Adaptive Reuse Case Study Project – Foch St.

Project Description

Addresses:

Buildings 2-3: 1001-1059 Foch Street.

Building 1: 821-945 Foch Street.

For my adaptive reuse case study I am considering the proposed properties and determining what the property should be developed as.

There are three buildings located just off of  W.7th street in the cultural district / W 7th street corridor.  It is just south west of the Montgomery Plaza and there are several new multistory multifamily apartments being built directly across from the proposed site.

 

 

 

 

 

 

 

 

 

 

 

 Building 1 has approx 68,000 SF, Building 2 has 80,000 SF and building 3 has 14,300 SF.  Currently the tenants of these three buildings include a Tex/Mex restaurant, a yoga studio, art supply store and offices.

I am proposing to convert building three into a much needed grocery store for the cultural district/W 7th corridor.   I believe that due to the overall demographics of the area a Whole Foods Grocery store would be ideal.

Currently the closest grocers are a Central Market and a Super Target.  The Super Target is located fairly close to the proposed site behind the Montgomery Plaza shopping center.  Super Target is more of a general store and I believe while it does provide groceries the area has a large enough population that a dedicated grocery store would be profitable.

Central Market (location A in the picture) is located approximately 10 minutes away and is outside of walking distance for the residences in the W. 7th corridor. (Proposed site is labeled B in the below picture.)

According to Whole Foods they require the following in order to consider a site for one of their stores:

• 200,000 people or more in a 20-minute drive time
• 25,000-50,000 Square Feet
• Large number of college-educated residents
• Abundant parking available for our exclusive use
• Stand alone preferred, would consider complementary
• Easy access from roadways, lighted intersection
• Excellent visibility, directly off of the street
• Must be located in a high traffic area (foot and/or vehicle)
   

The demographics for the proposed sites area certainly fit within the stores requirement that there be 200,000 people, at least, in a 20 minute drive time area and that there be a large number of college educated residents.

The site however needs more parking for the proposed grocery store .  Therefore I am also proposing to tear down part of building 2 and replace it with parking spaces.

Buildings 1 and 3 can continue to be used for the current tenants and office space.

I believe the location is close enough to the main corridor of W. 7th that the signage at the top of the building and parking garage can mitigate the fact that the store is not directly on W. 7th.

Financial Analysis

Currently retail rents in the project ranged from $30-45/SF, NNN (NNN expenses $11/SF).  Office rents in the 100,000 SF office component of the W7th project were getting $25-26/SF even in the deepest parts of the recession without offering big incentives.

Building 2 is currently approximately 80,000 square feet.  Since Whole Foods maximum space requirements are 50,000 sf I will be tearing down 30,000 sf of the current building to help make parking available for the store.

Using precast concrete panels and steel frame construction, costs per square foot will be $55.80, this plus contractor fees and architectural fees the total construction costs per sf would be $73.

So the total construction costs would be approx $3,650,000.  Assuming that the expected rent would be $25 per sf the EGI would be 1,225,000, assuming a debt coverage ratio of 1.25 and an interest rate of 6% with a Maximum LTV of 80% the Maximum Supportable Total Project costs can be no more that 12,097,233.

Summary

I believe that to maximize the current layout of this site with minimum reinvestment and construction costs building 1 and 3 should remain as they are and building 2 should be converted into a Whole Foods Grocery store.  Tearing down part of the building in order to increase the amount of parking which is required for the store will also add to the functionality of the site overall.

Sources:

RS Means /REED Construction Data (http://www.reedconstructiondata.com/rsmeans/models/supermarket/texas/fort-worth/)

Whole Foods (http://www.wholefoodsmarket.com/company-info/real-estate)

Developer Feedback

 

 

Adaptive Reuse – The Live Oak Music Hall and Lounge – Bill Smith

What was once the Southside Lions Club, built in 1952, is now the Live Oak Music Hall and Lounge. It is located at 1311 Lipscomb St. in the Near Southside neighborhood in Fort Worth.

We met up with Bill Smith, who is the developer and visionary behind this restoration project, for a tour.

Bill shares with us that he has had 37 years in the construction business and decided to take on this project as a labor of love.

When he acquired the property it was a pier and beam construction that had warped floors, so much so that you had to literally climb uphill when you entered.

He and his son put in their own sweat equity by restoring the property.

From leveling and re pouring the concrete floors to importing and hand carving the gorgeous wood mahogany used through out the facility to putting in an ingenious beer pump that allows for beer on the beautiful roof bar, to the live music stage inside the building, the Live Oak is a study in innovative renovation.

