TRIFECTA SQUARE APARTMENTS

Trifecta Square is a 52-unit garden-style community with approximately 37,188 square feet of rentable space located on 1.533 acres of land in north central Austin. The property consists of four, two-story buildings with pitched composition shingle roofing. Buildings are wood frame construction with brick and HardiPlank siding. Floor plans consist of 40 one-bedroom units and 12 two-bedroom units with an average of 715 square feet.

Many of the unit interiors have recently been renovated and the spacious floor plans feature 100% ceramic tile flooring throughout, upgraded countertops in kitchens and bathrooms, large walk-in closets, fireplaces, built-in wet bars, and balconies or patios. Common area amenities include a swimming pool with new pump and filter, large courtyard with playground, clothes-care center, barbeque grills, and the recent addition of a leasing office with onsite management.

INVESTMENT HIGHLIGHTS

*Class C properties offered the least amount of concessions yet achieved the highest occupancy rate (96.3%) amongst all multifamily classes in 2014, according to Austin Investor Interests research.

*According to Berkadia Research, effective rents in Austin will rise 4.5% percent in 2015, to $1,185 per month. Rents advanced 3.9% in the prior four quarters to $1,085 per month as of December 2014.

*North Austin is one of the most rapidly improving submarkets in the top growth city in the nation, with the Mueller redevelopment (4.2 million square feet of office, retail, medical mixed use space) transforming the area with excellent job opportunities for residents.

*ACC Highland – Austin Community College’s newest, largest, and most innovative learning facility, housed in what was previously Austin’s Highland Mall, is less than two miles from Trifecta. The 200,000 SF first phase opened in 2014 and has the capacity to serve 6,000 students. Phase II planning is underway and could potentially serve 25,000 students.

*Outsized employment and population growth will continue to drive new housing demand in the metro. In 2014, approximately 47,500 more people have made Austin their home, including 13,000 individuals in their prime renting years.

*Hiring will accelerate in 2015 with 39,400 positions created for a 4.3% increase in Austin total employment, driving robust apartment absorption.

TRIFECTA SQUARE APARTMENTS

Property: Trifecta Square Apartments
Date Acquired: April 15 2015
Acquisition Price1: $3,415,000
Location: Austin, Texas
Cap Rate: 6.43% (purchase
price/2014 NOI)
Loan Amount2: $2,600,000
Investor Equity: $1,330,000
ACA Equity: $175,000
Projected Hold Period: 5 years
Pro Forma Yr. 1 CoC: 7.8%
Pro Forma 5-Yr. Avg CoC: 8.5%
Pro Forma IRR: 16.1%
Equity Multiple: 1.96x
Type: Class C+ Multifamily
Units: 52
$/Unit: $65,673
Current Occupancy: 98.0%

1 Before rehab reserve, transaction costs and fees. 2 Rate Fixed @ 3.8% (I.O. Yr. 1), 30-year Amort, 5 Yr. term.

1 Before rehab reserve, transaction costs and fees.
2 Rate Fixed @ 3.8% (I.O. Yr. 1), 30-year Amort, 5 Yr. term.