122-Unit Wexford Sells to L.A. Buyer

DUNCANVILLE, TX-A Los Angeles buyer has used funds obtained from selling a multifamily asset in Oklahoma to buy the 122-unit Wexford Townhomes. The Miami, FL buyer entered the Texas market with the acquisition, which was valued between $8 million and $11 million.

Al Silva, senior associate with Marcus & Millichap Real Estate Investment Brokerage Co.’s Fort Worth office says the 25-year-old asset at 600 Wembley Circle went through a “quiet” marketing period that reached a small number of buyers. “The buyer had experience operating outside his home state and the seller liked that,” says Silva, who had the marketing assignment with Marcus & Millichap associate Kelley Sparkman in the company’s Dallas office.

The buyer also took charge of a $7.5 million assumable interest-only conduit loan from Wachovia. The loan, which has a 6.18% interest rate, has another 3.5 years remaining. “This is a little different from a lot of the properties of this type on the market today,” Silva tells GlobeSt.com. “Most of them are either distressed or people have to sell because the note is coming due.”

However, Wexford Townhomes is in good condition and doesn’t require any upgrades. “We felt the property itself and the great assumable loan with time left on it would compel the few buyers out there to come to the table,” Silva explains. “This deal had undergone significant capital improvements over the past 18 months, so this represents a mid-to-long-term hold for the buyer for the cash flow.”

The occupancy of the one- and two-bedroom unit asset and the half-acre on which it sits is 95%. The current total return is just under 11%, with pro forma return estimated at 12.42%. Unit sizes are between 821 and 1,202 square feet and the rents are from $768 and $1,010.