Jefferson Square Apartmets WORK THIS ONE...

JEFFERSON SQUARE APARTMENTS Duluth, Minnesota

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. © 2016

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.

JEFFERSON SQUARE APARTMENTS

Duluth, MN

P R E S E N T E D B Y

Dan Linnell

Vice President Investments

Director - National Multi Housing Group

Minneapolis Office

Tel: (952) 852-9770

Fax: (952) 852-9710

[email protected]

License: MN 40211216

Mox Gunderson

Associate Vice President Investments


Minneapolis Office

Tel: (952) 852-9713

Fax: (952) 852-9710

[email protected]

Licenses: MN 40237387, ND 8586

Josh Talberg

Senior Associate

Member - National Multi Housing Group

Minneapolis Office

Tel: (952) 852-9769

Fax: (952) 852-9710

[email protected]


Adam Haydon

Associate

Associate Member - National Multi Housing Group

Minneapolis Office

Tel: (952) 852-9745

Fax: (952) 852-9710

[email protected]


PROPERTY NAME

MARKETING TEAM


EXECUTIVE SUMMARYOFFERING PROCEDURE

4

Gunderson Linnell Talberg of Marcus & Millichap is pleased to offer for sale Jefferson Square Apartments, a 20-unit apartment asset with

additional commercial income source: Many Rivers Montessori, located in Duluth, Minnesota

Price: $2,150,000

Interest Offered:

Fee simple interest in Jefferson Square Apartments, 916 East 3rd Street, Duluth, Minnesota.

Offering Procedures:

Purchasers wishing to make an offer should submit:

• Letter of Intent (template available upon request)

• Proof of Funds and Banking References

• Resume (which includes a list of other investment real estate owned now or in the past)

At the time the Owners select a Purchaser, they will have considered a number of factors including: price, contingency time frame(s), track

record and the perceived ability of potential purchasers to complete the contemplated transaction. Therefore, interested purchasers are

encouraged to submit as much of the above as possible with the Letter of Intent.

All communication, inquiries and requests, including property tours, should be addressed to the Marcus & Millichap listing agents. Do not

directly contact the Owners or anyone at the property.

Tour Schedule:

