-
5110 Chicago Ave SW • Lakewood, WA 98499
Somerset GardensA P A R T M E N T S
-
For More Information Please Contact
Isaac Chamberlin206.774.5422 [email protected]
Erich Bubbel206.774.5426 [email protected]
2621 Eastlake Ave E
Seattle, WA 98102
www.tfgre.com
-
02Investment Overview
05 Submarket Information
08 Financial Summary
10 Sales Comparables
14 Rent Comparables
18 Regional Information
Somerset G
ardens AP
AR
TM
EN
TS
-
Somerset G
ardens AP
AR
TM
EN
TS
:: INV
ES
TM
EN
T O
VE
RV
IEW
2
Investment Overview
The Foundation Group is pleased to offer the opportunity to
purchase the Somerset Gardens Apartments for the first time on the
market in over 20 years. Somerset Gardens is a 42-unit complex in
the heart of the JBLM Lakewood area. Lakewood continues to see
rapid growth while still maintaining its afford-ability, giving
renters an opportunity to live in close proximity to employment and
entertainment centers.
Built in 1977, Somerset Gardens is a mix of 23 - 1bedroom units
and 19 - 2bedroom units. The building is copper plumbed, pitched
composition roofs (all recently updated except for one building),
partial double pane vinyl windows, some single pane aluminum. Each
unit has Washer/Dryer hookups, a portion of the units have
dishwashers.
We believe the highest and best use for a new investor on this
property is a completion of exterior updates and a light over-haul
of the interior of units + a unit conversion of the existing
leasing office to capture remaining rental upside.
Somerset Gardens offers an investor the opportunity to purchase
a market in place yeild with upside on renovation to achieve above
market reutrns.
-
3
Price $5,750,000
Units 42
Current Cap Rate 5.19%
Market Cap Rate 6.71%
Current GRM 11.75
Market GRM 9.55
Price/Sq.Ft $219
Price/Unit $136,905
Parking Spaces 42
Rentable Sq.Ft 26,250
Lot Sq.Ft 63,598
Zoning MF1
Year Built 1977
Construction Type Wood Frame
Heating Electric Baseboard
Washer/Dryer In Unit
Quick Facts
• Buyer to verify
Som
erse
t Gar
dens
AP
AR
TM
EN
TS
::
IN
VE
ST
ME
NT
OV
ER
VIE
W
-
Somerset G
ardens AP
AR
TM
EN
TS
:: INV
ES
TM
EN
T O
VE
RV
IEW
4
-
Lakewood City Description
Lakewood, WA is the second largest city in Pierce County. It is
the host community to Joint Base Lewis-McChord and the Lakewood
Industrial park; the fourth largest private, for prof-it employer
in Pierce County. JBLM is a stone’s throw away from Somerset
Gardens.
Tacoma-Lakewood is a growth market: Population growth in the
Tacoma-Lakewood is expected to continue during the 3-year forecast
period, with the population reaching 953k by December 2022. 70
percent of the growth will come from net in-migration.
Tacoma-Lakewood has a tight rental market: Strong popula-tion
growth during the past several years, and relatively slow
multifamily development delivery have contributed to an overall
estimated vacancy rate of 3.4 percent.
Lakewood is a snapshot of all that picteresque Washington has to
offer. It’s no wonder that Lakewood has been nick-named the
‘playground’ for the region’s elite, who enjoy 11 parks consisting
of more than 540 acres, 5 lakes, four golf courses, the Lakewood
Gardens, and much, much more.
LAKEWOOD + RAINIER
JOINT BASE LEWIS MCCHORD
5
Som
erse
t Gar
dens
AP
AR
TM
EN
TS
::
IN
VE
ST
ME
NT
OV
ER
VIE
W
Lakewood is a high density area that offers ample entertainment
and employment within a reasonable commute time.
