Mid Month June 2019

I’d like to officially welcome Joan Gomez to the Altus team! Joan is joining Altus with over 20 years of experience in Property Management. She lives in Oklahoma and will be taken over Asset Management on our OK/AR portfolio. We are extremely excited to have her and her wealth of experience on board!

In the Pipeline:

  • We are partnering with a builder on the construction of 104 Class A apartment units in Chico, CA. The builder is purchasing an option to purchase the property once complete. Investment in this project will be structured similar to mezzanine debt with a predetermined annual rate of return but will enjoy the tax benefits of equity versus debt. If for some reason the builder doesn’t exercise their option, the deal becomes even better. There is one additional detail that is still being worked out with expectation it will be resolved this coming week, at which point we will proceed to completing the private placement memorandum. We are excited about the risk reward prolife of this project.  
  • The Westpark multi-tenant industrial property in Tupelo, MS is still in contract and progressing towards close. There is an existing 300,000 of 100% leased distribution warehouse and we will be building an additional 100,000 – 125,000 square feet of flex retail on some additional land that is included in the purchase. Strong cash on cash returns are anticipated from the purchase forward with the new construction to not only boost the overall returns but will also create a Qualified Opportunity Zone compliant investment. Two members of the Altus team will be back onsite next week continuing to work through engineering plans and construction due diligence. The preliminary marketing package is complete and will be ready for distribution next week. If you are interested in receiving a copy please contact the office at 707.932.5887.
  • The 26,100 SF retail shopping center in NW OKC is still in contract and moving forward. The Phase II came back clear, so we are moving forward with full engineering plans for the exterior upgrade. It appears this project is fully funded, and debt is being obtained.
  • We have multiple off market opportunities we are investigating in OK and TX markets that we hope to have more updates on next month.  

Current Repositioning Projects:

Norman Portfolio

(340 Units, Norman OK)

  • Charleston (160 units)
    • Occupied at 83%, a 3% increase from last month and preleased to 95%. We anticipate hitting 95% occupancy mid-August with the current move in and move outs planned.  
  • Other Complexes (180 units)
    • Occupancy at these properties continues to remain stagnant. Joan has been spending time with the property management company and onsite manager over the last two weeks to work through all marketing efforts to drive traffic to these sites.

Village on the Lake

(160 Units, Oklahoma City OK)

  • Leased to 93%, a 5% increase from last month.

Normandy Place Apartments

(80 Units, Little Rock, AR)

  • Leased to 73%, a 2% increase from last month.
  • Traffic to the property has increased and the onsite manager’s conversion for qualified traffic to approved applications has increased significantly over the past month. In the past four weeks we have taken 7 applications compared to the 1 application from the previous four. Unfortunately, even with the increased number of applications 3 move outs stunted the increase in occupancy.

Items of Note at our Stabilized Properties:

Arrow’s Edge Apartments

(118 Units, Sherwood AR)

  • Occupied at 90%.
  • Our first round of lease renewals and rent increases went out last month. So far 62% of the 16 sent out signed another yearlong lease. The next rounds of renewals will go out Monday morning. These lease renewals are helping us reduce the loss to lease at the property when we purchased it earlier this year.

Other:

  • The Altus specific equity raise continues but is quickly progressing with the first closing planned for July 1st. We will continue additional raising in the next couple of weeks as we move toward legal documentation review. If you are interested in receiving more information, please reach out to Forrest at fjinks@altusequity.com
  • If you are interested in allocating a portion of your investment portfolio to secured deeds of trust, please give us a call and we will add you to the list on investors who receive the first look at new opportunities. Loan opportunities have been a bit slow over the past few months but we do have two loans that are being funded and closing next week.

 

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.

 

Best,

 

Ali Negus