Short term hold – 18% preferred equity position. Newly renovated, market rate apartment conversion (from hotel)
475 N Granada Ave, Tucson, AZ 85701, USAListing Details
- Listing Type: Equity Listing
- Category: LP
- Type: Multi-family
- Asset Type: Multi-family
- Status: Stabilization
- Year built: 1959
- Year remodeled: 2024
- Hold Period: 9-30 months as of June 2024
- Distribution Frequency: Preferred equity position will be distributed in lump sum at sale not later than March 2027. Distributions will be paid quarterly upon stabilization
- Asset Strategy: Now in Stabilization after complete re-developent.
- Preferred Return: The preferred equity is offered at 18.0% IRR and the property will be sold no later than March 2027. See PPM for further details. Preferred equity position will be distributed in lump sum at sale not later than March 2027.
- Loan-to-Value: 55% Loan to Cost
- Sponsor Name: Sterling Real Estate Partners
- Sponsor Years in business: 19
- Number of Sponsor Offerings: 30
Property Location
Property Description
-
Property Description:
Hotel Conversion to Market Rate Apartments: This acquisition represents an opportunity to acquire a 10-acre site in downtown Tucson with a seven building, 278-room hotel and convert it to 212 market rate apartments.
Entitlements are Completed: The property was acquired on December 30, 2021, and Sterling re-zoned, entitled, permitted the former 278 room hotel to convert it to 212 market rate apartment units.
Build Below Replacement Costs: The all-in per-unit cost for the conversion is $184,434. Properties in the submarket are currently trading at over $200k per unit.
Minimal Execution Risk: Construction started in May 2023 and is 95% complete and scheduled to be 100% complete by August 31st, 2024. All of the amenity areas are open, and the property is 67% leased.
Additional Development potential: The site has been approved for the development of 154 additional units which is not reflected in the underwriting.
Proximity Demand Drivers: Two blocks from downtown and one block from I-10 with direct access to the frontage road and freeway. Provide a low rent option in the downtown market.
Sterling HCP Investors LLC (“Sterling”) is seeking $1,000,000 of preferred equity which will be combined with $3,687,708 of committed preferred equity to fund the construction and operating costs to complete the construction of a 212-unit hotel conversion to apartments.
The preferred equity is offered at 18.0% IRR and the property will be sold no later than March 2027.
The total project cost is $39,100,000 and $184,434 per unit. There is a $21,375,000 construction loan with $3,667,100 remaining in available funding. The total loan to cost is 55% and combined LTC of the first mortgage and preferred equity is 65%.
There is $13,547,721 of equity subordinated to the preferred equity position. The sponsor has invested $2.5M, 14% of the total equity, in the project. The loan matures March 2025 and has two, one-year extension provided the following conditions are met: 90% occupancy, 8.0% debt yield, and 65% LTV.
Listing Documents
Ask about this Listing
Short term hold – 18% preferred equity position. Newly renovated, market rate apartment conversion (from hotel)
475 N Granada Ave, Tucson, AZ 85701, USAListing Details
- Listing Type: Equity Listing
- Category: LP
- Type: Multi-family
- Asset Type: Multi-family
- Status: Stabilization
- Year built: 1959
- Year remodeled: 2024
- Hold Period: 9-30 months as of June 2024
- Distribution Frequency: Preferred equity position will be distributed in lump sum at sale not later than March 2027. Distributions will be paid quarterly upon stabilization
- Asset Strategy: Now in Stabilization after complete re-developent.
- Preferred Return: The preferred equity is offered at 18.0% IRR and the property will be sold no later than March 2027. See PPM for further details. Preferred equity position will be distributed in lump sum at sale not later than March 2027.
- Loan-to-Value: 55% Loan to Cost
- Sponsor Name: Sterling Real Estate Partners
- Sponsor Years in business: 19
- Number of Sponsor Offerings: 30
Property Location
Property Description
-
Property Description:
Hotel Conversion to Market Rate Apartments: This acquisition represents an opportunity to acquire a 10-acre site in downtown Tucson with a seven building, 278-room hotel and convert it to 212 market rate apartments.
Entitlements are Completed: The property was acquired on December 30, 2021, and Sterling re-zoned, entitled, permitted the former 278 room hotel to convert it to 212 market rate apartment units.
Build Below Replacement Costs: The all-in per-unit cost for the conversion is $184,434. Properties in the submarket are currently trading at over $200k per unit.
Minimal Execution Risk: Construction started in May 2023 and is 95% complete and scheduled to be 100% complete by August 31st, 2024. All of the amenity areas are open, and the property is 67% leased.
Additional Development potential: The site has been approved for the development of 154 additional units which is not reflected in the underwriting.
Proximity Demand Drivers: Two blocks from downtown and one block from I-10 with direct access to the frontage road and freeway. Provide a low rent option in the downtown market.
Sterling HCP Investors LLC (“Sterling”) is seeking $1,000,000 of preferred equity which will be combined with $3,687,708 of committed preferred equity to fund the construction and operating costs to complete the construction of a 212-unit hotel conversion to apartments.
The preferred equity is offered at 18.0% IRR and the property will be sold no later than March 2027.
