HUB625          where life happensImage courtesy of: Laura Doran
VISION
VisionImage courtesy of: Laura Doran
SITE CONTEXT
Primary Market AreaLocation   Secondary Market Area                               N
Primary Market AreaLocation   Secondary Market Area                               N
Primary Market AreaLocation   Secondary Market Area                               N
Primary Market AreaLocation   Secondary Market Area                               N
Primary Market AreaLocation   Secondary Market Area                               N
Primary Market AreaLocation   Secondary Market Area                               N
Primary Market AreaLocation   Secondary Market Area                               N
Location              HS/C-2-C           C-2-A                         N
Historical Conditions1920’s   1930’s   1968   2003   2016
Demographic Trends                 SUMMARY            2010    2011     2016    Population                      9,505   10,...
Demographic Trends                 SUMMARY            2010    2011     2016    Population                      9,505   10,...
Psychdemographics                 LIBERAL 33.6                            YEARS OLD OLDER THAN 65 37.7 YEARS OLD 70% BLACK...
Psychdemographics            LIBERALTECH-SAVY                                  LIVING ALONE                        35.5 YE...
Psychdemographics
Residential Market    Row houses, older low-rise  Population increase, family size             decrease  Home prices rose ...
Office Market    11 million SF existing in Capitol     Hill/NoMa, 681,000 planned        Steady employment levels         ...
Retail Gap $16,000,000 $14,000,000 $12,000,000 $10,000,000  $8,000,000  $6,000,000  $4,000,000  $2,000,000         $0 -$2,...
HUB625The Building
Program                                         Multifamily         Retail        Office                                  ...
Program                                         Multifamily         Retail        Office                                  ...
Program                                         Multifamily         Retail        Office                                  ...
Program                                         Multifamily         Retail        Office                                  ...
Program                                         Multifamily         Retail        Office                                  ...
Program                                         Multifamily         Retail        Office                                  ...
Target Market
Program A gym. Not another personal trainingcenter or a boutique gym. Just a place  to workout. We need to have morebusine...
Architecture Design and SustainabilityImage courtesy of: Laura Doran
Architecture Design and Sustainability                                                Brick traditions of Washington, DC  ...
Architecture Design and Sustainability                                                Brick traditions of Washington, DC  ...
FINANCE AND RETURNS
Uses Summary                       Development Cost Summary     Project Cost                         Total             per...
Sources Summary     Summary of Capitalization     Equity (35% of Total Cost)                    $       9,760,289         ...
Ten Year ProForma                                                     Predevelopment                                Constr...
Retail         Tenant                        RPGSF         TI        Lease Term       Lease Type                  Bank of ...
RetailStabilized Year One Net Operating Income                                              Leasing            Stabilized ...
Office         Tenant                   RPGSF     TI    Lease Term       Lease Type                   Major Tenant $      ...
OfficeStabilized Year One Net Operating Income                                               Leasing           Stabilized ...
Multi-Family                                                Average  Current        Description              # of Units   ...
MultifamilyStabilized Year One Net Operating Income                                                 Leasing               ...
Parking                                                          Building Cost     Stabilized Net Operating Income        ...
Ten Year ProForma                                                     Predevelopment                                Constr...
Exit Strategy                                 CAP RATE Analysis       Year 9 NOI                    Cap Rate          5.75...
Development Returns                             UNLEVERAGED IRR            15.3%                                LEVERAGED ...
Construction and Leasing SchedulePre-ConstructionMay 2012 – Sept 2013Due Diligence               Groundbreaking          R...
Construction and Leasing SchedulePre-Construction          ConstructionMay 2012 – Sept 2013      Oct 2013 – June 2015Due D...
Construction and Leasing SchedulePre-Construction          Construction               LeasingMay 2012 – Sept 2013      Oct...
Risks
Case Study14th and U Street NW and H Street NE They had tough turns afterthe riots of the 1960s. Now,they are both undergo...
14th & U St. NW   H St. CorridorCase Study14th and U Street NW and H Street NE They had tough turns afterthe riots of the ...
ConclusionImage courtesy of: Laura Doran
Acknowledgements                       Jon Eisen                   Rob Wolcheski                     Laura Doran
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  • Mixed use project in the up and coming H Street Corridor**** square feetRetail, Office, ResidentialProvides needed neighborhood goods and services** IRR** Return on InvestmentHUB 625 is a mixed use project in the up and coming H Street Ne Corridor. Retail, office and residential uses are seamlessly integrated over Arevitalizedperforming arts scene,hipster bars, and a boom of high-endresidential units are reshaping H Street,NE quickly. The neighborhood’s populationis increasing and bringing with it new businessesand new consumers.H Street, NE’s one-and-a-half mile commercialcorridor is home to over 100 retail shops and acollection of new coffee houses, restaurants anddiverse retail opportunities catering to DC’syoung professionals and long-time residents.Construction and renovation of approximately1,000 residential units, building renovationsand storefront improvements—along withstreetscape improvements currently underway—Why H Street, NEare breathing energy and excitement into thisneighborhood bordered by Capitol Hill, StantonPark and Near Northeast.The Atlas Performing Arts Center, a restoredArt Deco landmark theater, and the H StreetPlayhouse have become regional destinationsfor patrons of the performing arts. The Rock andRoll Hotel and other H Street venues beckon thelive music crowd.More than 67,000 passengers and customers passthrough nearby Union Station on Metrorail everyday. Thousands of others arrive via Amtrak andcommuter rail, which are all within steps of atransformed H Street, NE.
