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[IMGCAP(1)]FORT WORTH-Despite slowed multifamily asset sales, a Littleton, CO-based partnership has brought a 1,193-unit, seven-property portfolio to market for slightly more than $50 million. The confidence factor for the sales is mortared in the financing: three sized just right for Fannie Mae and four with assumable mortgages far below today’s fixed interest rates.

“The opportunities are different for each property, but as a portfolio the value add is in burning off concessions, loss to lease and economic vacancy,” Al Silva, senior associate in Fort Worth for Marcus & Millichap Real Estate Investment Services, tells GlobeSt.com. Teaming with associate Kelley Sparkman in Dallas to sell the package whole or in pieces, Silva says buyers’ interest to date has been geographically oriented, but “I’m not ruling out a portfolio sale because we’ve got plenty of interest at the portfolio sale level.”

The North Texas properties are 220-unit Fielders Glen at 3601 S. Fielder Rd. in Arlington and 224-unit Windtree at 5600 E. Cotswold Hills Dr. and 168-unit Hillside View at 5400 Boca Raton Blvd., both in Fort Worth. In South Texas, the properties are the 124-unit Park Deville at 407 Greens Rd. and 180-unit Palms on Rolling Creek at 17100 Rolling Creek Dr., both in Houston; and 93-unit Central Park Condos at 2210 Westview Blvd. and 184-unit Riverwalk at 291 Scarborough Dr., both in Conroe.

The telling is in the details. The 15-building Fielders Glen, situated on 10 acres, is 88% leased as is the 20-building Windtree, a 10.6-acre footprint. Hillside View, with 15 buildings on 6.3 acres, is 90% occupied. The 92%-leased Park Deville is a 10-building mix on 3.5 acres while the 88%-filled Palms is a 10-building project on 7.9 acres. Riverwalk, boasting 95% occupancy, is a 14-building complex on seven acres.

[IMGCAP(2)]Interest to date has come from smaller private buyers to institutional investors, according to Silva. “There are still a lot of people who are bullish on Texas,” he says. “And, this is a good opportunity for someone who is coming to Texas for the first time to aggressively expand their presence.”

Silva says the seller, who has additional holdings in Texas, amassed the properties in the past three to seven years. The assets range from class C plus to class B plus, predominately 1980s-era construction. The one-, two- and three-bedroom mix averages 822 sf and rent averages $638 per month. “Some properties can definitely get a bump in rents with interior upgrades,” Silva says. “With several of these, you can carve out a niche by interior upgrades and adding amenities.”

The broker, though, says upside is more related to tighter operating efficiencies and more aggressive marketing in sync with concession burn-off. Silva says concessions average 5% to 6% of gross rents, with the buy-in cap rate hovering 7%.

“We feel this is a great flight to safety type of market play–notes in yesterday’s financing terms, solid returns coming into the deal and room for improvement,” Silva says, adding three assets are “perfect sizes” for Fannie Mae financing. “The value add is there, but the value is there too on the current return.”

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