Manhattan Beach, ca · Highland is located at the main commercial intersection of Manhattan Beach’s El Porto ... also installed. In total, more than $1 million was invested in the

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Affiliated Business Disclosure

CBRE, Inc. operates within a global family of companies with many subsidiaries and/or related entities (each an “Affiliate”) engaging in a broad range of commercial real estate businesses including, but not limited to, brokerage services, property and facilities management, valuation, investment fund management and development. At times different Affiliates may represent various clients with competing interests in the same transaction. For example, this Memorandum may be received by our Affiliates, including CBRE Investors, Inc. or Trammell Crow Company. Those, or other, Affiliates may express an interest in the property described in this Memorandum (the “Property”) may submit an offer to purchase the Property and may be the successful bidder for the Property. You hereby acknowledge that possibility and agree that neither CBRE, Inc. nor any involved Affiliate will have any obligation to disclose to you the involvement of any Affiliate in the sale or purchase of the Property. In all instances, however, CBRE, Inc. will act in the best interest of the client(s) it represents in the transaction described in this Memorandum and will not act in concert with or otherwise conduct its business in a way that benefits any Affiliate to the detriment of any other offeror or prospective offeror, but rather will conduct its business in a manner consistent with the law and any fiduciary duties owed to the client(s) it represents in the transaction described in this Memorandum.

Confidentiality Agreement

This is a confidential Memorandum intended solely for your limited use and benefit in determining whether you desire to express further interest in the acquisition of the Property.

This Memorandum contains selected information pertaining to the Property and does not purport to be a representation of the state of affairs of the Property or the owner of the Property (the “Owner”), to be all-inclusive or to contain all or part of the information which prospective investors may require to evaluate a purchase of real property. All financial projections and information are provided for general reference purposes only and are based on assumptions relating to the general economy, market conditions, competition and other factors beyond the control of the Owner and CBRE, Inc. Therefore, all projections, assumptions and other information provided and made herein are subject to material variation. All references to acreages, square footages, and other measurements are approximations. Additional information and an opportunity to inspect the Property will be made available to interested and qualified prospective purchasers. In this Memorandum, certain documents, including leases and other materials, are described in summary form. These summaries do not purport to be complete nor necessarily accurate descriptions of the full agreements referenced. Interested parties are expected to review all such summaries and other documents of whatever nature independently and not rely on the contents of this Memorandum in any manner.

Neither the Owner or CBRE, Inc, nor any of their respective directors, officers, Affiliates

or representatives make any representation or warranty, expressed or implied, as to the accuracy or completeness of this Memorandum or any of its contents, and no legal commitment or obligation shall arise by reason of your receipt of this Memorandum or use of its contents; and you are to rely solely on your investigations and inspections of the Property in evaluating a possible purchase of the real property.

The Owner expressly reserved the right, at its sole discretion, to reject any or all expressions of interest or offers to purchase the Property, and/or to terminate discussions with any entity at any time with or without notice which may arise as a result of review of this Memorandum. The Owner shall have no legal commitment or obligation to any entity reviewing this Memorandum or making an offer to purchase the Property unless and until written agreement(s) for the purchase of the Property have been fully executed, delivered and approved by the Owner and any conditions to the Owner’s obligations therein have been satisfied or waived.

By receipt of this Memorandum, you agree that this Memorandum and its contents are of a confidential nature, that you will hold and treat it in the strictest confidence and that you will not disclose this Memorandum or any of its contents to any other entity without the prior written authorization of the Owner or CBRE, Inc. You also agree that you will not use this Memorandum or any of its contents in any manner detrimental to the interest of the Owner or CBRE, Inc.

If after reviewing this Memorandum, you have no further interest in purchasing the Property, kindly return this Memorandum to CBRE, Inc.

Disclaimer

© 2014 CBRE, Inc. The information contained in this document has been obtained from sources believed reliable. While CBRE, Inc. does not doubt its accuracy, CBRE, Inc. has not verified it and makes no 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 do not represent the current or future performance of the property. The value of this 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.

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t h e o f f e r i n g3701 Highland Avenue is a three-story, free-standing, 11,566-square -foot office building located in Manhattan Beach, California. The building is located in the North “El Porto” section of Manhattan Beach. The property has incredible panoramic ocean views and sits a block away from the sand.

