Property

Valencia Apartment Homes Fort Worth, TX

Property
Type
Multi-Family
Investment Type
Property
Asset Profile
Value Add
Min. Investment
$25K
Estimated Hold
3-5Y
Target Return (IRR)
18%
Target Annual Cash
12.1%
Target Equity Multiple
2.03x
This deal is oversubscribed
 

Offered By

Nicholas Residential LLC Experienced Sponsor

Dallas, Texas

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Assets Under
Management

Currently
$146MM
Exited
$106.5MM
Portfolio LTV
65%
Historical
Realized Returns

Total IRR
36.3%
Equity Multiple
2.3x
Annual Cash
11.8%
Years Of
Experience

As Principals
10+ years
In Business
2 years
Size
45 Staff
* All information is reported by Nicholas Residential LLC as of 6/12/2017.
 

About this Property

Many of the Property’s 263 units have been partially upgraded by the current owner, while some have not been improved at all. These upgrades have justified a rent premium of $125/unit. Upon acquisition, Sponsorship will complete full renovations on all 171 units which have not already received the full upgrade package, with a plan to achieve blended premiums of at least $85/unit.

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Key Points

  • Proven and focused team: Valencia will be Nicholas Residential and ParaWest’s eighth deal as partners, having completed projects totaling more than 2,400 units and $163 million in multifamily properties across Texas. Together, the partnership has averaged in excess of a 20% IRR and 2.00x equity multiple to investors since 2011.
  • High cash flow with monthly distributions: The Co-Sponsors are targeting a 10% preferred return distribution paid monthly commencing immediately upon acquisition.
  • Proven renovation plan: The property has a proven renovation plan implemented by the current owner (92 out of 263 units fully upgraded) that is achieving average rent premiums of $125 per fully upgraded unit. Nicholas Residential & ParaWest plan to move rents to market as units turn and continue the full upgrade renovation program on 171 units to achieve blended average upgrade premiums of at least $85/unit.
  • Strong market fundamentals: Rent growth for similar vintage assets in East Fort Worth experienced an annual increase of over 12% for Q4 2016, according to MPF Research. Additionally, Fort Worth rent growth has continued to outpace Dallas for the past nine consecutive quarters due to a lack of supply. In the I-820 submarket, there are no new units currently under construction and REIS projects that effective rents will grow by 7.2% in 2017.
 

Financials

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Location Details

Fort Worth, TX

Valencia is ideally located near major thoroughfares allowing for convenient access to downtown Fort Worth, the Fort Worth Medical District, the Alliance Corridor, and Dallas/Fort Worth International Airport. Combined, these employment drivers total more than 258,000 jobs within a 15 minute drive.

The Fort Worth-Arlington Metropolitan Division has shaken off the oil and gas industry downturn and is now experiencing increasing employment growth. Current Employment Statistics (CES) data from the U.S. Bureau of Labor Statistics (BLS) show that non-farm wage and salary employment grew by 2.1% from September 2015 to September 2016. this figure is up from the 1.8% growth seen in the prior 12 month period. Additionally, the number of employed residents in the area was up by 3.0% (33,685) in the year to September 2016 which is more than three times the increase from the prior 12 month period. A low cost of living continues to draw workers to the Fort Worth area as the population increased by 49,420 (2.1%) in the year to the third quarter.

The Fort Worth-Arlington Metropolitan Division has shaken off the oil and gas industry downturn and is now experiencing increasing employment growth. Current Employment Statistics (CES) data from the U.S. Bureau of Labor Statistics (BLS) show that non-farm wage and salary employment grew by 2.1% from September 2015 to September 2016. this figure is up from the 1.8% growth seen in the prior 12 month period. Additionally, the number of employed residents in the area was up by 3.0% (33,685) in the year to September 2016 which is more than three times the increase from the prior 12 month period. A low cost of living continues to draw workers to the Fort Worth area as the population increased by 49,420 (2.1%) in the year to the third quarter.

Moody’s Economy.com still predicts an ongoing boom in metro Fort Worth. The population is forecast to continue rising by about 50,000 per year (2.0%). Employment is anticipated to increase by an average of 25,360 (2.4%) from 2017 to 2020. The number of households is expected to rise by more than 100,000 over five years. Source: REIS

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Documents

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Frequently Asked Questions

Below are some of the most frequently asked questions about this offering.

The first projected distribution is scheduled for October 2017.

Distributions are scheduled to go out on a monthly basis.

Yes, non-US residents are welcome to apply.

Yes, this offering is 1031 exchange compatible.

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Have a Question?

Send Nicholas Residential LLC and/or RealCrowd a message. If you have a question about this offering ask Nicholas Residential LLC. If you have a question about the transaction process or other general inquiry, RealCrowd will be happy to help.

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