Sunridge

Apartment purchase and improvement in Grand Prairie, TX


Summary

  • Number of Units 332
  • Year Built 1984
  • Structure Equity
  • Holding Period 10 years
  • Annual Dividend 10.4%
  • Annual Total Return 24.9%

Investment Thesis

In 2007 The PPA Group purchased this 332-unit complex which was highly distressed due to poor management and undercapitalization. While in a submarket the property was operating at 70% occupancy and we identified it as a strong contender for growth and appreciation. The amenities were in poor working order, there was a high skip rate, and tenant satisfaction was very low. Upon purchasing the property, we made significant improvements to the exterior and amenities. To improve relations and bring in more tenants we partnered with a non-profit allowing them to use our club house to hold English as a second language programs for mothers and young children. This gave us tens of thousands of dollars in free publicity, brought in additional tenants, and improved overall tenant relations. The result of our efforts was a 2x increase in net operating income after just the first year. Our award-winning property management company, CLEAR Property Management, continued this trend of growth over the years resulting in steady cash flows to our investors. This was done by implementing our time- tested system of improving marketing, cutting costs, raising rents, and increasing the overall value of the property. This property is an example of a full cycle acquisition and sale completed by our parent company and is not held in the Upside Avenue REIT.

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