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i n v e st m e n t h i g h l i g h ts

• Located within one block to the Pacific Ocean

• Incredible panoramic ocean views

• Surrounded by an abundance of retail amenities in the Rosecrans Corridor, El Porto and downtown Manhattan and Hermosa Beaches

• Safe beach city environment

• Easy access to 105 and 405 freeways and to the west Los Angeles cities along Vista Del Mar

• Maintenance, landscaping and general upkeep consistent with Class A or B beach city office/retail property

• Majority of tenant spaces have been upgraded with new paint, flooring and lighting

• Short-term leases on 2nd and 3rd floor ocean view space provides opportunity for a partial owner user

• Rare office/retail purchase opportunity in Manhattan Beach

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Built in 1978 and previously occupied by numerous beach city office and retail users, 3701 Highland is located at the main commercial intersection of Manhattan Beach’s El Porto neighborhood.

The property sits on 6,273 sq. ft of land and has a 13-car parking garage on the ground floor of the building.

3701 Highland has been recently renovated, the entire exterior has been painted, all new windows and balcony doors were installed, new flooring and ceilings in common corridors, and over 50% of the tenant spaces have new flooring, paint and upgraded lighting.

The building was also renovated in 2006, and the common areas, roof, bathrooms, electrical and metering were all completely redone. New tile flooring and an entry way ceiling were also installed. In total, more than $1 million was invested in the 2006 renovations.

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Address 3701 Highland Avenue, Manhattan Beach, CA

Total Building Size ±11,566 SF

Total Land Size ±6,273 SF (± 0.144 Acres)

P D 4137-012-067

Year Built 1978, R2013 & 2014

Occupancy ±78%

Number of Tenants 6

Parking: 25 parking spaces, 13 reserved spaces in gararge, 12 spaces leased on an annual basis from adjacent property, additional two-story Manhattan Beach city parking structure directly across street

Foundation: Concrete slab-on-grade

Structure: Wood/steel-frame, reinforced concrete, reinforced CMU

Zoning CNE – North End Commercial District

Roof System: Metal mansard panels at south-east elevation and built up roof (BUR)

Restrooms 2 common restrooms and 3 tenants have interior private restrooms

HVAC Rooftop packaged units at upper level with split-system heat pumps and condensers at lower levels

Water Supply Piping & Heating Copper piping with electric water heater (40 gallon)

Fire Suppression Wet-pipe sprinkler system, 100% coverage

Electric Supply Wiring Copper wiring

Telecommunications AT&T, Verizon FIOS

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s o u t h bay ov e rv i e w

3701 Highland Avenue is located in Los Angeles County’s South Bay submarket, a dynamic coastal region stretching from Los Angeles International Airport (LAX) to Long Beach and including the prominent residential communities of Manhattan Beach, Hermosa Beach, Playa Vista and the Palos Verdes Peninsula. The South Bay office market contains approximately 29.9 million square feet of rentable area, of which the Beach Cities and El Segundo office markets total 11.3 million, or approximately 36%.

s o u t h bay ov e rv i e w

Quality of life is the primary driver for a South Bay location, as the beach communities offer the ultimate California lifestyle, an abundance of executive housing, outstanding amenities and quality schools. Significant industries based in the South Bay include defense, aerospace, technology, automotive, international trade, oil & gas and telecommunication. In fact, the South Bay is the corporate headquarters location for Mattel, Toyota USA, Honda USA, Epson and DIRECTV. Other major users include Northrop Grumman, Boeing, Wells Fargo, Raytheon, Herbalife, Teredata, Merck, Oracle, ING, Chevron and Teledyne.

The South Bay is also the home of two of the key “engines of growth” of the greater Los Angeles County area (the Ports of Los Angeles/Long Beach and Los Angeles International Airport). As the leading seaport in North America in terms of shipping container volume and cargo value, the ports generate 919,000 regional jobs and $39.1 billion in annual wages and tax revenues. The South Bay is the leader in the fast growing international trade arena with the largest port facilities and international air cargo volume in the nation. LAX is the major international cargo airport serving Southern California – the world’s eleventh largest economy. The continued expansions of the ports and the planned modernization and expansion of the airport envisioned by LAX 2015 ensures the long term viability and increased importance of these key economic engines.