The total project cost is $39,100,000 and $184,434 per unit. There is a $21,375,000 construction loan with $3,667,100 remaining in available funding. The total loan to cost is 55% and combined LTC of the first mortgage and preferred equity is 65%.
There is $13,547,721 of equity subordinated to the preferred equity position. The sponsor has invested $2.5M, 14% of the total equity, in the project. The loan matures March 2025 and has two, one-year extension provided the following conditions are met: 90% occupancy, 8.0% debt yield, and 65% LTV.
Listing Documents
Ask about this Listing
Short term hold – 18% preferred equity position. Newly renovated, market rate apartment conversion (from hotel)
475 N Granada Ave, Tucson, AZ 85701, USAListing Details
- Listing Type: Equity Listing
- Category: LP
- Type: Multi-family
- Asset Type: Multi-family
- Status: Stabilization
- Year built: 1959
- Year remodeled: 2024
- Hold Period: 9-30 months as of June 2024
- Distribution Frequency: Preferred equity position will be distributed in lump sum at sale not later than March 2027. Distributions will be paid quarterly upon stabilization
- Asset Strategy: Now in Stabilization after complete re-developent.
- Preferred Return: The preferred equity is offered at 18.0% IRR and the property will be sold no later than March 2027. See PPM for further details. Preferred equity position will be distributed in lump sum at sale not later than March 2027.
- Loan-to-Value: 55% Loan to Cost
- Sponsor Name: Sterling Real Estate Partners
- Sponsor Years in business: 19
- Number of Sponsor Offerings: 30
Property Location
Property Description
-
Property Description:
Hotel Conversion to Market Rate Apartments: This acquisition represents an opportunity to acquire a 10-acre site in downtown Tucson with a seven building, 278-room hotel and convert it to 212 market rate apartments.
Entitlements are Completed: The property was acquired on December 30, 2021, and Sterling re-zoned, entitled, permitted the former 278 room hotel to convert it to 212 market rate apartment units.
Build Below Replacement Costs: The all-in per-unit cost for the conversion is $184,434. Properties in the submarket are currently trading at over $200k per unit.
Minimal Execution Risk: Construction started in May 2023 and is 95% complete and scheduled to be 100% complete by August 31st, 2024. All of the amenity areas are open, and the property is 67% leased.
Additional Development potential: The site has been approved for the development of 154 additional units which is not reflected in the underwriting.
Proximity Demand Drivers: Two blocks from downtown and one block from I-10 with direct access to the frontage road and freeway. Provide a low rent option in the downtown market.
Sterling HCP Investors LLC (“Sterling”) is seeking $1,000,000 of preferred equity which will be combined with $3,687,708 of committed preferred equity to fund the construction and operating costs to complete the construction of a 212-unit hotel conversion to apartments.
The preferred equity is offered at 18.0% IRR and the property will be sold no later than March 2027.
The total project cost is $39,100,000 and $184,434 per unit. There is a $21,375,000 construction loan with $3,667,100 remaining in available funding. The total loan to cost is 55% and combined LTC of the first mortgage and preferred equity is 65%.
There is $13,547,721 of equity subordinated to the preferred equity position. The sponsor has invested $2.5M, 14% of the total equity, in the project. The loan matures March 2025 and has two, one-year extension provided the following conditions are met: 90% occupancy, 8.0% debt yield, and 65% LTV.
Listing Documents
Ask about this Listing
WE TAKE PRIDE IN OUR EXCLUSIVE OFFICIAL APPROVED SPONSOR GROUP.
We’re doing something that has never been done in the real estate syndication industry. We’ve launched our exclusive Official top-rated PREIshare-Approved Sponsor Group to showcase sponsors who are doing it right. A PREIshare-Approved Sponsor is a real estate syndicator who has undergone our professional review process by providing pertinent information on experience, background, company structure, real estate investing experience, and other areas so we can verify they are as good as they say they are.
- 382 W 6110 S
- Salt Lake City, UT 84107
- (801) 753-0754
- 1(833) PREIshare (773-4742)
- info@preishare.com
LEGAL NOTICE: By accessing this Site and any pages thereof, you agree to be bound by its Terms of Use. This website is only suitable, intended, and available for accredited investors who are familiar with and willing to accept the risks associated with private investments. Use of this website does not constitute an offer by PREIshare to sell, solicit or make an offer to buy any investment interest and PREIshare does not give or offer any business advice, investment advice, tax or legal advice to anyone using this website or the services are defined in the Terms of Use.
Certain information on this website relating to properties or other potential investment opportunities has been prepared and/or approved by the “Trusted Partners”, Sponsors, or Issuers of those properties/investments. PREIshare does not endorse, guarantee, recommend, advise or make any investment recommendations. You agree that you will not hold PREIshare (or any of its officers, owners, employees, affiliates or agents) liable for any investment made with any third party (including our Sponsors and/or “Trusted Partners”).
PREIshare allows prospective investors to connect with issuers listed on our platform. PREIshare is not offering any securities. All securities are offered by issuers on the platform, and investment agreements are made directly between investors and issuers. PREIshare receives compensation from issuers for listing them on the platform. The amount of compensation that an issuer pays PREIshare does not change based on whether the issuer completes an offering of securities or on the amount the issuer raises. Issuers may compensate PREIshare in the form of ownership interests in their company. Visit our platform’s website for further important information.