  • Physical, visual, as well as emotional barriers that exist in the neighborhoods around the site define the primary trade area
  • Physical, visual, as well as emotional barriers that exist in the neighborhoods around the site define the primary trade area
  • Physical, visual, as well as emotional barriers that exist in the neighborhoods around the site define the primary trade area
  • Physical, visual, as well as emotional barriers that exist in the neighborhoods around the site define the primary trade area
  • Physical, visual, as well as emotional barriers that exist in the neighborhoods around the site define the primary trade area
  • Physical, visual, as well as emotional barriers that exist in the neighborhoods around the site define the primary trade area
  • Physical, visual, as well as emotional barriers that exist in the neighborhoods around the site define the primary trade area
  • ZoningFarAllowed uses
  • Trolley brought people and increased retail spending into the areaBecame a strong residential neighborhood with a prominent professional class, and large retail anchors: sears, people’s drug, giant, woolworthsAs the automobile became more prevalent, people started moving out of the area, and the riots of 1968 after MJK jr’s assassination devastated the area, and fell into disrepairBeginning in 2003, the DC govt began large scale funding efforts- great streets, h street main street, programs. Through transportation improvements, retail and development grants, large scale private investment, h street is on its way to regaining I‘ts past stature. It appears that the introduction of retailers and the trolley, which stimulated the area almost 100 years ago will once again revitalize the area. The District began redeveloping the H St Corridor nine years ago with visions of restoring the once bustling retail center to it’s former glory. The corridor was part of the inagural class of areas to undergo the “Greats Street Initiative,” a program that strives to “transform the H Street, NE Corridor into a thriving and inviting neighborhood center.” According to the city’s vistion, H Street will be full of “hip but has young families” and is “international, multilingual and diverse.” Under the H Street Great Streets and Streetcar project $65 million will be invested in new street-lights, curbs & sidewalks and trees & landscaping. In addition the H Street Main Street and DC Department of Small and Local Business Development is providing business assistance and commercial property improvement services. The nightlife of the area has been quick to develop, due to the large scale investments made by bar magnate Joe Englert. Initial investors in the H St Corridor weren’t subjected to the high standards present today, the planning, development and economics offices is looking for businesses that will fulfill the daily needs of the residents. Daily goods and service that will transition the area from a nightlife destination toa 24 hour active neighborhood.
  • The population of the Primary trade area is expected to increase by 1,402 persons over the next five years with an overall increase in households of 726. The number of families is expected to continue to rise, increasing by 243, but the average family size is going to decrease to 2.11 after leveling off at the current size of 2.14 persons.the age distribution of the primary trade area is highest within the 25-34 age group, 28% of the 2011 population. High concentrations are also found in the 35-44, 45-54 age groups (16.6% and 12.3%, respectively). This shows a high concentration of young and settled professionals in the area, with a low number of families. A second group of citizens that cannot be ignored is the number of senior citizens that are aging in place. The number of seniors (ages 55-74) is projected to increase from 2011 to 2016 by a total of <(978-1178)+(472-633)+(267-301)= number> persons.
  • The population of the Primary trade area is expected to increase by 1,402 persons over the next five years with an overall increase in households of 726. The number of families is expected to continue to rise, increasing by 243, but the average family size is going to decrease to 2.11 after leveling off at the current size of 2.14 persons.the age distribution of the primary trade area is highest within the 25-34 age group, 28% of the 2011 population. High concentrations are also found in the 35-44, 45-54 age groups (16.6% and 12.3%, respectively). This shows a high concentration of young and settled professionals in the area, with a low number of families. A second group of citizens that cannot be ignored is the number of senior citizens that are aging in place. The number of seniors (ages 55-74) is projected to increase from 2011 to 2016 by a total of <(978-1178)+(472-633)+(267-301)= number> persons.
