Overview

  • Apartment, Community, Condo, Multi Family Property
  • Property Type
  • 180
  • Bedrooms
  • 180
  • Bathrooms

Description

Property Updated on Tuesday, October 11, 2022 by Lior Lustig

This offer is for accredited investors

Offering Video:

The acquisition of Park 45 Apartments in Houston, Texas. The 150 units Multifamily property is located in the desirable submarket of Spring/Tomball

EXECUTIVE SUMMARY

Nadlan Invest is offering the opportunity to invest in the acquisition of Park45 Apartments in Houston, Texas. The 180 units Multifamily property is located in the desirable submarket of Spring/Tomball. The area has seen impressive population growth over the last decade. Within a three-mile radius, the population has grown 23.8% and is projected to grow another 8.7% over the next five years. The average household income within one mile is $116,000 and the average home value is $288,000. Within one mile of the property is an HEB, Walmart, Lowe's, Home Depot, Academy Sports and Outdoors, Target and much more. Park 45 is also located 5 minutes from the 2,000-acre Springwoods Village mixed-use development, home to Exxon Mobil, HP, and ABS corporate campus. The Woodlands is located a short drive north and is home to over 66,000 employees and over 11 million square feet of retail.

As a major corporate center, Houston is home to 24 Fortune 500 headquarters, the fourth largest concentration of any metro in the nation. Houston is well established in the top three markets in the country for the last decade for population and job growth and is expected to continue and outperform in the coming years. Houston's success as a top global market for headquarters is driven by its deep talent pool, low cost of living and doing business, and an exceptional quality of life.
Park45 Phase I includes 150 units and was completed in 2018 by the original developer. Phase II includes 30 units and was brought online last year by current ownership. Phase II rents achieves up to a $150 premium on an identical unit type, with very minor upgrades. Also, the average rents across the property are approximately 15% lower than the comps in the area. The offering presents an opportunity to acquire a newly built community for a low basis, with no deferred maintenance, and a significant upside which will be achieved by anchoring the new rents at the market level, as well as implementing a light renovation program for the majority of the Phase I units, to exceed the Phase II finishes level.

PARK45

203 3 0 Whitewood Drive, Spring, TX 773 73


Our Deal in Houston – Shot by our partners Yield Street
Who is Yield Street?
Yieldstreet is an American company based in New York City. The company focuses on expanding access to private market investment products. Yieldstreet provides investments in art, real estate, legal, and various other industries. Wikipedia
Headquarters location: New York, NY
Founded: 2014, New York, NY
Chief product officer: Rick Winslow
Chief revenue officer: Mathew Keshav Lewis
general counsel: Ivor Wolk
 
Number of customers: roughly 300,000 members

Yieldstreet's growth

Yieldstreet's total client base is
roughly 300,000 members. New members in 2021 have already exceeded all of 2020, the firm said. Investments on the platform have totaled more than $300 million this year, nearly surpassing the $310 million in all of 2020.

Park45 is a 180-unit, newly built multifamily community located in the affluent Spring submarket. With 150 units built in 2018, and an additional 30 units built in 2021. While Park45 has no deferred maintenance, it entails an opportunity to modernize and upgrade the amenities and unit interiors to better compete with some of the top properties in the submarket.

Phase II offers an upgraded finishes package that includes SS appliances, backsplash, larger kitchen cabinets, granite in the bathrooms, and undermount sinks. The sponsor renovation program will include those upgrades, as well as upgraded bathroom finishes, upgraded lighting package, USB outlets, two tone paint, fenced yards in selected units, and more. The exterior and amenities upgrade will include a mature landscaping, carports, pool upgrade, BBQ lounge, upgraded gym and clubhouse.

INVESTMENT STRENGTHS

CONTROL AND TRANS PARENCY

The sponsor, through its affiliate 'Element National Management', will self-manage the property. The in-house operation will allow high transparency and full control over every step of the investment process.

THE OPPORTUNITY
The sponsor was able to secure the Off-Market deal for a lower price than other offers. The opportunity also entails a significant upside through a management play, and a light value-add program that includes renovation of up to 50% of the total units.

PORTFOLIO EFFICIENCY
The sponsor currently owns 1811 units in the Houston market. The scale and local team would allow the sponsor to increase efficiency at the property immediately. As well as allowing for a future portfolio sale which will potentially entail a premium on the sale price.

HIGH GROWTH MARKET
The Houston metro area is the fifth largest metro in the nation and is expected to show the fastest population growth in the nation by 2025, as well as the second largest job growth in the nation. The market is highly diversified and attracts many large employers from different industries such as healthcare, energy and tech. Due to that combination of stable continuous population and job growth, the metro market rent growth is expected to continue and outperform the nation's.

INVESTMENT STRATEGY

LOSS TO LEASE
The seller acquired phase I (2018), and developed phase II (2021). The sponsor analysis shows up to $450,000 LTL attributed to an ongoing lease up efforts and management inefficiencies. The sponsor strategy is to capture that income by improving the in place leasing process, using its local scale to eliminate the management inefficiencies, as well as executing light property upgrades so it can better compete in the sub-market.

VALUE ADD
The VA strategy includes renovation of 40% of the interiors, as well as common areas improvements and touch ups to the pool area, residents' club, and grounds. The analysis assumes an average of $120/unit increase for interior renovations and a total of $103,680 NOI increase derived from VA. The renovation will position the property as one of the best value offerings in the submarket.

ORGANIC GROWTH
Houston is one of the country's leaders in population growth and job growth, and it is expected to continue its growth for the next five years. Axiometrics forecast 5% to 5.2% rent increase for 2022 and 2023 in Spring, Houston, which reflects a robust demand for that product in the following years.

