Park Plaza62-Unit Community in the Northeast Austin Sub Market
NorthEast Austin Submarket
Located just minutes from Samsung, General Motors, Dell, Apple, IBM, Microsoft, National Instruments, and HP.
Average rent’s at takeover were approximately 15% below market, with all utilities being paid by the property.
Park Plaza is a well-maintained 1983 asset that was in need of a cosmetic upgrade.
The tenant demographic is a great mix of blue collar and construction professionals/families.
829 Park Plaza.
This 62-unit multifamily property was built in 1983, and features large one and two-bedroom units, playground, pool/outdoor area, and an on-site laundry facility.
- Occupancy at takeover 100% 100%
- Value-Add Rent Growth 15% 15%
- Average Annual Sub Market Rent Growth 4.7% 4.7%
- Average Sub Market Occupancy 95.6% 95.6%
Austin is one of the key places we want to be because we think that’s where our people want to be. We want to develop the kinds of facilities where you feel good about coming to work every day.
Park Plaza is exactly the kind of deal we look for. It was brought to us by our broker as a pre-market deal. The seller had owned the property for 20+ years, managing it himself from out-of-state. Rents were approximately $150 below market rates, and the owner was paying all utilities, the only property in the area to do so.
Since our purchase at the end of 2019, we’ve prioritized getting all tenants on 6-12 month leases, making sure to stagger them to reduce our exposure. At takeover, 50 of the 62 units were month-to-month. Within two months, we had converted 40 of those to longer term leases, and implement RUBs upon renewal.
We expect to exit this project in 5-7 years, with an equity multiple greater than 2.0x and an average annual return of 18%.