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PEQUOT TERRACE ESTATES
OFFER
ING
MEM
OR
AND
UM
IN ASSOCIATION WITH KELLER WILLIAMS COMMERCIAL MIDWEST. 31361 RASMUSSEN ROAD, PEQUOT LAKES MN 56472
Pequot Terrace EstatesCONTENTS
We obtained the following information above from sources we believe to be reliable. However, we have not verified its accuracy and make no guarantee, warranty or representation about it. It is submitted subject to the possibility of errors, omissions, change of price, rental or otherconditions, prior sale, lease or financing, or withdrawal without notice. We include projections, opinions, assumptions or estimates for example only, and they may not represent the current or future performance of the property. You and your tax and legal advisors should conduct yourown investigation of the property and transaction.
01 Executive Summary Investment Summary 5 Unit Mix Summary 6 Location Summary 7
02 Property Description Property Features 9 Aerial Map 10
03 Rent Roll Rent Roll Details 12
04 Financial Analysis Income & Expense Analysis 14 Cash Flow Analysis 15
05 Demographics Demographics 18 Demographic Charts 19
in Association with:
Stratton Group, Keller Williams Southern Arizona Marc LuetySales Associate [email protected]
Marketed By:
Keller Williams Commercial Midwest
Robert Bayer, MBA & CPA
MN License #40521537
Pequot Terrace Estates Confidentiality and Disclaimer | 03
CONFIDENTIALITY AND DISCLAIMER:
The information contained in the following offering memorandum is proprietary and strictly confidential. It is intended to be reviewed only by the party receiving it from Keller Williams Commercial Midwest in association with Stratton Group, Keller Williams Southern Arizona and it should not be made available to any other person or entity without the written consent of Keller Williams Commercial Midwest in association with Stratton Group, Keller Williams Southern Arizona.
By taking possession of and reviewing the information contained herein the recipient agrees to hold and treat all such information in the strictest confidence. The recipient further agrees that recipient will not photocopy or duplicate any part of the offering memorandum. If you have no interest in the subject property, please promptly return this offering memorandum to Keller Williams Commercial Midwest in association with Stratton Group, Keller Williams Southern Arizona. This offering memorandum has been prepared to provide summary, unverified financial and physical 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. Keller Williams Commercial Midwest in association with Stratton Group, Keller Williams Southern Arizona 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, PCBs or asbestos, the compliance with local, state and federal regulations, the physical condition of the improvements thereon, or 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 offering memorandum has been obtained from sources we believe reliable; however, Keller Williams Commercial Midwest in association with Stratton Group, Keller Williams Southern Arizona has not verified, and will not verify, any of the information contained herein, nor has Keller Williams Commercial Midwest in association with Stratton Group, Keller Williams Southern Arizona 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. Prospective buyers shall be responsible for their costs and expenses of investigating the subject property.
PROPERTY SHOWINGS ARE BY APPOINTMENT ONLY.PLEASE CONTACT STRATTON GROUP FOR MORE DETAILS.Copyright © 2019 CREOP, LLC. All Rights Reserved.
Pequot Terrace Estates | Executive Summ
ary
Executive Summary
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Investment Summary
Unit Mix Summary
Location Summary
Pequot Terrace Estates Investment Summary | 05
OFFERING SUMMARYADDRESS 31361 Rasmussen Road
Pequot Lakes MN 56472COUNTY Crow Wing CountyBUILDING SF 0LAND SF 497,455NUMBER OF SPACES 38APN 290104100BB0009
FINANCIAL SUMMARYOFFERING PRICE $850,000PRICE PER UNIT $22,368NOI (Jun-2018 YTD) $69,753NOI (2019 Normalized) $75,218CAP RATE (Jun-2018 YTD) 8.21 %CAP RATE (2019 Normalized) 8.85 %GRM (Jun-2018 YTD) 6.32GRM (2019 Normalized) 5.98
DEMOGRAPHICS 5 MILE 25 MILE 50 MILE2018 Population 6,615 80,157 187,5382018 Median HH Income $52,343 $51,834 $50,6242018 Average HH Income $72,323 $71,107 $67,454
38 MH Spaces - 63% Occupied
12 POH (including Mgr Unit) - Fully Occupied
11.42 Acres w/ ~1/3 Available for Expansion
All City Utilities - Electric & Gas Sub-Metered & Direct-Billed
Upside in Recapturing W/S/T Costs
$260-$290 Lot Rents - Upside in Rent Increase
38-SPACE, ALL AGES PARK - 38 Space All-Ages Community over 11.5acres, 14 Vacancies. 12 Park-Owned Homes (including manager's unitwho gets $500/mo. ($250 Cash + $250 Rent Concession); 25 Tenant-Owned Spaces - 14 Vacant; 1 Home Under Contract. Flooring repairsare currently being made for 5 units and the owner is working on bids fora new roof on 1 unit.
