Michel Hibbert, a broker with Charles Dunn Co. and a partner in the deal, tells GlobeSt.com that talks were beginning for the 204-unit Waterford Apartments at 3829 Gannon Lane in South Dallas when he visited, saw the shared access road with the 228-unit Renaissance Creek Apartments at 3839 Gannon Lane and placed bids with separate brokers to get the multifamily block. When the deals closed, Waterford brought $4.2 million and Renaissance fetched $4.8 million for limited partnership sellers, some with crossover interests in both properties. Jay Gunn with Hendricks & Partners' Dallas office represented Waterford's local seller of record, F-Crest Holdings LP; and Nita Stewart with CB Richard Ellis Inc.'s local office brokered for Renaissance's seller, FJBB-Gannon Ltd.

Built in 1985 and 1986, the complexes are positioned near the intersection of US Highway 67 and Interstate 20. Hibbert says less than $1 million will be spent on renovations, mostly cosmetic upgrades for the 80%-leased assets. The new name isn't being released, but Sunridge Management Group of Dallas has been hired to steer the lease-up.

Waterford, a mix of efficiencies and one-bedroom units, rent for $300 to $400 per month. Its units average 500 sf. The Renaissance's apartments, averaging 700 sf, are one- and two-bedrooms that bring in $400 to $600 per month.

Hibbert has another property under contract in North Texas. "We're very optimistic about the area as far as coming from California to the Texas market," he says. "We heard some good reports from other investors who have bought there. Dallas is where we want to be."

Hibbert says the partnership reinvested 1031 exchange proceeds from a 16-unit complex in Los Angeles to mark its first spot in Texas. The second purchase will be made with funds from another Los Angeles-area exchange, he says.