-
Unit Type Units Approx Sq FtCurrent
RentCurrent
/ Sq Ft
Market Rent
Market / Sqft
1 Bed/ 1 Bath 23 525 $863 $1.64 $950 $1.81
2 Bed/1 Bath 19 720 $922 $1.28 $1,300 $1.81
Average 25,656 $1.46 $1.81
Utility Income $3,160 $3,150
Other Income $250 $500
Total 42 $40,777 $50,200
Property Notes & Assumptions• W/D in each unit• Office can
be converted to unit per new zoning• Copper Plumming• Pitched
Roofs• Ample Parking
Scheduled Income
Somerset G
ardens AP
AR
TM
EN
TS
:: INV
ES
TM
EN
T O
VE
RV
IEW
6
-
Current Market
Gross Potential Rent $489,324 $602,400
Vacancy ($14,680) 3% ($30,120) 5%
Effective Gross Rent $474,644 $572,280
E X P E N S E S
Property Taxes (2020) $38,000 $46,250
Insurance (Proforma) $12,600 $12,600
Utilities $44,364 $44,364
Maintenance & Repairs $36,604 $33,600
5% Pro. Management (Profor-ma) $23,732 $28,614
Landscaping. $9,000 $9,000
Reserves (Proforma) $10,500 $10,500
Misc. $1,250 $1,250
Total Expenses $176,050 $186,178
Net Operating Income $298,594 $386,102
Loan Payments $224,507 $224,507
Pre Tax Cash Flow $74,087 5.11% $161,595 11.14%
Principle Reduction $86,068 $86,068
Total Pre Tax Return $160,156 11.04% $247,664 17.07%
Financials
7
Som
erse
t Gar
dens
AP
AR
TM
EN
TS
::
IN
VE
ST
ME
NT
OV
ER
VIE
W
-
Building Name AddressSales Date
# of Units
Year Built
Sales Price GRM CAPPrice/SqFt
Price/Unit
4120 109th St SW 4120 109th St SW 3/16/20 13 1979 $2,100,000 N/A
N/A $311 $161,538
Lakewood FourPlexes
5816 77th St W 5/29/20 8 1985 $1,300,000 12.50 5.70% $191
$162,500
Sherwood Forest8100 Sherwood
Forest St SW8/28/20 16 1963 $2,350,000 N/A N/A $205 $146,875
Averages 12.50 5.70% $236 $156,971
Somerset Gardens 11.75 5.19% $219 $136,905
4120 109 St SW
Sales Comparables
Lakewood FourPlexes Sherwood Forest
Somerset G
ardens AP
AR
TM
EN
TS
:: INV
ES
TM
EN
T O
VE
RV
IEW
8
-
Sales Comparables
3
2 Lakewood FourPlexes
4120 109th St SW 1
Sherwood Forest
Somerset Gardens
9
Som
erse
t Gar
dens
AP
AR
TM
EN
TS
::
IN
VE
ST
ME
NT
OV
ER
VIE
W
-
Somerset G
ardens AP
AR
TM
EN
TS
:: INV
ES
TM
EN
T O
VE
RV
IEW
10
-
11
Som
erse
t Gar
dens
AP
AR
TM
EN
TS
::
IN
VE
ST
ME
NT
OV
ER
VIE
W
-
Seattle / Puget Sound Region
Seattle is the largest city in the state of Washington with an
estimated population of 686,800 as of 2016. The Seattle
metropolitan area, also known as the Puget Sound,is comprised of
King, Pierce and Snohomish County. As an MSA, the Puget Sound isthe
15th largest metropolitan area in the United States with a
population of approximately3.7 million people.
Seattle has a thriving local economy and is home to eight
Fortune 500 companies including Costco, Microsoft, Amazon, Paccar,
Starbucks, Nordstrom, Expeditors International and Weyerhauser. In
addition, Seattle is home to other notable tech companies such as
Expedia, Zillow, Tableau and Zulily. It is quickly establishing
itself as a national tech hub as multiple companies from Silicon
Valley, such as Googleand Facebook, have opened Seattle offices in
an attempt to draw on the talented pool of tech workers living in
and rapidly moving to Seattle.
In 2016, Zillow ranked Seattle as the second hottest housing
market in the nation for appreciation. Similarly in June of 2016,
Redfin also ranked Seattle as the second hottest housing market
behind Denver, where the average days on market of a listing is
eight and median sales price growth year over year is 7.5%. Much of
this growth comes from the hot job market in Seattle, ranked as the
fourth best in the nation. A statistical analysis by Careerbuilder
found that in 2015 Seattle added 78,082 jobs. Recently Conway
Pederson forecasts they expect the Puget Sound region to add 47,900
jobs in 2016.
Currently, the year to date in-migration to the Puget Sound
based on driver’s license data for January through May shows 49,656
people have moved into the area. On an annual basis, the 12-month
moving average of monthly in migration is approximately 10,000
people. Annually that puts more than 120,000 people moving into the
Puget Sound region; though this does not account for people moving
out of the region, the bottom line is the area has and will
continue to grow at a rapid pace making the rental market as strong
as its ever been.
Somerset G
ardens AP
AR
TM
EN
TS
:: INV
ES
TM
EN
T O
VE
RV
IEW
12
-
Buoyed by its technology sector and the metro’s appeal as a
live-work-play environment, Seattle’s economy and multifamily
market continue to break new ground.
13
Som
erse
t Gar
dens
AP
AR
TM
EN
TS
::
IN
VE
ST
ME
NT
OV
ER
VIE
W
-
The information included in this document has been obtained
from
sources we believe to be reliable. While we do not doubt its
accuracy,
we have not verified it and cannot make any guarantee, warranty
or
representation about it. It is your responsibility to
independently confirm
its accuracy and completeness. Any projections, opinions,
assumptions, or
estimates used are for example only and may not accurately
represent the
current or future performance of the property. The value of any
proposed
transaction to you depends on tax and other factors which should
be
evaluated by your tax, financial and legal advisors. You and
your advisors
should conduct a careful, independent investigation of the
property to
determine to your satisfaction the suitability of the property
for your
needs.
For More Information Please Contact
Isaac Chamberlin206.774.5422 [email protected]
Erich Bubbel206.774.5426 [email protected]
2621 Eastlake Ave E
Seattle, WA 98102
www.tfgre.com
