Sora on Rose
Location: Tempe, AZ
Property Type: Multifamily
Number of Units: 92
Acquisition Date: April 8th, 2014
Status: Sold by Gelt on September 29th, 2015
On September 27th, 2013 Gelt Rose Holdings, LLC, acquired 92 unit La Paz Apartments for $6,000,000. This equated to a basis of $65,217 per unit and $78.79 per square foot. On December 22nd 2015, Gelt Rose Holdings, LLC sold the asset (since remarketed ?Sora on Rose?) for $7,850,000, or a basis of $85,326 per unit and $103.08 per square foot. Cumulatively, we netted our investors approximately 29.5% over a 26-month hold period.
The property, built in 1971, is located in a vibrant and growing area of Phoenix just north of 16th street and Bethany Road. It is comprised of 76,151 square feet and offers forty-five one bedrooms and forty-seven two bedrooms. Community amenities at the time of acquisition included a laundry room, clubhouse, pool, and individual storage units. We quickly recognized a ?value add? opportunity through the following means: extensive renovation of unit interiors, enhancement of the pool area, remodeling of the leasing office/clubhouse area, addition of a bike room, and aesthetic enhancements throughout the property including upgraded the laundry rooms and adding accent paint around the premises. Through our value add efforts, we were able to increase rents 13.4% in just two years of ownership! Additionally, we increased ?other income? through several means, one being purchasing our own washer/dryers and collecting the full amount of income from these machines (about $1,500 per month.) In relation to the previous ownership, we also collected far more utility bill-back income, ?prep fees,? ?pet fees? and ?late fees.? All told, we were able to increase our effective gross income by over $130,000 annually from when we took over the property, and decreased expenses by nearly $70,000 annually, representing a nearly 75% increase in net operating income.
Sora on Rose was a well executed ?value-add? play and we are thrilled to announce another success story for our loyal investors.