Post on 26-Aug-2020
v 3966W. 6TH STREETLOS ANGELES, CA 90020
Marcus & Millichap has been selected to exclusively market 3966 West Sixth Street, ideally located on the southeast corner of West Sixth Street and South Manhattan Place in prime Koreatown.
The offering consists of a ~9,187 square-foot multi-tenant retail building currently ~75% occupied by tenants on short term or month-to-month leases paying far below market rents. This creates an opportunity for an investor to realize tremendous immediate upside through making improvements and stabilizing the asset at market rents. Further, the attractive zoning and Tier 4 TOC designation (Buyer to verify) makes this ~10,964 square-foot corner lot a viable redevelopment site.
Koreatown is one of the most rapidly developing submarkets within Los Angeles, with the majority of the development activity centered around the Wilshire corridor. Within a quarter-mile radius of 3966 West 6th Street, there are over 15 major redevelopments planned or currently under-construction, including over 1,500 new apartment and condo units, over 500 hotel rooms, and north of 100,000 square-feet of new commercial space.
3966 West 6th Street sits within walking distance from some of Koreatown’s most popular restaurants, bars, and retailers. The property boasts excellent visibility along West 6th Street in a densely populated area (over 100,000 people within 1 mile and over 630,000 people within 3 miles) and high traffic counts exceeding 60,000 cars per day at the intersection of 6th and Western.
EXECUTIVE SUMMARY
PROPERTY SUMMARY
Address 3966 W. 6th Street, Los Angeles, CA 90020
Price $3,800,000
ProForma CAP Rate 5.45%
Price/SF (bldg) $413.63
Price/SF (land) $346.59
Bldg SF 9,187 SF
Land SF 10,964 SF
APN 5503-031-008
Year Built 1921
Type of Ownership Fee Simple
Within a quarter mile radius of 3966 West 6th Street, there are over 15 major redevelopments planned or currently under-construction.
3966 W. 6th Street
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ADDRESS
3966 W. 6th Street, Los Angeles, CA 90020
SITE
The subject property is located on the southeast corner of W. 6th Street and S. Manhattan Place.
SQUARE FOOTAGES
The Subject Property consists of retail building consisting of 9,187 SF on a 10,964 SF lot.
FRONTAGE AND ACCESS
Access is from W. 6th Street and S. Manhattan Place. 150 feet of frontage on W 6th Street.
YEAR BUILT
The property was built in 1921.
TRAFFIC COUNTS
Over 65,000 cars per day at the intersection of 6th & Western
ZONING
C2-1
• Value-add investment opportunity in Prime Koreatown
• All tenants on short term leases or month-to-month
• 10,964 square-foot corner lot zoned C2-1, Tier 4 TOC (Buyer to verify)
• Area benefiting from rapid growth – subject property surrounded by multiple major redevelopments
• Over 1.2 million people within 5 miles
• Over 630,000 people within 3 miles
• Excellent visibility and frontage along W 6th St, Walk Score of 97 “Walker’s Paradise”
INVESTMENT HIGHLIGHTS
PROPERTY INFORMATION
MW
estern Avenue
S. Manhattan Place
W. 6th Street
Wilshire/Western Station CVS
The Wiltern
Wilshire Boulevard
3966W. 6TH STREETLOS ANGELES, CA 90020
WALK SCORE 97/100
VERY WALKABLE
Most errands can be accomplished on foot
GOOD TRANSIT
Many nearby public transportation options
including the Metro Purple Line, which connects to
Downtown LA
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TENANT SF % EXP RENT RENT/SF PRO FORMA RENT PROFORMA RENT/SF
3966 1,242 13% VACANT - - $2,484.00 $2.00
3968 1,055 11% M2M $650.00 $0.62 $2,110.00 $2.00
3970 1,055 11% M2M $850.00 $0.81 $2,110.00 $2.00
3972 1,055 11% M2M $900.00 $0.85 $2,110.00 $2.00