• Tuesday, July 26th

• Thursday, July 28th

• Tuesday, August 2nd

• Thursday, August 4th

• Wednesday, August 10th

• Call for Offers: Thursday, August 11th by 5:00 PM CST

TABLE OF CONTENTS

SECTION

INVESTMENT OVERVIEW 01Offering Summary

Regional Map

Local Map

Aerial Photo

FINANCIAL ANALYSIS 02Rent Roll Summary

Rent Roll Detail

Operating Statement

Notes

Pricing Detail

Acquisition Financing

Growth Rate Projections

Cash Flow

MARKET COMPARABLES 03Comparables

Rent Comparables

MARKET OVERVIEW 04Demographic Analysis


JEFFERSON SQUARE

INVESTMENT

OVERVIEW

6


#

EXECUTIVE SUMMARY

OFFERING SUMMARY

MAJOR EMPLOYERS

EMPLOYER # OF EMPLOYEES

Essentia Health 7,880

Saint Mary’s Duluth Clinic 9,500

Comfort Systems 1,755

Saint Mary’s Medical Center 1,544

Saint Luke’s Hospital of Duluth 1,535

University of Minnesota Duluth 1,100

United Healthcare 950

County of Saint Louis 822

Decc 586

Duluth Missabe Iron Range Railway 550

Advanstar Communications Inc. 400

DEMOGRAPHICS

1-Miles 3-Miles 5-Miles

2015 Estimate Pop 15,843 45,778 76,558

2010 Census Pop 15,878 45,735 76,564

2015 Estimate HH 7,527 18,716 31,646

2010 Census HH 7,575 18,685 31,653

Median HH Income $25,941 $36,602 $43,318

Per Capita Income $18,391 $25,149 $26,717

Average HH Income $37,519 $57,034 $61,694

7

UNIT MIX

NUMBEROF UNITS

UNIT TYPEAPPROX.SQUARE FEET

6 1 Bed / 1 Bath 897

1 1 Bed / 1 Bath + Den 1,080

13 2 Bed / 1 Bath 1,031

20 Total 19,872*

* Additional 13,695 Square Feet Commercial Space

VITAL DATA

Price $2,150,000 CURRENT PRO FORMA

Down Payment 25% / $537,500 CAP Rate 6.90% 7.01%

Loan Amount $1,612,500 GRM 8.57 8.40

Interest Rate / Amortization 4.15% / 25 YearsNet Operating Income

$148,437 $150,708

Price/Unit $107,500Net Cash Flow After Debt Service

8.31% / $44,691.60 8.74% / $46,962.23

Price/SF $108 Total Return 15.30% / $82,227 15.72% / $84,498

Number of Units 20

Rentable Square Feet 19,872

Number of Buildings 1

Number of Stories 2

Year Built 1893


#

OFFERING SUMMARY

INVESTMENT HIGHLIGHTS

Built in 1893 | Renovated in 1985 into 20 Award Winning Apartment Homes

3 Blocks to Lake Superior | Easy Access to Interstate 35

Additional Income Through Commercial Lease to On-site Montessori School

CAP Rate of 6.9% | Potential Year 1 Total Return Over 15%

On behalf of Gunderson Linnell Talberg of Marcus & Millichap, we would like to introduce our newest listing, Jefferson Square Apartments; a Preservation Award winning

apartment building located in beautiful Duluth, Minnesota.

Situated on a sprawling one acre parcel near Lake Superior Jefferson Square was built in 1893 as a Duluth village school. In 1985, the property was converted into

apartments and now features 20 unique and distinctive floor plans. In addition, there is 13,695 rentable square feet of commercial space that is currently being leased by a

Montessori school, Many Rivers Montesorri. They are currently in discussion with current ownership in regard to an expansion of space and extension of the lease. Please

contact the Marcus & Millichap listing agent for the latest information.

Conveniently located near downtown Canal Park, The Lakewalk on Lake Superior, Jefferson Square Apartments are within close proximity to the many shops and

restaurants that Duluth has to offer. Residents of Duluth benefit from an exciting variety of residential, commercial, recreational, education, and entertainment-oriented

venues; attracting tech companies, medical providers, engineering, and all companies attracted to Duluth’s seaport setting. Furthermore, visitors from all over the world

travel to Duluth annually to participate in Grandma's Marathon, an annual weekend event that draws over 18,000 participants. Other area attractions include the Boundary

Waters Canoe Area, a popular destination for canoeing and fishing. It is one of the most visited wilderness areas in the United States with over 250,000 visitors annually.

Jefferson Square offers an investor the opportunity to step into a stabilized asset and take advantage of today's historically low interest rates and long-term debt. A

prospective purchaser may consider two very lucrative opportunities. The first is achieved through simply operating the asset in its current form, while placing more

emphasis on marketing and advertising, adjusting renewals and new residents to market rent, enhancing the going-in cash on cash return. The second is achieved through

upgrades to select units and common areas, which should generate further upside through average rent increases.

INVESTMENT OVERVIEW

8


#

OFFERING SUMMARY

PROPERTY OVERVIEW

Built in 1893 as a Duluth village school, Jefferson School was renovated into 20 unique and

distinctive apartment homes in 1985 which earned a Preservation Award. Each floor plan is

different but all offer large, open and inviting rooms with 10-foot ceilings. Oversized windows

flood the rooms with light for an airy feeling.

Jefferson Square Apartments consists of 6 one-bedroom/one-bathroom, one 1-bedroom/1-

bathroom + den, and thirteen 2-bedroom/1-bathroom units. The building is heated by gas

boiler heat.

In addition, there is 13,695 rentable square feet of commercial space that is currently being

leased by a Montessori school. They are currently in discussion with current ownership in

regard to an expansion of space and extension of the lease. Please contact the Marcus &

Millichap listing agent for the latest information.

