Mid Month Update-January 15, 2018

Happy New Year!

As we enter 2018, the Altus team is looking forward to all that the year will bring. We’ve set our goals both as a company and as individuals, and we are committed to supporting one another in realizing our ambitions. If Altus can help you achieve any of your 2018 objectives, please reach out and we would be honored to play a role in your success!

Property acquisition continues to be a primary focus as we kick off the new year, and we are analyzing deals daily to find our next opportunity.  Here’s a look at current deals:

In the Pipeline:

• We have an accepted LOI on a small 104-unit property in Del City, OK. This will be a nice addition to our portfolio as it is located less than 2 miles from our Cedar Hills complex. This will allow the two properties to utilize the same office and maintenance staff. A team from Altus will be at the property this week to begin due diligence.

• We are in negotiations on 10 acres of light industrial land in Georgetown, TX. It is a unique opportunity involving an expected imminent domain claim by the Texas Department of Transportation.

• We continue to review multiple deals throughout a variety of markets. An LOI recently went out for an interesting portfolio opportunity in Texas, Tennessee and Georgia. Forrest and Andy are travelling to Texas to meet with the seller next week to discuss the offer. & TX.  Assuming our offer is accepted we will have more details for you next month!

• We are currently looking for reinvestment opportunities for ~$5.5 Million of 1031 Exchange equity. Using 1031s can be a great way to defer capital gains taxes and benefit from returns on a large capital base. In most cases Altus is able to fill investors 1031 needs while allowing the investor to take a passive role in the identification, purchase, financing, and asset management process.


Current Repositioning Projects:

Norman Portfolio
(340 units, Norman OK)
• Fencing upgrades, landscaping and the continued completion of construction on Lindsey Street are improving curb appeal daily, attracting more traffic to the properties.
• The subcontractor responsible for the upgrades to the complexes exteriors (and all their crews) disappeared from the job over Christmas, have not shown since and have not been responsive to communication. The contractor over the entire project has hired replacement subcontractors who are on site and picking up where the previous contractor left off.
• Despite the holidays an additional 15 unit interiors were completed during the month. There is another 35 units currently in progress.

Village on the Lake
(160 units, Oklahoma City)
• Currently 50% leased.
•  Exterior improvements are done on this property and the interior contractor has their crews working overtime to try and stay ahead of the unit demand.

AE Rockwell
(304 units, Oklahoma City)
• The HUD loan will close on the 25th of this month.
• Occupancy remains stabilized at 95%.

AE Sunset
(98 units, Edmond OK)
• Occupied at 90%, a 2% decrease from last month.
• We are working closely with the property management company to resolve the drop in occupancy so that we can begin the refinancing process.
Normandy Place
(80 units, Little Rock AR)
• Normandy remained 50% occupied over the last month. The onsite manager is working diligently to keep up the leasing momentum that we had prior to the holidays.

Magnolia Apartments
(40 units, Redding CA)
• Exterior improvements (drainage and pest work) have begun, but are moving slowly dependent on weather.
The first three units are ready for interior improvements and should begin before the end of the month.  Planned improvements include new cabinets, countertops, flooring and trim package.

Stabilized Properties:
French Villa
(110 Units, Tulsa OK)
• Currently 93% occupied and leased.
• Interior renovations are 100% complete.

AE Bodega
(11 units, Petaluma)
• 92% occupied.
• The property is under contract for sale, it is scheduled to close early February. Some minor construction improvements that were agreed upon as part of the sale were completed this past week.

Cedar Hills
(124 units, Del City OK)
• Currently 95% occupied and leased.
• The property is not listed for sale but at the request of a broker we allowed the property to be toured and there is a party interested in purchasing the property.

AE Commerce
(20,000 SF Commercial Space, Rohnert Park)
• This property has been placed back on the market for sale.

AE Three -1500 Farmers Lane
(17,400 SF Commercial Space, Santa Rosa)
• Construction is 100% complete and we received final certificate of occupancy.
• This property is under contract for sale, all contingencies have been removed, and closing is scheduled for early February.

AE Carousel
(96000 SF Light Industrial, Redding CA)
• FedEx, one of the tenants in this light industrial building, contacted us this week to begin the process of exercising their option on their lease. This is an important for step in securing additional years of their tenant hood, which would be a big win for the entity.

• Many people have inquired how we plan on being involved in the rebuild efforts in Sonoma County. We don’t have any details to share at this time and are being patient while the frenzy dissipates, but we are likely to have some sort of opportunity to offer to our investors as we get farther into the process.

If you have any interest in discussing any of the above opportunities in greater detail, please reply to this email or call our office at (707) 932-5887.  We will gladly add you to our distribution list and/or schedule an appointment to discuss your investing needs further.


Ali Negus