Student Housing Project - Carrollton, GA

[Account Closed]

Investment Info:

Large multi-family (5+ units) buy & hold investment in Carrollton.

Purchase price: $1,118,965
Cash invested: $6,108,366

A 40 unit 136 bed student housing property located adjacent to the University of West Georgia on 3.1 acres.

What made you interested in investing in this type of deal?

The location of the site and the enrollment data for the University of West Georgia was strong. UWG continued to grow through the recession and the market had not had new product delivered in a couple of years.

How did you find this deal and how did you negotiate it?

First I studied the enrollment data for all the public universities in Georgia and saw that UWG had grown steadily. Then I visited the market and saw that the properties in the market were older and there were few options that were walk to campus. At that point we hired a local real estate broker and he help us negotiate with property owners. It took over 12 months to get all the properties under contract.

How did you finance this deal?

1031 and conventional bank financing. We brought in a group of equity investors as well.

How did you add value to the deal?

We assembled 9 parcels that were owned by a total of owners. The zoning on the property did not allow for student housing and was single family rental houses that were grandfathered under the current zoning. We combined the properties into one parcel, demolished the houses and redeveloped the site.

What was the outcome?

We still own the property and its occupancy year after year is 95%. Rent has continued to increase year after year and the market fundamentals remain strong. The location and design of property had been the biggest selling points.

Lessons learned? Challenges?

This was our second deal and we made a lot of mistakes. Through these mistakes we learned the importance of strong deal fundamentals and hiring the right team. Also over the years we have learned the importance of property management and optimizing the rental income and expenses. It was also the first deal where we had to raise equity and gave us a better understanding of how to raise equity efficiently and effectively.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Metro West Realty - Real Estate Broker & Property Manager
Georgia & West Engineering - Civil Engineers
Lattimore and Hughes Construction - General Contractor
Ameris Bank - Lender