2000. It is estimated that the median household income in your area will be $27,219 five years from now, which represents a change of 18.46% from the current year. The current year per capita income in your area is $14,502, compare this to the US average, which is $29,962. The current year average household income in your area is $35,189, compare this to the US average which is $78,425.

PopulationIn 2016, the population in your selected geography is 8,784. The population has changed by -13.55% since 2000. It is estimated that the population in your area will be 8,516.00 five years from now, which represents a change of -3.05% from the current year. The current population is 47.80% male and 52.20% female. The median age of the population in your area is 36.35, compare this to the US average which is 37.68. The population density in your area is 2,791.95 people per square mile.

HouseholdsThere are currently 3,552 households in your selected geography. The number of households has changed by -9.55% since 2000. It is estimated that the number of households in your area will be 3,464 five years from now, which represents a change of -2.48% from the current year. The average household size in your area is 2.41 persons.

EmploymentIn 2016, there are 4,221 employees in your selected area, this is also known as the daytime population. The 2000 Census revealed that 41.04% of employees are employed in white-collar occupations in this geography, and 56.73% are employed in blue-collar occupations. In 2016, unemployment in this area is 11.30%. In 2000, the average time traveled to work was 24.00 minutes.

Race and EthnicityThe current year racial makeup of your selected area is as follows: 15.43% White, 78.47% Black, 0.04% Native American and 0.41% Asian/Pacific Islander. Compare these to US averages which are: 70.77% White, 12.80% Black, 0.19% Native American and 5.36% Asian/Pacific Islander. People of Hispanic origin are counted independently of race. People of Hispanic origin make up 4.38% of the current year population in your selected area. Compare this to the US average of 17.65%.

PROPERTY NAME

MARKETING TEAM


HousingThe median housing value in your area was $66,284 in 2016, compare this to the US average of $187,181. In 2000, there were 2,142 owner occupied housing units in your area and there were 1,785 renter occupied housing units in your area. The median rent at the time was $369.

Source: © 2016 Experian

DEMOGRAPHICS

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www.MarcusMillichap.com

Joseph DiSalvo

Vice President InvestmentsDirector, National Office and Industrial Properties GroupIndianapolis OfficeTel: (317) 218-5334

Fax: (317) 218-5310

[email protected]

License: IN RB14051407

P R E S E N T E D B Y

Offering Memorandum - LoopNetimages2.loopnet.com/d2/FcuRoh5ec8L89vQQVDS6Lmn5lQTGRvGj7... · 2017-07-25 · these matters and makes no warranty or representation whatsoever regarding

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