100-unit multifamily project (with 67 low income units governed by HUD) in Fresno, CA
This project was purchased in 2003 for $28,000 per door.
To increase cash flow, we reduced the term of HUD contracts from the 10-year standard to 5 years, resulting in significant rent increases with each annual renewal. To enhance the facility, we renovated interiors as needed and maintained it in excellent condition.
The project was refinanced in 2011 and 150% of the invested capital was repatriated. The average annual cash flow from operations was 8.9%. Upon selling the project in 2016, an annual average return of 64% was achieved.