$46M in Arizona Multifamily closed in last 60 days

[Serge S.]

Greetings BP, its been a while and I wanted to post a brief update of our deal flow in the last 60 days:

1. Metro PHX - 168 unit mid 80s and late 90s former Marriot Residence Inn, off market deal purchased from Covid distressed seller. Purchased at $15.75M, unit mix is split between 2bd/1bd/studio all fully furnished with a $25k/door Marriott PIP less than 24 months ago. Fully converted to multifamily and currently running it as a hybrid. Property was empty at purchase in early December 2020 and as of of Feb 1 is 94% occupied and generated $290k in cash reciepts in January 2021. I underwrote this project to a year 1 $1.25M NOI and its looking like this will be closer to a $2M NOI.

2. Metro Tucson - 135 unit late 70s multifamily in an ideal Tucson location on Broadway. Off market deal through seller/broker relationship. Fantastic unit mix including nearly half 2/2. This complex had no RUBS in place and average rents at least $200 below market and produced a $500k NOI at time of purchase for $10.8M. Planned capex will include an exterior refresh and bringing rents to market. This will be an $900k year 2 NOI with minimal heavy lifting.

3. Metro Tucson - 236 unit 1980s in fantastic Catalina Mtn location, walking distance to the best retail in Tuc. Another off market deal purchased for $19M with nearly $1M NOI in place. Rents no less than $200 below market with no RUBS in place. This will be a year 2 $1.5M NOI.

All deals were done with local portfolio lenders at terms equivalent to Fannie but without any prepayment penalties. 

Any questions, please post ...

[Brian Burke]

Congrats, Serge...so amazing to follow your success. We are neighbors now, as we just closed a $36MM deal not far from one of yours. You have some good assets there and I’m glad you were able to pull that one off without our involvement. Like I said then, you didn’t need us, you have this 100% under control!  Congrats!