TIC Pool Grabs 248 Units Off Market for $23M

(To read more on the TIC market, click here.)

BENBROOK, TX-In a two-week spin, ORIX Real Estate Capital Inc. has purchased and built a tenant-in-common pool for the flip of a 248-unit, class A complex in southwest Fort Worth. When the dust had settled on the off-market deal, 18 TIC investors had put up $9.4 million of equity for the $23.4-million takeover of Victorian Quarters.

The TIC pool for the 8889 Cook Ranch Rd. asset consisted of all US investors clearing 1031 exchanges from their books, Marc Armentrout, ORIX director for the TIC program, tells GlobeSt.com. The capital markets group’s business model is buy and sell to a pool as quickly as possible.

“We look at new, class A properties in growing markets that are stabilized,” explains Margo Steahly, director for TIC sales for the Chicago-based ORIX, who teamed with Armentrout to acquire the 12-building asset from the developer, Team Ranch Partnership, led by Johnny W. Stevens of Wichita, KS. She says Victorian Quarters was built in 2004, with occupancy at 90% at the closing.

Armentrout say the TIC is poised to hold Victorian Quarters for 10 years. HSAD Property Management Co. of Plano was slid in to oversee the 18-acre complex. The mix of apartments are one-, two- and three-bedrooms ranging from 760 sf to 1,313 sf. Monthly rents start at $760 and top out at $1,450.

Armentrout says the deal was bed down with a $14-million loan from Calabasas, CA-based Countrywide Financial Corp.’s commercial lending group. He says TIC investors put up a minimum $300,000 to join the pool, with the average buy-in ringing up $525,000.

Victorian Quarters is the second one in the metroplex for ORIX’s one-year-old, Dallas-based TIC group. “It had a good story behind,” Steahly says, “and reasonable expectations for our investors. It was very well received.”