The Fort Worth Housing Authority's sealed-bid requirements kept many would-be buyers at bay, with only a handful emerging during the three-month marketing, according to Chris Epp, head of Apartment Realty Advisors' private client services group in Dallas. He says the authority sale required $50,000 down on Day 1 and $25,000 of non-refundable earnest money ASAP for the mid-1980s complex, built in three phases on nearly five acres at 5931 Oakland Hills, 350 Shady Lane Dr. and 5301 Greenshaven Dr. Woodhaven Crossroads carried a $3.25-million ask on an "as-is" basis.
"It shows very, very well. The thing that held the feeding frenzy back is the way the Fort Worth Housing Authority has to offer their deals," Epp tells GlobeSt.com. "In a free and open marketing campaign, we think there would have been absolutely no problem in achieving the full asking price."
Woodhaven Crossroads has 20 buildings of one- and two-bedroom apartments from 530 sf to 1,033 sf. Monthly rents go from $395 to $710, with 76 units in the subsidy pool. The asset's average rent is $606 per month. The current concession is $99 move-in for a one-year lease.
Under the Land Use Restriction Agreement, 32 apartments are reserved for residents earning 80% of the region's median income of $50,664 per year and 44 units are for individuals in the 60% category. Epp says there is "a significant gap" between the in-place rents and the LURA ceiling to add to upside. In the 80% category, one- and two-bedroom LURA rents could be $803 and $905, respectively, while the 44 lower income-restricted units could be $613 and $691, respectively.
Epp says the housing authority bought the complex five years ago to provide "affordable, safe housing" in a down-trodden area that has since started to turn around. During that time, the authority renovated the complex to class B standards and re-tenanted. "It is the valedictorian of the Woodhaven submarket," he says. "They took excellent care of the asset and in tenant selection." And now, he says the authority is moving on to deploy its money elsewhere in the city.
Epp says the buyer is a newcomer to Texas, but not the multifamily industry. "The buyer was extra easy to work with and is looking for more in Dallas/Fort Worth," he adds.
Woodhaven's upside stacks up to "a management play at the end of the day for these guys," Epp says, "and his ability to push rents." Donna Tarter with Legacy Commercial Bank in Dallas arranged financing. The ARA team included Brian O'Boyle and Jordan Cortez.
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