3974 1,055 11% VACANT - - $2,110.00 $2.00
3976 1,055 11% M2M $750.00 $0.71 $2,110.00 $2.00
3978 1,055 11% M2M $700.00 $0.66 $2,110.00 $2.00
3980 1,645 18% M2M $1,200.00 $0.73 $3,290.00 $2.00
Total 9,217 100% $5,050.00 $0.92 $18,434.00 $2.00
Vacancy 25%
INCOME AND EXPENSE
Scheduled Lease Income: $221,208
NNN Charges: $63,351
Effective Gross Income: $284,559
Vacancy (5%): $14,228
Expenses: $63,351
Net Operating Income: $206,980
EXPENSES ANNUAL
Taxes 1.25% $47,500
Insurance $6,048
LADWP $2,913
Repairs & Maintenance $4,594
Reserves $2,297
Total Expenses: $63,351
Expenses Per SF $6.90
FINANCIALSRENT ROLL
ANNUALIZED OPERATING DATA W. 6TH STREETPRICING
Price $3,800,000
Bldg SF 9,187 SF
Land SF 10,964 SF
ProForma CAP Rate 5.45%
Price/SF (bldg) $413.00
Price/SF (land) $347.00
M
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# ADDRESS SALES PRICE PRICE/SF (BLDG) BLDG SF LOT SF LOT SF/
LANDCLOSE OF ESCROW
YEAR BUILT
1 4051-4059 W. 3rd Street, Los Angeles $3,975,000.00 $530.28 7,496 15,246 $260.72 6/30/2017 1979
2 4355 W. 3rd Street, Los Angeles $3,305,000.00 $319.82 10,334 10,454 $316.13 9/30/2016 1931
3 4416-4430 Beverly Boulevard, Los Angeles $4,625,000.00 $469.54 9,850 26,572 $174.06 8/22/2016 1965
4 3031 W. Olympic Boulevard, Los Angeles $1,950,000.00 $450.97 4,324 4,323 $451.08 In Escrow 1960
5 3600 W. Olympic Boulevard, Los Angeles $4,180,000.00 $481.23 8,686 9,583 $436.18 3/12/2018 2007
6 941 S. Vermont Avenue, Los Angeles $2,700,000.00 $356.44 7,575 16,335 $165.29 6/5/2017 1928
7 3019-3023 W. 6th Street, Los Angeles $1,185,000.00 $489.67 2,420 4,792 $247.29 8/16/2018 1933
8 3065 W. 8th Street, Los Angeles $8,150,000.00 $709.56 11,486 22,142 $368.08 5/31/2018 1968
Average $3,758,750.00 $475.94 7,771 13,681 $302.35 1959
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SALES COMPARABLES
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# ADDRESS RENTAL RATE/YR
RENTAL RATE/MO LEASE TYPE SPACE AVAIL BLDG SF YEAR BUILT
1 3923 W. 6th Street, Los Angeles $36.00 $3.00 NNN 1,200 31,914 1926
2 3801-3813 W. 3rd Street, Los Angeles $27.60 $2.30 NNN 1,750 11,000 1924
3 3469-3473 W. 8th Street, Los Angeles $27.96 $2.33 NNN 1,030 3,390 1948
4 4355-4365 W. 3rd Street, Los Angeles $38.40 $3.20 MG 900 10,334 1931
5201-207 S. Western Avenue, Los Angeles
$30.00 $2.50 NNN 1,810 11,016 1923
6 400 S. Western Avenue, Los Angeles $30.00 $2.50 NNN 1,559 16,337 1930
Average $31.66 $2.64 1,375 13,999 1930
RENT COMPARABLES
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# ADDRESS DESCRIPTION
1 500 S Oxford Avenue Seven story, 89 unit condo redevelopment on the southeast corner of Oxford and Fifth Street
2 4000 W 6th Street Six story mixed-use redevelopment including 44 apartments plus retail replacing an existing gas station
3 3751 W 6th Street Mixed-use project to include 200 hotel rooms, 44 apartments, and 18,000 square-feet of commercial space
4 3800 W 6th Street 20-floor mixed-use redevelopment including 192 hotel rooms, 122 condos, and 15,200 square-feet of commercial space
5 3663 Wilshire Boulevard The Wilshire Boulevard Temple expansion set to include a ballroom, meeting rooms, and landscaping by local firm Studio-MLA
6 Pio Pico Pocket Park The Pio Pico brand of the LA Public Library would move the existing surface parking lot underground to make way for a small new park
7 635 S Western Avenue 132 apartments and 900 square-feet of retail space proposed to be constructed atop an existing parking structure
8 640 S St. Andrews Place 227 units of housing proposed alongside the historic Wilshire Professional Building
