Flatirons Equity Portfolio
In 2022 we passively invested in 7 different opportunities totaling 2,078 doors with 11 unique properties in total. We would be happy to discuss what we liked about each of these opportunities, how we evaluated the investment returns and analyzed the sponsor underwriting. We also acquired one property as part of the General Partner ownership team. As part of that acquisition we participated in most aspects of the opportunity including analyzing and underwriting, securing debt, due diligence, capital raising, investor relations, and asset management. Reach out to schedule some time to learn more!
The District at Midtown (formerly the Verge Apartments) is
a 217-unit apartment community in one of the top job markets in the United States, Dallas, TX! This asset has tremendous value add potential and is located in a phenomenal location that is within close proximity to many major economic drivers in the Dallas-Fort Worth market. Below are a few details about the asset and the details of the investment.
Asset Class: C Class
Debt: 7-10 Year, 58-59%% leverage, fixed-rate loan 4.86%
5 Year Projected Total Return: 100.22%
Annual Cash on Cash Projected Return: 5.14%
Capital Raise: $17,000,000
This asset is located in far North Dallas, where CoStar projects 5.12% rent growth annualized over the next 5 years. The direct area Verge is located in has also seen a staggering 6.37% annualized rent growth over the last 10 years. The asset also sits less than a few blocks off of Interstate 635, a major thoroughfare and has EXTREMELY low bad debt and delinquency due to the type of tenant base. Verge and all
Competitors currently have 95-100% occupancy as is!
The District at Midtown is walking distance to the Galleria Mall with Nordstrom, Apple, Louis Vuitton, Zara, Sephora and more. The asset is also located inside of the Dallas Midtown Development project which is set to break ground in 2022. The plan highlights include parks and open space, two luxury hotels, iconic office towers, luxury condo units, a 10 screen AMC movie theater, boutique shopping, restaurants and entertainment venues.
Montclair Estates is a 113 unit Class B 55+ apartment community in Garland, TX. The asset is located in a submarket of Dallas/ Fort Worth, TX which is one of the top job markets in the United States, This asset has tremendous value add potential and the demand for this type of product in this submarket is extremely high! Montclair is located in a phenomenal location within Garland and is within a close proximity to many major economic divers in the Dallas-Fort Worth market and is within 2,000 ft of the Dallas Athletic Club. This was our first ever passive investment in Multifamily!
Keystone Farms (pictured above) was the second Multifamily Property Teresa and I passively invested in 2022. It is a 90 unit class B property built in 1998 with units having a townhome style feel in the hot market of Nashville, Tennessee. Nashville is experiencing tremendous economic growth from many industries adding new offices including Oracle announcing its HQ2 and Amazon adding over 5,000 new jobs. This is increasing buying power of tenants with median household incomes on the rise and supply in short demand. The property is closing next week and is already achieving up to 9% above proforma rents on some unit types before implementing the business plan! The sponsorship team secured 7 years of fixed rate date on this property providing excellent risk hedge in today's rising rate environment.
Built in 1997, Castle Hills Townhomes is a 148-unit townhome community featuring spacious units with 84% attached garages, fireplaces, and private yards providing tenants with an enhanced living experience. This powerhouse submarket is in great demand due to its location, employment opportunities, NEISD school district, and proximity to airport and major thoroughfares. Both properties offer tremendous opportunities for our vertically integrated teams to generate significant upside for our investors.
Built in 1982, Seville consists of seventeen two-story buildings in a park-like setting featuring large, home-like floorplans, which average 930 square feet and include full-size washer/dryer connections in 100% of the units. The units also feature private patios, offering residents more space and privacy. This powerhouse submarket is in great demand due to its location, employment opportunities, NEISD school district, and proximity to airport and major thoroughfares. Both properties offer tremendous opportunities for our vertically integrated teams to generate significant upside for our investors.
Sedona Square is a 250-unit multifamily community in Houston, TX built in two phases during 1982 and 1983. The property is comprised of 16
residential buildings spread across a 4.3-acre site. Sedona Square offers residents a selection of 1 bed/1 bath, 2 bed/1 bath, 2 bed/2 bath and 3 bed/2 bath floor plans.
Sedona Square sits in the Alief Submarket, 30 minutes southwest of Houston CBD. This area is characterized as one of the most ethnically diverse neighborhoods in the MSA, as there are several Asian, African, and Hispanic restaurants and retailers nearby. The
immediate area is a mix of residential buildings, office parks, retail, and education centers. Additionally, Sedona Square feeds into Alief ISD schools, several of which are just minutes from the property, offering convenience for families.
Verano is a 1980-built, 312-unit multifamily community in Houston, TX. The property is comprised of 22 residential buildings spread across a 9.5-acre site. Verano offers residents a selection of 1 bed/1 bath, 2 bed/1 bath, and 2 bed/2 bath floor plans.
Verano sits in the Briar Forest/West Memorial Submarket, between several high traffic roads in Interstate 10, Sam Houston Tollway, and Westpark Tollway. The property boasts proximity to major employment hubs, Energy Corridor and Westchase. Energy Corridor
employs over 94,000 employees, and Westchase employs more than
50,000 workers. Verano is surrounded by an abundance of retail and
entertainment options. Nearby are City Centre and Memorial City Mall, retail destinations that feature everyday brands to upscale retailers and sophisticated retail.
Rock Creek is a 572-unit multifamily community in Houston, TX built in two phases during 1980 and 1983. The property is comprised of 39 residential buildings spread across a 20.6-acre site and has been well-maintained by the current owner. Rock Creek offers residents a selection of 1 bed/1 bath, 2 bed/1 bath, 2 bed/2 bath, and 3 bed/2 bath floor plans.
Rock Creek sits in the Northwest Houston Submarket, 20 minutes north of Houston’s CBD. The property is located just off Interstate 45, which provides residents quick and easy access to Houston's significant employment and entertainment centers. Rock Creek is surrounded by retail centers, residential buildings, parks and trails, and healthcare facilities in the immediate area. Rock Creek is also a
part of the highly desirable Spring ISD and is located just minutes away from several ISD schools.
Ariva is a 176-unit Class B value-add multifamily investment opportunity in Dallas/Fort Worth, TX. Built in 1979, the asset consists of 18 two-story buildings with pitched roofs, 5 boilers, individual HVAC and electric, and 263 covered/49 open parking spaces. Purchase price is $23.9M with $2.2M in Capex, an attractive $136k/unit as comparable properties are currently trading at $140k/unit.
Located in a 1-mile high MHHI of $63k, Ariva is situated in SW Fort Worth, off I-20 between the major thoroughfares of Chisholm Trail Parkway and 35W. Altamesa Blvd connects those two arteries with Ariva just north of Altamesa on Woodway Dr. Healthcare, government/defense, university, and retail are key demand drivers. Lockheed Martin, Southside Medical District, Texas Christian University (TCU), Hulen Mall retail as well as Amazon and Walmart distribution centers are major area employers.
On the hunt for the next opportunity to passively invest in Texas or Tennessee.