Emerald Coast Portfolio 120 Townhome Portfolio

[Foti Karastamatis]

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $17,700,000

120 Total Units
C Asset Class
B Market Class
1984/1986 Build Years
~$350+ Estimated Average Rental Upside per Unit

What made you interested in investing in this type of deal?

Great value add opportunity in a very desirable MSA with amazing assumable debt.
~$147,500/door @ acquisition vs $191k/door average
Below-market rents across both properties

How did you find this deal and how did you negotiate it?

One of our partners is a CRE Broker in Florida. He and his team were able to identify this as a potential multi family property that would fit our and our investors needs.

How did you finance this deal?

We assumed the exiting 3.64% Freddie Mac loan and syndicated the rest. We (GP team) have skin in the game with over $3.6M of our own capital invested. The sellers believed in our vision for the property that they invested over $2M as an LP.

How did you add value to the deal?

Both properties are undergoing extensive renovations to become a higher quality product, providing further upside beyond the sizeable in-place rent bumps.

Lessons learned? Challenges?

Destin is a "tourist area" and labor is much more expensive. We brought in out of town contractors that worked within our budget.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Our partner, Kevin Kohler, is with KW Commercial in Fl. He and his team know the SE market and are a great team to work with.