Multifamily Continues to Fly off the Shelves

DALLAS—Yet another example of a multifamily acquisition of an asset with rents at below-market levels is San Benito Apartments. The rents were 40% below market, the buyer tells GlobeSt.com. This off-market transaction was made possible due to the purchaser’s compelling offer, which included an initial non-refundable earnest money deposit and expedited feasibility period.

The purchaser was a North Texas-based real estate investment and management firm, Ci Management. Dallas-based Vanguard Real Estate Advisors represented Ci. The Dallas-based seller was represented by John Thompson of Low Sky Commercial Real Estate.

“The purchaser was able to acquire a tremendous value-add asset in a highly desirable area of East Dallas with current rents significantly below market levels,” said Jordan Cortez, managing principal of Vanguard Real Estate Advisors.

The two-story 22-unit community is located in the Little Forest Hills neighborhood at 9008 San Benito Way, just a few blocks east of White Rock Lake. It was constructed in 1961.

“First, we’re going to reposition the property. We’ll be doing a phased rehab. As current leases come up, we’ll offer to let the current tenants stay with a 10% market discount. That’s still a fairly hefty rise in rents for them though,” Jay Cutcher, owner and CEO of Ci Management tells GlobeSt.com. “If they choose to leave, we’re going to do one of two make readies depending on amount of time we have in the unit. The lower level make ready will simply freshen the unit up with new floors, paint, cabinets and counters. The higher level make ready will include moving a wall to reconfigure the downstairs. We’re also tackling all of the deferred maintenance issues.”

Vanguard Real Estate Advisors specializes in investment sales assignments, joint venture equity placement and structured finance solutions.