Multi-Family Investment Offering 1925 Century Park East Suite 2350 Los Angeles, CA 90067 Direct 310.312.1800 Fax 310.312.1801 Lic. #01201641

1342-46 Ocean Park Boulevard Santa Monica, CA 90405

Large Leveraged Seller Financing

Exclusively offered by Charles Dunn Company, Inc. Kimberly Roberts Stepp Senior Managing Director (310) 492-8402 License #: 01251767 Soledad Jothier Associate (310) 492-8411 Lic. #01932252

Property Photographs

1342-46 Ocean Park Blvd. Santa Monica, CA 90405

2

These materials are based on information and content provided by others which we believe are accurate. No guarantee, warranty or representation is made by the Charles Dunn Company or its personnel, and all interested parties must independently verify its accuracy and completeness. As well, any projections, assumptions, opinion, or estimates are used for example only and do not represent the current or future performance of the identified property. Your tax, financial, legal and toxic substance advisors should conduct a careful investigation of the property and its suitability for your needs, including land use limitations. The property is subject to prior lease, sale, change in price, or withdrawal from the market without notice :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

Financial Summary Tenant Summary Rent with $14.58 pass Market Rents thru to Tenant

Unit #

Bed/Bath

Current Rent

1342-1

1/1

$ 1,538

$ 1,552.58

$ 1,850

1342-2

1/1

$ 1,680

$ 1,694.58

$ 1,850

1342-3

1/1

$

$

754.58

$ 1,850

1342-4

1/1

$ 1,588

$ 1,602.58

$ 1,850

1346-1

1/1

$ 1,500

$ 1,500.00

$ 1,850

1346-2

1/1

$ 1,600

$ 1,614.58

$ 1,850

1346-3

1/1

$ 1,680

$ 1,694.58

$ 1,850

1346-4

1/1

$ 1,772

$ 1,786.58

$ 1,850

753

Monthly Rental Income

$ 12,098

$ 12,200

$ 14,800

Laundry Income

$

$

125

$

125

$

400

$

400

Total Monthly Garage Income (2x$200)

125 $ 400

Total Monthly Income

$ 12,623

$ 12,725

$ 15,325

Scheduled Annual Income

$151,632

$152,701

$183,900

Comment

Includes 2 Garages

*In order to obtain the market rents, units must be renovated * *21% Upside in Rents

1346-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

3

Property Information Property Description

Charles Dunn Company, Inc., has been exclusively retained by the owner in connection with the sale of 1342 Ocean Park Blvd, an 8 unit multi-residential property located in the Santa Monica neighborhood of Los Angeles. The offering represents an opportunity to purchase the fee simple interest in an asset with the potential to reposition it by increasing rents and the cash flow. Site Name and Address

1342-46 Ocean Park Blvd Santa Monica, CA 90405

Assessor’s Parcel Number

4285-003-010 & 011

Property Type

Multi-family

Offering Price

$3,000,000

Cap Rate

3.55%

Price Per Unit/Price Per Gross Square Foot

$375,000 / $591

Number of Buildings/Stories

2 buildings / 1 story

Number of Units

8

Unit Mix

8-1/1

Approximate Building Area (Gross)

5,072 ± S.F.

Construction

Wood Frame / Stucco

Utilities

All units separately metered

Year Built

1940 / 1941

Approximate Lot Size

100’ x 140’ (13,974 ± S.F.)

Zoning

SMR-3

Offering Highlights

•

First time on the market in over 40 years.

•

Large double lot of over 13,500 +/- Sq. Ft.

•

Property is beautifully manicured with artificial grass & designed landscaping with central fountain and front gate.

•

Courtyard-style property with private entrances.

•

24 Hour Camera – secured property.

•

8 Private Garages

•

Close proximity to Main Street shops and restaurants, Santa Monica Pier and Beach.

