DENTON, TX-A joint venture comprised of M&A Real Estate Partners and Phoenix Capital Partners has acquired Campus Park Apartments, a 192-unit/564-bed student housing project. The partnership bought the class A complex from its developer, Internacional Realty of San Antonio, TX, for an undisclosed amount.
Campus Park Apartments is the second deal that Dallas-based Phoenix Capital and Encino, CA-based M&A Real Estate Partners have acquired, according to Andrew Scott, partner of Phoenix Capital Partners. In December 2009, the JV bought Ansley at Park Central, a class A apartment property in Dallas.
Phoenix Capital is the equity partner in both deals, while M&A Real Estate Partners serves as the operating partner. “We focus on all real estate sector, but we are definitely focused more intently on multifamily right now,” Scott tells GlobeSt, adding that the firm owns one other student housing property in Tempe, AZ, near Arizona State University. “Some people consider student housing somewhat recession proof, and while I don’t know if I would go that far, if the property is well-located and priced right, it tends to stay full and do very well.”
The 10-year-old Campus Park Apartments, which serves a student population in excess of 45,000 (between the University of North Texas and Texas Women's University), is the “value provider” among newer class A properties in the marketplace. The garden-style property is nearly 100% occupied for the fall 2010 school year, Scott notes.
“We liked the price – it was a large discount to replacement cost and a very good cap rate,” Scott says, noting that the firm will achieve a cash-on-cash return on its equity of more than 10% the first year.
The new owners plan to upgrade the units and increase amenities at the property. “Combined with universities’ growth, we think the improvements will allow us to grow rents,” Scott says.
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