Sherif and Zyrafete Zenullahi, armed with 1031 exchange funds, purchased the property at 3524 N. Miller Rd. from local sellers Steven and Kimberly Olafson. "This is definitely a value-added deal," says Richard Butler, an investment broker with Marcus & Millichap Real Estate Investment Brokerage Co.'s Phoenix office. "It will be worth a lot more once it's fixed up."
Butler, the seller's broker, tells GlobeSt.com that the 90%-leased Sir Lancelot Apartments received 10 offers, but the Zenullahis were the only prospective ones to meet the ask. "They could see the value in the property," he says, "and knew that they could fix it up because they're hands-on owners." He estimates the renovation tab could be as much as $75,000.
According to Butler, the Zenullahis obtained a 10-year loan with a 5.4% fixed interest rate from La Jolla Bank to acquire Sir Lancelot Apartments. Ryan Ash of Marcus & Millichap's Phoenix office was the buyer's broker.
Built in 1958 on slightly more than an acre, the complex is one of the oldest rental properties in the city, Butler says. The two-bedroom units of 875 sf rent for $625 per month.
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