  • Urban Rows: This group makes up almost half of the primary market area demogpraic profile. This gorup is shrinking due to urban renewal programs. Median age is 33.6 years, with hoseholds consisting of marrie d couples, single parent families and gradparents as caregivers within multi-generational families. 70% of this population is black, and 12% is hispanic. Median household income is $34, 356 and is the lowest among all sectors within the H St NE Primary market area. This popualation often holds jobs in whitecollar fields such as the health care industry, and local governement jobs. Unemployment is double the US rate, at 20%. Households are primarily row houses and single family dwelligns and 60% of these are owner occupied with the mortgage paid off generations ago. Trendsetters: A young, diverse and mobile group, trendsetters are comprised of singles livivng alone or with roomates. A younger group, with a median age of 35.5, this group is diverse with a high percentage of asian and hispanic persons. Medan household income is $61,498 and most have attended college, with one quarter holding a graduate degree. Over two-thirds fo this group are renters and about twenty percent don’t own a vehicle. This politically liberal group is a great consumer base to have. They shop in stores, stay up to date with technology, and are itnerested in maintaining their health; often purchasing natural/organic foods, vitamins, and health memberships or yoga passes. Social Security Set: With the majority of these citizens living alone, the majority live on a low fixed income but have accumulated wealth in their earlier years that they subsist on. 40% of houeholders are older than 65 years, and do not drive- therefore relying completely on public transportation. Limited and finintefianncialresourses determine the spending habits of this group. They shop is discount stores, bank in person, and rely on television and newspapers to stay current on sports and the news. City Strivers: This diverse group is comprised of a young (median age of 32.5 years),diverse (80% black), and varied family types (68 percent mix of married couples, single parents, and other families). A comparitively lower median income of $43,548 is often supplemented by Supplemental Security income or public assistance income. A high unemployment rate, of 18.6% is also present. Two-thirds of this population rent apartments in older, multi-tenant buildings. About 40% of these households do not own a car and rely soley on public transportation. This group prefers lower cost retail providers and often consumer fast food. Frequent watchers of athletic events, such as football and basketball, they also play tennis and basketball. Metropolitians: This group prefers to live in older city neighborhods. Evenly divided between singles who live alone or wiht others, and married couple families- the median age is 37.7 years, and the majority of the group is white. A solid labor force participation rate, a high secondary education completion rate, and a median hosuehold income of $60.191 are furhter descriptors of this group. This group pursues an active urbane lifestlye, travel frequently, and overall, are active members of their community. They join civic clubs, volunteer for environmental causes, and often work for a political party or candidate.
  • Urban Rows: This group makes up almost half of the primary market area demogpraic profile. This gorup is shrinking due to urban renewal programs. Median age is 33.6 years, with hoseholds consisting of marrie d couples, single parent families and gradparents as caregivers within multi-generational families. 70% of this population is black, and 12% is hispanic. Median household income is $34, 356 and is the lowest among all sectors within the H St NE Primary market area. This popualation often holds jobs in whitecollar fields such as the health care industry, and local governement jobs. Unemployment is double the US rate, at 20%. Households are primarily row houses and single family dwelligns and 60% of these are owner occupied with the mortgage paid off generations ago. Trendsetters: A young, diverse and mobile group, trendsetters are comprised of singles livivng alone or with roomates. A younger group, with a median age of 35.5, this group is diverse with a high percentage of asian and hispanic persons. Medan household income is $61,498 and most have attended college, with one quarter holding a graduate degree. Over two-thirds fo this group are renters and about twenty percent don’t own a vehicle. This politically liberal group is a great consumer base to have. They shop in stores, stay up to date with technology, and are itnerested in maintaining their health; often purchasing natural/organic foods, vitamins, and health memberships or yoga passes. Social Security Set: With the majority of these citizens living alone, the majority live on a low fixed income but have accumulated wealth in their earlier years that they subsist on. 40% of houeholders are older than 65 years, and do not drive- therefore relying completely on public transportation. Limited and finintefianncialresourses determine the spending habits of this group. They shop is discount stores, bank in person, and rely on television and newspapers to stay current on sports and the news. City Strivers: This diverse group is comprised of a young (median age of 32.5 years),diverse (80% black), and varied family types (68 percent mix of married couples, single parents, and other families). A comparitively lower median income of $43,548 is often supplemented by Supplemental Security income or public assistance income. A high unemployment rate, of 18.6% is also present. Two-thirds of this population rent apartments in older, multi-tenant buildings. About 40% of these households do not own a car and rely soley on public transportation. This group prefers lower cost retail providers and often consumer fast food. Frequent watchers of athletic events, such as football and basketball, they also play tennis and basketball. Metropolitians: This group prefers to live in older city neighborhods. Evenly divided between singles who live alone or wiht others, and married couple families- the median age is 37.7 years, and the majority of the group is white. A solid labor force participation rate, a high secondary education completion rate, and a median hosuehold income of $60.191 are furhter descriptors of this group. This group pursues an active urbane lifestlye, travel frequently, and overall, are active members of their community. They join civic clubs, volunteer for environmental causes, and often work for a political party or candidate.
