Seibco International Inc. is the buyer of the complex, positioned near the cities of South Houston and Pasadena. Allen Arms Apartment Inc. of Bellaire, TX is the seller of the class C product built in the early 1970s.
Jeff Eisenhardt of the Houston office of Hendricks & Partners represented the seller. The buyer, Seibco, used in-house representation.
Eisenhardt tells GlobeSt.com that the seller just acquired the holding in June 2000. The game plan was to remodel, raise rent and sell for a profit, he says. The 98%-occupied complex had 18 units still under construction when the wheeling and dealing began. By closing time, the rest of the construction was wrapped up and ready to occupy, he says.
Eisenhardt says the building went on the market in August 2001 for an asking price of $3.5 million. The marketing strategy was derailed by Sept. 11 as investors waited to see the nation's response to the terrorists' attacks. "Buying interest momentarily disappeared," says Eisenhardt. Still, the property attracted a half dozen bidders.
Eisenhardt believes occupancies at class B, C and D properties will remain steady, but class A product stands to lose tenants opt to buy and take the bait of low mortgage interest rates. In Q4 2001, class occupancy averaged 93.14% citywide, according to a research report put out by O'Connor & Associates.
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