Bill also explained his ingenious financing of the project by selling share to anyone in the community interested in seeing this venue prosper.

The Live Oak has also made a commitment to it’s community by sponsoring programs for the community.

Through fundraising nights and volunteer based music mentoring sessions such as local musicians working with youth to give free music lessons the Live Oak intends to become part of the fabric of the community.

When Bill explains to us that he did not go to college and that he realizes that it’s not for everyone he is proud to help others like him achieve their dreams and provide this venture as an example of what is possible.

This visit was truly inspirational and I hope the Live Oak and it’s community prosper.

Adaptive Reuse – Eddie Vanston, devolper – 209 S. Main Street

We met with Eddie Vanston at 209 S. Main St.  Eddie restored the Sawyer Grocery store into 14 loft apartments with office space on the street level.

Eddie explained how he was able to partner with Chevron in order to utilize the Federal Historic Tax Credit program available through the US Park Service for the restoration for this project. In order to qualify the building had to be at least 50 years old with an architectural or historic significance. The FHTC allows for a 20% tax credit to be taken by the projects investors.

He also explained the us of the New Market Tax Credit for Lenders.   The lender can receive 30% tax credits for the amount of the land.

 

Eddie also explained that he has close to 100% occupancy for his project.  Due in part to the reasonable rental rates in the area as compared to the 7th street development to the west of downtown.

 

Eddie then took us around the corner to view his current project.  The building was build in 1910 and was a fireproof warehouse.

Eddie is converting the downstairs space into a beer garden and the upstairs into lofts. 

One thing that we notice inside the building is how cool it is.  Eddie explains that when the building was built it was before air conditioning was so prominent and due to the fireproof construction and the natural ventilation in the building it stays cool year round.

 

As we tour the upstairs we notice that the original features of the concrete ceilings the floors and exposed brick are sealed and will be prominent features in the lofts.

Eddie also explains that even though the building was built as a fireproof warehouse he is still required to put in safety features such as a sprinkler system.

Adaptive Reuse – Ft. Worth South – Mike Brennan

We met with Mike Brennan at the Ft. Worth South, Inc (http://www.fortworthsouth.org) office located at 1606 Mistletoe Blvd.

Mike, who is the director of Fort Worth South, Inc, was kind enough to give us an overview of Fort Worth South, Inc.  He explained that this is the entity created to administer the TIFF that was started in 1997 for the redevelopment of the near south side neighborhood in Ft. Worth.    Sponsored by a coalition of public and private stakeholders, including the City of Fort Worth, the Fort Worth Transportation Authority, and the district’s major hospitals, this non profit organization is concerned with accomplishing 5 mission goals.

1.  Increase public awareness of the Near South side

– Attract new residents and new residential development
– Support the growth of the district’s existing businesses and institutions
– Attract new businesses to the Near Southside

2.  Assist all private and public development projects that advance the district’s mixed-use, urban vision.

3. Sponsor or support special events and networking events that attract visitors to the area and strengthen community ties among Near Southside businesses and residents.

4. Provide information and resources that assist all types of Near Southside stakeholders.

5. Partner with the City and other community organizations to advance educational initiatives, public policies, and community programs that foster a revitalized and safe central city.

 

Mike explained that it is his job to develop the building regulations and to communicate with the community in order to get their input on these regulations so as to help facilitate their adherence.

Also, Mike explained that he had 7 goals in which he felt were important for most communities to implement in order to re establish a vibrant community.  These are

1. a walkable urban environment

2. residential development

3. anchors and industry

4. supporting locally owned business

5.  need for both small scale and large scale business

6. a balance for preservation and new development

7. to improve perceptions and investor confidence

 

With events like Friday on the green and open streets Fort Worth South side is helping to encourage people to come to and shop and hopefully move into the area.

Adaptive Reuse – Downtown Ft. Worth T&P building

A breath taking step into the past for our modern world.  The Ft. Worth Texas and Pacific Railroad  building is now a transit oriented development with the upper floors of the building being turned into luxury condos.  On our site visit the gorgeous lobby was being set up for a wedding reception and the family graciously allowed us in to look around.

Designed in 1931 by Wyatt C Hedrick, the building is an excellent example of the Art Deco movement made popular in the 1920’s -30’s. According to the Texas Historic Landmark affixed to the side of the building rail traffic began to decline in the 1950’s  and the last passenger train to arrive was in 1967. Today the upper stories of the building are known as the Texas and Pacific Lofts.  These luxury loft apartments are in a prime downtown location with a covered portico to reach the trains located across the tunnels.  There is also a snack bar and tables in the covered pavilion in the trains waiting area. 

