Recent acquisition of a 112 unit value-add multifamily building.

[Chris R.]

Investment Info:

Large multi-family (5+ units) commercial investment investment in Savannah.

Purchase price: $3,875,000
Cash invested: $2,130,000
Sale price: $5,200,000

The Tristan Townhomes consist of 112 two-bedroom, one-bathroom, two-story, townhome-style units. There are 28 buildings, each with 4 units, and one duplex building designed as an onsite property management and maintenance building at the entrance of the property. Tristan was built in 1983 and is a one-owner property. The current owner is in her 80’s and is ready to retire after self managing this property for over 30 years. There has not been a rent raise on most of the units in over 10 years with a current average rent of $550 per month. The comps in a 5-mile area average over $950 per month. There is some deferred maintenance and the units can use an upgrade, but overall they are in decent shape. The building currently holds a 99.1% occupancy. The reason for the 0.9% vacancy appears to be a unit being cleaned and new carpet being added. There is currently a waiting list to rent at Tristan.

Sterling Rhino Capital plans to upgrade and maximize this opportunity by upgrading the exterior of each building with new paint, facia boards, landscaping, driveway work, and striping. The interiors will have new flooring, appliances, hardware, and blinds. Through a carefully calculated rent escalation plan and upgrades, we are confident this property will produce favorable returns for our investors. We have hired a reputable property management company that shares our vision and is confident they can execute the business plan. This opportunity was negotiated for over 10 months and eventually purchased at a 22% discount off asking at just over $34,598 per door.