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Any real estate investor who has been following the Tampa Bay region of Florida in recent years is well aware of the significant growth in the area. According to U.S. Census data, the population in Tampa has surged by 4.9%. Where the population grows, home prices tend to rise as well. Redfin’s June report showed that the median home price was up 12.6% to $499,450, higher than the national median. Unlike many markets with more homes for sale than last year, Tampa’s inventory is down 3.3% year over year.
When home prices spike in a market, it often represents an opportunity for multifamily investors. That’s the case with the Captive Club Apartments, a 361-unit multifamily property in the Westshore submarket of Tampa, which is being offered for investment on the EquityMultiple platform. The project was first launched in September 2023 but is now closing for investment at the start of August, giving accredited investors one last chance to join in and capitalize on the potential for a 13% net preferred return. The investment minimum is $20,000.
If you are not ready to commit $20,000, the Ascent Income Fund from EquityMultiple is another option. This fund takes a loan-focused approach, targeting stable income from senior commercial real estate debt positions. It has a historical distribution yield of 12.1%, backed by real assets. With payment priority and flexible liquidity options, the Ascent Income Fund is a cornerstone investment vehicle for income-focused investors. First-time investors with EquityMultiple can invest in the Ascent Income Fund with a reduced minimum of just $5,000.
A Unit-By-Unit Upgrade
EquityMultiple is offering a $3 million preferred equity investment pari-passu in a larger $11 million preferred equity investment. The sponsor, Stolar Capital, is co-investing $8 million. The property was acquired by Sinatra & Co, which bought it for $63.3 million. Stolar has invested with Sinatra & Co. on two other properties in the Tampa area with a very similar business plan. Sinatra & Co. is a real estate development and investment firm that owns three other properties in Tampa. It has a total of $650 million in assets under management, with 4,500 multifamily units and 900,000 square feet of commercial space.
The property is centrally located in Tampa and is less than six miles from Tampa Bay Airport. The building has two swimming pools, a clubhouse, dog parks, and a fitness center. The seller completed the necessary amenity upgrades and base building improvements. This is a value-add deal, and Sinatra & Co. is concentrating on upgrading individual units to bring the rents up to the market rate.
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When Sinatra & Co. bought the property, the in-place rent of $1,441 per unit represented a 21% discount to comparable leases in the area. The plan was to renovate 268 units and spend approximately $18,500 on upgrades, allowing Sinatra & Co. to increase the rent by around $325 per unit. The first quarter results showed good progress on the plan; 90 units have been renovated so far, with an average lease rent premium of $381 per unit. All of the capital improvements on the complex are underway and currently under budget. A new property manager was hired to oversee the building and manage the budget.
Full details of the project are available on the EquityMultiple platform. Prospective investors are encouraged to read the terms carefully before investing. The early signs of success of this project are promising and demonstrate the strength of multifamily investing in the Tampa area.
This article Invest In The Tampa Apartment Market And Earn A 13% Target Net Preferred Return originally appeared on Benzinga.com