9

Decorative, Original Woodwork

Common Area Amenities

Secured Garages

10-Foot Ceilings | Oversized Windows

Unit Amenities

Natural Woodwork | Built-ins

Individual, Unique Floor Plans

Off-street Parking

Large, Open Common Areas

Within Walking Distance to Lake Superior

Ceramic Tile


#

PROPERTY SUMMARY

OFFERING SUMMARY

10

THE OFFERING

Property Jefferson Square

Price $2,150,000

Property Address 916 E 3rd St,Duluth,MN

Zoning Multifamily

SITE DESCRIPTION

Number of Units 20

Number of Buildings 1

Number of Stories 2

Year Built/Renovated 1893 | 1985

Lot Size 0.98 Acres

Type of Ownership Fee Simple

Landscaping Mature

UTILITIES

Water Owner

Phone Tenant

Electric Tenant

Gas Owner

CONSTRUCTION

Foundation Concrete Block

Exterior Brick

Parking Surface Paved Lot

Roof Pitched Roof

MECHANICAL

Wiring Standard

Fire Protection Sprinkler System | Alarm

PROPOSED FINANCING

First Trust Deed

Loan Amount $1,612,500

Loan Type Proposed New

Interest Rate 4.15%

Amortization 25 Years

Loan Term 5 Years

Loan to Value 75%

Debt Coverage Ratio 1.43


#

PROPERTY SUMMARY

OFFERING SUMMARY

11


#

OFFERING SUMMARY

12

MANY RIVERS MONTESSORI - 13,695 SF


FINANCIAL

ANALYSIS

13

FINANCIAL ANALYSIS


RENT ROLL SUMMARY

14

#of AvgSq Rental Average Average Monthly Average Average MonthlyUnitType Units Feet Range Rent Rent/SF Income Rent Rent/SF Income1 Bed/ 1 Bath 6 897 725 ‐ 1028 $902 $1.01 $5,412 $902 $1.01 $5,4121 Bed/ 1 Bath + Den 1 1,080 ‐ $1,000 $0.93 $1,000 $1,000 $0.93 $1,0002 Bed/ 1 Bath 13 1,031 765 ‐ 1365 $1,115 $1.08 $14,498 $1,115 $1.08 $14,498Totals/WeightedAverages 20 994 $1,046 $1.05 $20,910 $1,046 $1.05 $20,910

GrossAnnualizedRents $250,920 $250,920

Scheduled Potential

1 Bed/ 1 Bath

30%

2 Bed/ 1 Bath

65%

1 Bed/ 1 Bath + Den

5%

Unit Distribution

FINANCIAL ANALYSIS


OPERATING STATEMENT

15

Income T12 Time0 Year1 Notes PerUnit PerSFGrossPotentialRent 250,895 250,920 258,448 [1] 12,922 13.01

Loss / Gain to Lease 0 0 0.0% (2,584) 1.0% [2] (129) (0.13)GrossScheduledRent 250,895 250,920 255,863 [3] 12,793 12.88PhysicalVacancy (5,314) ($11,291) 4.5% (11,514) 4.5% (576) (0.58)EconomicVacancy

Bad Debt (205) (753) 0.3% (768) 0.3% (38) (0.04)Concession (1,250) (502) 0.2% (512) 0.2% (26) (0.03)

TotalVacancy ($6,769) ($12,546) 5.0% ($12,793) 5.0% [4] ($640) ($1)EconomicOccupancy 95.00% 95.00%

EffectiveRentalIncome 244,126 238,374 243,070 12,153 12.23OtherIncome

Commercial Income 62,066 62,066 63,928 [5] 3,196 3.22Parking Income 17,030 17,030 17,541 [6] 877 0.88Laundry Income 4,790 4,790 4,934 [7] 247 0.25Late & NSF Fees 1,651 1,651 1,701 [8] 85 0.09Other Income 2,340 2,340 2,410 [9] 121 0.12

TotalOtherIncome $87,877 $87,877 $90,513 $4,526 $4.55EffectiveGrossIncome $332,003 $326,251 $333,583 $16,679 $16.79

Expenses T12 Time0 Year1 Notes PerUnit PerSFReal Estate Taxes 33,202 32,048 33,009 [10] 1,650 1.66Insurance 7,573 7,573 7,800 [11] 390 0.39Gas 11,219 11,219 11,556 [12] 578 0.58Electric 22,576 22,576 23,253 [13] 1,163 1.17Water & Sewer 13,916 13,916 14,333 [14] 717 0.72Waste Removal 7,760 7,760 7,993 [15] 400 0.40Maintenance & Repairs 7,113 7,113 7,326 [16] 366 0.37Cleaning & Supplies 1,631 1,631 1,680 [17] 84 0.08Contract Services 1,582 1,582 1,629 [18] 81 0.08Lawn & Snow 13,422 5,000 5,150 [19] 258 0.26Payroll Expense 27,989 27,989 28,829 [20] 1,441 1.45Legal & Accounting 2,717 2,717 2,799 [21] 140 0.14Advertising & Promotion 1,743 1,743 1,795 [22] 90 0.09Administrative 4,356 4,000 4,120 [23] 206 0.21Miscellaneous Expense 9,634 9,634 9,923 [24] 496 0.50Management Fee 16,438 16,313 16,679 [25] 834 0.84

TotalExpenses $182,871 $172,814 $177,875 $8,894 $8.95Expensesas%ofEGI 55.1% 53.0% 53.3%OperatingReserves $0 $5,000 $5,000 [26] $250 $0.25NetOperatingIncome $149,132 $148,437 $150,708 $7,535 $7.58Notes and assumptions to the above analysis are on the following page.