  • Urban Rows: This group makes up almost half of the primary market area demogpraic profile. This gorup is shrinking due to urban renewal programs. Median age is 33.6 years, with hoseholds consisting of marrie d couples, single parent families and gradparents as caregivers within multi-generational families. 70% of this population is black, and 12% is hispanic. Median household income is $34, 356 and is the lowest among all sectors within the H St NE Primary market area. This popualation often holds jobs in whitecollar fields such as the health care industry, and local governement jobs. Unemployment is double the US rate, at 20%. Households are primarily row houses and single family dwelligns and 60% of these are owner occupied with the mortgage paid off generations ago. Trendsetters: A young, diverse and mobile group, trendsetters are comprised of singles livivng alone or with roomates. A younger group, with a median age of 35.5, this group is diverse with a high percentage of asian and hispanic persons. Medan household income is $61,498 and most have attended college, with one quarter holding a graduate degree. Over two-thirds fo this group are renters and about twenty percent don’t own a vehicle. This politically liberal group is a great consumer base to have. They shop in stores, stay up to date with technology, and are itnerested in maintaining their health; often purchasing natural/organic foods, vitamins, and health memberships or yoga passes. Social Security Set: With the majority of these citizens living alone, the majority live on a low fixed income but have accumulated wealth in their earlier years that they subsist on. 40% of houeholders are older than 65 years, and do not drive- therefore relying completely on public transportation. Limited and finintefianncialresourses determine the spending habits of this group. They shop is discount stores, bank in person, and rely on television and newspapers to stay current on sports and the news. City Strivers: This diverse group is comprised of a young (median age of 32.5 years),diverse (80% black), and varied family types (68 percent mix of married couples, single parents, and other families). A comparitively lower median income of $43,548 is often supplemented by Supplemental Security income or public assistance income. A high unemployment rate, of 18.6% is also present. Two-thirds of this population rent apartments in older, multi-tenant buildings. About 40% of these households do not own a car and rely soley on public transportation. This group prefers lower cost retail providers and often consumer fast food. Frequent watchers of athletic events, such as football and basketball, they also play tennis and basketball. Metropolitians: This group prefers to live in older city neighborhods. Evenly divided between singles who live alone or wiht others, and married couple families- the median age is 37.7 years, and the majority of the group is white. A solid labor force participation rate, a high secondary education completion rate, and a median hosuehold income of $60.191 are furhter descriptors of this group. This group pursues an active urbane lifestlye, travel frequently, and overall, are active members of their community. They join civic clubs, volunteer for environmental causes, and often work for a political party or candidate.
  • Centers that focus on everyday needs, such as groceries and other necessities, remain successful during economic downturns or slow growth periods. Future retail devlopment should focus on a mixed-use format involving office or residential within a waklable urban area or close to public transit. Overall, consumrs want to reduce their drivign time and rely on their immediate neighborhood for daily necessities. Existing retail, office, res statsThe reduction in supply of class a office space, along with the pipeline resupply of space means that there is a aother existing supply, so it should be differentiate itself form the market by offering a lower price. Class B offices priced competitively should do well. Vacant vs owner occ, vs renterThis presents the oppurtunity for a residential buildign directly on H Street that could appeal to incoming residents looking for a more direct connection to the action of H Street.
  • Within the past five years, a number of modern and promising restaurants have opened in the area, Sticky Rice, H Street Country Club, TruOrleans, and have introduced a new Thursday night through Sunday crowd. However, residents and businesses within the area still lack quality dailiyamenties such as a health club, laundromat, a shipping facility, and a full-service bank. Limited type of retailer which means that the type of retail occupant that can occupy the H Street Corridor is limited. There is a significant need for retail space of a higher class that can meet the needs of a larger retailer.
  • 30% of americans are now living alone
  • The architecture of HUB625 will reference the longstanding brick traditions of washington dc with references to the light, airy and desireable modern style of european design. Evendent on the facade will be overlapping volutmes that highlight the multi-use premise of the development. The gym, located on the second level will have a floor-to-ceiling window that will protrude slightly from the rest of the facade, in order to maximize views and highlight this unique use. The residential units along the back of the lot will have street-level access as well as access through the parking garage.
  • The architecture of HUB625 will reference the longstanding brick traditions of washington dc with references to the light, airy and desireable modern style of european design. Evendent on the facade will be overlapping volutmes that highlight the multi-use premise of the development. The gym, located on the second level will have a floor-to-ceiling window that will protrude slightly from the rest of the facade, in order to maximize views and highlight this unique use. The residential units along the back of the lot will have street-level access as well as access through the parking garage.
  • The architecture of HUB625 will reference the longstanding brick traditions of washington dc with references to the light, airy and desireable modern style of european design. Evendent on the facade will be overlapping volutmes that highlight the multi-use premise of the development. The gym, located on the second level will have a floor-to-ceiling window that will protrude slightly from the rest of the facade, in order to maximize views and highlight this unique use. The residential units along the back of the lot will have street-level access as well as access through the parking garage.
  • 360 H StreetEven with pipeline projects delivering 215 units in Jan 2013, with a conservative absorption estimate of ten units per month, all of these properties will be stabilized or occupied by September 2014, Pipeline ResidentialEvolution of H StreetTrolley schedule
  • I am here to say that it can be done. With all of the risks present in developing in the h street corridor, there lies even biggger potential. And besides that, it already has been done. A quick comparision of the redevelopment of 14th and u street nw, and the beginnings of development at h st ne shows a plethora of sikilarities. And where there are gaps, there are substitutions.
  • I am here to say that it can be done. With all of the risks present in developing in the h street corridor, there lies even biggger potential. And besides that, it already has been done. A quick comparision of the redevelopment of 14th and u street nw, and the beginnings of development at h st ne shows a plethora of sikilarities. And where there are gaps, there are substitutions.
  • Their interest in the corridor marks another escalation in H Street’s progression from a run-down corridor still scarred from the 1968 riots, to an edgy strip of local bars, to a sought-after residential market, even by developers looking region-wide.
