Property Details
Ground-Up Development 
Asset Profile
Opportunistic

Lume - Wilmington, MA

Wilmington, MA

Multi-Family Property
The Procopio Companies Lynnfield, MA
The Procopio Companies
  • IRR 20.9%
  • Equity Multiple 2.02x
  • Hold Period 4Y
  • Minimum Investment $25K
  • Year 1 Cash on Cash 0%
  • Stabilized Cash on Cash 12.3%
  • First Distribution Jan 2022
  • Distribution Frequency Quarterly
  • Asset Profile Opportunistic
  • Loan-to-Value 70%
  • Current Occupancy 0%

About this Property

Address 635 Main Street
Square Footage 64,260 sq. ft.
# of Units 49
Market Occupancy 95%
Average Projected Rent $2,668
Average Market Rent $2.03 /SF
Total Project Cost $19,975,000
Stabilized Loan to Value 65%

Top Questions

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


How are you mitigating risk due to the COVID-19 pandemic?

Michael Procopio, Procopio Companies: "COVID-19 related risks to this project are primarily around capital markets risk and the availability of non-or low-recourse construction debt, coupled with where current spreads are at over LIBOR. To that end, Procopio Companies has revised the financial modeling and underwriting assumptions to allow for a decrease in leverage to 70% LTC, and will execute, as needed, principal repayment and completion guarantees. Furthermore, Procopio Companies has removed refinance assumptions from underwriting, and while still seeing that as an opportunity for a creative to the deal, it is not assumed in the base-case. Overall, to date in the Boston market the impacts of COVID-19 on Class-A multifamily have not been significant. Rent collections across Procopio Companies' portfolio in April 2020 were at 96% overall, and the company anticipates the market will flush out any lingering delinquencies well prior to the lease-up and stabilization of this asset in 2022."

 

Why are you buying the Property?

Michael Procopio, Procopio Companies: "This property is perfectly positioned in one of Boston’s upscale suburban bedroom communities. Wilmington, like Reading and Woburn are positioned on the inner-128/Interstate 95 corridor, bustling with expanding technology, industrial, lab and defense companies. Located a short walk from the commuter rail station, and within easy access to interstates 93 and 95, the property is perfectly positioned to attract both downsizing baby-boomers desiring to stay in the upscale community of Wilmington, and young professionals seeking out an amenity and convenience driven apartment living lifestyle."

 

What is your investment strategy/business plan for the Property?

Michael Procopio, Procopio Companies: "This is an opportunistic ground-up investment, strategically located in an upscale yet not-developed suburban area of greater Boston. While very desirable, and with a median household income over $118,000, Wilmington has resisted extensive multifamily development, creating increased demand among young professionals and empty-nesters, making this entitled development extremely attractive. Procopio Companies is positioning this as not only the newest class-A property in the sub-market, but as an attractive value proposition to the competition in neighboring communities, with a hold period sufficient to not only stabilize the property, but push rents through a minimum of two turn cycles and exit on a 48-month timeline."

 

What are the 3 most important aspects of this investment opportunity for the investors?

Michael Procopio, Procopio Companies:
  1. "Ability to participate in a Class-A transit-oriented ground-up project, with both strong returns and relative safety due to not only the project profile, but the positioning of the project in one of the country’s best-performing multifamily markets"
  2. "The strength of a seasoned local sponsor and development team, who together have over half-a-billion dollars in active development in the Boston MSA."
  3. "Ability to capitalize on significant YoY rent growth and depressed exit CAP rates in the Boston market, allowing for unprecedented valuations and investor returns."

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

About this Property

Address 635 Main Street
Square Footage 64,260 sq. ft.
# of Units 49
Market Occupancy 95%
Average Projected Rent $2,668
Average Market Rent $2.03 /SF
Total Project Cost $19,975,000
Stabilized Loan to Value 65%

Top Questions

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


How are you mitigating risk due to the COVID-19 pandemic?