FINANCIAL ANALYSIS


NOTES

16

Notes to Operating StatementName Time0 Year1

[1] Gross Potential Rent

[2] Loss / Gain to Lease

[3] Gross Scheduled Rent[4] Total Vacancy

[5] Commercial Income[6] Parking Income [7] Laundry Income[8] Late & NSF Fees[9] Other Income[10] Real Estate Taxes[11] Insurance[12] Gas[13] Electric[14] Water & Sewer[15] Waste Removal[16] Maintenance & Repairs[17] Cleaning & Supplies[18] Contract Services[19] Lawn & Snow[20] Payroll Expense[21] Legal & Accounting[22] Advertising & Promotion[23] Administrative[24] Miscellaneous Expense[25] Management Fee[26] Operating Reserves

Based on Actual Figure from the Trailing 12-Month Profit & Loss Statement

Based on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss Statement

Reflects potential rents annualized as of the June 2016 Rent Roll Report.Determined by Gross Scheduled Rent Less Gross Potential RentReflects scheduled rents annualized as of the June 2016 Rent Roll Report.Projects a Total Vacancy of 5 percent; based on historical annual performance, market conditions and current leasing efforts.Based on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Taxes Payable 2016 according to the St. Louis County TreasurerBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss Statement

Based on Actual Figure from the Trailing 12-Month Profit & Loss Statement

Based on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Broker Estimate of $250 Per UnitBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementBased on Broker Estimate of $200 Per UnitBased on Actual Figure from the Trailing 12-Month Profit & Loss StatementManagement Fee estimated at 5 percent of Effective Gross Income (EGI)Based on Broker Estimate of $250 Per Unit.

3 Percent Increase from the Time 0 amountEstimated Loss to Lease of 1 Percent of Gross Potential Rent

Projects a Total Vacancy of 5 percent; based on historical annual performance, market conditions and current leasing efforts.3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the 2016 Real Estate Taxes3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amount3 Percent Increase from the Time 0 amountManagement Fee estimated at 5 percent of Effective Gross Income (EGI)Based on Broker Estimate of $250 Per Unit.

MARCUS & MILLICHAP CAPITAL CORPORATION

CAPABILITIES

MMCC—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

$4.9 billion

total national

volume in 2015

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 1,601

debt and equity

financings

in 2015

ACQUISITION FINANCING


17


MARKET

COMPARABLES

18

8


SALES COMPARABLES MAP

19


(SUBJECT)

