Property Details
Below Market Rents  Repositioning Opportunity  NOI Growth 
Asset Profile
Value Add

LURIN: The Cove Apartments (Tampa, FL)

Tampa, FL

Multi-Family Property
LURIN Dallas, TX
LURIN
  • IRR 36.05%
  • Equity Multiple 2.48x
  • Hold Period 3Y
  • Minimum Investment $100K
  • Year 1 Cash on Cash 0%
  • Stabilized Cash on Cash 11.3% Y3
  • First Distribution Mar 2023
  • Distribution Frequency Quarterly
  • Co-Investment 5% ($1.97MM)
  • Preferred Return 9%
  • Investor Profit Share See Financials
  • Asset Profile Value Add
  • Loan-to-Value 85%
  • Current Occupancy 96%

About this Property

"The Cove is a value-add investment opportunity located on the bay in Tampa, FL, the most sought-after multifamily market in the country. LURIN will transform the asset into a class-A- property through an extensive value-add strategy using it's in-house construction and operations teams."

- Jon Venetos, LURIN

Property Address 4003 S West Shore Blvd
# of Units 689
Square Footage 446,086 sq. ft.
Year Built 1979
Year Renovated 2018
Current Occupancy 96%
Market Occupancy 98%
Current Average Rent $1,386
Average Market Rent $2,149
Acquisition Price $195,000,000
Price/SF $439.10
Stabilized Loan to Value 61%

Top Questions

All answers are provided by the sponsor, LURIN, or its representatives.

 

Why are you buying this property?

Jon Venetos LURIN: "This acquisition represents an opportunity to acquire a Class B apartment community in Tampa, FL, the 2nd fastest growing city in the USA and the #1 MSA for relocations. The property will represent LURIN’s fourth transaction in the Tampa Bay MSA and the 24th transaction in Florida. LURIN will use its in-house operations and construction teams to implement its business plan to transform the asset into a desirable class-A- property through an extensive value-add strategy. By strategically repositioning the property, LURIN will market the property’s desirable location to bring rents and occupancy in-line with properties of similar vintage in the immediate sub-market."

 

What are the most important aspects of this investment opportunity for the investors?

Jon Venetos, LURIN:

  1. "Tampa Market Fundamentals: The Tampa market is one of the most sought-after multifamily markets in the country. Population growth into the area remains strong as domestic migration to the business-friendly Sun Belt markets continues. Tampa Bay was the #1 relocation destination for Americans who moved during the pandemic and was ranked 5th in the country for relocations in 2021. Job growth in the market has been drastically elevated during the pandemic with booming technology and financial services sectors. Homeownership is becoming less attainable, as Zillow forecasts home values will rise by 25% in Tampa in 2022. As homes become less affordable, more residents have turned to renting, continuing the strong demand for apartments in the area. Economic and population growth have led to a boom for multifamily as historical and projected future rents are at all-time highs."
  2. "Live-Work-Play Location: The Cove is situated directly on water in Tampa Bay in the heart of the Westshore/South Tampa submarket, Tampa’s most desirable neighborhood. Situated in the nexus of Downtown Tampa, Westshore Business District, Gateway Business District and Downtown St. Petersburg, The Cove is uniquely positioned to offer tenants quick access to all of the major office employment nodes within the market. Within South Tampa, there are several entertainment and nightlife centers supplying ample options for popular restaurants and bars. For outdoor enthusiasts, South Tampa offers multiple access points to Tampa Bay for water and boating activities. This live-work-play environment attracts a wide renter pool, from well-educated millennial renters to families wanting quick commutes and a premier education."
  3. "Irreplaceable Asset & Value-Add Opportunity: The Cove is unique in that no other apartment community within South Tampa has similar waterfront access, and there are no remaining developable land parcels with direct access to the Bay. The property needs a large capital infusion to upgrade the interior units to a level commensurate with nearby competitors making it a prime, value-add investment opportunity. Previous ownership renovated 138 interior units to a Class-A level that is equal to the premier properties in the submarket; however, the remaining 551 units, and much of the exteriors and amenities, need modernization. Renovated and Class-A properties in the submarket are achieving $500-$700 premiums above current rents for unrenovated units at the property."
  4. "Proven Track Record: LURIN already owns and operates 21 assets in Florida consisting of 4,025 units across 5 different markets (Tampa/ St. Pete, Fort Myers, Panama City, Fort Walton Beach, and Pensacola). LURIN manages and executes all renovations with its in-house construction and property management teams. LURIN has a proven track record of repositioning value-add properties throughout Florida, including 2 recent dispositions, The Lennox (34.5% Net IRR and 2.2x Net Equity Multiple) and Amelia at Westshore (102.4% Net IRR and 1.7x Net Equity Multiple)."

 

What is your investment strategy/business plan?