STRONG EXIT CONDITIONS
The demand for high quality affordable housing in the Southeast and Texas specifically is at an all time high. That demand is expected to grow, as more and more employers are moving into the region, development costs are going up as supply pipeline for the submarket stays constrained. The property product type is sought after by institutional buyers and the sponsor being able to offer a buyer an assembly of properties that can result in a significant portfolio premium.

HOUSTON METRO
Houston is the fourth largest city in the country and ranks fourth among US cities with the most Fortune 500 headquarters with twenty-two on the list. The city is dominant among the most competitive US cities for corporate relocation and expansion activity and is internationally recognized as the global energy capital. In addition to its diverse industries and educated / skilled workforce, a key factor underscoring Houston's business appeal is the fact that it is one of the least expensive major US cities in which to conduct business. Significant benefits include the absence of state or city income taxes, no state property tax, as well as a moderate cost of living index. Houston's strategic location and core strengths, including an expanding healthcare sector, cutting-edge medical advancements, technological breakthroughs across industries and strong import / export trade activity, uniquely position it to play a vital role in meeting national and global market demands. Houston has and will continue to stand as a global leader among US metros and the world.

MAJOR HOUSTON INDUSTRIES

Port Houston
Port Houston is the # 1 port in the nation for waterborne tonnage, foreign waterborne tonnage and vessel transits. Port Houston is a 25-mile-long complex of about 200 private and public industrial terminals along the 52-mile-long Houston Ship Channel.

Energy Capital
Houston is the Energy Capital of the World and is home to 4,000+ firms in the region with more than 40% of the nation's base manufacturing petrochemical capacity.

International Transport
Houston's airport system consists of 3 airports, supports more than 190,000 regional jobs and contributes more than $ 36.4 billion to the local economy. The airport system served more than 58.7M passengers in 2019 and 41M year-to-date November 2020.

Medicine
The Texas Medical Center (TMC), the World's Largest Medical Complex (1,345 acres) consists of 61 member institutions. TMC's workforce consists of more than 106,000 employees. The TMC sees 8M + patients annually including 16K international patients.

Space Center
NASA's Johnson Space Center resides on a 1,700-acre campus and employs around 11,000. Major employers within the complex include some notable companies like The Boeing Company, Lockheed Martin and Jacobs Engineering
Axiom Space plans to build the worlds first commercial space station at the Houston Spaceport at Ellington Field.

Tech
Houston has been attracting tech companies and start-ups that choose to relocate their operations to the city. Recently HP announced that it will relocate its HQ to Houston.

PARK45 SUBMARKE T / SPRING
The Tomball/Spring submarket has performed very well over the last 12 months. Effective rents have grown 16.3% in the last 12 months as demand for apartments has soared within the submarket and across the metro. Tomball/Spring has absorbed 3,206-units T12 while Houston MSA has absorbed nearly 35,000-units. There is currently one project under construction within a 3-mile radius. AxioMetric's is projecting strong rent growth over the next three years with 6.2% for 2022. Park 45 is located 5-minutes from the 2,000-acre Springwoods Village mixed-use development, home to Exxon Mobil, HP, and ABS corporate campus. The proximity to Interstate 45 gives Park 45 convenient access to both major north Houston employers and business districts such as downtown Houston, the Galleria, and the Texas Medical Center.

The Woodlands, located only 10 minutes from Park45, ranked #2 as the best city to live in the US for 2020 (Niche). Boasts a diversified employment base with over 2,100 employers and more than 68,000 employees - more employees than households. Several multinational and national corporations are located in The Woodlands including Occidental (Oxy), Chevron Phillips, Alight Solutions, and Huntsman Corporation. Average household income in The Woodlands is upwards of $132,000, one of the highest in the country. 50% of The Woodlands population has a median household income of $100,000 of which 21% is $200,000 or greater. Over the last 5-years The Woodlands has averaged a median new home sales price of more than $500k. Population is projected to increase 17.4% in the next five years, which will directly affect the entire surrounding areas with additional jobs, amenities, and housing demand.

PROPERTY SURROUNDINGS
Located along Interstate-45, Park 45 enjoys convenient access to an abundance of retail, dining, and entertainment. Less than 3,000 feet from Park 45 is the Louetta Central Shopping Mall. Anchored by Walmart, Kohl's, and Michaels. Within one-mile of the property is Cypresswood Commons, Cypresswood Court, Spring Park Center shopping destinations. Considered a one-stop-shop area with retail, dining and entertainment options that include but are not limited to Topgolf, Best Buy, Staples, Target, Walgreens, Office Depot, The Home Depot, Lowe's Home Improvement

Affluent surrounding demographics will benefit Park 45 for the years to come.

Within a one and three-mile radius, the population has soared 36.7% and 46.5%, respectively, over the last decade. These staggering numbers are only projected to continue as population growth over the next five years within a three-mile radius is projected at 23.8%.

Average household income within a one-mile radius is $116,009 while the average home value within the same radius is $335,817. Such stats are the result of the 73.1% of the jobs within a one-mile radius being white collar jobs.

PROPERTIES SUBMARKETS FORECAST

The property submarkets effective rent growth forecast based on Axiometrics and outperforms the national average and the Houston Market.
The submarket is lacking new supply and along with the consistent rent growth will provide a strong foundation for the next 5 years

COMPANY PROFILE

STRATEGY
The company was founded by its affiliates for the purpose of locating superior multifamily acquisition opportunities. In light of the COVID-19 shifting market dynamics and historically low interest rates, each of the company's new acquisitions is carefully selected to provide both immediate and durable superior cash flow, along with long term growth and stability.

