Multifamily Owner Shuffling 3,500-Unit Portfolio in North Texas

On the market for $7.5 million, the 318-unit Skyline Place Apartments at 4700 Wimbelton Way in East Dallas brought 30 offers in a four-month marketing period that ended with eight full-price bids, Tom Warren, associate partner in Dallas for Phoenix-based Hendricks & Partners, tells GlobeSt.com. Scoring the win was a Bakersfield, CA-headquartered investment group, State Road Skyline LP-Arppel Inc.

Next month, a single buyer is lined up to scoop up five of the six remaining assets in the 3,500-unit sell-off of class C and class C-plus properties. Warren says the sale culminates a 10- to 12-year hold. "It was time to get out," he explains of the turnover. The first to go was the 232-unit LaSalle Crossing at 1600 LaSalle Dr. in Sherman, which sold a few months ago.

Part of the gain will be deployed as 1031 Exchanges, which Warren is lined up to run for the Del Mar partnership. "The seller will reinvest their proceeds in Texas," he stresses.

Skyline Place's new owner will spend about $300,000 on upgrades to "cure deferred maintenance," Warren says of the 80%-leased complex. The mix of 222 one-bedroom and 96 two-bedroom units average 776 sf, with the monthly rent set at 66 cents per sf. The East Dallas submarket average is pushing 73 cents per sf, building in post-renovation upside for the new owner, which made the close with a $6.2-million loan assumption held by Archon Group of Irving, TX. The 17-year-old Skyline Place, positioned on 11.8 acres, is assessed at $5.6 million.