Jon Venetos, LURIN: "LURIN’s business plan will be to transform the asset into a desirable Class-A- property and improve on-site operations with its in-house operations and construction teams. LURIN’s renovation strategy will be focused on three key areas; i) interior upgrades, ii) exterior improvements / curing deferred maintenance, and iii) improving existing amenities and adding new amenities. LURIN believes its value-add investment will yield an average rental increase of $524 per month per unit. LURIN will be using its in-house construction teams for both interior and exterior renovations and is planning to invest $16.9M into The Cove."

"The business plan calls for a full rehab of 551-unit interiors (80%) and a partial rehab of 138-unit interiors (20%), upon which time LURIN plans to continue to operate asset and distribute quarterly free cash flow payments back to investors. The estimated timeline for this is planned to be between 24 and 30 months into the project lifecycle."

"It is LURIN’S intention to dispose of the asset roughly 36 months into the project life cycle after fully repositioning the asset, assuming normal market conditions. That said, opportunity may exist to refinance the asset prior to 36-month period, return LP capital and cash flow the asset for a period beyond 36-months."

 

What are the risks and how are you mitigating those risks?

Jon Venetos, LURIN: “There are several potential risks associated with investment, including but not limited to: i) expiration of leases, ii) unexpected delays in construction, iii) cost overruns in construction, iv) due diligence may not reveal all property conditions, v) financing and refinance risk, and vi) general local market risk for St. Petersburg, FL. Additional risks for this investment include an unforeseen material events such as hurricanes or a global pandemic. LURIN believes these risks are mitigated through our vertically integrated platform, controlling construction and operations. Additionally, LURIN engages third party consultants to individually insure each property against unforeseen circumstances.”

 

NOTE: All answers provided by the sponsor, LURIN, or its representatives.

About this Property

"The Cove is a value-add investment opportunity located on the bay in Tampa, FL, the most sought-after multifamily market in the country. LURIN will transform the asset into a class-A- property through an extensive value-add strategy using it's in-house construction and operations teams."

- Jon Venetos, LURIN

Property Address 4003 S West Shore Blvd
# of Units 689
Square Footage 446,086 sq. ft.
Year Built 1979
Year Renovated 2018
Current Occupancy 96%
Market Occupancy 98%
Current Average Rent $1,386
Average Market Rent $2,149
Acquisition Price $195,000,000
Price/SF $439.10
Stabilized Loan to Value 61%

Top Questions

All answers are provided by the sponsor, LURIN, or its representatives.

 

Why are you buying this property?

Jon Venetos LURIN: "This acquisition represents an opportunity to acquire a Class B apartment community in Tampa, FL, the 2nd fastest growing city in the USA and the #1 MSA for relocations. The property will represent LURIN’s fourth transaction in the Tampa Bay MSA and the 24th transaction in Florida. LURIN will use its in-house operations and construction teams to implement its business plan to transform the asset into a desirable class-A- property through an extensive value-add strategy. By strategically repositioning the property, LURIN will market the property’s desirable location to bring rents and occupancy in-line with properties of similar vintage in the immediate sub-market."

 

What are the most important aspects of this investment opportunity for the investors?

Jon Venetos, LURIN:

  1. "Tampa Market Fundamentals: The Tampa market is one of the most sought-after multifamily markets in the country. Population growth into the area remains strong as domestic migration to the business-friendly Sun Belt markets continues. Tampa Bay was the #1 relocation destination for Americans who moved during the pandemic and was ranked 5th in the country for relocations in 2021. Job growth in the market has been drastically elevated during the pandemic with booming technology and financial services sectors. Homeownership is becoming less attainable, as Zillow forecasts home values will rise by 25% in Tampa in 2022. As homes become less affordable, more residents have turned to renting, continuing the strong demand for apartments in the area. Economic and population growth have led to a boom for multifamily as historical and projected future rents are at all-time highs."
  2. "Live-Work-Play Location: The Cove is situated directly on water in Tampa Bay in the heart of the Westshore/South Tampa submarket, Tampa’s most desirable neighborhood. Situated in the nexus of Downtown Tampa, Westshore Business District, Gateway Business District and Downtown St. Petersburg, The Cove is uniquely positioned to offer tenants quick access to all of the major office employment nodes within the market. Within South Tampa, there are several entertainment and nightlife centers supplying ample options for popular restaurants and bars. For outdoor enthusiasts, South Tampa offers multiple access points to Tampa Bay for water and boating activities. This live-work-play environment attracts a wide renter pool, from well-educated millennial renters to families wanting quick commutes and a premier education."
  3. "Irreplaceable Asset & Value-Add Opportunity: The Cove is unique in that no other apartment community within South Tampa has similar waterfront access, and there are no remaining developable land parcels with direct access to the Bay. The property needs a large capital infusion to upgrade the interior units to a level commensurate with nearby competitors making it a prime, value-add investment opportunity. Previous ownership renovated 138 interior units to a Class-A level that is equal to the premier properties in the submarket; however, the remaining 551 units, and much of the exteriors and amenities, need modernization. Renovated and Class-A properties in the submarket are achieving $500-$700 premiums above current rents for unrenovated units at the property."
  4. "Proven Track Record: LURIN already owns and operates 21 assets in Florida consisting of 4,025 units across 5 different markets (Tampa/ St. Pete, Fort Myers, Panama City, Fort Walton Beach, and Pensacola). LURIN manages and executes all renovations with its in-house construction and property management teams. LURIN has a proven track record of repositioning value-add properties throughout Florida, including 2 recent dispositions, The Lennox (34.5% Net IRR and 2.2x Net Equity Multiple) and Amelia at Westshore (102.4% Net IRR and 1.7x Net Equity Multiple)."