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stat e o f t h e m a r k e t

Tremendous Corporate PresenceWith two major transportation hubs on its borders (LAX and the Ports of Los Angeles and Long Beach) and the Pacific Ocean at its back door, the Beach Cities benefit from tremendous accessibility and contribute to Los Angeles’ status as a “global gateway.” Because of this, the Beach Cities are home to some of the biggest names in key industries, including Raytheon, Boeing, Northrop Grumman, Aerospace Corp, Mattel, Direct TV, Accenture, Chevron and Xerox. The area is also home to entrepreneurial lifestyle brands like Skechers footwear, which has its worldwide headquarters in Manhattan Beach.

While the aerospace/defense industry remains a major employer in the area, this market has also reinvented itself in recent years, welcoming industry leaders in technology and entertainment. This has contributed to a more diversified economic center. Additionally, many executives working in the Beach Cities choose to relocate here instead of commuting from the pricier West Los Angeles submarkets.

Unparalleled Transportation InfrastructureThe South Bay is served by seven freeways and highways, including the San Diego (I-405), Century (I-105), San Gabriel (I-605), Long Beach (I-710), Harbor (I-110) and Artesia (SR-91) freeways. The Terminal Island (103) Highway also links the Ports of Long Beach and Los Angeles with the Pacific Coast Highway and the nation’s largest cargo facilities. Additionally, the 22-mile Blue Line provides light rail service linking downtown Los Angeles with downtown Long Beach, and the 21-mile Green Line parallels the Century (I-105) Freeway, linking El Segundo with residential areas in the central and eastern area.

Highly Educated and Affluent PopulationThe Beach Cities continue to grow as young professionals and affluent families seek a higher quality of life. Despite the rapid growth, the population remains predominantly wealthy and highly educated. The average household income in the city is $167,732 while almost 23% of the population living within a mile of the subject property has an average income of over $250,000 (8.9% over $500,000 and 13.5% $250,000-$499,000+). Education levels are high, with 67% of the area’s residents age 25 or over having a bachelor’s degree or higher, a figure more than twice the national average.

With its excellent school districts and small community feel, the Beach Cities are a favorite of families looking to settle in a prestigious and highly rated area. As the affluent populace increases, the demand for more amenities means the Beach Cities will continue to need a host of retailers, restaurants, entertainment, medical services and lodging, particularly along Rosecrans and Sepulveda Boulevards.

s o u t h bay h i g h l i g h ts

The South Bay office market is strategically located between West Los Angeles and Orange County and features excellent regional access by way of the San Diego (405), Century (105), Long Beach (710), Artesia (91) and Harbor (110) freeways. Additionally, the market offers close proximity to LAX and Downtown Los Angeles.

The South Bay office market benefits from the bordering Westside office market as growth from the entertainment, high-tech and service industries has caused migration to and expansion in the South Bay. In 2013, Westside markets ended the year with a 13.4% vacancy rate and a $3.62 average asking rate. Currently (as of 1Q14), the Westside average asking rental rate is approximately a 77% premium over the South Bay.

Westside tenants recognize the tremendous benefits of relocating to the South Bay, which include quality office space, comparatively lower rental rates, lower operating costs, lower parking rates and higher parking ratios, a large, well educated labor pool, and high quality of life. Businesses will continue to migrate to the South Bay due to the Westside rental rate premium.

Over the past decade, the evolution and aggressive expansion of the aerospace and defense industries into the commercial sector, as well as Westside migration, has led to a broadening of the South Bay’s tenant base which is comprised of high-technology, telecommunications, healthcare, automobile, entertainment and financial services firms.

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m a n h at ta n b e ac h / b e ac h c i t i e s ov e rv i e w

The South Bay’s “Beach Cities” (Manhattan Beach, Redondo Beach, Hermosa Beach and El Segundo) are among the most desirable places to live and work in Southern California. They offer luxurious coastal living and an excellent public school system, making them a favorite with residents seeking an upscale lifestyle. Businesses in the Beach Cities benefit from a varied and dynamic marketplace and proximity to Los Angeles International Airport (LAX). With its near-perfect climate and quintessential beach setting – along with convenient access to Los Angeles – this region is one of the jewels of Southern California.

With just over two miles of ocean frontage, Manhattan Beach is a city of beautiful homes on tree-lined streets, year-round sunshine, and white-sand beaches. Situated along the coastline, the city is flanked by oceanfront neighborhoods that face the sea. Filled with friendly people proud of their town, their pier and their heritage, Manhattan Beach offers an array of shops, boutiques and major department stores throughout the downtown and north end business districts as well as the Manhattan Village Mall.

