We acquired the Great Northern (“GN” or the Property”) Apartments (Class C apartment community located in Austin’s North submarket) in 2015. The Seller of GN was a “mom and pop”, absentee owner.  The Seller maintained the asset well, but failed to achieve market rents evidenced by the fact that the Property’s in-place rents were substantially below (32%) the comp set weighted average rents (Berkadia Capital survey) prior to our acquisition. The Manager’s plan was to strategically increase rents via enhanced revenue management, further upgrades of interior units, improved curb appeal, overall repairs, as well as optimizing cost controls in support of establishing better operating margins via scale and efficiencies (Manager owned six assets in submarket).  Following execution of our renovation and repositioning plans, we planned to refinance the acquisition loan, thereby potentially repatriating significant equity capital within the first year of ownership.

After executing its plan, our team increased overall rents by nearly 34% since inception.  We also refinanced the asset per our business plan resulting in a 27% return of original equity.  In consideration of market conditions as well as the size and age of the Property, the Company realized upon its investment via a sale to a private investor in Q318.