 

What is your investment strategy/business plan?

Jon Venetos, LURIN: "LURIN’s business plan will be to transform the asset into a desirable Class-A- property and improve on-site operations with its in-house operations and construction teams. LURIN’s renovation strategy will be focused on three key areas; i) interior upgrades, ii) exterior improvements / curing deferred maintenance, and iii) improving existing amenities and adding new amenities. LURIN believes its value-add investment will yield an average rental increase of $524 per month per unit. LURIN will be using its in-house construction teams for both interior and exterior renovations and is planning to invest $16.9M into The Cove."

"The business plan calls for a full rehab of 551-unit interiors (80%) and a partial rehab of 138-unit interiors (20%), upon which time LURIN plans to continue to operate asset and distribute quarterly free cash flow payments back to investors. The estimated timeline for this is planned to be between 24 and 30 months into the project lifecycle."

"It is LURIN’S intention to dispose of the asset roughly 36 months into the project life cycle after fully repositioning the asset, assuming normal market conditions. That said, opportunity may exist to refinance the asset prior to 36-month period, return LP capital and cash flow the asset for a period beyond 36-months."

 

What are the risks and how are you mitigating those risks?

Jon Venetos, LURIN: “There are several potential risks associated with investment, including but not limited to: i) expiration of leases, ii) unexpected delays in construction, iii) cost overruns in construction, iv) due diligence may not reveal all property conditions, v) financing and refinance risk, and vi) general local market risk for St. Petersburg, FL. Additional risks for this investment include an unforeseen material events such as hurricanes or a global pandemic. LURIN believes these risks are mitigated through our vertically integrated platform, controlling construction and operations. Additionally, LURIN engages third party consultants to individually insure each property against unforeseen circumstances.”

 

NOTE: All answers provided by the sponsor, LURIN, or its representatives.

Offered By

LURIN

LURIN

Dallas, TX

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Assets Under
Management

Currently
$1.7B 30+ assets
Exited
$735MM 10+ assets
Portfolio LTV
59%  
Historical
Realized Returns

Total IRR
39%  
Equity Multiple
2.1x  
Annual Cash
N/R  
Years Of
Experience

As Principals
5+ years  
In Business
7 years  
Size
90 Staff * Dedicated investor relations
* All information is reported by LURIN as of 5/4/2022.
Assets Under
Management

Currently
$1.7B 30+ assets
Exited
$735MM 10+ assets
Portfolio LTV
59%  
Historical
Returns

Total IRR
39%  
Equity Multiple
2.1x  
Annual Cash
N/R  
Years Of
Experience

As Principals
5+ years  
In Business
7 years  
Size
90 Staff * Dedicated investor relations
* All information is reported by LURIN as of 5/4/2022.

Financials

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Offering Financial

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Location Details

Tampa, FL

Jon Venetos, LURIN:

"Location: The Cove is located in South Tampa, the premier submarket within the city. South Tampa is characterized by wealthy neighborhoods, abundant shopping, outdoor recreational opportunities, great public schools, and easy access to employment centers."

"Work: For quick commutes on the Tampa side of the metro, The Cove is only a 10-minute drive to both Downtown Tampa (75,000+ high-wage employees & UCF Medical School) and the Westshore Business District (Florida’s largest office community). In addition to those office hubs, just across the bay from The Cove, the Gateway Business District and Downtown St. Petersburg are easily accessible using the Gandy and Howard Franklin Bridges. Those two employment centers contain over 150,000 employees. At the nexus of the four primary employment nodes within the Tampa metro, the property can be home to employees who work across the entire MSA. Also, in addition to office employment, MacDill Air Force Base is just south of the property and home to over 30,000+ military occupations."

"Play: Nightlife and entertainment options are also only a short drive away from the property. Within South Tampa, there are several entertainment and nightlife centers such as Hyde Park and the SOHO District that supply ample options for popular restaurants and bars. Both areas have the premier restaurants in the city, as well as luxury retail staples like Lululemon, Anthropology, and Soul Cycle. Just five blocks south of the property is the Westshore Marina District, a recently completed $1B mixed-use development. The Westshore Marina District contains new luxury townhomes, 60K SF of boutique retail and dining, 150 boat slips, and several community parks. Downtown Tampa is not just an office hub; the central business district is full of great restaurants, bars, breweries and major attractions. The new Armature Works and Water Street Developments are mixed-use hubs that have transformed the downtown into a major entertainment attraction."

Documents

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Offering Agreement Documents

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