According to the Texas Pacific Lofts website the apartments are NY/Soho style lofts with original terrazzo flooring and exposed duct work. These start at $100k so are very reasonably priced.  This along with the location near the trains is a very desirable location.  A step back in time for our modern lifestyle.  Located at 221 West Lancaster Avenue, next to the historic US Post Office.    The buildings amenities include 24 hour concierge, deeded parking, business center, owners lounge, courtyards, fitness center and the Trinity railway express commuter light rail in the building.

Adaptive Reuse – Southside Ft. Worth – Ray Boothe Architect

Today we met with Ray Boothe an architect and developer who is credited as one of the pioneers of redeveloping the near south side neighborhood in Ft. Worth.  We met with Ray outside Brewed at 815 Magnolia St. in the Ft. Worth Near Southside neighborhood.

He showed us several properties that he’s worked on in the area including the building next to Brewed that will be turned into a gourmet grocery store and deli named Ryan’s.    Both of the buildings were built in the 50’s.  Ray explained that he used the available Near South-side TIFF for the landscaping, street improvements and the entry areas of the buildings. 

 

 

Ray explains that using techniques from before air conditioning to build fits into today’s trend for low energy and cost efficient -sustainable design.  Using natural lighting, positioning of the building to maximize on sun exposure and minimize excessive heat all come into play.

Ray also shared with us that he started back in the 90’s in acquiring the properties that he has slowly been renovating.  His first project in the area was an old drugstore he renovated 12 years ago.  Across the street from the drugstore is another project that he restored in conjunction with a bank that was looking for a new place to do business.   He said before the modern use of mixed zoning took off in Ft. Worth he was trying to build with this in mind.  In the building with the bank he has 5 loft apartments upstairs and a restaurant and bank office downstairs.  Again using the TIFF for the green areas on the outside of the building.  Bringing beauty and function back to what was a building that was unused. 

Mike Brennan of FortWorthSouth.org credits Ray Boothe with being the pioneer for the work they are continuing with today.  As you can see he has certainly done a tremendous amount of work and should be applauded for his vision.

Adaptive Reuse – Bishop Arts District

One of my class’ site visits has been to the Bishop Arts District located just south of Methodist hospital in Oak Cliff.  I grew up in a house on N. Bishop literally a block north of the arts district.    Some things have changed quite a bit from when I was a kid and I am excited to see the old buildings being given a new life.

This area was originally served by a trolley service that stopped at 7th & Bishop.  This of course allowed for quite a bit of pedestrian traffic through the area.  Boutique shops and restaurants a theater and a bowling alley were mainstays of the area.  Once the trolley system was shut down the life stream to the district died with it.  Commerce shifted to Jefferson Ave which is just a few blocks south of the district.

This led to the eventual disuse and abandonment of the district.   In the 80’s Jim Lake started to purchase the old buildings in an attempt to salvage an area that he remembered as vibrant.  This was considered a rather risky investment but not afraid of the long game Mr. Lake held fast to his dream of one day seeing the district back to it’s former glory.

To the left you’ll see a picture of the Piggly Wiggly grocery store that sat at the corner of Bishop and Davis.  As an example of adaptive reuse this has been turned into the Cafe Brazil as seen here. 

Once again the building see’s a steady flow of foot traffic from hungry shoppers visiting the district.

Across from Cafe Brazil is the old No. 15 Firehouse that I remember was still active when I was a kid. 

It has been converted into a Gloria’s Restaurant.

Through a little sentimentality and creative reuse the district is seeing a return to it’s vibrant past.

Adaptive Reuse – 400 North Ervay; old post office new luxury condos

Built in 1930 this location was built to house every branch of the federal government.   The U.S. Post Office, Federal Bureau of Investigation and the Federal Court System. 

The ceiling has painted frescoes and the walls are a beautiful green marble.  You can see the original cages over the post office windows.

The courtroom has hand carved wooden wainscoting and floor to ceiling windows.  The courtroom was the home to many cases in Dallas.

Currently the public spaces of the building can be rented out for special occasions.
Luxury apartments and condos are currently occupying the top floors in the building.

