The investor's find is the 99%-leased Chalet Apartments at 6775 Jack Finney Blvd. The Hunt County property, built in 1978 and renovated in 1994, was sold by a Steve Fithian and Scott Henderson with Sperry Van Ness in Fort Worth on behalf of a private investor from Dallas. Judy Kent of TLC Realty in Mt. Pleasant, TX represented her hometown investor.
"Californians didn't want to go out there no matter what the yields were," Henderson tells GlobeSt.com. "Once you leave the four-county metroplex, things return to normal. A 10 cap isn't uncommon in our secondary markets and an 8.5 cap in Greenville is a real coup." The trek into Dallas is just 52 miles to the southeast.
To make the close, Henderson says the buyer assumed a $2.2-million loan balance with two years left on interest-only payments and then 28 years of full amortization. The fixed-rate loan, bearing a 5.25% interest, is serviced by LNR Property Corp. of Miami. "The loan had value or this would have been a 10 cap deal," Henderson explains, adding the assumption was cleared within a month.
According to Henderson, Chalet Apartments' 99% occupancy is a signal to the new owner that a rent hike could be imposed. His best guess is another $25 per month could be tacked onto current rates, which range from $355 to $540 per month. Chalet Apartments, positioned on 5.32 acres, has 16 studios, 48 one-bedroom and 56 two-bedroom units, ranging from 493 sf to 974 sf.
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