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ARLINGTON, TX-A Las Cruces, NM investor, notching his first win in Dallas/Fort Worth, has paid $9.7 million for the 264-unit Walnut Ridge in North Arlington. The new owner has put up a $3.6-million down payment and assumed a $6.1-million loan to gain the edge over a pack of eight would-be buyers.

When the dust settled at the closing table, Cruces Investment Group was holding a deed to the 95%-leased Walnut Ridge at 2500 Burney Rd., a 13-building footprint with upside in operational changes and rent bumps, according to Tom Burns, associate partner on Hendricks & Partners’ Dallas team. He and senior investment adviser Jay Gunn did a routine 30-day market run with the listing for a private investor from Plano, TX, who took the highest offer on the table in a natural culling of his long-time portfolio.

“His money was not exchange related, which was a little unusual,” Burns tells GlobeSt.com. “It was cash in the bank from a refinance.” He adds that Cruces Investment has been trying, and getting beat in the past 18 months, to get a North Texas asset for its portfolio. To score the first win, Cruces Investment assumed a Freddie Mac loan with a 5.25% fixed-rate interest and 30-year amortization.

With the deal done, the new owner will undertake a renovation to nudge the complex to a “solid class B” to underwrite a $20 to $25″ per month rent hike, Gunn says. The new owner has started the upside play with a utility chargeback to residents.

“The chargeback on the utilities is going to help his bottom line significantly,” Burns adds. Walnut Ridge’s oversight has been turned over to Capstone Management Co. of Dallas, which will steer the renovation as well at the 24-year-old complex, situated on nearly nine acres.

Gunn says the new owner plans to “lock it down and hang on” to the mix of one- and two-bedroom apartments, ranging from 471 sf to 945 sf. The monthly rents were $409 to $675 when the deed changed hands.

Burns says Walnut Ridge’s location–just blocks from US Highway 360 and close to Interstate 30–was the drawing card for investment circles, much as it’s been for other deals in the past year. “It’s all the excitement going on over there with the Dallas Cowboys’ stadium and the mixed-use [proposed GloryPark],” Burns says. “New buyers to the market have a fresh set of eyes. There’s not a preconceived notion. They don’t see it as it was 10 to 15 years ago.”

Burns and Gunn have closed $70.5 million in deals this year, with Arlington emerging as the leader for the sales volume. To date in the city, they’ve sold four complexes totaling 804 units, three more with 1,078 units at the title company and two more with 378 units up for grabs.

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