Michael Procopio, Procopio Companies: "COVID-19 related risks to this project are primarily around capital markets risk and the availability of non-or low-recourse construction debt, coupled with where current spreads are at over LIBOR. To that end, Procopio Companies has revised the financial modeling and underwriting assumptions to allow for a decrease in leverage to 70% LTC, and will execute, as needed, principal repayment and completion guarantees. Furthermore, Procopio Companies has removed refinance assumptions from underwriting, and while still seeing that as an opportunity for a creative to the deal, it is not assumed in the base-case. Overall, to date in the Boston market the impacts of COVID-19 on Class-A multifamily have not been significant. Rent collections across Procopio Companies' portfolio in April 2020 were at 96% overall, and the company anticipates the market will flush out any lingering delinquencies well prior to the lease-up and stabilization of this asset in 2022."

 

Why are you buying the Property?

Michael Procopio, Procopio Companies: "This property is perfectly positioned in one of Boston’s upscale suburban bedroom communities. Wilmington, like Reading and Woburn are positioned on the inner-128/Interstate 95 corridor, bustling with expanding technology, industrial, lab and defense companies. Located a short walk from the commuter rail station, and within easy access to interstates 93 and 95, the property is perfectly positioned to attract both downsizing baby-boomers desiring to stay in the upscale community of Wilmington, and young professionals seeking out an amenity and convenience driven apartment living lifestyle."

 

What is your investment strategy/business plan for the Property?

Michael Procopio, Procopio Companies: "This is an opportunistic ground-up investment, strategically located in an upscale yet not-developed suburban area of greater Boston. While very desirable, and with a median household income over $118,000, Wilmington has resisted extensive multifamily development, creating increased demand among young professionals and empty-nesters, making this entitled development extremely attractive. Procopio Companies is positioning this as not only the newest class-A property in the sub-market, but as an attractive value proposition to the competition in neighboring communities, with a hold period sufficient to not only stabilize the property, but push rents through a minimum of two turn cycles and exit on a 48-month timeline."

 

What are the 3 most important aspects of this investment opportunity for the investors?

Michael Procopio, Procopio Companies:
  1. "Ability to participate in a Class-A transit-oriented ground-up project, with both strong returns and relative safety due to not only the project profile, but the positioning of the project in one of the country’s best-performing multifamily markets"
  2. "The strength of a seasoned local sponsor and development team, who together have over half-a-billion dollars in active development in the Boston MSA."
  3. "Ability to capitalize on significant YoY rent growth and depressed exit CAP rates in the Boston market, allowing for unprecedented valuations and investor returns."

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

Offered By

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Assets Under
Management

Currently
$205MM less than 10 assets
Exited
$32.48MM less than 10 assets
Portfolio LTV
70%  
Historical
Realized Returns

Total IRR
26.6%  
Equity Multiple
2.16x  
Annual Cash
N/R  
Years Of
Experience

As Principals
30+ years  
In Business
70 years  
Size
28 Staff * Dedicated investor relations
* All information is reported by The Procopio Companies as of 4/13/2020.
Assets Under
Management

Currently
$205MM less than 10 assets
Exited
$32.48MM less than 10 assets
Portfolio LTV
70%  
Historical
Returns

Total IRR
26.6%  
Equity Multiple
2.16x  
Annual Cash
N/R  
Years Of
Experience

As Principals
30+ years  
In Business
70 years  
Size
28 Staff * Dedicated investor relations
* All information is reported by The Procopio Companies as of 4/13/2020.

Financials

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Offering Financial

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Location Details

Wilmington, MA

Proximity to employers, a strong public school system and an existing resident base that is affluent and highly educated. Excellent connectivity to major thoroughfares I-93 and Route 128 with immediate access to Routes 38, 62 and 129; 20-minute drive to Logan International Airport; 12-minute walk from the Wilmington Commuter Rail Station w/ a 30-minute ride into North Station Boston; Just over 1 mile from dominant regional grocer, Market Basket

Documents

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Offering Agreement Documents

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