TEAM
Behind 'July Residential' is a team of multifamily experts working tirelessly to locate and acquire new opportunities, improve operations and better communities. The team through its affiliates includes over 350 professionals and is based in New York City, Washington DC and Boca Raton.

THE MALIBU HOTEL EXPERIENCE
The management team behind 'July Residential' has decades of combined experience in the US multifamily sector. The management team has acquired, developed and managed over 15,000 units and $2 billion nationwide

SURGERY
The operation includes acquisitions and analysis team, in-house management company, accounting department and construction experts. The full-service in-house operation allows the company to move quickly, find value where others cannot, and maximize return for its partners and investors.

EXECUTIVE TEAM

ROBERTO LVL AVAL I
With over 20 years of experience, LV heads the company's property operations, along with the due diligence process of new investments. LV is also the President and Chief Executive Officer of 'Element National Management' which had over 15,000 units under management. LV oversees the day-to-day activities as well as manages the financial performance of the management company. His primary responsibilities include managing all capital improvements, financial planning, strategic planning, budget review, and all personnel decisions.

AVIHAI DANIELL
Avihai is the co-founder and managing partner of July Residential, Avihai responsibilities include establishing and implementing investment strategies, identifying new target markets, and the overall financial analysis and management of new investments. Avihai graduated from Babson College, and while still at Babson founded 'Sutton Daniell Capital Partners' which originated construction loans in New York, acquired and invested in properties throughout the country. Avihai prior experience also includes working at a REIT-focused hedge fund, Zimmer Partners, where he covered, identified and underwrote prospective REIT investments.

ISAAC PINTO
Isaac Pinto is the co-founder and managing partner of July Residential. Isaac has over a decade of real estate experience. As July Residential managing partner, he oversees the acquisition analysis, strategic planning, finance and development of the investment properties. With a background in law and accounting, Isaac also oversees the company's legal and tax strategy. Prior to forming July Residential, Isaac founded and led an operation that developed ground up multifamily projects with a specific interest in the DC Metro market. Isaac has a proven ability of locating superior opportunities and overseeing a development operation from the ground up to a successful exit, while creating value for his investors and partners

NATIONAL MANAGEMENT ELEMENT

'Element National Management', the company's exclusive property management company and co-founder, was founded in 2007 by LV Lavalli and partnered with Star Real Estate Ventures/El-Ad National to service their growing portfolio of properties exclusively to them, and now July Residential as well. Element is headquartered in Boca Raton, Florida and operates regional offices in Georgia, Florida, Texas, Louisiana and Michigan. Element employs approximately 350 trained multifamily management professionals who utilize the latest information systems, technology and operational techniques to provide superior service and asset performance to their partners. Element has serviced the acquisition of, managed and operated over 15,000 units, in excess of $2,000,000,000.

