(Read more on the multifamily market.)
HOUSTON-Looking to accrue 5,000 units within two years in the city, Phoenix-based Right Place Properties has started the plan by rescuing the 94-unit Braesforest Apartments out of foreclosure for $1.77 million. The new owner plans to invest another $30,000 per door to convert the almost empty complex into condos.
Natan Jacobs, president of Red Door Group in Phoenix, says the units at 8100 Creekbend Dr. should be ready to sell by the end of the year. He says the ask will be $49,990 to $89,990.
Jacobs tells GlobeSt.com that the complex has only five tenants, all on month-to-month leases. "We'll let people finish their month, then begin the renovations," he says, adding the buyer most likely will outsource condominium sales to a third-party company familiar with the local market.
Jacobs says the asset was acquired from the lender, ALTM LLC of New York City. Braesforest isn't a typical buy for Right Place Properties because it had so much deferred maintenance, but it was too good of a deal to pass up. The 3.34-acre Braesforest Apartments has a mix of one-, two- and three-bedroom units averaging 966 sf. The monthly rent averages $569.
"We're looking for B properties that support themselves and have a value-add through raising rents or improvements," Jacobs says. "We hold them as rentals for a few years."
Jacobs says the goal is to buy 2,000 units in Greater Houston in the next year and another 3,000 units by late 2009. To support the plan, Right Place Properties is assembling a local team that includes an asset manager, construction manager and broker.
"We've been looking all over. And out of a potential 200 deals we've looked at so far, the right zone for us has been in the far west market," Jacobs says. "As we evaluate how sales go on the first properties, we'll have a better idea where else to buy."
Kevin Peck, a partner with Red Door Group, negotiated the buy side. Shayan Hasnain of Houston Income Properties Inc. represented the lender.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