Seller will carry 1st T.D. at negotiable rate and terms

1346-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

4

Financial Summary Expenses

The future income and expenses of the Property may vary significantly during Buyer’s ownership. Buyer shall rely on Buyer’s expertise to project the future income and expense of the Property

Expenses Property Taxes (1.25% Tax Rate)

$ 37,500

Water, Sewer & Trash

$ 3,200

Electricity

$

Landscape Service

$ 1,200 (est.)

800

Management (Off-Site) (4%) Pest Control

$

600 (est.)

Business License

$

192

Rent Control Fee

$ 1,400

Repairs & Maintenance

$ 5,000 (est.)

TOTAL EXPENSES

$ 49,892

Janitorial Service ($150/mo.)

32.6% of Scheduled Income $6,237/Unit $9.84/Bldg. S.F.

1346-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

5

Property Photographs

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

6

Property Information Parcel Map

APN: 4285-003-010 & 011

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

7

Property Information

Subject Property: 1342-1346 Ocean Park Blvd., Santa Monica, CA 90405

Location Maps

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

8

Property Information

Subject Property: 1342-1346 Ocean Park Blvd., Santa Monica, CA 90405

Aerial Maps

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

9

Market Overview Snapshot

TOTAL POPULATION

93,161

POPULATION CHANGE

7.6% (2000-2012)

AREA

8.57 square miles (Land Area)

PERSONS PER HOUSEHOLD

1.9

AVERAGE HOUSEHOLD INCOME

$105,547 25 Years of Age or Over:

EDUCATION

High School Graduates……. 10.7% Bachelor Degree….............. 35.7%

Santa Monica is a beachfront city in western Los Angeles County, California. It is located on the Santa Monica Bay, surrounded by the city of Los Angeles on three sides. It borders Pacific Palisades on the northwest, Brentwood on the north, West Los Angeles on the northeast, Mar Vista on the east and Venice on the southeast. Santa Monica had become a famous resort town by the early 20th century because of its agreeable climate. Since the late 1980s, the city has been growing rapidly due to a significant increase in jobs and tourism. TRANSPORTATION Freeways/Highways: The Santa Monica Freeway (Interstate 10) and State Route 2 begin in Santa Monica. The Santa Monica Freeway between Santa Monica and downtown Los Angeles has the distinction of being one of the busiest highways in all of North America. Santa Monica is also the western (Pacific) terminus of historic U.S. Route 66. Just east of Santa Monica is Interstate 405, the "San Diego Freeway," a major north-south route in between Los Angeles County and Orange County, California. Public Transportation: The city of Santa Monica runs the Big Blue Bus, which also serves much of West Los Angeles and the University of California at Los Angeles (UCLA). Santa Monica is also served by the Los Angeles County Metropolitan Transportation Authority's bus lines. The Exposition Line from Culver City to Santa Monica is currently under construction and is planned to begin service in 2015. Airport and ports: The city owns and operates Santa Monica Airport, a general aviation airport. Like other cities in Los Angeles County, Santa Monica is dependent upon the Port of Long Beach and the Port of Los Angeles for international ship cargo. Bicycles: Santa Monica received the Bicycle Friendly Community Award (Bronze) by the League of American Bicyclists in 2009.

1346-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

10

Market Overview Area Highlights

With its excellent economic and demographic fundamentals, Santa Monica is on the Nation’s shortlist for the most desirable locations for residents, companies, and retailers. Santa Monica’s warm climate, scenic ocean border, and ease of access to the rest of Los Angeles, attracts the best and the brightest. Premier amenities such as fine dining and high-end retail span the entirety of the City’s various neighborhoods, making it a top destination for tourists and Los Angeles indwellers. Quite simply, Santa Monica represents all the best that Southern California has to offer. Serviced by two major freeways— Interstates 405 and 10—and four major thoroughfares, Santa Monica is just minutes away from other notable business and retail areas such Beverly Hills, Century City, and Brentwood. The eclectic Venice district is a next door neighbor. And with Downtown Los Angeles a mere 16 miles away to the east, there really is no downside to enjoying Santa Monica’s prime beach location. Getting around Santa Monica is even easier. With an award winning public transportation system, pedestrian-friendly terrain, and an abundance of parking structures, going from one neighborhood to the next is guaranteed to be convenient. Santa Monica’s 8.3 square miles is composed of a diverse mix of lively neighborhoods, many of which are designated “Business Improvement Districts” (BID). In a cooperative effort between The City of Santa Monica and several private organizations, great care has been taken to ensure that the City is an exceptional place to live, work, and play. 1346-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