DISCLAIMER & CONFIDENTIALITY

Nadlan Invest LLC OR ITS AFFILIATES (THE “DEVELOPER” OR “SPONSOR”) WHICH IS ACQUIRING AND/OR DEVELOPING THE PROJECT (“PROJECT”) THAT IS THE SUBJECT OF THIS INVESTMENT SUMMARY (THE “BOOK”), FOR ITSELF, ITS AFFILIATES , SUBSIDIARIES AND THEIR SUCCESSORS AND ASSIGNS, AND EACH OF THEIR RESPECTIVE SHAREHOLDERS, DIRECTORS, OFFICERS, MANAGERS, MEMBERS, AND EMPLOYEES (COLLECTIVELY, THE “DEVELOPER PARTIES”), MAKES THE FOLLOWING DISCLAIMER AS AN INTEGRAL PART OF THIS BOOK:
THIS BOOK HAS BEEN PREPARED SOLELY FOR THE INFORMATIONAL USE OF THE PROSPECTIVE INVESTOR TO WHOM THIS BOOK HAS BEEN DELIVERED (“PROSPECTIVE INVESTOR”) FOR THE PURPOSE OF CONSIDERING WHETHER TO MAKE AN EQUITY INVESTMENT IN THE PROJECT. ALL INFORMATION IN THIS BOOK, AS WELL AS ANY ATTACHMENTS AND/OR REFERENCES HEREIN, SHALL NOT CONSTITUTE AN OFFER TO SELL OR A SOLICITATION OF AN OFFER TO BUY ANY INTEREST IN ANY SECURITY OR ANY SECURITY DERIVATIVE PRODUCTS OF ANY KIND, OR ANY TYPE OF TRADING OR INVESTMENT ADVICE, RECOMMENDATION OR STRATEGY. NO OFFER TO SELL OR SOLICITATION OF AN OFFER TO BUY AN INTEREST IN ANY SECURITY OR OTHER SUCH PRODUCT MAY BE MADE TO A PROSPECTIVE INVESTOR UNTIL A COPY OF THE CONFIDENTIAL PRIVATE PLACEMENT MEMORANDUM AND THE SUBSCRIPTION AGREEMENT OF THE SPEs, LLC AND THE ORGANIZATIONAL GOVERNING DOCUMENTS THE PROJECT, AND ANY OTHER APPLICABLE SUBSCRIPTION MATERIALS (COLLECTIVELY, THE “INVESTMENT DOCUMENTS”), HAVE BEEN PROVIDED TO AND REVIEWED BY SUCH PROSPECTIVE INVESTOR, WHICH MUST BE COMPLETED AND RETURNED IN ACCORDANCE WITH THE TERMS THEREOF. THE DEVELOPER PARTIES MAKE NO GUARANTEE OR REPRESENTATION WITH RESPECT TO THE PERFORMANCE OF ANY INVESTMENT, THE SPECIFIC RATE OF RETURN ON ANY INVESTMENT OR THE RETURN OF CAPITAL.
THIS BOOK HAS BEEN BASED ON FACTS AND ASSUMPTIONS THAT MAY BE INACCURATE IN WHOLE OR IN PART. THE DEVELOPER PARTIES HAVE NOT UNDERTAKEN ANY INDEPENDENT INVESTIGATION TO CONFIRM THE ACCURACY OR COMPLETENESS OF THE INFORMATION AND GRAPHICS CONTAINED IN THIS BOOK (INCLUDING WITHOUT LIMITATION ANY STATISTICS AND BUDGETS RELATING TO THE PROJECT, SOURCES AND USES OF CAPITAL TO COMPLETE THE PROJECT, CONSTRUCTION BUDGET, CONSTRUCTION TIMELINE AND FINANCIAL PROJECTIONS DESCRIBED HEREIN), DO NOT MAKE ANY REPRESENTATIONS OR WARRANTIES, EXPRESSED OR IMPLIED, WITH RESPECT TO THE SAME, AND HEREBY DISCLAIM ANY RESPONSIBILITY FOR THE ACCURACY, CORRECTNESS OR COMPLETENESS OF THE CONTENTS OF THIS BOOK. THE FORECASTS OF ESTIMATED PROFITS, CASH FLOW AND RETURNS PROVIDED IN THIS BOOK MAY HAVE NO BEARING WHATSOEVER UPON THE OUTCOME OF THE PROJECT. ALL INFORMATION CONTAINED HEREIN ARE ESTIMATES ONLY AND SUBJECT TO CHANGE WITHOUT NOTICE. IN ASSESSING ANY INVESTMENT DECISION, PROSPECTIVE INVESTOR SHOULD NOT RELY UPON THE PAST PERFORMANCE OF OTHER PROJECTS AFFILIATED WITH THE DEVELOPER PARTIES. ALL VALUES AND TIME PERIODS CONTAINED HEREIN ARE ESTIMATES ONLY AND ARE SUBJECT TO CHANGE WITHOUT NOTICE.
THIS BOOK IS NOT INTENDED TO PROVIDE FINANCIAL OR INVESTMENT ADVICE OR TAKE INTO ACCOUNT ANY TAX PLANNING CONSIDERATIONS, AND ANY SUCH ADVICE IS EXPRESSLY DISCLAIMED. PROSPECTIVE INVESTORS ARE CONSIDERED TO BE SOPHISTICATED AND KNOWLEDGEABLE IN REAL ESTATE DEVELOPMENT AND ARE EXPECTED TO SEEK INDEPENDENT LEGAL AND FINANCIAL ADVICE BEFORE MAKING ANY INVESTMENT DECISION. THIS BOOK MAY NOT BE COPIED, TRANSMITTED OR DELIVERED TO ANY THIRD PARTY WITHOUT THE EXPRESS WRITTEN PERMISSION OF THE DEVELOPER.
THE MATERIALS CONTAINED IN THIS BOOK ARE CONFIDENTIAL, PREAPERED SOLELY FOR THE PURPOSE OF THE INVESTMENT DESCRIBED THEREIN AND IT IS NOT TO BE COPIED TO BE USED FOR ANY PURPOSE OR MADE AVAILABLE TO ANY OTHER THIRD PARTY WITHOUT THE EXPRESS WRITTEN CONSENT OF JULY RESIDENTIAL GROUP. IN ACCEPTING THIS, THE RECIPIENT AGREES TO KEEP ALL MATERIALS CONTAINED HEREIN CONFIDENTIAL.

Hebrew description at the bottom of the page

THE OPPORTUNITY

Nadlan Invest is offering the opportunity to invest in the acquisition of Park45 Apartments in Houston, Texas. The 180 units Multifamily property is located in the desirable submarket of Spring/Tomball. The area has seen impressive population growth over the last decade. Within a three-mile radius, the population has grown 23.8% and is projected to grow another 8.7% over the next five years. The average household income within one mile is $116,000 and the average home value is $288,000. Within one mile of the property is an HEB, Walmart, Lowe's, Home Depot, Academy Sports and Outdoors, Target and much more. Park 45 is also located 5 minutes from the 2,000-acre Springwoods Village mixed-use development, home to Exxon Mobil, HP, and ABS corporate campus. The Woodlands is located a short drive north and is home to over 66,000 employees and over 11 million square feet of retail.

As a major corporate center, Houston is home to 24 Fortune 500 headquarters, the fourth largest concentration of any metro in the nation. Houston is well established in the top three markets in the country for the last decade for population and job growth and is expected to continue and outperform in the coming years. Houston's success as a top global market for headquarters is driven by its deep talent pool, low cost of living and doing business, and an exceptional quality of life.

Park45 Phase I includes 150 units and was completed in 2018 by the original developer. Phase II includes 30 units and was brought online last year by current ownership. Phase II rents achieves up to a $150 premium on an identical unit type, with very minor upgrades. Also, the average rents across the property are approximately 15% lower than the comps in the area. The offering presents an opportunity to acquire a newly built community for a low basis, with no deferred maintenance, and a significant upside which will be achieved by anchoring the new rents at the market level, as well as implementing a light renovation program for the majority of the Phase I units, to exceed the Phase II finishes level.