Downtown Manhattan Beach is a vibrant area with more than 50 dining experiences including taverns, cafés and fine dining; 71 specialty boutiques

providing unique gifts, clothing and accessories, stylish home décor and unique stationery items; and approximately 171 service-type providers including everything from financial institutions and salons to Shade, a luxurious small boutique hotel.

The Manhattan Beach Unified School District serves the area and is well known for its high performance, ranking 12th in the state. The city’s many communities provide a multitude of activities for residents and visitors, including surfing, beach volleyball and sun worshipping, along with a variety of sports activities in several city parks. Bicycle enthusiasts have use of a beachside bikeway that extends north to Santa Monica and south to Palos Verdes.

The Manhattan Beach Pier is a California State Historic Landmark and the perfect place for strolling, fishing, dolphin sighting and star gazing. Along the Rosecrans corridor, restaurants, office buildings, fitness centers and retail fuse into a unique lifestyle atmosphere. City events include art festivals, concerts in the park and much more.

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29© 2014 CBRE Limited. Data © TeleAtlas, Google, AerialExpress, DigitalGlobe, Landiscor, USGS, i-cubed. The information contained herein (the “Information”) is intended for informational purposes only and should not be relied upon by recipients hereof. Although the Information is believed to be correct, its accuracy, correctness or completeness cannot be guaranteed and has not been verified by either CBRE Limited or any of its affiliates (CBRE Limited and its affiliates are collectively referred to herein as “CBRE”). CBREneither guarantees, warrants nor assumes any responsibility or liability of any kind with respect to the accuracy, correctness, completeness, or suitability of, or decisions based upon or in connection with, the Information. The recipient of the Information should take such steps as the recipient may deem appropriate with respect to using the Information. The Information may change and any property described herein may be withdrawn from the market at any time without notice or obligation of any kind on the part of CBRE. TheInformation is protected by copyright and shall be fully enforced.

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Address

SITE: 3701 Highland Ave. Manhattan Beach

1. 200 Pier Ave. Hermosa Beach

2. 308-312 Rosecrans Ave. Manhattan Beach

3. 333 Manhattan Beach Blvd. Manhattan Beach

4. 1141 Highland Ave. Manhattan Beach

5. 1219 Morningside Dr. Manhattan Beach

6. 1110 Manhattan Ave. Manhattan Beach

7. 1112 Ocean Dr. Manhattan Beach

8. 34 Hermosa Ave. Hermosa Beach

9. 211-215 Manhattan Beach Blvd. Manhattan Beach


Property Photo Address Bldg Sq. Ft. Available Sq. Ft. Lease Rate Comments

1. 200 Pier Ave. Hermosa Beach

17,500 1,028 $5.54 MG No view spaces available, 53 parking spaces

2. 308-312 Rosecrans Ave. Manhattan Beach

10,692 312-2,662 $3.75 NNN No views, no parking


3,300 1,200 $6.25 NNN Downtown Manhattan Beach, partial ocean views, no parking


3,792 2,000 $8.00 NNN Downtown Manhattan Beach, no parking

5. 1219 Morningside Dr. Manhattan Beach

9,522 298-349 $7.48 FSG Downtown Manhattan Beach, small suites, 14 parking spaces

6. 1110 Manhattan Ave. Manhattan Beach

6,980 3,297 $3.75 NNN Downtown Manhattan Beach, second story office, few windows

2 parking spaces

7. 1112 Ocean Dr. Manhattan Beach

10,000 400-1,500 $4.00 - $4.87 MG Downtown Manhattan Beach, ocean views, 8 parking spaces


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Property Photo Address Bldg Sq. Ft. Available Sq. Ft. Lease Rate Comments


9,680 800-2,400 $5.00 NNN 8 parking spaces


7,400 1,600-4,300 $10.00 NNN Downtown Manhattan Beach, ocean views, 6 parking spaces