11

Market Overview

Santa Monica’s coastal climate provides an ideal atmosphere for

Economy

entertainment companies, restaurants and retail shops have migrated to Santa Monica due to the diverse business economy.

taking advantage of the famous California lifestyle. Many businesses, high profile corporate headquarters, large hi-tech

Santa Monica is home to many notable businesses, including Universal Music Group, Lionsgate Firms, Macerich, MTV and Playtone Company. A number of computer and internet companies and game development studios are also based in Santa Monica, making it a major location for the technology sector.

These companies include Yahoo!, Microsoft, Activision Blizzard, SCE Studios Santa Monica and Riot Games. TOP EMPLOYERS According to the City’s most recent Comprehensive Annual Financial Report, the top employers for the city are: #

EMPLOYER

# OF EMPLOYEES

1

City of Santa Monica

2,528

2

Santa Monica College

2,086

3

Saint John’s Health Center

1,796

4

Santa Monica – UCLA Medical Center

1,780

5

Santa Monica – Malibu Unified School District

1,500

6

RAND Corporation

894

7

Universal Music Group

850

8

Beachbody

704

9

Activision Blizzard

692

10

ET Whitehall (Shutters and Casa Del Mar)

534

DEMOGRAPHICS Based on Pitney Bowes Business Insight, the population in 2012 is estimated to be 93,161 for Santa Monica, California. The racial and ethnic composition is comprised of 77.4% White, 3.9% African American, 9.0% Asian/Pacific Islander, 0.4% Native American and 9.3% other races (including 2+ races). 9.8% respondents of all races claimed Hispanic or Latino ethnicity.

1346-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

12

Market Overview Notable Locations

The Third Street Promenade is a public entertainment venue in the downtown area of Santa Monica, California and is considered a premier shopping and dining district on the Westside, attracting crowds from all over Los Angeles County. Its proximity to the Pacific Ocean coupled with Los Angeles's mild climate makes it a popular tourist destination. Classical guitar players, magicians, clowns, hip-hop dancers, lounge singers, session drummers, and other artists line up approximately 40 to 50 feet (15m) apart from each other all along Third Street. The Santa Monica Pier is a large double-jointed pier located at the foot of Colorado Avenue in Santa Monica, California and is a prominent, 100Third Street Promenade

year-old landmark. Pacific Park is an oceanfront amusement park located on the pier and has the first and only solar powered Ferris Wheel. It also has a carousel from the 1920s, an aquarium, shops, entertainers, an arcade, a trapeze school, a pub, and an assortment of restaurants. The Santa Monica Pier comprises of two adjoining piers: the Municipal Pier and the Pleasure Pier to the south, a.k.a. Newcomb Pier. The Santa Monica Pier has frequent presence in popular culture including films, TV

The Santa Monica Pier

shows, MTV and Video Games. The Santa Monica Museum of Art (SMMOA) is an independent, non-collecting Art museum located at Bergamot Station, Southern California’s largest art gallery and cultural complex. It exhibits the work of local, national, and international contemporary artists. The museum was founded in 1984 by Abby Sher. It offers temporary exhibitions organized by in-house curators and guest curators from around the world. Related public programs include: artist talks, educational workshops for all ages, film screenings, concerts, and other art-related events. The museum’s mission statement is "Through its exhibitions, education, and outreach programs, the Santa Monica Museum of Art fosters diversity, innovation, and

Santa Monica Museum of Art

discovery in contemporary art – local, national, and international."