INVESTMENT HIGHLIGHTS

  • THE INVESTMENT | The acquisition and renovation of the property
  • THE PROPERTY | 180 units located in Houston, Texas
  • CLASS | White Collar housing, Class A
  • INVESTMENT TERM | Holding period of up to 5 years
  • FINANCING | 75% LTC, 3.35% Constant Rate, 3 Years term
  • PROJECT COSTS | Total of $ 60M including renovation budget

PROPERTY SUMMARY

PARK45

203 3 0 Whitewood Drive, Spring, TX 773 73

Park45 is a 180-unit, newly built multifamily community located in the affluent Spring submarket. With 150 units built in 2018, and an additional 30 units built in 2021. While Park45 has no deferred maintenance, it entails an opportunity to modernize and upgrade the amenities and unit interiors to better compete with some of the top properties in the submarket.
Phase II offers an upgraded finishes package that includes SS appliances, backsplash, larger kitchen cabinets, granite in the bathrooms, and undermount sinks. The sponsor renovation program will include those upgrades, as well as upgraded bathroom finishes, upgraded lighting package, USB outlets, two tone paint, fenced yards in selected units, and more. The exterior and amenities upgrade will include a mature landscaping, carports, pool upgrade, BBQ lounge, upgraded gym and clubhouse.

  • 180Units / Average Size Per Unit: ± 825 SF
  • AVERAGE RENT: $ 1230
  • YEAR BUILT: 2018/2021
  • OCCUPANCY: 96.0%
  • CONSTRUCTION TYPE: Concrete Block
  • ACRE: 7.09

UNIT MIX

INVESTMENT STRENGTHS

CONTROL AND TRANS PARENCY

The sponsor, through its affiliate 'Element National Management', will self-manage the property. The in-house operation will allow high transparency and full control over every step of the investment process.

THE OPPORTUNITY
The sponsor was able to secure the Off-Market deal for a lower price than other offers. The opportunity also entails a significant upside through a management play, and a light value-add program that includes renovation of up to 50% of the total units.

PORTFOLIO EFFICIENCY
The sponsor currently owns 1811 units in the Houston market. The scale and local team would allow the sponsor to increase efficiency at the property immediately. As well as allowing for a future portfolio sale which will potentially entail a premium on the sale price.

HIGH GROWTH MARKET
The Houston metro area is the fifth largest metro in the nation and is expected to show the fastest population growth in the nation by 2025, as well as the second largest job growth in the nation. The market is highly diversified and attracts many large employers from different industries such as healthcare, energy and tech. Due to that combination of stable continuous population and job growth, the metro market rent growth is expected to continue and outperform the nation's.

INVESTMENT STRATEGY

LOSS TO LEASE
The seller acquired phase I (2018), and developed phase II (2021). The sponsor analysis shows up to $450,000 LTL attributed to an ongoing lease up efforts and management inefficiencies. The sponsor strategy is to capture that income by improving the in place leasing process, using its local scale to eliminate the management inefficiencies, as well as executing light property upgrades so it can better compete in the sub-market.

VALUE ADD
The VA strategy includes renovation of 40% of the interiors, as well as common areas improvements and touch ups to the pool area, residents' club, and grounds. The analysis assumes an average of $120/unit increase for interior renovations and a total of $103,680 NOI increase derived from VA. The renovation will position the property as one of the best value offerings in the submarket.

ORGANIC GROWTH
Houston is one of the country's leaders in population growth and job growth, and it is expected to continue its growth for the next five years. Axiometrics forecast 5% to 5.2% rent increase for 2022 and 2023 in Spring, Houston, which reflects a robust demand for that product in the following years.

STRONG EXIT CONDITIONS
The demand for high quality affordable housing in the Southeast and Texas specifically is at an all time high. That demand is expected to grow, as more and more employers are moving into the region, development costs are going up as supply pipeline for the submarket stays constrained. The property product type is sought after by institutional buyers and the sponsor being able to offer a buyer an assembly of properties that can result in a significant portfolio premium.

LOCATION - HUSTON, TEXAS

6.49 million
Houston Metro population. The metro gained 1.15M new residents between 2010-2019 and was ranked 2nd in the nation for population growth. Houston is projected to keep that pace for the next decade.

$290,000
Median home sale price in Houston April 2021. Up 22.4% compared to last year.

$ 472B
Houston GDP. has grown over 30% since 2010.

HOUSTON METRO
Houston is the fourth largest city in the country and ranks fourth among US cities with the most Fortune 500 headquarters with twenty-two on the list. The city is dominant among the most competitive US cities for corporate relocation and expansion activity and is internationally recognized as the global energy capital. In addition to its diverse industries and educated / skilled workforce, a key factor underscoring Houston's business appeal is the fact that it is one of the least expensive major US cities in which to conduct business. Significant benefits include the absence of state or city income taxes, no state property tax, as well as a moderate cost of living index. Houston's strategic location and core strengths, including an expanding healthcare sector, cutting-edge medical advancements, technological breakthroughs across industries and strong import / export trade activity, uniquely position it to play a vital role in meeting national and global market demands. Houston has and will continue to stand as a global leader among US metros and the world.