RENTAL RATE UPSIDE - $260 SW Lot Rent; $290 DW Lot Rent &~$660 POH Rent. Rents haven't been raised in several years and whenthey were, it was only $5-10. Market rents sit in the $275-325 range;owners have just been leveling rents as spaces/units turnover.
CITY SERVICES - All City Services; Water/Sewer Master-Metered &Included in Rent with Trash; Electric & Gas are both Sub-Metered &Direct-Billed. Upside in Recapturing Water/Sewer/Trash Expenditures.
Unit Type Occupied Vacant Total Avg Rent Potential Monthly Collected Monthly Market Rent Market CollectedTOH 12 13 25 264$ 6,590$ 3,210$ 278$ 6,950$ POH 11 0 11 661$ 7,270$ 7,270$ 275$ 3,025$ RTO 1 0 1 260$ 260$ 260$ 275$ 275$ Manager 1 0 1 250$ 250$ -$ 250$ 250$ Total / Avg 25 13 38 378$ 14,370$ 10,740$ 276$ 10,500$ Pct % 66% 34% 100% Annual 172,440$ 128,880$ 126,000$
Pequot Terrace Estates - Unit Mix
Pequot Terrace Estates Unit Mix Summary | 06
Pequot Terrace Estates Location Summary | 07
LAKE DISTRICT NORTH OF BRAINERD MN - PequotTerrace Estates Mobile Home Park is located in northernPequot Lakes, Minnesota just east of Sibley Lake & southof Upper Hay Lake. The city is 23 miles north of Brainerd, acity of 13,000 that sits on the Burlington Northern rail lineand is home to Brainerd International Speedway.
PROXIMITY TO ST CLOUD & MINNEAPOLIS - St. Cloud,Minnesota is about an hour and a half south of PequotLakes; and Minneapolis is about 2 1/2 hours south, only anhour farther than St. Cloud on I-94.
SITUATED ALONG MN HWY 371 - Minnesota Highway371 serves as a main route in Pequot Lakes; other routesinclude County Roads 11, 16, 17, 29, and 112.
CITY COUNCIL ACTIVITY - As of early September 2018,the Pequot Lakes City Council members took their timereviewing all parts of a first draft of the 2019 budget and areconsidering adopting a preliminary general tax levy.