9 3921 Wilshire Blvd. Plans for an existing office building to be converted into 100 apartment units plus retail space
10 3980 Wilshire Blvd. A seven story mixed-use projects including 228 residential units and nearly 16,500 square-feet of commercial space
11 3700 Wilshire Blvd. Original plans for a 36-story mixed-use development including over 500 residential units and 62,000 square-feet of commercial space
12 670 S Harvard Plans for a 110-room hotel with restaurant and street-level retail
13 700 S Manhattan Place Expected to open next year, 160 residential units and 10,300 square-feet of commercial space
14 731 S Oxford Avenue An existing 30-unit apartment complex to be replaced by a 92-unit project
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NEARBY KOREATOWN DEVELOPMENTS
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KOREATOWN
Koreatown is a neighborhood in Central Los Angeles, California, centered near Eighth Street and Western Avenue. Koreans began immigrating in larger numbers in the 1960s and found housing in the Mid-Wilshire area. Many opened businesses as they found rent and tolerance towards the growing Korean population. Many of the historic Art deco buildings with terra cotta facades have been preserved because the buildings remained economically viable for the new businesses.
It is the most densely populated district by population in Los Angeles County, with some 120,000 residents in 2.7 square miles. Despite the name evoking a traditional ethnic enclave, the community is complex and impacts areas outside the traditional boundaries. While the neighborhood culture has historically been oriented to the Korean immigrant population, Korean business owners are creating stronger ties to the Latino community in Koreatown. The community is highly diverse ethnically, with half the residents being Latino and a third being Asian. Two-thirds of the residents were born outside of the United States, a high figure compared to the rest of the city. Olympic Boulevard has blocks dominated by Korean-language signs and new blue-tile-roofed shopping centers. This initial Korean business area has spread to an area bounded by Olympic Boulevard, Vermont Avenue, 8th Street and Western Avenue. The Korean business area also sprawls to the north and south along Western and Vermont for three miles, and to the east and west along Olympic for two miles. South Korean investment has been a large contributor to the neighborhood economy since the 1960s. Since the early 2000s, that investment has increased greatly, ballooning to an estimated $1 billion in new construction investment. The area also has a vibrant nightlife with many lively restaurants and clubs, especially Korean barbecue restaurants and karaoke bars.
WALK SCORE 97/100 METRO PURPLE LINE
DEMOGRAPHICS
1 MILE 3 MILES 5 MILES2014 Population 100,163 639,077 1,164,1512014 Households 39,771 254,820 464,4502014 Average Household Size 2.51 2.46 2.412014 Daytime Population 31,708 210,010 607,611
2014 Owner Occupied Housing Units 11.84% 13.24% 19.85%2014 Renter Occupied Housing Units 88.16% 86.76% 80.15%2014 Vacant 3.86% 3.26% 3.43%
2014 Median Household Income $33,056 $33,532 $35,8752014 Per Capita Income $21,005 $23,019 $25,8942014 Average Household Income $52,703 $56,887 $63,309
VERY WALKABLE
Most errands can be accomplished on foot
GOOD TRANSIT
Many nearby public transportation options
including the Metro Purple Line, which connects to
Downtown LA
AREA OVERVIEW
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vANDREW LEFFSenior AssociateDirector, National Retail GroupTel: (818) 212-2815Fax: (818) 212-2710andrew.leff@marcusmillichap.comLicense: CA #01865688