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HOUSTON-A group of local investors has secured $8.6 million to reposition an Inner Loop multifamily property with a low occupancy and high potential given its location. More than $2 million will go into interior and exterior renovations.

The joint venture owners of the 156-unit Timber Grove Condominiums, a rental property since it delivered in 1985 at 1710 W. TC Jester Blvd., secured the two-year loan at a floating interest rate from a national bank. Jason Rice, an assistant vice president for Quantum First Capital, a Dallas-based real estate finance and advisory firm, arranged the financing for TGJV LP. Rice tells GlobeSt.com that the local JV recently added another Houston-area partner who helped to secure the loan.

The original four-building Timber Grove was expanded in 1995 and now consists of six three-story buildings and a four-story parking garage. Nestled in a heavily wooded area, the property is situated inside the 610 Loop, with easy access to the downtown, Galleria, Medical Center and River Oaks shopping centers. Rice says the location helped win the loan. “If Timber Grove had been farther out, it may have been more difficult,” he says.

The financing will be used to renovate and reposition the asset. Rice says previous management neglected the property in recent years, driving a significant drop in occupancy. The restructured ownership team plans to pump more than $2 million into a renovation. The exterior work will add new siding, roofs, landscaping and garage upgrades. Work to interiors will include new carpeting, countertops, cabinets, appliances and HVAC. Rice says the renovation will take six to eight months to complete.

When the work’s done, the owners expect to raise rents to about $1.15 per sf. The goal is a monthly per unit rent of $840, up $13 from the existing rate. Timber Grove’s units average 730 sf. The repositioning might include a name change, Rice adds.

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