The building is 5 stories and 100,000 + square feet. It’s historic craftsmanship has been restored to it’s former glory.  There are 78 residences in the converted upstairs apartment spaces.   There is a private residential lobby along with a rooftop garden,fitness facilities, and several lounges from the converted courthouse rooms.

The building has easy access to the Arts District and the Woodall Rogers deck park.

Adaptive Reuse and development readings

1.    Historic Preservation Tax Credits

Under the provisions of the Tax Reform Act of 1986, a 20% tax credit is available for the substantial rehabilitation of commercial, agricultural, industrial, or rental residential buildings that are certified as historic. The credit may be subtracted directly from federal income taxes owed by the owner.

Federal tax incentives are available to stimulate private investment in the rehabilitation of historic structures. The Tax Reform Act of 1986 establishes:

• a 20% tax credit for the substantial, certified rehabilitation of certified historic structures for commercial, industrial and rental residential purposes, and a 10% tax credit for the substantial rehabilitation for nonresidential purposes of buildings built before 1936; and
  a straight-line depreciation period of 27.5 years for residential property and 39 years for nonresidential property for the depreciable basis of the rehabilitated building reduced by the amount of the tax credit.
• A certified historic structure is any building that is listed individually in the National Register of Historic Places, or located in a registered historic distinct and certified as being of historic significance to the district.
• A registered historic district is any district that is listed in the National Register of Historic Places, or designated under a local ordinance under Michigan Public Act 169 of 1970, as amended, which has been certified by the National Park Service as substantially meeting all the requirements for listing of districts in the National Register. Simply being listed in a locally designated historic district is not sufficient to gain access to the Federal tax credits.
• A certified rehabilitation is any rehabilitation of a certified historic structure that is certified as being consistent with the historic character of the property and, where applicable, the district in which it is located. The Secretary of the Interior’s Standards for Rehabilitation are used to determine whether the historical character of the building is preserved through the process of rehabilitation.

http://www.nps.gov/tps/

http://www.nps.gov/tps/tax-incentives.htm

http://www.illinoishistory.gov/ps/taxcredits.htm
http://ohp.parks.ca.gov/?page_id=25007
http://www.michigan.gov/mshda/0,4641,7-141-54317_19320_62001-54165–,00.html

 

2.    New Market Tax Credits

Established by Congress in 2000 this program is meant to help new or increase investments into operating businesses and real estate projects located in low-income communities. Investment in low income areas allows investors to receive a tax credit against their Federal income tax return in exchange for making equity investments in specialized financial institutions called Community Development Entities.

http://www.cdfifund.gov/what_we_do/programs_id.asp?programID=5

http://en.wikipedia.org/wiki/New_Markets_Tax_Credit_Program

http://www.irs.gov/pub/irs-utl/atgnmtc.pdf

http://nmtccoalition.org/

 

 

3.    Community Development Entities

The investment vehicle for the NMTC is a Community Development Entity (CDE).   CDE may apply for credits through an annual competition conducted by the CDFI Fund1. CDEs successful in receiving an allocation must have a strong business plan, good management, proven track record of working with investors and proposed projects that will have a substantial impact in low-income communities.

Once an allocation has been awarded, a CDE must then seek private investment in exchange for the credit. The CDE has five years to place the credits, after which time the credits can be recaptured and transferred to another CDE. Corporate and individual taxpayers may receive a federal tax credit of 39 percent over seven years in return for their equity investment in a CDE. With the proceeds from these equity investments, CDEs must provide investments of equity, loans, lines of credit and technical assistance to qualified businesses. CDEs have one year to place the funds in qualified investments. In general, if substantially all of the proceeds from the credit are not placed in qualified investments, the CDE would be out of compliance. At that point, recapture penalties would be applied to the investor.

http://www.frbsf.org/publications/community/investments/0308/article1a.html

http://www.novoco.com/new_markets/resource_files/forms/Comm_Dev_Entity_Certif_App.pdf

http://www.21stcgfund.com/

http://www.chicagodevelopmentfund.org/success-stories.html

 

4.    Rehabilitation Tax Credits

Most local and state authorities have an entity that administers the federal Rehabilitation Investment Tax Credit (RITC) program in partnership with the National Park Service (NPS) and the Internal Revenue Service (IRS). The tax credit program is one of the most successful and cost-effective programs that encourage private investment in rehabilitating income producing, historic properties such as office buildings, rental housing, hotels, bed and breakfasts, and retail stores.