8,820 4,000 $10.00 NNN Downtown Manhattan Beach, ocean views, no parking


© 2014 CBRE Limited. Data © TeleAtlas, Google, AerialExpress, DigitalGlobe, Landiscor, USGS, i-cubed. The information contained herein (the “Information”) is intended for informational purposes only and should not be relied upon by recipients hereof. Although the Information is believed to be correct, its accuracy, correctness or completeness cannot be guaranteed and has not been verified by either CBRE Limited or any of its affiliates (CBRE Limited and its affiliates are collectively referred to herein as “CBRE”). CBREneither guarantees, warrants nor assumes any responsibility or liability of any kind with respect to the accuracy, correctness, completeness, or suitability of, or decisions based upon or in connection with, the Information. The recipient of the Information should take such steps as the recipient may deem appropriate with respect to using the Information. The Information may change and any property described herein may be withdrawn from the market at any time without notice or obligation of any kind on the part of CBRE. TheInformation is protected by copyright and shall be fully enforced.


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Address




3. 500-508 Pier Ave. Hermosa Beach


5. 936-950 Hermosa Ave. Hermosa Beach







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Property Photo Address Bldg Sq. Ft.Land Sq. Ft.

Sales PricePrice PSF Date Sold Comments


8,8204,410

$10,600,000$1,201.81

In Escrow Redevelopment


4,6292,696

$6,943,500$1,500.00

In Escrow Investment


3,3004,500

$3,100,000$939.39

3/2014 Owner user


5,5877,810

$4,425,000$792.02

9/2013 Investment

5. 936-950 Hermosa Ave. Hermosa Beach

6,4503,999

$4,000,000$620.16

1/2014 Investment, tired buiding


10,57016,117

$5,372,500$508.28

7/2013 Owner user, tear down



Sales PricePrice PSF Date Sold Comments


4,50015,682

$2,975,000$661.11

5/2013 Owner user, tear down


2,7402,993

$5,000,000$1,401

7/2013 Redevelopment


3,2724,182

$2,500,000$912.41

5/2012 Investment


3,2724,182

$1,860,000$568.46

11/2013 Investment, tired building


1,6663,533

$1,800,000$1,080.43

4/2011 Owner user


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sa l e s ava i l a b i l i t i e s

© 2014 CBRE Limited. Data © TeleAtlas, Google, AerialExpress, DigitalGlobe, Landiscor, USGS, i-cubed. The information contained herein (the “Information”) is intended for informational purposes only and should not be relied upon by recipients hereof. Although the Information is believed to be correct, its accuracy, correctness or completeness cannot be guaranteed and has not been verified by either CBRE Limited or any of its affiliates (CBRE Limited and its affiliates are collectively referred to herein as “CBRE”). CBREneither guarantees, warrants nor assumes any responsibility or liability of any kind with respect to the accuracy, correctness, completeness, or suitability of, or decisions based upon or in connection with, the Information. The recipient of the Information should take such steps as the recipient may deem appropriate with respect to using the Information. The Information may change and any property described herein may be withdrawn from the market at any time without notice or obligation of any kind on the part of CBRE. TheInformation is protected by copyright and shall be fully enforced.


Address





4. 722 1st St. Hermosa Beach



7. 4101-4103 Highland Ave. Manhattan Beach

8. Elevon El Segundo


Sales PricePrice PSF Comments


8,8204,410

$10,600,000$1,201.81

In escrow


4,6292,696

$6,943,500$1,500.00

In escrow, investment


2,4407,200

$2,197,000$900.41

Owner user

4. 722 1st St. Hermosa Beach

4,1124,517

$1,500,000$364.79

Partial owner user


9755,236

$975,000$1000.00

Investment


300 $699,000$2,330.00

Owner user

7. 4101-4103 Highland Ave. Manhattan Beach

2,5205,846

$2,499,000$991.67

El Porto Market & Deli, on market for over a year


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Sales PricePrice PSF Comments

8. 1126 22nd St. Manhattan Beach

9,00022,216

$4,250,000$472.22

In escrow, redevelopment

9. Elevon El Segundo

2,000 – 27,000 TBD$495.00

Owner user, pricing based on cold shell


Bob HealeyLic. 01021735+1 310 363 [email protected]

Erin RiersonLic. 01930776+1 310 363 4905erin,[email protected]

CBRE, Inc2221 Rosecrans Ave.Suite 100El Segundo, CA 90245

Documents

Manhattan Beach, ca · Highland is located at the main commercial intersection of Manhattan Beach’s El Porto ... also installed. In total, more than $1 million was invested in the