MAJOR HOUSTON INDUSTRIES
Port Houston
Port Houston is the # 1 port in the nation for waterborne tonnage, foreign waterborne tonnage and vessel transits. Port Houston is a 25-mile-long complex of about 200 private and public industrial terminals along the 52-mile-long Houston Ship Channel.
Energy Capital
Houston is the Energy Capital of the World and is home to 4,000+ firms in the region with more than 40% of the nation's base manufacturing petrochemical capacity.
International Transport
Houston's airport system consists of 3 airports, supports more than 190,000 regional jobs and contributes more than $ 36.4 billion to the local economy. The airport system served more than 58.7M passengers in 2019 and 41M year-to-date November 2020.
Medicine
The Texas Medical Center (TMC), the World's Largest Medical Complex (1,345 acres) consists of 61 member institutions. TMC's workforce consists of more than 106,000 employees. The TMC sees 8M + patients annually including 16K international patients.
Space Center
NASA's Johnson Space Center resides on a 1,700-acre campus and employs around 11,000. Major employers within the complex include some notable companies like The Boeing Company, Lockheed Martin and Jacobs
Engineering
Axiom Space plans to build the worlds first commercial space station at the Houston Spaceport at Ellington Field.
Tech
Houston has been attracting tech companies and start-ups that choose to relocate their operations to the city. Recently HP announced that it will relocate its HQ to Houston.

PARK45 SUBMARKE T / SPRING
The Tomball/Spring submarket has performed very well over the last 12 months. Effective rents have grown 16.3% in the last 12 months as demand for apartments has soared within the submarket and across the metro. Tomball/Spring has absorbed 3,206-units T12 while Houston MSA has absorbed nearly 35,000-units. There is currently one project under construction within a 3-mile radius. AxioMetric's is projecting strong rent growth over the next three years with 6.2% for 2022. Park 45 is located 5-minutes from the 2,000-acre Springwoods Village mixed-use development, home to Exxon Mobil, HP, and ABS corporate campus. The proximity to Interstate 45 gives Park 45 convenient access to both major north Houston employers and business districts such as downtown Houston, the Galleria, and the Texas Medical Center.

The Woodlands, located only 10 minutes from Park45, ranked #2 as the best city to live in the US for 2020 (Niche). Boasts a diversified employment base with over 2,100 employers and more than 68,000 employees - more employees than households. Several multinational and national corporations are located in The Woodlands including Occidental (Oxy), Chevron Phillips, Alight Solutions, and Huntsman Corporation. Average household income in The Woodlands is upwards of $132,000, one of the highest in the country. 50% of The Woodlands population has a median household income of $100,000 of which 21% is $200,000 or greater. Over the last 5-years The Woodlands has averaged a median new home sales price of more than $500k. Population is projected to increase 17.4% in the next five years, which will directly affect the entire surrounding areas with additional jobs, amenities, and housing demand.

PROPERTY SURROUNDINGS
Located along Interstate-45, Park 45 enjoys convenient access to an abundance of retail, dining, and entertainment. Less than 3,000 feet from Park 45 is the Louetta Central Shopping Mall. Anchored by Walmart, Kohl's, and Michaels. Within one-mile of the property is Cypresswood Commons, Cypresswood Court, Spring Park Center shopping destinations. Considered a one-stop-shop area with retail, dining and entertainment options that include but are not limited to Topgolf, Best Buy, Staples, Target, Walgreens, Office Depot, The Home Depot, Lowe's Home Improvement

Affluent surrounding demographics will benefit Park 45 for the years to come.

Within a one and three-mile radius, the population has soared 36.7% and 46.5%, respectively, over the last decade. These staggering numbers are only projected to continue as population growth over the next five years within a three-mile radius is projected at 23.8%.

Average household income within a one-mile radius is $116,009 while the average home value within the same radius is $335,817. Such stats are the result of the 73.1% of the jobs within a one-mile radius being white collar jobs.

PROPERTIES SUBMARKETS FORECAST

The property submarkets effective rent growth forecast based on Axiometrics and outperforms the national average and the Houston Market.
The submarket is lacking new supply and along with the consistent rent growth will provide a strong foundation for the next 5 years

LOCATION RATING BY NICHE.COM

Link to Location Rating - Huston Texas

HOUSTON METRO EMPLOYMENT

HEADQUARTERS RELOCATION

 

MARKETING BROCHURE - ENGLISH

 

NEWMARK HOUSTON MARKET REPORT

TOP THINGS TO DO IN HOUSTON TEXAS

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An investment opportunity in Houston, Texas with the potential for improvement

Hello to all investors,

Nadlan Invest is proud to present you with an opportunity to join an investment in a multi-family residential complex in the hottest market in the United States today - Texas.

Investment Amount: Starting at $ 100,000.
As part of the deal, a residential complex (multi-family) was purchased, which numbers 180 apartments that are already inhabited by about 96 percent, and in fact yield a return from day one.

The project was purchased at a price that embodies a significant discount from the market price and in fact generates a profit already at the time of purchase.
The complex is within walking distance of a large number of employers, retail centers, restaurants and some of the best schools in the city.

150 units were built in 2018 and 30 additional upgraded units were built in 2021, and these upgraded units are already generating higher rents than the units that were not upgraded. The transaction presents an improvement opportunity and the implementation of an extensive renovation program for additional units to make them more attractive to a new audience and at a higher rent. This upgrade will allow, among other things, to take advantage of the demand expected to grow in the future in the sub-markets in the city. Axiometrics predicts a 4.3 percent to 6.3 percent rent increase for 2021 and 2022 in northwest Houston, reflecting strong demand for this type of property in the coming years.

Investment benefits

Opportunity to add value

Significant increase in rent

Excellent location

Easy access to sources of employment

Property Summary

180 units / average size per unit: ± 1230 SF

Year of construction: 2018/2021

Occupancy: 96%

The return for investors
Monthly cash flow from a respectable yield and another significant yield at the time of sale - you are welcome to contact us for the detailed offer details.

Strengths for the deal

1. Texas - In general
Texas is a major destination for many companies due to tax and weather benefits, including Tesla, Apple, HP and more. Texas is experiencing strong positive migration and low unemployment rates and includes a large number of anchors in various areas: energy, technology, medicine and more.