  • E hedeman presentation 051112

    1. 1. HUB625 where life happensImage courtesy of: Laura Doran
    2. 2. VISION
    3. 3. VisionImage courtesy of: Laura Doran
    4. 4. SITE CONTEXT
    5. 5. Primary Market AreaLocation Secondary Market Area N
    6. 6. Primary Market AreaLocation Secondary Market Area N
    7. 7. Primary Market AreaLocation Secondary Market Area N
    8. 8. Primary Market AreaLocation Secondary Market Area N
    9. 9. Primary Market AreaLocation Secondary Market Area N
    10. 10. Primary Market AreaLocation Secondary Market Area N
    11. 11. Primary Market AreaLocation Secondary Market Area N
    12. 12. Location HS/C-2-C C-2-A N
    13. 13. Historical Conditions1920’s 1930’s 1968 2003 2016
    14. 14. Demographic Trends SUMMARY 2010 2011 2016 Population 9,505 10,166 11,568 Households 4,328 4,642 5,384 Families 1,751 1,875 2,118 Average Household Size 2.14 2.14 2.11 Owner Occupied Housing Units 2,234 2,331 2,624 Renter Occupied Housing Units 2,094 2,310 2,761 Median Age 33.9 33.8 33.7
    15. 15. Demographic Trends SUMMARY 2010 2011 2016 Population 9,505 10,166 11,568 Households 4,328 4,642 5,384 Younger people in smaller families Families 1,751 1,875 2,118 filling more households, Average Household Size 2.14 2.14 2.11 looking to buy, but primarily to rent. Owner Occupied Housing Units 2,234 2,331 2,624 Renter Occupied Housing Units 2,094 2,310 2,761 Median Age 33.9 33.8 33.7
    16. 16. Psychdemographics LIBERAL 33.6 YEARS OLD OLDER THAN 65 37.7 YEARS OLD 70% BLACKSINGLE PARENTS 12% HISPANICTECH-SAVY 80% BLACK LIVING ALONE MARRIED COUPLES LIVING ALONE MARRIED COUPLES 35.5 YEARS OLD NATURAL/ORGANIC FOODS FOOTBALL $60,191 AMI $43,548 AMI LIVING ALONE PUBLIC TRANSPORTATION LOW FIXED INCOME FAST FOOD WHITE POLITCALLY ACTIVE $34,356 AMI 20% UNEMPLOYMENT NO CAR YOGA PASSES 18.6% UNEMPLOYMENT 32.5 YEARS OLD RENTERS PUBLIC TRANSPORTATION $61,498 AMI SINGLES SINGLES IN-STORE SHOPPING SINGLE PARENT FAMILIES WHITECOLLAR ROOMATES RENTERS NO CAR SOCIAL SECURITY INCOME
    17. 17. Psychdemographics LIBERALTECH-SAVY LIVING ALONE 35.5 YEARS OLD NATURAL/ORGANIC FOODS YOGA PASSES RENTERS SINGLES ROOMATES
    18. 18. Psychdemographics
    19. 19. Residential Market Row houses, older low-rise Population increase, family size decrease Home prices rose 11.2% in April 1,648 units to deliver by 2015 360 H Street, 610 H StreetWalkable urban area that contains all neighborhood amenities MEDIAN RENT Studio $ 1,520 One Bedroom $ 1,550 Two Bedroom $ 2,400 Three Bedroom $ 2,710
    20. 20. Office Market 11 million SF existing in Capitol Hill/NoMa, 681,000 planned Steady employment levels H St Arts District 316 F ST NE Neighborhood Services 12% overall vacancy Gap: Smaller Class B AverageClass Buildings Inventory Vacancy Pipeline Rent A 41 9,093,623 7.8% 681,085 $ 61.13 B 22 2,094,677 3.0% $ 47.75 C 16 474,238 30.0% $ 42.86 Constitution SquareTotal 79 11,662,538 12.0% 681,085 $ 53.63
    21. 21. Retail Gap $16,000,000 $14,000,000 $12,000,000 $10,000,000 $8,000,000 $6,000,000 $4,000,000 $2,000,000 $0 -$2,000,000
    22. 22. HUB625The Building
    23. 23. Program Multifamily Retail Office Total Res Units 146 Multifamily Units- Average Size 716 Multifamily Units NSF 104,592 Retails (NSF) 36382.5 Office NSF 78,698.90 Gross SF 244,238.5 Number of Buildings/Rentable Floors 1/7 Parking Spaces 153 NImage courtesy of: Laura Doran
    24. 24. Program Multifamily Retail Office Total Res Units 146 Multifamily Units- Average Size 716 Multifamily Units NSF 104,592 Retails (NSF) 36382.5 Office NSF 78,698.90 Gross SF 244,238.5 Number of Buildings/Rentable Floors 1/7 Parking Spaces 153 NImage courtesy of: Laura Doran
    25. 25. Program Multifamily Retail Office Total Res Units 146 Multifamily Units- Average Size 716 Multifamily Units NSF 104,592 Retails (NSF) 36382.5 Office NSF 78,698.90 Gross SF 244,238.5 Number of Buildings/Rentable Floors 1/7 Parking Spaces 153 NImage courtesy of: Laura Doran
