Investment Overview

46 Eleven is a 79-unit apartment community in Dallas, Texas located about 10 minutes east of Downtown Dallas on Interstate 30. This location is a quiet spot but near to major employment centers like the I-30 industrial corridor and Dallas Medical District, retail, grocery & restaurants along I-30, and White Rock Lake. The median household income in a one mile radius of 46 Eleven is just over $80K. There is minimal new supply in this submarket which creates occupancy stability for workforce housing and should lead to rent growth sooner than other spots in the metroplex. The subject property was built in 1964 and consists of 3 buildings that are comprised of brick veneer and stucco exteriors on concrete slab foundations with pitched composition roofs that were replaced in the last 5 years. The property is heated and cooled by a two-pipe chiller (replaced 2018) and master metered for electricity. All interior electric panels have been replaced and electric wiring is copper. Other important renovations include all new windows and patio sliders, new boiler, as well as all 79 units have been renovated with new cabinets, flooring, backsplash, black appliances and new Formica counters. Average unit size is above average at 824 SF and 100 percent of units are 2-bed floorplans. 46Eleven is part of Chapter 11 Bankruptcy proceedings due to a distressed ownership, but the subject property itself is not distressed. 46Eleven is well occupied and offers stable cash flow, a going-in 7% cap rate, and out-sized returns of 13% cash-on-cash yields from day-one. This offering is free & clear of existing debt and sizes for 80% fixed rate agency debt, which allows for low-risk of execution. When considering the recent renovations, a new owner can enjoy the cash flow and stability of 46Eleven without a major capex budget. The property is very well occupied, having remained over 94% occupancy for at least the past 60 days. Opportunity to improve NOI can be quickly found by increasing the water RUBS to market norm of 70% (currently 42%) which adds over $15k to NOI and rents will continue to improve as the supply drop-off continues.