2. Houston, Texas - in particular
While other major Texas rates have risen significantly and become less accessible and at higher risk for price fixes, such as Austin which has already risen about 45 percent in the past year and Dallas which has risen about 30 percent in the past year, Houston has risen at a much lower percentage so it is still affordable Where to go up and less where to fix.
Organic Growth: Houston is one of the state's leaders in population growth and job growth, and is expected to continue its growth for the next five years. Axiometrics expects a 4.3% to 6.3% increase in rent for 2021 and 2022 in northwest Houston, reflecting strong demand for this complex in the coming years.
3. Resistance to crises
A. Residential property:
In times of crisis we saw a significant advantage to residential properties, because while offices and commercial real estate have alternatives, such as working from home or ordering products online, the population always needs a place to live at reasonable costs, and multi-family properties allow this.

 B. Multi-family:
In times of crisis the properties that showed the highest stability were multi-family properties, because if one of the spouses lost his job, the family will shrink from a house that costs $ 3000 per month to an apartment that costs $ 850 per month and it can be seen that rents of multi-family complexes increased Occupancy.
You can watch my lecture on multi-family properties and their benefits in times of crisis here.

4. Profit on purchase and cash flow from day one:
In real estate transactions there is a rule - the profit is made on the purchase.
Strategy: Buy at an Opportunity Price ® ​​Improvement and Profits from Current Leases ® Maintenance and Profits from Leases ← Sale of the project (Exit)
The project in question was purchased at a price that embodies a significant discount from the market price and in fact generates a profit already at the time of purchase.
In times of crisis, the most important thing is cash flow - and with an occupancy rate of 96 percent, the project generates cash flow from the first day of entering into the transaction.

5. Population level in the area:
The property is in an A-level area, meaning white-collar middle class and a low crime rate.

6. Potential for value increase and Value Add, and the potential for increasing rents:
The developer purchased the complex below the market price, and will make improvements to the apartments in the complex in order to increase the value in preparation for the sale.

The management team's strategy includes renovation of the apartments that have not been renovated, as well as improvements to the common areas. In the apartments that have not been renovated, we will add stainless steel electrical appliances - Stainless Steel, cladding for the kitchen walls - Backsplash, larger kitchen cabinets, granite in the kitchen and bathrooms and new sinks - Undermount Sink. Also updating the bathroom lighting, USB sockets, paint in two tones, a closed yard with a fence in separate units and more.
In the flooded areas, we will update with the addition of trees, covered parking, upgrading the pool, barbecue area, upgrading the gym and the residents' club.
The Proforma analysis assumes a significant increase in rent per unit for internal renovations and a significant increase in Net Operating Income. The renovation will position the property as one of the best properties in this submarket, which will result in a significant increase in value before the sale.

7. Economies of scale:
In real estate, the larger the project, the greater its stability and stronger bodies are involved.
The project in question has a total cost of approximately 34 million dollars, and the project received financing of 75 percent of the project amount at a phenomenal interest rate of only 3.35 percent from the Southern Western insurance company.
A project that includes financing increases the overall security of the project because an external body - the analysts of the lending bank, checked the transaction and decided that it is safe enough to finance this transaction with 25.5 million dollars.

8. The team:

The project is being carried out together with an experienced local partner - July Residential.

Enterprise, a company that has existed since 1982, will participate in the deal with us, and that has invested over 44 billion dollars in various residential projects, thus producing 781,000 houses and apartments in all 50 states of the United States in order to make the home and the community places of pride, strength and belonging.

The entrepreneurs invested 8 million dollars of the capital required as a deposit to receive the loan, which adds to the overall security for the investor, since another significant body checked the transaction and decided that it was worthwhile to invest such a significant amount. https://www.enterprisecommunity.org)

The management company that will manage the project is Element National, a huge asset management company that manages about 15,000 properties in the United States (https://elementmgt.com), Which adds security to the transaction due to the experience of this company, as well as something that ensures efficiency in managing and reducing expenses.

One of the owners of its actual management company and CEO (Roberto Levali) is a partner in July Residential, the experienced company that carries out the actual project - this of course leads to a clear identification of interests and will be an important part of the success of the deal.

The investment will be accompanied in Israel by GBK - an international law firm and one of the leading firms in Israel in the field of commercial agreements. The accompaniment will include all investors and the company.
For advice on American taxation you can contact our accountant (please get back to us by return email to schedule a call).
Articles that were published about the closing of additional transactions that we made with the developer:

9. Strong exit strategy:
The property is expected to be held for 3 to 5 years and at the time of sale generate additional significant profit for investors, beyond the current cash flow.
Demand for high-quality affordable housing in southeast Texas is at an all-time high. This demand is expected to increase, as more and more employers move to the area, development costs rise while the sub-market supply pipeline remains limited. Multi-family complexes such as this complex are in demand by institutional buyers and the sponsor can offer the buyer a range of properties that can lead to a significant premium in the sale price.

10. Identity of interests and full registration of the investor in the transaction:
Investors will be officially registered in the company's incorporation agreement as part of the property owners.
There is a priority for investors over the entrepreneur in the distribution of profits.
Identity of interests: We and our local partner will invest personally (about half of the required equity balance) alongside the investors and on the same terms.
 