Bridgeman Russell Building

1926 East 2nd Street

Les Chateaux

Heritage Apartments

SALES COMPARABLES

IN ESCROW COMPARABLES

ON MARKET COMPARABLES

1

2

3

4

PROPERTY NAME

MARKETING TEAM


COMPARABLES

rentpropertyname1

rentpropertyaddress1

rentpropertyname1


rentpropertyname1


20

SALES COMPARABLES IN ESCROW COMPARABLES ON MARKET COMPARABLES

rentpropertyname1


673 VISTA ISLE DRIVE

673 VISTA ISLE DRIVE, SUNRISE, FL, 33325


916 EAST 3RD STREET, DULUTH, MN, 55805

Units Unit Type

Offering Price: $2,150,000 6 1 Bed / 1 Bath

Price/Unit: $107,500 1 1 Bed / 1 Bath + Den

Price/SF: $108.23 13 2 Bed / 1 Bath

CAP Rate: 6.9%

Total No. of Units: 20

Year Built: 1893

10 WEST 1ST STREET, DULUTH, MN, 55802

Units Unit Type

Close Of Escrow: 9/16/2014 3 Studio / 1 Bath

Sales Price: $3,026,500 24 1 Bed / 1 Bath

Price/Unit: $97,629 4 2 Bed / 1 Bath

Price/SF: $85.00


Year Built: 1905

BRIDGEMAN RUSSELL BUILDING

1

1926 EAST 2nd STREET, DULUTH, MN, 55812

1926 EAST 2ND STREET

Units

Close Of Escrow: 7/2/2013 12

Sales Price: $895,000

Price/Unit: $74,583

Price/SF: $51.00


Year Built: 1964

2

PROPERTY NAME

MARKETING TEAM


COMPARABLES

rentpropertyname1


rentpropertyname1


rentpropertyname1


21

SALES COMPARABLES IN ESCROW COMPARABLES ON MARKET COMPARABLES

700 COMMONWEALTH AVENUE, DULUTH, MN, 55808

Units Unit Type

On Market 1 Studio / 1 Bath

List Price: $4,250,000 52 1 Bed / 1 Bath

Price/Unit: $69,672 8 2 Bed / 1 Bath

Price/SF: $105.00

Cap Rate: 6.95%


Year Built: 1976

HERITAGE APARTMENTS

4

* Please contact the Marcus & Millichap agent for further details.

Units Unit Type

In Escrow * 1 Studio 1 Bath

Total No. of Units: 141 59 1 Bdr 1 Bath

Year Built: 1969 28 2 Bdr 1 Bath

38 2 Bdr 1.5 Bath

15 3 Bdr 1.5 Bath

LES CHATEAUX

3

3800 LONDON ROAD, DULUTH, MN, 55804

8


RENT COMPARABLES MAP


(SUBJECT)

Lofts on Canal

Les Chateaux

Birkshire Apartments

Layfayette Apartments

Greysolon Apartments

4

7

8

9

11

20

12

14

15

16

17

13

18

10

4

1

2

3

5

22

PROPERTY NAME

MARKETING TEAM


RENT COMPARABLES


916 E 3RD ST, DULUTH, MN, 55805





23

YEAR BUILT: 1893


916 EAST 3rd STREET, DULUTH, MN, 55805

Unit Type Units SF Rent Rent/SF

1 Bed / 1 Bath 6 897 $902 $1.00

1 Bed / 1 Bath + Den 1 1,080 $1,000 $0.96

2 Bed / 1 Bath 13 1,031 $1,115 $1.08

Total/Wtd. Avg. 6 1,002 $1,005.74 $1.00

LES CHATEAUX3800 LONDON ROAD, DULUTH, MN, 55804

2


Studio / 1 Bath 1 525 $830 $1.59

1 Bed / 1 Bath 59 810 $929-$1,103 $1.26

2 Bed / 1 Bath 28 1,100 $1,310-$1,680 $1.36

2 Bed / 1.5 Bath 38 1,191 $1,328-$1,842 $1.34

3 Bed / 1.5 Bath 3 1,200 $1,474 $1.23

3 Bed / 1.5 Bath 12 1,875 $2,355-$2,437 $1.28

Total/Wtd. Avg. 24 1,117 $1,528.80 $1.34

OCCUPANCY: 95% | YEAR BUILT: 1969

COMMENTS COMMENTS COMMENTS

LOFTS ON CANAL20 SUTPHIN STREET, DULUTH, MN, 55802

OCCUPANCY: 70% | YEAR BUILT: 1886Newer Construction | Currently in Lease-up

1


1 Bed / 1 Bath 20 723 $1,143 $1.59

2 Bed / 1 Bath 1 849 $1,054 $1.25

2 Bed / 2 Bath 6 1,113 $1,554 $1.40

Total/Wtd. Avg. 9 895 $1,250 $1.40

PROPERTY NAME

MARKETING TEAM


RENT COMPARABLES

BIRKSHIRE APARTMENTS

731 E 1ST ST, DULUTH, MN, 55805





24

BIRKSHIRE APARTMENTS731 EAST 1ST STREET, DULUTH, MN, 55805


3

Unit Type Units Rent

2 Bed / 1 Bath 8 $1,100

Total/Wtd. Avg. 8 $1,100

LAYFAYETTE APARTMENTS815 EAST 1ST STREET, DULUTH, MN, 55805


4


1 Bed / 1 Bath 12 $595-$675

Total/Wtd. Avg. 12 $635

GREYSOLON APARTMENTS823 EAST 1ST STREET, DULUTH, MN, 55805

5


2 Bed / 1 Bath 18 $820

Total/Wtd. Avg. 18 $820


COMMENTS COMMENTS COMMENTS


MARKET

OVERVIEW

25

REGIONAL MAP


26

LOCAL MAP


27

AERIAL PHOTO


28


#

PROPERTY SUMMARY

29

Leif Erikson Park &The Rose Garden

Portland Park

Jefferson SquareApartm ents


#

Attractions

OFFERING SUMMARY

30

DULUTH, MINNESOTA

Duluth features a number of local attractions aimed to entertain both visitors and locals. Museums include the Duluth Art Institute and the Duluth’s Children

Museum. The city is also home to a professional ballet company, the Minnesota Ballet, as well as the Duluth Superior Symphony Orchestra. The soon to be

renovated NorShor Theatre will be a center for arts and entertainment in the downtown area, and will bring a wide variety of new performances from local,

regional, and national performers.

