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The Seller of the Property has left all 256 units in their original interior state, allowing the Sponsor to acquire a 1980’s vintage asset with untapped value-add potential. Having recognized this opportunity in a rapidly growing market, the Sponsor seeks to leverage the growth of Tulsa’s South Tulsa / Broken Arrow submarket and implement a unit enhancement program to generate significant returns for investors. The Sponsor anticipates the interior value-add program to cost approximately $3,500 per unit and generate average rent premiums of at least $75 per unit monthly. All 265 units will be equipped with stainless steel appliances, new or refinished cabinets, cabinet hardware, faux granite countertops, vinyl wood flooring in wet area, upgraded lighting, upgraded plumbing fixtures, two tone paint, kitchen backsplashes, and 2 inch blinds. The Sponsor expects renovations to be completed at a rate of 11 units per month, which would allow the enhancement program to be complete within the first two years of operation. As per the Sponsor’s pro forma analysis, the projected NOI upon exit is $1,404,978, significantly higher than the $849,875 acquisition NOI. Additionally, pro forma projects exit gross sales proceeds of $23,416,300, approximately $7,000,000 higher than the acquisition price. The Sponsor’s anticipated exit cap rate is 6.00%.
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Available to Accredited Investors:
The Place at 101 Sheridan Apartments is located in south-east Tulsa, approximately 20 minutes from downtown. It is within a mile of the Creek Turnpike and about a mile from highway 64. Both the turnpike and highway 64 provide direct access to Tulsa’s main interstates, which makes getting downtown and to other neighborhoods easy. The turnpike intersects with Interstate 44, the primary route to Oklahoma City. The Property is also located near major retail centers with numerous shopping and dining options. Approximately .6 miles away, there are stores like Costco, Target, and Sprouts, while just a few miles from the site, there is the Square 91 Shopping Center and the Woodland Hills Mall.
The Property is located adjacent to one of Tulsa’s most desirable residential neighborhoods. Property values in this area range from $400,000 to $2,000,000 and is within the boundaries of the Jenks Public School District, which is one of the top-ranked school districts in Oklahoma. The Property, also within this PSD boundary, offers an affordable option while benefiting from being in this area of Tulsa.
The multifamily market in Tulsa has been performing well over the past few years. Employment has stimulated demand, while the introduction of new product has been slow. This variance has increased rent rates across the city while keeping vacancy rates low. Performance is projected to stay strong as the sales activity continues to grow and supply remains stagnated. The Property’s submarket, South Tulsa / Broken Arrow, has out-performed the greater metro market in the two to four star property range over the last year. The average rent growth of these properties was 3.3%, approximately 1.2% higher than the metro average. The submarket’s average vacancy rate of 9.1% is .7% lower than the greater market average.
Tulsa has also just launched the Tulsa Remote Program, which pledges to pay remote workers $10,000 is they commit to living in Tulsa for one year. The program is designed to entice young professionals as well as shape the community and stimulate the economy long term.
Available to Accredited Investors:
Below are some of the most frequently asked questions about this offering.
No. While the OM Reads that cash-flow will be split 90/10 to a 10% IRR, the PPM reads that 100% of cash flow will be distributed pro rata to “investors” until a 10% return has been achieved. Since this deal is structured as a 90/10, that is 90% of funds from the LP, 10% of funds coming from the GP/Sponsor, 100% of cash-flow will be split 90/10 until the first hurdle (10% IRR) has been achieved.
Nicholas Residential’s founder Paul Panza has had a relationship with the top two real estate crowdfunding companies dating back to 2013 and has completed funding for 10 deals consisting of more than 3,000 units and $200m in multifamily assets through both portals. In the early crowdfunding days, after much research, Mr. Panza settled on the “direct-to-investor” model of crowdfunding over capital “aggregators” that pool funds into one entity and invest in a project without any direct relationship with the sponsor. This was particularly important to Paul and his team, as building long term relationships with investors is paramount to purely raising capital. This structure has been the driving force behind Nicholas Residentials long relationship with the direct-to-investor portals and complete avoidance of the aggregation model, which has most recently proved unsustainable. In the past, Nicholas has launched deals on both portals simultaneously, but in an effort to avoid confusion among investors, the company has decided to launch new deals on one portal at a time, with short 30-day timelines, and a portion of total equity capital allocated to each site. This allows Nicholas to build new relationships with investors that are “unique” to each portal, while continuing to nurture existing relationships with investors who “cross-over” both sites.
Nicholas has allocated a total of $1m to the RealCrowd portal and the deal will be closed to new investors once that allocation has been met. The company also has the ability to close new acquisitions on its balance sheet and back-fill any remaining equity should the need arise. Syndicated equity transactions, in which Nicholas works with a handful of high-net-worth accredited investors, represents only a small portion of the company’s total investor base, which also includes a network of family offices, institutions, pension funds and money managers across the US and abroad. Most recently, the firm acquired a 6-property, 2,200 unit Multifamily REIT in Houston with a total equity raise of more than $70m.
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Send Nicholas Residential LLC and/or RealCrowd a message. If you have a question about this offering ask Nicholas Residential LLC. If you have a question about the transaction process or other general inquiry, RealCrowd will be happy to help.
In the meantime, you can create an account to view detailed information about Bellevue at Sheridan Apartments.
In the meantime, please review the offering documents and financials.