Overview of the Houston, Texas Real Estate Market

Houston is the largest city in the state of Texas in the United States, and the fourth largest in the entire United States. According to the United States Population Census conducted in 2020, the city's population is approximately 2,304,580 million, with an area of ​​approximately 1,600 square kilometers. The city is home to the Harris County Administrative Center and is the economic center of the Houston-Sugarland-Bytown metropolitan area - the fifth largest area in the United States - with a population of 7.1 million as of 2020.
The Houston skyline is the fourth highest in North America (after: New York, Chicago and Toronto), and the 12th highest in the world as of 2014. A system of tunnels and elevated sidewalks 11 km long in the city connect the buildings in the center, which allows pedestrians not to suffer from excessive heat in summer or heavy rain in winter.
Houston is multicultural, thanks in part to its many academic institutions and large industries, as well as being a major port city. Over 90 languages ​​are spoken in the city and it has the youngest population in the nation, a partial contribution to this was immigration to Texas.
The jewish community
The Houston Jewish community, estimated at 47,000 in 2001, has existed in the city since the 1800s. Most Houston Jews come from all over the United States and Israel, Mexico, Russia and elsewhere. As of 2016 there were over 40 synagogues in Greater Houston. The major synagogues in Houston are the Beit Yeshurun ​​Congregation, the Conservative Jewish Synagogue, and the Beit Yisrael and Amnu-El Jewish Reformed Communities.

כלכלה
The Houston economy has a broad industrial base in the fields of energy, manufacturing, aeronautics and technology; Only New York is home to more Fortune 500 companies. Commercially, Houston is considered a world city, and is the world's leader in the oilfields industry. The Port of Houston is ranked first in the United States in international cargo tonnage, and second in total cargo tonnage. In 2012, $ 110.3 billion worth of goods were exported from the Houston area, the three destinations to which most export are Mexico, Canada and Brazil. Most of the city's success in the petrochemical industry is due to the Port of Houston. Unlike elsewhere, rising oil and fuel prices are helping the Houston economy, as many of its residents are employed in the energy industry.

In 2013, Houston was identified as the number one city in the United States in job creation by the U.S. Bureau of Statistics, after it was not only the first major city to hold all the jobs lost during the economic downturn that preceded it, but also after the crash. The economist and vice president of research at the Greater Houston Partnership Patrick Yankovsky attributed Houston's success to the area's real estate and energy industries' ability to learn from historical mistakes. Moreover, Jankowski stated that “more than one hundred foreign-owned companies moved, expanded or established new businesses in Houston” between 2008 and 2010, this openness to outside businesses increased job creation at a time when domestic demand was low. Also in 2013, Houston again appeared on Forbes' list of "Best Places for Business and Careers".
Airports
Houston is served by 3 airports, two of which are commercial and served 52 million passengers in 2007. The main one is Houston George W. Bush Airport, the tenth largest in the United States in terms of number of passengers and 28th in the world. Bush Airport is a major base of operations for United Airlines, offering more than 700 flights departing from the city.
Health Services

Houston is home to the Texas Medical Center, which is the center of the largest research and health care institutions in the world. All 49 members of the medical center are non-profit organizations. They provide patient care and preventive medicine services, research, education, and concern for the well-being of the local, national, and international community. The Texas Medical Center employs more than 73,600 people, the institutions at the medical center include 13 hospitals and 2 specialty institutes, 2 medical schools, 4 nursing schools, a dental school, a pharmacy and provides employment for almost every health-related profession. The site is home to the largest medical evacuation service in Heath, and one of the first to be established in the world, as well as a successful transplant program. The medical center performs more heart surgeries from anywhere in the world.

The medical and research institutions at the Texas Medical Center include the M. D. Anderson Cancer Center, the Texas Children's Hospital, the Memorial-Herman Hospital, and more.

The Newmark report lists other reasons to love Houston:

  • Houston is already the fourth largest MSA in the United States, and Moody's Analytics estimates that Houston is expected to have the largest population growth in the United States between 2021 and 2026 (512,000 additional residents).
  • Many sources rank the Houston area in the top five for employment growth, with Moody's Analytics ranking Houston in 3rd place out of the top 20 Metro in 2021-2026, with an average annual growth of 69K.
  • At the onset of the corona plague, Houston's employment was at a record high with 3.2 million workers and a 3.9% unemployment rate (February 2020). Today, employment in Houston stands at 95% of pre-epidemic levels with an unemployment rate of 6.1%.
  • Texas Medical Center is the largest in the world, employing over 100,000 employees with $ 3 billion projects in progress. The Texas Medical Center is expected to add another 23,000 workers to the workforce and generate $ 5.2 billion for the Texas economy. The Houston Medical Center currently has 85 hospitals in the area, employing more than 350,000 staff.

Houston Multi-Family Market:

  • The average effective rent in all types of properties has risen by 4.0% QOQ and an increase of 12.8% in the last 12 months. The average occupancy is close to 92% for the Houston Metro.
  • The impressive demand for apartments has raised rents to an all-time high in Houston. Real Page Analytics expects a significant increase in Houston c rents over the next four years with an increase of 4.3% in 2022.

Why invest here?

Houston is in a prime position for continued growth due to its pro-business climate, population growth, strong employment base, solid infrastructure, low cost of living and high quality of life.

More information about the Houston Texas real estate market at our site

 

Property Documents

Newmark Houston Market Report 3Q21
Nadlan Invest - Park45 - Investment Offering - Accredited Investors

Details

Updated on October 11, 2022 at 7:53 pm
  • Price: $100,000
  • Bedrooms: 180
  • Bathrooms: 180
  • Property Type: Apartment, Community, Condo, Multi Family Property
  • Property Status: Cash Flow Investment, For Sale, Turn Key
  • Address 20330 Whitewood D
  • City Houston
  • State / County Texas
  • Zip / Postal Code 77373
  • Reserved Northwest Houston
  • Country United States

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