$1232000

Brookport Apartments
  • Units: 44
  • Cap Rate: 9.45 Percent
  • Price Paying: 49.81 sqft
  • Price Per Unit: $29886
  • Property Type: Multi Family
  • Gross Rent Multiplier: 4.92
  • Year Built: 1954
  • Monthly Income Per Unit: $506
  • Expense to Income Ratio: 53.53 Percent
  • Average Square Feet: 600
  • Debt Service Coverage: 1.56
  • Cash Flow: 45359.99
  • ROI Year One: 13.49
  • Listing Agent: -
  • Property Features: Income Property Organization is pleased to present the exclusive marketing of Brookport Apartments, which consists of 44 units, and is located in East Lansing, Michigan, home to Michigan State University. Brookport Apartments is located off of Haslett Road, and within 1½ miles of campus. With an enrollment of nearly 50,000 students, MSU is the largest public university in Michigan and the ninth-largest university in the country. The immediate proximity to the biggest university in Michigan affords the owner of Brookport a substantial supply of quality tenants. The East Lansing market has remained remarkably unaffected by the significant downturn in market conditions. Specifically, rental rates and occupancy have held, allowing operators assurance that an asset in this community is a sound investment for a long term hold. Historically occupancy rates in this market range from 90-100%. As for the property itself, Brookport is a garden-style property constructed in 1954, and is outfitted with a landlord-paid, hot-water baseboard heating system and separately metered units for electricity. The property is currently 93% occupied, with rental rates slightly below the market average. Thus, an investor can add substantial value to this asset via increased rental rates. Between 2006-2009 Brookport underwent approximately $250,000 in capital improvements including: all new boilers & hot-water tanks, the rehabilitation of every bathroom, one new roof, and all new vinyl windows. Brookport was previously purchased in 2005 for $1,425,000, or $32,386 per unit. When the $250,000 of capital improvements are added to the previous sales price the current sales price effectively represents 79% of the previous disposition value. The 2010 NOI was $95,000 and the 2011 NOI is targeted at $113,000, making this offering a 9.0% cap rate based on in-place income. Additionally, substantial value can be added through self-management. The current owner lives out-of-state, necessitating third-party management at a cost of over $15,000 per year. Thus, a local operator could easily increase the NOI to approximately $130,000 via self management. Under this scenario, this offering would reflect a 10% cap rate, and a purchasers cash-on-cash return would be in excess of 13%. Brookport is a well performing asset that can be acquired at an artificially low value due to the significant economic downturn, which has compressed value across the nation, and in particular in Michigan. This situation is exacerbated by a lack of available credit, allowing active buyers to acquire properties at deep discounts. The economic reward will be significant for opportunistic investors with ample liquidity to acquire assets such as Brookport in this once-in-a-lifetime buyers market. Once you have had a chance to review the included information please call to set up a confidential showing before this aggressively priced opportunity is gone.
  • Interior Features: -
  • Exterior Features: -

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  • About Us

    Income Property Organization offers customized brokerage services that are designed to meet the specific needs of a wide range of clients -- private owners as well as institutional investors -- who want to buy or sell income property.
  • Contact Us

    Income Property Organization
    6421 Inkster Rd., Suite 200
    Bloomfield Hills, MI 48301
    Telephone (248) 932-0300
    Fax (248) 932-0301