Regional Map
Locator Map
Pequot Terrace Estates | Property Description
Property Description
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Property Features
Aerial Map
Parcel Map
Additional Maps
Pequot Terrace Estates Property Features | 09
PROPERTY FEATURESNUMBER OF SPACES 38BUILDING SF 0LAND SF 497,455LAND ACRES 11.42NUMBER OF VACANCIES 14OCCUPANCY 63%PARCEL NUMBER 290104100BB0009
UTILITIESCITY WATER Master-MeteredCITY SEWER Master-MeteredCITY GAS Sub-MeteredCITY ELECTRIC Sub-MeteredCITY TRASH Included in Rent
Pequot Terrace Estates Aerial Map | 10
Pequot Terrace Estates | Rent R
oll
Rent Roll
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Rent Roll Details
Pequot Terrace Estates2018 RENT ROLL
No Unit Mix Status Lot Rent POH Charge Total Rent Vacancy Factor Collected Rent Market Rent
1 A2 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$
2 A4 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 3 A6 POH Occupied 260.00$ 365.00$ 625.00$ -$ 625.00$ 640.00$ 4 A8 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 5 A10 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 6 A12 POH Occupied 260.00$ 415.00$ 675.00$ -$ 675.00$ 690.00$ 7 A14 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 8 A16 POH Occupied 260.00$ 415.00$ 675.00$ -$ 675.00$ 690.00$ 9 B3 POH Occupied 260.00$ 435.00$ 695.00$ -$ 695.00$ 710.00$ 10 B11 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 11 B12 TOH Occupied 290.00$ -$ 290.00$ -$ 290.00$ 300.00$ 12 B13 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 13 B14 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 14 B15 Manager Occupied 250.00$ -$ 250.00$ (500.00)$ (250.00)$ (250.00)$ 15 B16 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 16 B17 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 17 B18 POH Occupied 260.00$ 336.14$ 596.14$ -$ 596.14$ 611.14$ 18 B19 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 19 B20 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 20 B21 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 21 B22 POH Occupied 260.00$ 415.00$ 675.00$ -$ 675.00$ 690.00$ 22 B23 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 23 B24 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 24 B25 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 25 B26 TOH Occupied 290.00$ -$ 290.00$ -$ 290.00$ 300.00$ 26 B27 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 27 B28 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 28 B29 POH Occupied 260.00$ 265.00$ 525.00$ -$ 525.00$ 540.00$ 29 B30 TOH Occupied 290.00$ -$ 290.00$ -$ 290.00$ 300.00$ 30 B31 POH Occupied 260.00$ 380.00$ 640.00$ -$ 640.00$ 655.00$ 31 B32 POH Occupied 260.00$ 490.00$ 750.00$ -$ 750.00$ 765.00$ 32 B33 POH Occupied 260.00$ 415.00$ 675.00$ -$ 675.00$ 690.00$ 33 B34 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 34 B36 POH Occupied 260.00$ 415.00$ 675.00$ -$ 675.00$ 690.00$ 35 C1 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 36 C2 TOH Vacant 260.00$ -$ 260.00$ (260.00)$ -$ 275.00$ 37 C3 TOH Occupied 260.00$ -$ 260.00$ -$ 260.00$ 275.00$ 38 C4 POH Occupied 260.00$ 400.00$ 660.00$ -$ 660.00$ 675.00$ 38 66% 9,960.00$ 4,746.14$ 14,706.14$ (3,880.00)$ 10,826.14$ 14,746.14$
Pequot Terrace Estates Rent Roll Details | 12
Pequot Terrace Estates | Financial Analysis
Financial Analysis
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Income & Expense
Multiyear Cash Flow Projections
Pequot Terrace Estates Income & Expense Analysis | 14
INCOME JUN-2018 YTD 2019NORMALIZED
Effective Gross Income $134,560 $142,108
Less: Expenses $64,807 $66,890
Net Operating Income $69,753 $75,218
Income Notes: Increase in income due to rent increase; raise $260 to $275 & raise $290 to $300
EXPENSES JUN-2018YTD
2019NORMALIZED
Taxes / Licenses $229 $8,692 $232 $8,831
Insurance $150 $5,689 $152 $5,775
Management Fee $79 $3,000 $351 $13,356
Marketing $13 $500
Repairs & Maintenance $461 $17,535 $374 $14,211
Office Expense $65 $2,483 $67 $2,527
Utility Expense $675 $25,640 $557 $21,183
Other Expenses $47 $1,768 $13 $507
Total Operating Expense $1,705 $64,807 $1,760 $66,890
% of EGI 48.16 % 47.07 %
Per Unit Per Unit
Expense Notes: Utilities were astronomically higher in 2017 & 2018 than previous years due towater leaks. Owners have spent several grand in capital expenses to resolveplumbing issues this year and last, normalizing and leveling both repair & utilityexpenditures for future years.
