Analysis of Investments

Parkcrest

PASSCO

Passco Parkcrest is an investment into a Class A multifamily apartment complex located in Bradenton, Florida. Bradenton is about 40 miles south of Tampa. The property consists of a total of 400 units and was built in 2015.

Investment Highlights

  • Yr. 1 Cash-on-Cash 5.50%
  • Initial Occupancy 88.50%
  • Est. Time Horizon None YEARS
  • Current Cash Flow
  • Yr. 1 Cap Rate to Investor 4.94%
  • Investor Purchase Price $85,200,000
  • Total Offering Size $36,450,000

Loan Information

The total loan is for $48,750,000 and is from Fannie Mae. The term is for a total of 10 years with the first 5 years being interest only. When amortization begins it will be based on a 30 year schedule. The interest rate is fixed at a rate of 3.55%.

  • Yr. 1 DSCR 2.34
  • Loan-to-Offering 57.22%
  • Hold Period DSCR 2.11

Tenant Information & Lease Terms

Leases are signed on an individual basis at multifamily properties. The property manager will negotiate terms on a case by case basis. Leases are generally signed on a 12-month basis; however, this may differ for each tenant. A security deposit must be provided by the tenants and subleasing is not allowed.

Key Positives

  • Due to the property being recently built, there is less likelihood that the property will need capital expenditures to maintain the property.

  • The population growth in the local area is very favorable with positive growth anticipated in the 1,3, and 5 mile radius. This growth is projected to outpace the national average and is expected to be 2.42% in the 1 mile radius.

Key Risks to Consider

  • The Bradenton economy is reliant upon tourism and leisurely activity which makes it highly cyclical. Should there be a downturn in the economy and travel spending decreases in the area the subject property may be affected unfavorably.

  • The cap rate to investors is low (4.94%).

Investment Sponsor Information

PASSCO

According to the sponsor's website: "Since 1998, Passco Companies, LLC has operated throughout all market conditions and cycles. The company has acquired over $4 billion in multifamily and commercial real estate in the United States. Since its inception, Passco Companies has become a recognized provider of investment opportunities in real estate projects.

Passco Companies is directed by a team of dedicated senior real estate professionals whose experience in the business averages 34 years, and who, collectively, have acquired over $30 billion in investment real estate projects."

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