Clemson Ridge Apartments

Clemson Ridge Apartments is 120 apartment homes, located on the western side of Seneca, SC, in Oconee County just 7 miles from Clemson University.

Property Overview

Clemson Ridge Apartments is 120 apartment homes, located on the western side of Seneca, SC, in Oconee County just 7 miles from Clemson University, one of the top universities in the nation. Oconee County consists of nearly 76,000 residents and is well known for its pro-business climate, unmatched quality of life, and is home to over 60 industry-related companies which boasts a labor force of over 632,000.

Clemson Ridge consists of: 1 swimming pool; 1 business center with study lounge, 1 laundry facility, fitness, playground, and pet park. Unit features include: complete kitchens with pantry; separate dining area; breakfast bar; walk-in closets; washer & dryer connections; patio or balcony with storage.

Premise

The core-plus opportunity existed in refreshing interior kitchens, improving curb appeal and landscaping, and updating amenities – while pushing rents to market. The partnership acquired Clemson Ridge Apartments in April 2016 through a bidding process. The asset
was being dually marketed by the seller along with another owned property in Jacksonville, Florida through a separate broker. Once we learned this, we used the opportunity to leverage our negotiations in conjunction with the Florida deal, and was able to acquire
Clemson at a 11.3% discount to the NAI appraised value of $9,700,000 or a 6.3 CAP. Our purchase price was $8,600,000, or $71,667 per unit.

For exterior capital improvements, we tuned up the building entrances and breezeways, stair railings, and vinyl siding, resurfaced the swimming pool, and updated the play area and landscaping throughout the property. *By the end of 2017, the annual net-operating-income (NOI) increased from $607,283 at acquisition to $709,604 – a 16.8% growth in only 21
months. We achieved this NOI growth with less than 5% renovated apartments, through a laser focused management plan, yet strategically allowing additional value-add upside for the next owner.

On June 22, 2018, the property went under contract for $11,000,000, a 5.3% CAP rate and an increase in value of 37.5% within 28 months of ownership.

Investment Summary

City State Seneca, SC
Asset Type Multifamily
Months Held 28 Months
No. of Units/SF 120 units / 134,700 sq ft
IRR 43.4%
Equity Multiple 2.1x
Avg Annualized Yield 15.1%
Acquisition LTC 79.4%
Total Rehab Budget $252,694
Total Investment Basis $1,923,670

 

  At Aquisition At Sale % Increase
NOI $607,283 $709,604* 16.8%
Annual Rent $970,770 $1,118,866 15.3%
Price $8,600,000 $11,000,000 27.9%
Occupancy 94% 96% 2%
Price per Unit $71,666.66 $91,666.66 27.9%
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