Elevate Apartments & Townhomes
Ideal Value-Add Opportunity with an Ability to Significantly Enhance Rents
Opportunity to Recapture Some Expenses Further Enhancing the NOI
Purchased at Discount Despite Highly Competitive Market
Amenities On-Site Provide Further Increased Valuation
Extremely Popular Growing Submarket with Prime Location Near Downtown
Highly Oklahoma City Market with Increasingly Diverse Employer Base
Growing Technology, Aerospace, Service and Manufacturing Positioning for Further Growth
Consistently Ranked High for Multiple Categories of Business & Lifestyle
Year-over-Year Rent Growth of 8.2% (CoStar) with Decreasing Vacancies
45% Discount in Rents Relative to National Average Gives Significant Potential Upside
Increased Household Income 15% in 5-Years (CoStar)
Targeted Fund Returns
Cash-On-Cash Yield (Initial)
6.0% – 8.0%
Cash-On-Cash Yield (Stabilized)
8.5 - 10.5%
Target IRR
16.0 - 18.0%
Equity Multiple
2.3 - 2.7x
About Elevate Apartments & Townhomes
Elevate Apartments & Townhomes is another great opportunity to acquire a very well-located asset that will benefit from a moderate renovation value-add program.
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Pax Properties was able to buy this 126-apartment community in Oklahoma City at a significant discount, acquiring it through a loan assumption, paying less than what the previous owners purchased it for in 2016. This is unheard of in today’s highly competitive, inflationary, rapidly rising valuations environment.
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Strong ROI is supported by a substantial rent delta with competing submarket properties and achievable through market-accepted upgrades including new appliances, fixtures, flooring, and finishes. Proven opportunities for revenue increases and decreasing expenses through renovating, repositioning, and rebranding gives us an excellent investment opportunity.
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Given the location and amenities that include an indoor pool, gym area, clubhouse, and conference rooms which can be converted to highly sought after work-space, there is a huge amount of room to grow the rents. For example, a neighboring complex rents for about $200 higher post renovations and we feel our units once repositioned and rebranded will be best-in-class and demand higher rents.
Elevate is in an increasingly popular neighborhood and prime location near downtown. Nearby is heavy street traffic with Barnes and Noble, Home Depot, and Chick Fil A (which trade at high-valuation 4 caps) as neighbors.
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Oklahoma City’s diverse business landscape consists of major employers in aerospace, biosciences, manufacturing, healthcare, education, finance, insurance, transportation, construction, and telecommunications. Oklahoma City’s dynamic Tech Sector accounts for an estimated $2.7 billion in direct economic impact and employs over 39,000 people.
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These include a growing base of private companies headquartered in the Oklahoma City MSA. Love’s Travel Stops ranks 17th on Forbes’ list of largest U.S. private companies, software giant Paycom ranks 18th among Fortune’s 100 fastest-growing companies and Hobby Lobby, BancFirst, INTEGRIS Health, and Love’s Travel Stops are all included in Forbes’ 2020 list of America’s Best Employers.
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The Oklahoma City Metro posted a March unemployment rate of 4.0%, one of the lowest in the nation among large metropolitan areas (BLS).
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Oklahoma City-based Drov Technologies is revolutionizing the trucking industry. Construction is underway on Boeing’s new $20M B-52 Modernization and Sustainment facility at Oklahoma City’s Tinker Air Force Base. With over 26,000 employees, Tinker generates an annual economic impact of $4.83B.
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Online auto retailer Carvana is planning a 102-acre vehicle inspection and reconditioning center near Will Rogers Airport. Amazon’s presence in Oklahoma City is expanding again with a new 1 million-SF sorting facility immediately north of its 2.5 million-SF OKC Fulfillment Center. The new facility is projected to add 1,000 jobs to the 5,000 workers already present.
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OKC has been ranked as the number 1 for the easiest place to do business (CoStar), the lowest cost of living among large metros (C2ER,2021), and best city for street art (USA Today, 2021). It is number 3 for the lowest cost of doing business (Moody/s, 2021), number 9 for best city to start a career (Zippia, 2020), in the top 10 for biggest millennial boomtowns (MagnifyMoney, 2019) and top 20 for best run cities in America (WalletHub.com, 2020).