    26. 26. Program Multifamily Retail Office Total Res Units 146 Multifamily Units- Average Size 716 Multifamily Units NSF 104,592 Retails (NSF) 36382.5 Office NSF 78,698.90 Gross SF 244,238.5 Number of Buildings/Rentable Floors 1/7 Parking Spaces 153 NImage courtesy of: Laura Doran
    27. 27. Program Multifamily Retail Office Total Res Units 146 Multifamily Units- Average Size 716 Multifamily Units NSF 104,592 Retails (NSF) 36382.5 Office NSF 78,698.90 Gross SF 244,238.5 Number of Buildings/Rentable Floors 1/7 Parking Spaces 153 NImage courtesy of: Laura Doran
    28. 28. Program Multifamily Retail Office Total Res Units 146 Multifamily Units- Average Size 716 Multifamily Units NSF 104,592 Retails (NSF) 36382.5 Office NSF 78,698.90 Gross SF 244,238.5 Number of Buildings/Rentable Floors 1/7 Parking Spaces 153 NImage courtesy of: Laura Doran
    29. 29. Target Market
    30. 30. Program A gym. Not another personal trainingcenter or a boutique gym. Just a place to workout. We need to have morebusinesses that cater to neighborhood needs rather than another restaurant that is filled with people fromelsewhere in the city. There are plentyof places to eat and get drunk already. Tom Aloisia, Near NorthEast Resident
    31. 31. Architecture Design and SustainabilityImage courtesy of: Laura Doran
    32. 32. Architecture Design and Sustainability Brick traditions of Washington, DC Light and modern European design Overlapping volumes highlight uses Street level access to first floor multifamily units Local and sustainable building techniques From predevelopment to operation and beyond Mix of local and national tenants Community Amenities: Gardens, ZipCars Gallery space available for community events and organizations Multifamily units face the existing residential with Green Space in between to sponsor casual interactionsImage courtesy of: Laura Doran
    33. 33. Architecture Design and Sustainability Brick traditions of Washington, DC Light and modern European design Overlapping volumes highlight uses Street level access to first floor multifamily units Local and sustainable building techniques From predevelopment to operation and beyond Mix of local and national tenants Community Amenities: Gardens, ZipCars Gallery space available for community events and organizations Multifamily units face the existing residential with Green Space in between to sponsor casual interactionsImage courtesy of: Laura Doran
    34. 34. FINANCE AND RETURNS
    35. 35. Uses Summary Development Cost Summary Project Cost Total per GSF Land Cost $ 5,286,024 $ 72.00 Hard Costs $ 34,912,925 $ 142.95 Soft Costs $ 9,756,953 $ 39.95 Fees and Administration $ 3,117,990 $ 12.77 Net Development Costs Financing- Interest Expenses, Fees $4,717,779 $19.32 Net Interest Cost $ 2,203,550 $ 9.02 Total Development Costs $59,995,222 $245.64 Land Cost Hard Costs Soft Costs Fees and Administration Financing- Interest Expenses, Fees Net Interest Cost
    36. 36. Sources Summary Summary of Capitalization Equity (35% of Total Cost) $ 9,760,289 at Land Closing $ 1,850,108 at Construction $ 7,910,180 Construction Loan $ 14,690,334 Loan to Cost Ratio 75% Loan Interest (5%) $ (2,203,550.17) Permanent Loan $38,996,894 Loan to Cost Ratio/Loan to Value 75% Interest Rate 5% Amortization 25 years Equity Loan
    37. 37. Ten Year ProForma Predevelopment Construction Lease Up Stabilization Sale YEAR 0 YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Net Operating Income $ - $ - $ - $ - $ - $ 679,859 $ 7,332,765 $ 7,552,748 $ 7,779,331 $ 8,012,711 $ 6,069,799 Hard Costs $ - $ - $ (15,926,457) $ (18,986,469) $ - $ - $ - $ - $ - $ - $ - Soft Costs $ (623,598) $ (623,598) $ (7,034,563) $ (851,595) $ (623,598) $ (691,584) $ (733,277) $ (755,275) $ (777,933) $ (801,271) $ (606,980) Development Fees $ (480,492) $ (31,180) $ (3,197,322) $ (2,762,450) $ (31,180) $ (92,367) $ - $ - $ - $ - $ - Land Cost $ (5,338,884) $ - $ - $ - $ - $ - $ (1,393,225) $ (1,435,022) $ (1,478,073) $ (1,522,415) $ (1,153,262) Total Development Costs $ (6,442,974) $ (654,778) $ (26,158,342) $ (22,600,515) $ (654,778) $ (783,951) $ - $ - $ - $ - $ 133,545,177 Sale Price $ - $ - $ - $ - $ - $ - $ 