http://www.crt.state.la.us/hp/tax_incentives_program.aspx

http://www.ginsbergjacobs.com/assets/08-12-new_historic_rehab_tax_credits.pdf

http://www.irs.gov/pub/irs-mssp/rehab.pdf

http://www.portal.state.pa.us/portal/server.pt/community/rehabilitation_investment_tax_credit_program/2646

 

5.    Low Income Housing Tax Credits

Low Income Housing Tax Credit is a dollar-for-dollar tax credit in the United States for affordable housing investments. It was created under the Tax Reform Act of 1986 (TRA86) that gives incentives for the utilization of private equity in the development of affordable housing aimed at low-income Americans. LIHTC accounts for the majority – approximately 90 percent – of all affordable rental housing created in the United States today.  The tax credits are more attractive than tax deductions as they provide a dollar-for-dollar reduction in a taxpayer’s federal income tax, whereas a tax deduction only provides a reduction in taxable income. The “passive loss rules” and similar tax changes made by TRA86 greatly reduced the value of tax credits and deductions to individual taxpayers. As a result, almost all investors in LIHTC projects are corporations.

http://en.wikipedia.org/wiki/Low-Income_Housing_Tax_Credit

http://portal.hud.gov/hudportal/HUD?src=/program_offices/comm_planning/affordablehousing/training/web/lihtc/basics/work

http://www.youtube.com/watch?v=XxwpoLztx70

http://portal.hud.gov/hudportal/HUD?src=/program_offices/fair_housing_equal_opp/lihtcmou

 

 

6.    Community Development Block Grants

Community Development Block Grants are to be used for a wide range of housing and community development activities directed toward neighborhood revitalization, economic development and improved community facilities and services, and must give “maximum feasible priority” to activities that will benefit low-and moderate-income persons or aid in the prevention or elimination of slums or blight.  Funds may also be used to meet other community development needs that present a serious and immediate threat to the health or welfare of the community.

http://www.us-government-grants.net/block-grants

http://portal.hud.gov/hudportal/HUD?src=/program_offices/comm_planning/communitydevelopment/programs

http://www.governing.com/gov-data/other/2012-HUD-Community-Development-Block-Grants-list-map.html

http://www.loansafe.org/louisiana-studies-post-katrina-housing-in-pass-christian

 

 

7.    Mortgage Guarantee Programs (through HUD)

In 1934 the U.S. Federal Housing Administration (FHA) was created to provide mortgage insurance on loans made by FHA-approved lenders throughout the United States and its territories. It insures mortgages on single family and multifamily homes including manufactured homes and hospitals. It is the largest insurer of mortgages in the world. The nation’s trend toward housing assistance continued with the creation of the Veterans Administration (VA) home loan program in 1944 and Rural Housing Service (RHS) loans in 1994. The FHA was created for the purpose of providing a national insurance program against home default. The insurance was funded from the proceeds of a fixed premium charged on unpaid loan balances, and those revenues were used to buy Treasury securities as a way to cover future mortgage defaults. This insurance cuts the default risk lenders face when the only down payment buyers can afford to make is well under 20 percent.  The programs are referred to by their names of Fannie Mae, Freddie Mac, Ginnie Mae as well as the VA guaranteed loans.

http://www.netplaces.com/mortgages/the-mortgage-business-mortgages-101/federal-loan-programs-and-how-they-work.htm

http://hud.gov/offices/cfo/reports/2011/cjs/fha_fund_2011.pdf

http://www.freddiemac.com/sell/expmkts/hudind.html

http://www.businessweek.com/news/2012-03-27/fha-bailout-risk-looming-larger-after-guarantee-binge-mortgages

 

 

8.    Tax Increment Financing

Tax increment financing (TIF) is based upon the pledge of future real property (not personal) taxes generated by new development within that defined geographic area. The public improvements make development of the area possible, which in turn enhances the value of the property. The taxes generated as a result of the enhanced property values are used to fund the public improvements within the area and other incidental costs.  Once the period of the TIF has completed the TIF funds go back into the general fund as taxes.

http://www.tedc.org/inc_taxincrement.php

http://en.wikipedia.org/wiki/Tax_increment_financing

http://dfw.cbslocal.com/2012/04/30/dallas-boosting-development-with-tax-increment-financing/

http://www.icsc.org/government/CDFA.pdf

 

9.    Building Code in relationship to Adaptive Reuse

Some municipalities have modified their codes and zoning regulations to encourage adaptive reuse projects.

