Overview

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Amelia Apartments (82 units) and Amelia West Townhomes (24 units) in Valdosta, GA in Sunbelt Fund I.

The Amelias

After more than a year of ownership at Amelia Apartments (82 units) and Amelia West Townhomes (24 units) in Valdosta, GA in Sunbelt Fund I, below find our pre-investment rationale and a comparison of how the properties have performed under our ownership relative to the prior owners. 
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The investment strategies at these two assets were distinctly different: while Amelia Apartments was a stabilized asset that had just undergone a property-wide value-add program, Amelia West was a full turn-around project, with non-paying residents and significant deferred maintenance. ​ 

​Since takeover of the two assets, we have increased revenue by a combined 23% and stabilized the assets at a combined 98% occupancy. 

Quantitative Analysis

• Amelia Apartments: prior to our ownership average collections per apartment per month was $537.  Given the lack of competitors in the submarket, and average rent of those competitors sitting at $700+, we believed the asset was ripe for rent pushes by improving marketing and professionalizing the property management team.  Through better training, use of “LISA” the A.I. leasing agent, improved property management reporting technology, tighter policies and procedures, we have pushed average rent per unit per month to $631 over the trailing 12-months. 
  
• Amelia West Townhomes: unlike the above, the property was in poor physical condition at the time of acquisition, however, we were able to acquire the asset at an attractive $35k per unit, leaving ample room to spend capital remedying deferred maintenance while still maintaining a relatively low equity basis in the project. 
  

Qualitative Analysis

• At the time of acquisition, Amelia Apartments had just received property wide in-unit renovations, including new flooring, kitchen cabinets and countertops, appliances, and new bathroom vanities. We capitalized on the prior owner’s renovation spend through organically pushing rents to the market level.  
  
• Due to Amelia West Townhomes’ proximity to Amelia Apartments we were able to add economies of scale, easily managing the property remotely from Amelia Apartments while helping to distribute Amelia Apartments’ payroll burden across the additional 24 units. ​
  

How We Have Run the Asset

• At Amelia Apartments we have organically pushed rents thanks to prior ownership’s property-wide renovation program, while keeping a steady eye on costs.  We expect to continue to steadily increase average rents and closely monitor costs. 
  
• At Amelia West Townhomes we have evicted non-paying residents, spent ~$10k/unit remedying deferred maintenance and renovating units, and have pushed occupancy from 58.3% to 100% and average rents from $522 to $645 today. 
  

Current Valuation and IRR Scenarios

Community Name	All-in Purchase Price	​Total Liabilities	​Attributed Equity
Amelia Apartments​	$4,416,578	$3,109,000	$1,307,578
​Amelia West	$1,084,643	-	$1,084,643
Combined	$5,501,221	$3,109,000	$2,392,221

Community Name	​Valuation Basis	​NOI Observation Period	​NOI
Amelia Apartments	Mkt Cap Rate	October 2019 - September 2020​	$370,781
​Amelia West	Mkt Cap Rate	​July 2020 - September 2020 Annualized	$79,056

	Exit Cap Rate	Exit Valuation	Property IRR	Equity Multiple
Low Case	6.5%	$6,920,571	34.8%	1.41
Base Case	6.0%	$7,497,286	46.6%	1.63
High Case	5.5%	$8,178,857	60.4%	1.89

Have more questions?

If you would like to learn more about the team, the Sunbelt strategy, and investing in a Ballast Rock fund, please contact us via email by clicking the button below or tom@ballastrock.com.

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