The Great Lakes Aquarium features animals and habitats found within the Great Lakes Basin and other freshwater ecosystems such as the Amazon River. The

aquarium houses 205 different species of fish, birds, reptiles, amphibians and mammals. It is one of few aquariums in the United States that focuses on

freshwater exhibits.

The Lake Superior Zoo offers year-round recreational activities and features animals from around the world, including Amur tigers, snow leopards, African lions,

brown bears, kangaroos, and gray wolves, plus a variety of birds, reptiles, primates and barnyard animals.

Canal Park is one of the primary recreation-oriented district of Duluth. It is largely a conversion of an old warehouse district into restaurants, cafés, hotels, and

shops, especially those dealing in antiques and other novelties. Some of Canal Park’s attractions include a 4.2 mile long lakewalk that offers a view of Park

Point’s extensive sandy dunes and beaches. Visitors can also view the lighthouse pier, and visit the Lake Superior Maritime Visitor Center, the Great Lakes

Aquarium, and the William A. Irvin floating ship museum.

Recreation

In 2014, Duluth won Outside magazine’s “Best Town 2014” tournament.

The city offers numerous outdoor activities including golf, fishing, hiking, skiing, sailing, canoeing, kayaking, and both biking and mountain biking. The city is also

the starting point for trips into the Boundary Waters Canoe Area Wilderness and Minnesota’s North Shore, popular camping destinations highlighted by rocky

cliffs, waterfalls, cobblestone beaches, glacials lakes, rolling hills, scenic rivers, and ridges covered in boreal forest inland from the lake.

The 1.3 million acre Boundary Waters Canoe Area Wilderness is one of the most visited wilderness areas in the United States, attracting over 250,000 visitors per

year. In 2011, Forbes ranked it number 6 in “America’s Best Wilderness Escapes.”


#

Economy

OFFERING SUMMARY

31

DULUTH, MINNESOTA

Duluth is the major regional center for health care, higher education, retail, and

business services not only of its own immediate area but also of a larger area

encompassing northeastern Minnesota, northwestern Wisconsin, and the

western Upper Peninsula of Michigan.

Duluth has attracted several new engineering firms including TKDA, Barr

Engineering, LHB, Enbridge and Lake Superior Consulting.

In recent years it has seen strong growth in the transshipment of wind turbine

components coming and going from manufacturers in both Europe and North

Dakota and of oversized industrial machinery manufactured all around the world.

Duluth’s economy grows stronger every year. In a recent article by Finance and

Commerce, projects in Duluth will have amassed over $2 billion in public and

private investments by 2016. The economic outlook is promising as aviation,

education, healthcare, engineering, and information technology companies

continue to add new jobs.

Education

Duluth is home to the University of Minnesota Duluth (UMD). Founded in 1902,

the school is a regional branch of the University of Minnesota system. It has a

current enrollment of 10,000 students and offers 14 bachelor’s degrees in 85

majors, and graduate programs in 27 different fields including a Medical

School, Pharmacy program, and Doctor of Education program.

Other colleges and universities include The College of St. Scholastica, Lake

Superior College, and Duluth Business University. The University of Wisconsin -

Superior is in nearby Superior, Wisconsin.

Duluth is also a major center for aquatic biology and aquatic science. The city is

home to the EPA's Mid-Continent Ecology Division Laboratory and the

University of Minnesota-Duluth. These institutions have spawned many

economically and scientifically important businesses that support Duluth's

economy.

nawwindpower.com gwinnettmedicalcenter.org

d.umn.eduupak.com


#

Employers

OFFERING SUMMARY

32

DULUTH, MINNESOTA

Principal manufacturing firms in Duluth include heavy and light manufacturing plants, food processing plants, woolen mills, lumber and paper mills, cold storage

plants, fisheries, grain elevators, and oil refineries. The city is also a regional center for banking, retailing, and medical care for northern Minnesota, northern

Wisconsin, northern Michigan, and northwestern Ontario, Canada. More than 8,000 jobs in Duluth are directly related to the hospital industry. Arts and entertainment

offerings as well as year-round recreation in a natural environment have contributed to expansion of the tourist industry in Duluth. Some 3.5 million visitors each year

contribute $400 million to the local economy.

