INVESTMENT RETURN GOALS
14%
INTERNAL RATE OF
RETURN (IRR)
70%
LP Ownership after 100%
principal return
30%
GP Ownership after 100%
principal return
“ Our goal is to return your initial investment as soon as possible ”
INVESTMENT OVERVIEW
For several months while looking to expand outside of the Phoenix market, we targeted different properties in the Austin, Texas market. In early 2022, we announced the acquisition of two separate properties, each located in the Wooten section of Austin.
Wooten Park and West Anderson Court apartments are located only 0.4 miles apart on West Anderson Lane with great visibility on a major thoroughfare. Located just 5 miles north of the University of Texas, these apartments offer incredible proximity to the AustinCentral Business District as well as the burgeoning “Second Downtown”. The Second Downtown is located less than 4 miles north of the properties and includes the brand new Q2 Stadium, home to Austin MLS soccer team; the Domain, and a new $3 billion 66 acre master-planned neighborhood.
We are excited about the growth occurring in this market and will execute our proven offense to capitalize on it.
Learn more about the surrounding area and how it’s starting to trend.
‘Visit Austin’ recently wrote a great article about the Anderson’s Lane Neighbor. Read the full article here: https://www.austintexas.org/austin-insider-blog/post/anderson/
Property #1 – Magnolia Flats
We acquired Wooten Park Apartments for $161,111 per door for a total of $5.8M. It is one of two properties in the Wooten section of Austin, TX. that make up this Austin investment. It is a two story property with 36 units consisting of 14 Studios, 14 1BR/1bath and 8 2BR/1bath apartments. We’ve since re-branded it to Magnolia Flats.
This property was built in 1971, and is located at 1720 Wooten Park Drive. Rents at purchase were well below market rates and our intentions are to raise rents to keep pace with current market conditions. That work is already under way.
Prior to the purchase, the property had been owner operated for 25 years. The property continues to benefit greatly from our in-process value-add model.
At time of purchase, rents averaged $850, $1,060, and $1,225 for studio, 1BR and 2BR units, respectively. Market conditions as of October 2022 support new rent rates of $995, $1200, and $1,495 with room to increase upon the completion of additional internal and external upgrades.
As of October 2022, 9 of 36 unit interiors have been renovated. Although not a complete list, each of them has received fresh, modern paint, new bathroom and kitchen counters and appliances, upgraded fixtures, new floors, and new in-unit washer/dryers.
To date, we’ve also completed about 85% of the exterior beautification and upgrades which includes, but is not limited to, the following:
- Full paint, with rotted wood repairs/replacement
- Removed all satellites
- Cleaned up and secured wires in conduit
- Replaced front doors
- Replaced exterior lighting
- Improved landscaping, trimmed trees and added solar shades
- Installed new windows
- Enclosed dumpsters
- Seal coated and striped parking lots
- Changed name and signage
- Added outdoor kitchen and Adirondack seating
- Installed bistro lights with photocells
- Installed a pergola
You can visit the dedicated website for this property here: https://magnoliaflatsapts.com/
Property #2 – Anderson Flats
We acquired West Anderson Court for $170,000 per door for a total of $5.44M. We’ve since re-branded it to Anderson Flats. This two-story apartment building has 32 units, was built in 1969, and is located at 1220 W. Anderson Lane. It is located only 0.4 miles from our Magnolia Flats complex. Both of the properties had been mildly neglected with respect to interior and exterior upgrades.
Under previous ownership, rents did not keep pace with the rapid year-over-year rent growth in the Austin market. Current rents were well below market rates and averaged $843 and $950 for the 1BR and 2BR, respectively. Market conditions as of October 2022 support new rent rates of $1,200 and $1,495 with room to increase upon the completion of additional internal and external upgrades. The unit mix consists of 20 1BR/1Bath and 12 2BR/1Bath.
Targeted improvements are similar to the ones of the Wooten Apartment complex and will include interior as well as exterior upgrades to highly improve the aesthetics of both the interior and exterior of the living areas.
As of October 2022, 10 of 34 unit interiors have been renovated. Although not a complete list, each of them has received fresh, modern paint, new bathroom and kitchen counters and appliances, upgraded fixtures, new floors, and new in-unit washer/dryers.
Anderson Flats is a short walk to several well-known Austin institutions. The intersection of Burnett and W. Anderson is 0.6 miles away and is a very busy intersection with a large variety of shops and restaurants. Black Swan Yoga studio is a three minute walk across W. Anderson Lane. The very popular local chain, Summer Moon Coffee, is just half a mile away. Renovated 1,500-2,000 sq. ft. homes in the neighborhood have been selling for $725k-$875K.
To date, we’ve also completed about 85% of the exterior beautification and upgrades which includes, but is not limited to, the following:
- Full paint, with rotted wood repairs/replacement
- Removed all satellites
- Cleaned up and secured wires in conduit
- Replaced front doors
- Replaced exterior lighting
- Improved landscaping, trimmed trees and added solar shades
- Installed new windows
- Enclosed dumpsters
- Seal coated and striped parking lots
- Changed name and signage
- Added outdoor kitchen and Adirondack seating
- Installed bistro lights with photocells
- Installed a pergola
You can visit the dedicated website for this property here: https://andersonflatsapts.com/