5,939,540 $ 6,117,726 $ 6,301,258 $ 6,490,296 $ 138,461,714 Cash Flow Before Debt Service $ (6,442,974) $ (654,778) $ (26,158,342) $ (22,600,515) $ (654,778) $ (104,092) $ $ $ $ (2,776,698) $ (831,751) (2,776,698) (2,776,698) (2,776,698) Total Financing Costs $ (22,355.48) $ (767,889.95) $ (767,889.95) $ (768,660.83) $(2,776,698.48) $ (2,776,698) $ (2,776,698) $ (2,776,698) $ (2,776,698) $ (2,776,698) $ (831,751) Loan Proceeds $ 13,196,204 $ 4,407,100 $ 8,814,201 $ 1,469,033 0 0 0 0 0 0 0 Cash Flow After Debt Service $ 6,730,874 $ 3,029,143 $ (18,067,320) $ (21,853,889) $ (3,431,476) $ (2,880,791) $ 3,162,841 $ 3,341,028 $ 3,524,559 $ 3,713,597 $ 137,629,963 DSCR 2.64 2.72 2.80 2.89
    38. 38. Retail Tenant RPGSF TI Lease Term Lease Type Bank of America $ 70 $ 45 10 NNN FedEx $ 70 $ 45 10 NNN Balduccis $ 55 $ 70 10 NNN Big Bear $ 70 $ 65 5 NNN True Value $ 55 $ 70 10 NNN Gym $ 50 $ 40 10 NNN Gallery $ 20 $ 15 5 NNN Rental Income $ 1,296,073 PreLeasing Period 18 months Percentage PreLeased 80% Total PreLeased 29,106 SF Stabilization 90% occupancy Monthly Absorption- Post Delivery 3000 SF/mo Mo. Until Stabilization 2 months
    39. 39. RetailStabilized Year One Net Operating Income Leasing Stabilized UPS $ 72,000 $ 73,440 Balduccis $ 270,000 $ 278,100 Bank of America $ 72,000 $ 74,160 True Value $ 270,000 $ 278,100 Big Bear $ 135,000 $ 139,050 Gym $ 416,250 $ 428,738 Gallery Space $ 90,000 $ 92,700 Gross Potential Income $ 1,325,250 $ 1,364,288 Vacancy/Collection Loss $ (66,263) $ (68,214) Gross Revenue $ 1,258,988 $ 1,296,073 Tenant Improvements $ (1,627,500) $ - Leasing Commission $ (420,750) $ - Operating Expenses $ (251,798) $ (259,351) OPEX Reimbursement $ 251,798 $ 259,351 Total Expenses $ (2,048,250) $ - Net Operating Income $ (789,263) $ 1,296,073
    40. 40. Office Tenant RPGSF TI Lease Term Lease Type Major Tenant $ 35 $ 35 10 NNN Minor Tenant $ 40 $ 35 5 NNN Rental Income $ 3,130,937 PreLeasing Period 18 months Percentage PreLeased 60% Total PreLeased 47,219 SF Stabilization 90% occupancy Monthly Absorption- Post Delivery 3000 SF/mo Mo. Until Stabilization 9 months
    41. 41. OfficeStabilized Year One Net Operating Income Leasing Stabilized Gross Potential Income $ 2,951,209 $ 1,461,104 Vacancy/Collection Loss $ (295,121) $ (313,094) Gross Revenue $ 2,656,088 $ 2,817,844 Tenant Improvements $ (2,754,462) $ - Leasing Commission $ (649,266) $ - Operating Expenses $ (531,218) $ (563,569) CAM $ (9,637) $ (10,223) OPEX Reimbursement $ 531,218 $ 563,569 Total Expenses $ (3,413,364) $ (10,223) Net Operating Income $ (757,276) $ 2,807,620
    42. 42. Multi-Family Average Current Description # of Units SF Rental Rate Rent PSF Average Market Unit Studio 82 585 $ 1,755 $ 3.00 One Bed 25 765 $ 2,142 $ 2.80 Two Bed 15 960 $ 2,496 $ 2.60 IZ Units 50% Affordable Units 12 80% Affordable Units 12 Total 146 Rental Income $ 2,853,835 Concessions (1 mo. Free rent) $ (246,020) PreLeasing Period 2 months Total PreLeased 16 units Stabilization 90% occupancy Monthly Absorption- Post Delivery 14 leases/mo. Mo. Until Stabilization 8 Months
    43. 43. MultifamilyStabilized Year One Net Operating Income Leasing Gross Potential Income $ 3,170,928 Vacancy/Collection Loss $ (317,093) Gross Revenue $ 2,853,835 Concessions $ (246,020) Operating Expenses $ (570,767) Insurance $ (36,500) Total Expenses $ (853,287) Net Operating Income $ 2,000,548
    44. 44. Parking Building Cost Stabilized Net Operating Income Total Rent Per Spots Rent Per Spot Year Per Spot Parking Income $ 320,880 Rental Parking 137 $ 200 $ 328,080 $ 17,000.00 ZipCar $ (7,200) Surface parking 13 $ - $ - $ - ZipCar 3 $ (200) $ (7,200) $ 17,000.00 Gross Potential Income $ 313,680Rental Income $ 320,880 Vacancy/Collection Loss $ (31,368) Gross Revenue $ 282,312Required Parking Retail 48 Operating Expenses $ (56,462) Office 44 Residential 61 Total Expenses $ (56,462) Total 153 Net Operating Income $ 225,850