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

13

Market Overview Districts

Mid-City A popular location for film, television, and music companies. An array of museums and art galleries make this neighborhood a desirable cultural destination. Montana Avenue Luxury shopping and dinning that services the surrounding upscale neighborhood. A popular spot for celebrities. Main Street Blocks from the beach, a diverse mix of trendy shopping, restaurants, cafes, farmer’s market, and night clubs. Ocean Park A strong neighborhood-feel with several casual dining and retail options. Pico Boulevard An emerging nightlife scene with clubs, restaurants, and boutique shops. Santa Monica Airport A private airfield that is also home to the weekly Farmer’s Market and the extremely popular Santa Monica Outdoor Antique Market. The Beach 3.5 miles of immaculately maintained beach. The Ocean Front Walk makes enjoying the beautiful scenery fun and easy. Several distinctive hotels, such as Shutter of the Beach, Loews Santa Monica Beach Hotel, and The Fairmont Miramar Hotel, have gained notable prestige for their location and amenities. Palisades Park Runs along palm tree lined Ocean Avenue and offers a jogging friendly public park with an incredible view of the ocean.

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

14

Market Overview Multi-Family Market Trends

The 765,043-unit Los Angeles multifamily market remains at the nation’s premier level, with low vacancy and high rents. Demand is strong with substantial rental gains; the sprawling Los Angeles County remains a national market, drawing renters from a wide variety of income levels and, for that matter, a variety of geographical areas. MARKET OVERVIEW Vacancy Rates: Vacancy rates slightly decreased in the Santa Monica multi-family submarket, ending the 1st quarter 2013 with 3.4% from 3.5% four quarters ago. The average apartment vacancy rate for Los Angeles County closed at 3.7%, marking it the seventh consecutive quarter of vacancy under 4%. Rental Rates: Average rental rates for Santa Monica increased over the 12-month period ending 1st quarter 2013, up from $2,617 to $2,647. For Los Angeles County, average market rental rates ended the 1st quarter 2013 at $1,497, up 3.5% from 2012. Investment: The Santa Monica submarket witnessed 27 multi-family transactions that closed during the first quarter of 2013 with 60 total units and a total volume of approximately $63.2 million. The 27 buildings totaled 122,286 square feet and the average price per square foot equated to $436.93. Development: In 2012, Reis indicated 999 competitive units have been completed in 11 projects. Construction has been generally active in Los Angeles. From 2006 to 2010, 18,068 units were added, averaging 3,614 per year. Reis forecasts new construction to approximately 21,000 units from 2012 to 2016, just shy of the 25,922 forecast to be absorbed, keeping the market in balance for the next few years.

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

15

Market Overview Demographics

Residents of Santa Monica are afforded all the benefits of a worldclass city, which accounts for its high population density and steady rate of growth. As of 2006, there were 90,750 residents, a 7.9% increase since the 2000 Census. Given Santa Monica’s outstanding reputation and offerings, the City attracts the professional elite. with 64.1% of residents in managerial, professional and related occupations. 2007 Median Household Income was $71,796, with 62.8% earning $50,000 or higher, and 35.5% earning $100,000 and above. Santa Monica’s Family Income measure paints a similar picture with 62% earning $75,000 or more, and 50.5% of families taking in $100,000 and greater. Compared to Los Angeles County, with a Median Household Income of $53,573 and a Family Income of $60,264, Santa Monica’s demographics look even stronger. In addition to being top-earners, Santa Monica residents are highly educated. Of those 25 and older, 95.5% have a high school degree (LA County 75.5%), while 65.6% have Bachelor’s degrees or higher (LA County 28.3%).

Median Family Income (2007)

Santa Monica

Los Angeles County

United States

0

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

20,000

40,000

60,000

80,000

16

Contact Information: Kimberly Roberts Stepp Senior Managing Director [email protected] (310) 492-8402 Lic. #01251767

Soledad Jothier Associate [email protected] (310) 492-8411 Lic. #01932252

1342-46 Ocean Park Blvd. Santa Monica, CA 90405 :H Drive/1 Data/1 Admin/13/1342-46 Ocean Park Blvd.-[9.9.13-mdg-rev1]

17