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HOUSTON-An Oregon investor has sold its lone Houston property, releasing the deed to the 104-unit South Chase Apartments in the southwest submarket for close to the $3.2-million asking price.

The new owner is zeroing in on the below-market rents of about $50 per month as the upside in the takeover of 9330 Synott. The buyer of record is Azhuta LLC, a Houston investment group that paid “very close” to the asking price, Kyle Johnson in the Houston office of Marcus & Millichap tells GlobeSt.com. He teamed with Marcus & Millichap’s Norman Eastwood in Dallas to represent the seller, JS Properties of Lake Oswego, OR, which is planning to spin a 1031 Exchange with the proceeds.

The buyer, which has other multifamily properties in town, used in-house representation to negotiate the acquisition, a 95%-leased property with a Harris County 2002 assessment of $2.4 million.

Johnson says JS Properties felt it was a good time to sell. Besides, he says, local management, which the new owners plan to provide, could help increase rents while decreasing expenditures…at least that’s what the strategy is going forward. South Chase’s rents range from $450 to $610 per month, including water, a rate that’s $40 to $50 per month less than a neighboring property that is practically a twin, he says. The new owner’s upside plan includes outfitting units with individual water meters. The apartments range from 550 sf to 875 sf.

Johnson says the complex baited eight offers in the 90 days it was on the market. The owner obtained about $2.7 million in a 10-year loan, with 30-year amortization, at a 6.1% interest rate from Deutsche Bank to close the deal, according to Johnson.

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