262-Unit Multifamily in Texas

Investment Highlights

This is a true operational reset play rather than a cash flow deal today.

The asset was historically performing with ~$2.5M–$2.8M revenue and strong occupancy, but has recently dropped to ~80% occupancy with ~46 vacant units due to tenant base disruption and management issues. The current income reflects that dislocation, not the underlying potential of the property.

Average rents are ~$900–$1,000/unit today, with several units below market, and no real systematic renovation program has been executed yet. Prior ownership has only put in patchwork CapEx (~$500K total), leaving a clear path for a structured value-add strategy.

The opportunity here is to step in at a basis well below replacement cost, clean up the tenant base, stabilize occupancy back into the 90%+ range, and implement a proper unit upgrade program to drive rents. Even modest execution on lease-up alone materially improves NOI given the current vacancy.

One of the key components is the assumable agency debt (~$10.2M at ~4.5% fixed through 2029), which creates a significant financing advantage versus today’s market and helps offset the initial negative leverage during the turnaround.

This is best suited for an operator comfortable with heavy repositioning — not a yield play day one — but a basis-driven investment where value is created through execution and stabilization, with a clear refinance or exit once NOI is rebuilt.