The Club Apartments was our first acquisition in the Triad area of North Carolina. The property is located in Lexington, NC an area that continues to offer global industry, low cost of living, and world-famous food. It is also situated among the larger urban areas of Greensboro/High Point/Winston Salem (Triad) and Charlotte.
Extensive underwriting prior to the acquisition projected high returns on the multifamily asset through a re-positioning strategy as well as capitalizing on its close proximity to job centers. Upon Acquisition of the cash flowing asset in 2011, the Transition Team of our property management firm, Capstone Multifamily Group, took over management of the Club Apartments. Our property transition team implemented significant upgrades to the property's exteriors, resulting in a $12k reduction or operating expenses in turn, increasing cash flow to the balance sheet.
Oliver Court Apartments was our first acquisition in South Carolina. Our initial analysis of this asset allowed us to identify repositioning and transitioning strategies to deliver solid returns to investors. Oliver Court is located in a residential neighborhood setting and is conveniently located near schools, shopping, and major metropolitan areas such as Charlotte and Greenville.
Upon acquisition in 2011, our transition team constructed a brand new laundry facility & transformed a broken down swing set into a an inviting playground area that. In addition to offering more amenities, standard renovations such as roof replacements and full parking lot upgrades helped transition the property. Returns were staggered at the onset of property takeover due to the necessary repositioning tactics, including the implementation of a thorough tenant screening process and working with local authorities to reduce crime. Returns steadily increased closer to disposition and generated significant returns with the sale of the asset.
Southern Pines was in Spartanburg, SC in the upper SC state Market. Spartanburg's main driving economy has been the BMW plants, its vendors and service providers. There are also few colleges and universities which drove a lot of retail business and services.
MACC & Capstone Management stepped in after failed attempts to achieve higher rents and occupancy from the previous management company. The property all in acquisition cost was right around $8M and over $3M was allocated for Capital Improvement. The property was sold in 2017 for almost $17M and the NOI increase was due to rent increases and expense reduction.
Carolina Crossings was in one of the Charlotte's MSA. The property was located in Rock Hill, SC but only about 14 miles to downtown Charlotte. Carolina Crossings was built in three phases for a total of 267 units. It was acquired thru a 1031 Exchange in 2016 and sold in 2018 for a Capital gain of over $5M.
Upon Acquisition, we have allocated over $2M in unit upgrades. At the time of the sale we were to renovate and upgrade over 65% of the units and increase rents by $75-$125 a unit. Part of exterior upgrades were new energy efficiency windows for the older phase I and new roofs.
Gaston Properties consisted of small Multifamily properties ranging from 2 units to 16 units and some single families. Our strategy was to renovate and increase rents for the multifamily properties. Rehab and flip the single-family houses.
Upon acquisition, we concentrated first on the multifamily properties and left the single-family houses as is. Some were vacant, and some were occupied. After renovating and selling all multifamily properties we turned our focused on flipping the single-family homes. The Portfolio was purchased with equity capital only and when the last asset was sold in 2018, we turned a $1.5M equity to $4M at exit.