Duluth boasts an abundant, quality workforce, as well as a commitment to bringing new and expanded job opportunities into the community. Minnesota has the

highest high school graduation rate in the nation; more than 70 percent of Duluth students go on to college or post-secondary education.

A vital part of the Duluth economy is the Port of Duluth-Superior, which is designated a Foreign Trade Zone and ranks among the top ports in the country in total

volume of international and domestic cargo shipped in a 10-month season. An average of 40 million tons of cargo is handled at Duluth-Superior each year. The

impact on the local economy is $200 million annually, and some 2,000 jobs are dependent on the port. Duluth-Superior operates one of the largest grain-handling

facilities in the world. Grain is the primary export product; domestic shipments consist mainly of iron ore and taconite, in addition to metal products, twine,

machinery, coal, cement, salt, newsprint, lumber, and general cargo.

Connecting the port and the city of Duluth with inland markets are five railroads and more than 25 common motor freight carriers. Air cargo carriers serving Duluth

International Airport with daily flights are Federal Express, United Parcel Service, and Delta Airlines.

Skilled employees, quality of life and a diverse economy allow for a stable job base. The metro boasts a well-educated labor pool, with approximately 94 percent of

the population age 25 and older attaining a high-school diploma. It also ranks highly for its percentage of population age 25 and older with at least a bachelor’s

degree, at 38 percent. There are more than 20 institutions of higher learning in the metro, providing education and training to keep the local labor force among the

most skilled in the country. The local economy is supported by 1.9 million jobs in a wide range of sectors. Over the next five years, employment in the metro is

expected to grow by 1.2 percent annually, slightly lower than the U.S. average.

Another 16 percent, or 317,100 jobs, in the metro are in the education and health services sector, which is expected to expand by 2.1 percent annually through 2020.

The professional and business services sector also provides 16 percent of the workforce, or 314,300 jobs, and will record growth at 2.7 percent annually during this

time.