“Adaptive reuse is becoming more and more popular, and it has a lot to do with re-energizing historic downtowns from coast to coast,” says Claire DeBriere, executive vice president and COO of the Ratkovich Co., a Los Angeles-based company that has worked on adaptive reuse projects. “A lot of cities are pursuing preservation and adaptive reuse projects aggressively. And they’ve been very thoughtful in how they can encourage development and rehabilitation of their cores into something that is new, different and engaging.”

http://nreionline.com/property/mixed_use/adaptive_reuse_022012/

http://historicbellingham.org/documents_reports_maps/adaptive_reuse.pdf

http://www.structuremag.org/article.aspx?articleID=461

http://adaptivereusernoel.blogspot.com/2012/04/adaptive-reuseredevelopment-and.html

 

10.    Superfund and Brownfield Grants (EPA)

Superfund and Brownfield Grants are for properties that have been designated as either uncontrolled hazardous waste lands (Superfund) or are blighted and undesirable areas (Brownfields).

https://en.wikipedia.org/wiki/Superfund

https://en.wikipedia.org/wiki/Brownfield_Regulation_and_Development

http://www.epa.gov/earth1r6/6sf/brownfields/index.html

http://www.epa.gov/region6/6sf/6sf.htm

http://www.epa.gov/brownfields/

http://www.epa.gov/superfund/

 

 

11.    Pedestrian Oriented Development

Development designed with an emphasis primarily on the street sidewalk and on pedestrian access to the site and building, rather than on auto access and parking areas. The building is generally placed close to the street and the main entrance is oriented to the street sidewalk. There are generally windows or display cases along building facades which face the street. Typically, buildings cover a large portion of the site. Although parking areas may be provided, they are generally limited in size and they are not emphasized by the design of the site.

http://des.nh.gov/organization/divisions/water/wmb/repp/documents/ilupt_chpt_3.2.pdf

http://bishopartsdistrict.weebly.com/index.html

http://uc-ciee.org/downloads/CRECPODevaluation.pdf

http://des.nh.gov/organization/divisions/water/wmb/repp/documents/ilupt_chpt_3.2.pdf

http://www.cooltownstudios.com/2005/05/03/the-13-points-of-pedestrian-oriented-development/

 

 

12.    Transit Oriented Development

Transit-oriented development consists of transit neighborhoods that contain a mix of affordable and market rate housing.  MITOD’s provide many benefits, such as reduced income segregation, stabilization of transit system ridership, workforce stabilization, and strengthens the socioeconomic makeup of the neighborhood.  For these reasons, many jurisdictions are keenly interested in MITOD’s to achieve their goals of maximizing mass transit ridership, reducing traffic congestion, promoting economic development, growing their local tax bases, providing more housing options and lowering pollution and greenhouse gas emissions.

http://www.transit-oriented.com/

http://www.vtpi.org/tdm/tdm45.htm

http://www.transitorienteddevelopment.org/

http://www.dallas-ecodev.org/redevelopment/tod/

Commercial Property Analysis

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FoxFire Apartments 2421 N. Bell Ave Denton,TX

Executive Summary

The newly renovated Foxfire apartments in Denton, Tx is a solid choice for a commercial investment property.  Foxfire Apartments is a beautiful, well-maintained property in a quiet, peaceful neighborhood near Texas Women’s University. Occupancy is strong & is currently 98%. Tenant mix includes approx. 25-30% students. The owner has remodeled 38 of the 54 units & has increased rents, which is still lower than competitors.

Property/Project Description

Year Built: 1981
Units: 54
Buildings: 10
Stories: 2
Lot Size: +/- 3.10 acres
Zoning: NRMU-12
Net Rentable Area: approx. 39,400 SF

Current Occupancy 98% With Approx. 22% Students
• Located Near Texas Women’s University
• Strong Rental Market
• Hot Denton Sub-Market
• Beautiful, Well-Maintained Property
• 37 Units Remodeled With Upside in Rents (already in progress)

Market analysis

This complex is located in Denton TX which has two major universities.  The market demographics for this complex reflects this.

Financial Analysis

Assumptions:

• Purchase Price: $2,799,000
• LTV  70% = $1,959,300
• Amortization Period 25 years
• Loan Term 10 years
• Interest Rate 8.5%
• PRI Growth 3% annual
• VCL 4%
• Cost of sale 4% of purchase
• Holding period 10 Years
• Payments per year 12
• Cap Rate 8%

Best Case scenario

Worst Case scenario

Most Likely Case scenario

Citations

http://www.loopnet.com

Axis Realty Group

UNT

TWU

US Census Bureau