REVENUE ALLOCATION
DISTRIBUTION OF EXPENSES
Pequot Terrace Estates Cash Flow Analysis | 15
CASH FLOWCalendar Year Jun-2018 YTD Year 2 Year 3Gross Potential RevenueGross Rental Income $134,560 $142,108 $144,950Gross Potential Income $134,560 $142,108 $144,950Effective Gross Income $134,560 $142,108 $144,950Operating ExpensesTaxes / Licenses $8,692 $8,831 $9,008Insurance $5,689 $5,775 $5,891Management Fee $3,000 $13,356 $13,623Marketing $500 $510Repairs & Maintenance $17,535 $14,211 $14,495Office Expense $2,483 $2,527 $2,578Utility Expense $25,640 $21,183 $21,607Other Expenses $1,768 $507 $517Total Operating Expense $64,807 $66,890 $68,228Net Operating Income $69,753 $75,218 $76,722
Effective Gross Income vs Operating Expenses Cash Flow
Pequot Terrace Estates Cash Flow Analysis | 16
Calendar Year Jun-2018 YTD Year 2 Year 3Financial MetricsCash on Cash Return b/t 8.21 % 8.85 % 9.03 %CAP Rate 8.21 % 8.85 % 9.03 %Operating Expense Ratio 48.16 % 47.06 % 47.06 %Gross Multiplier (GRM) 6.32 5.98 5.86Breakeven Ratio 48.16 % 47.07 % 47.07 %Price / Unit $22,368 $22,368 $22,368
Pequot Terrace Estates | Dem
ographics
Demographics
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Demographic Details
Demographic Charts
Pequot Terrace Estates Demographics | 18
POPULATION 5 MILE 25 MILE 50 MILE
2000 Population 4,420 66,688 166,608
2010 Population 6,120 75,028 178,671
2018 Population 6,615 80,157 187,538
2023 Population 6,913 83,504 193,482
2018-2023: Population: Growth Rate 4.45 % 4.10 % 3.15 %
2018 HOUSEHOLD INCOME 5 MILE 25 MILE 50 MILE
less than $15,000 225 3,774 9,468
$15,000-$24,999 285 3,633 8,866
$25,000-$34,999 262 3,374 8,092
$35,000-$49,999 496 5,183 11,961
$50,000-$74,999 565 6,263 15,509
$75,000-$99,999 323 4,360 9,889
$100,000-$149,999 331 4,190 9,213
$150,000-$199,999 103 1,255 2,581
$200,000 or greater 104 1,250 2,391
Median HH Income $52,343 $51,834 $50,624
Average HH Income $72,323 $71,107 $67,454
HOUSEHOLDS 5 MILE 25 MILE 50 MILE
2000 Total Housing 3,241 41,697 102,941
2010 Total Households 2,519 31,231 74,426
2018 Total Households 2,695 33,282 77,970
2023 Total Households 2,810 34,643 80,387
2018 Average Household Size 2.45 2.38 2.37
2000 Owner Occupied Housing 1,531 21,690 54,504
2000 Renter Occupied Housing 336 5,194 12,160
2018 Owner Occupied Housing 2,143 25,842 61,964
2018 Renter Occupied Housing 552 7,440 16,006
2018 Vacant Housing 1,798 19,537 47,580
2018 Total Housing 4,493 52,819 125,550
2023 Owner Occupied Housing 2,279 27,603 65,179
2023 Renter Occupied Housing 531 7,039 15,208
2023 Vacant Housing 1,889 20,528 49,663
2023 Total Housing 4,699 55,171 130,050
2018-2023: Households: Growth Rate 4.20 % 4.00 % 3.05 %
Source: esri
Pequot Terrace Estates Demographic Charts | 19
5 Mile Radius 25 Mile Radius 50 Mile Radius
2018 Household Income
5 Mile Radius 25 Mile Radius 50 Mile Radius
2018 Population by Race
Pequot Terrace Estates Demographic Charts | 20
2018 Household Occupancy - 5 Mile Radius
Average Income Median Income
2018 Household Income Average and Median
Pequot Terrace Estates
in Association with:
Stratton Group, Keller Williams Southern ArizonaMarc LuetySales Associate [email protected]
powered by CREOP
Marketed By:
Keller Williams Commercial Midwest
Robert Bayer, MBA & CPA
MN License #40521537