Sources: MN.Gov/Deed, City-Data.com

visitduluth.com

PROPERTY NAME

MARKETING TEAM


DEMOGRAPHICS

Source: © 2015 Experian

Created on July 2016

POPULATION 1 Miles 3 Miles 5 Miles

2020 Projection

Total Population 15,757 45,806 76,870

2015 Estimate


2010 Census


2000 Census


Daytime Population

2015 Estimate 23,987 78,082 106,430

HOUSEHOLDS 1 Miles 3 Miles 5 Miles

2020 Projection

Total Households 7,517 18,857 32,030

2015 Estimate


Average (Mean) Household Size 2.03 2.15 2.23

2010 Census


2000 Census


Growth 2015-2020 -0.13% 0.75% 1.21%

HOUSING UNITS 1 Miles 3 Miles 5 Miles

Occupied Units

2020 Projection 7,517 18,857 32,030

2015 Estimate 8,280 20,210 33,824

Owner Occupied 2,029 8,299 17,935

Renter Occupied 5,498 10,416 13,711

Vacant 753 1,494 2,178

Persons In Units

2015 Estimate Total Occupied Units 7,527 18,716 31,646

1 Person Units 45.04% 39.59% 35.55%

2 Person Units 29.52% 31.75% 33.46%

3 Person Units 11.92% 12.77% 13.74%

4 Person Units 7.96% 9.51% 10.55%

5 Person Units 3.31% 4.26% 4.52%

6+ Person Units 2.26% 2.12% 2.17%

HOUSEHOLDS BY INCOME 1 Miles 3 Miles 5 Miles

2015 Estimate

$200,000 or More 0.66% 2.77% 2.76%

$150,000 - $199,000 0.96% 2.81% 3.08%

$100,000 - $149,000 3.66% 7.58% 9.23%

$75,000 - $99,999 5.61% 8.79% 10.21%

$50,000 - $74,999 12.45% 16.13% 18.92%

$35,000 - $49,999 13.56% 13.52% 13.77%

$25,000 - $34,999 14.8% 11.99% 10.7%

$15,000 - $24,999 18.87% 15.29% 13.87%

Under $15,000 29.44% 21.12% 17.45%

Average Household Income $37,519 $57,034 $61,694

Median Household Income $25,941 $36,602 $43,318

Per Capita Income $18,391 $25,149 $26,717

POPULATION PROFILE 1 Miles 3 Miles 5 Miles

Population By Age

2015 Estimate Total Population 15,843 45,778 76,558

Under 20 17.84% 22.67% 23.31%

20 to 34 Years 43.97% 34.64% 29.16%

35 to 39 Years 5.01% 4.39% 4.96%

40 to 49 Years 9.25% 9.12% 10.42%

50 to 64 Years 15.36% 16.57% 18.45%

Age 65+ 8.56% 12.65% 13.68%

Median Age 27.15 28.82 32.95

Population 25+ by Education Level

2015 Estimate Population Age 25+ 8,857 25,959 47,113

Elementary (0-8) 2.39% 1.59% 1.42%

Some High School (9-11) 6.44% 5.32% 5.14%

High School Graduate (12) 26.38% 23.29% 25.22%

Some College (13-15) 26.16% 23.14% 22.98%

Associate Degree Only 9.69% 9.04% 9.62%

Bachelors Degree Only 18.93% 23.58% 22.94%

Graduate Degree 9.44% 13.27% 12.08%

Population by Gender

2015 Estimate Total Population 15,843 45,778 76,558

Male Population 51.74% 49.81% 49.55%

Female Population 48.26% 50.19% 50.45%

33

Income

In 2015, the median household income for your selected geography is

$25,941, compare this to the US average which is currently $54,148.

The median household income for your area has changed by 16.80%

since 2000. It is estimated that the median household income in your

area will be $28,618 five years from now, which represents a change

of 10.32% from the current year.

The current year per capita income in your area is $18,391, compare

this to the US average, which is $29,638. The current year average

household income in your area is $37,519, compare this to the US

average which is $77,468.

Population

In 2015, the population in your selected geography is 15,843. The

population has changed by -1.72% since 2000. It is estimated that

the population in your area will be 15,757.00 five years from now,

which represents a change of -0.54% from the current year. The

current population is 51.74% male and 48.26% female. The median

age of the population in your area is 27.15, compare this to the US

average which is 37.55. The population density in your area is

5,027.52 people per square mile.

Households

There are currently 7,527 households in your selected geography. The

number of households has changed by -3.64% since 2000. It is

estimated that the number of households in your area will be 7,517

five years from now, which represents a change of -0.13% from the

current year. The average household size in your area is 2.03 persons.

Employment

In 2015, there are 22,853 employees in your selected area, this is also

known as the daytime population. The 2000 Census revealed that

62.23% of employees are employed in white-collar occupations in

this geography, and 37.88% are employed in blue-collar occupations.

In 2015, unemployment in this area is 7.28%. In 2000, the average

time traveled to work was 17.00 minutes.

Race and Ethnicity

The current year racial makeup of your selected area is as follows:

81.12% White, 5.84% Black, 0.05% Native American and 2.34%

Asian/Pacific Islander. Compare these to US averages which are:

70.98% White, 12.77% Black, 0.19% Native American and 5.25%

Asian/Pacific Islander. People of Hispanic origin are counted

independently of race.

People of Hispanic origin make up 2.42% of the current year

population in your selected area. Compare this to the US average of

17.53%.

PROPERTY NAME

MARKETING TEAM


Housing

The median housing value in your area was $136,966 in 2015,

compare this to the US average of $185,104. In 2000, there were

2,594 owner occupied housing units in your area and there were

5,217 renter occupied housing units in your area. The median rent at

the time was $405.

Source: © 2015 Experian

DEMOGRAPHICS

34

www.MarcusMillichap.com

Dan Linnell

Vice President Investments


Minneapolis Office

Tel: (952) 852-9770

Fax: (952) 852-9710

[email protected]


Mox Gunderson

Associate Vice President Investments


Minneapolis Office

Tel: (952) 852-9713

Fax: (952) 852-9710

[email protected]

Licenses: MN 40237387, ND 8586

Josh Talberg

Senior Associate

Member - National Multi Housing Group

Minneapolis Office

Tel: (952) 852-9769

Fax: (952) 852-9710

[email protected]


Adam Haydon

Associate

Associate Member - National Multi Housing Group

Minneapolis Office

Tel: (952) 852-9745

Fax: (952) 852-9710

[email protected]


P R E S E N T E D B Y

Jefferson Square Apartmets WORK THIS ONE...

Documents

Transcript of Jefferson Square Apartmets WORK THIS ONE...