    45. 45. Ten Year ProForma Predevelopment Construction Lease Up Stabilization Sale YEAR 0 YEAR 1 YEAR 2 YEAR 3 YEAR 4 YEAR 5 YEAR 6 YEAR 7 YEAR 8 YEAR 9 YEAR 10 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 Net Operating Income $ - $ - $ - $ - $ - $ 679,859 $ 7,332,765 $ 7,552,748 $ 7,779,331 $ 8,012,711 $ 6,069,799 Hard Costs $ - $ - $ (15,926,457) $ (18,986,469) $ - $ - $ - $ - $ - $ - $ - Soft Costs $ (623,598) $ (623,598) $ (7,034,563) $ (851,595) $ (623,598) $ (691,584) $ (733,277) $ (755,275) $ (777,933) $ (801,271) $ (606,980) Development Fees $ (480,492) $ (31,180) $ (3,197,322) $ (2,762,450) $ (31,180) $ (92,367) $ - $ - $ - $ - $ - Land Cost $ (5,338,884) $ - $ - $ - $ - $ - $ (1,393,225) $ (1,435,022) $ (1,478,073) $ (1,522,415) $ (1,153,262) Total Development Costs $ (6,442,974) $ (654,778) $ (26,158,342) $ (22,600,515) $ (654,778) $ (783,951) $ - $ - $ - $ - $ 133,545,177 Sale Price $ - $ - $ - $ - $ - $ - $ 5,939,540 $ 6,117,726 $ 6,301,258 $ 6,490,296 $ 138,461,714 Cash Flow Before Debt Service $ (6,442,974) $ (654,778) $ (26,158,342) $ (22,600,515) $ (654,778) $ (104,092) $ $ $ $ (2,776,698) $ (831,751) (2,776,698) (2,776,698) (2,776,698) Total Financing Costs $ (22,355.48) $ (767,889.95) $ (767,889.95) $ (768,660.83) $(2,776,698.48) $ (2,776,698) $ (2,776,698) $ (2,776,698) $ (2,776,698) $ (2,776,698) $ (831,751) Loan Proceeds $ 13,196,204 $ 4,407,100 $ 8,814,201 $ 1,469,033 0 0 0 0 0 0 0 Cash Flow After Debt Service $ 6,730,874 $ 3,029,143 $ (18,067,320) $ (21,853,889) $ (3,431,476) $ (2,880,791) $ 3,162,841 $ 3,341,028 $ 3,524,559 $ 3,713,597 $ 137,629,963 DSCR 2.64 2.72 2.80 2.89
    46. 46. Exit Strategy CAP RATE Analysis Year 9 NOI Cap Rate 5.75% 6.00% 6.25% NOI $ 8,012,711 $ 8,012,711 $ 8,012,711 Value $ 139,351,489 $ 133,545,177 $ 128,203,370
    47. 47. Development Returns UNLEVERAGED IRR 15.3% LEVERAGED IRR 17.8% LEVERAGED EQUITY MULTIPLIER 3.21 WHOLE $ PROFIT (UNLEV.) $106,695,055 WHOLE $ PROFIT (LEV.) $104,190,808 Leveraged Equity Required $ 47,181,181 Equity Multiplier Leveraged Equity Returned $ 151,371,989 3.208
    48. 48. Construction and Leasing SchedulePre-ConstructionMay 2012 – Sept 2013Due Diligence Groundbreaking Retail PreLeasingPlanning Sitework Office PreLeasingZoning Building Construction Res PreLeasingLand Acquisition Project Delivery Retail LeasingSchematic Design Office LeasingDesign Development Residential LeasingConstruction Documents BrandingPermitting MarketingBidding and Negotiation Tenant Occupancy
    49. 49. Construction and Leasing SchedulePre-Construction ConstructionMay 2012 – Sept 2013 Oct 2013 – June 2015Due Diligence Groundbreaking Retail PreLeasingPlanning Sitework Office PreLeasingZoning Building Construction Res PreLeasingLand Acquisition Project Delivery Retail LeasingSchematic Design Office LeasingDesign Development Residential LeasingConstruction Documents BrandingPermitting MarketingBidding and Negotiation Tenant Occupancy
    50. 50. Construction and Leasing SchedulePre-Construction Construction LeasingMay 2012 – Sept 2013 Oct 2013 – June 2015 Aug 2013– April 2016Due Diligence Groundbreaking Retail PreLeasingPlanning Sitework Office PreLeasingZoning Building Construction Res PreLeasingLand Acquisition Project Delivery Retail LeasingSchematic Design Office LeasingDesign Development Residential LeasingConstruction Documents BrandingPermitting MarketingBidding and Negotiation Tenant Occupancy
    51. 51. Risks
    52. 52. Case Study14th and U Street NW and H Street NE They had tough turns afterthe riots of the 1960s. Now,they are both undergoing a sort of renaissance. At theend of it, they will emerge as the city’s two great jewels. Jose C. Sousa, Planning and Economic Development Office
    53. 53. 14th & U St. NW H St. CorridorCase Study14th and U Street NW and H Street NE They had tough turns afterthe riots of the 1960s. Now,they are both undergoing a sort of renaissance. At theend of it, they will emerge as the city’s two great jewels. Jose C. Sousa, Planning and Economic Development Office
    54. 54. ConclusionImage courtesy of: Laura Doran
    55. 55. Acknowledgements Jon Eisen Rob Wolcheski Laura Doran

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