A California-based multifamily investor has purchased the 312-unit Mountain Valley Apartments in southwest Dallas, picking up the seller's last local property in an off-market transaction.
The 92.6%-leased Mountain Valley Apartments is located at 5875 Mountain Valley Lane, right across the street from an elementary school and park. Sam Pettigrew, managing partner in Dallas for National Apartment Advisers, represented the buyer, NVTX1 Apartments LLC of San Diego, in a direct deal with locally based Mountain Valley 2002 LP.
The well-maintained, 34-building complex is situated on 17.3 acres in a residential area at the edge of North Oak Cliff, an infill neighborhood of vintage single-family homes, boutiques and art galleries. It is the buyer's seventh property in the Dallas/Fort Worth metroplex, one of which is roughly three miles away creating the opportunity for economies of scale with the acquisition.
Pettigrew, acting on a lead from NAA's Houston office, sourced the deal for his longtime client in San Diego. "They analyzed the numbers, placed an offer and the seller responded quickly," he says. "We had hit the right price for him to sell."
The seller, who owned the asset for 15 years, was in the process of raising rents after completing a major renovation, inside and out. "There's an immediate return on the buyer's investment with the rent adjustments," Pettigrew says, "as the loss to lease burns off."
Mountain Valley's unit mix includes 185 two-story townhomes, a combination of two- and three-bedroom floor plans. The balance is one- and two-bedroom apartments, some with two baths. The all bills-paid units range from 752 sf to 1,252 sf with rents from $924 to $1,224 per month.
The recent renovations included a new office, which can double as an event room, for residents. Other tenant perks include two clothes care centers, playground and basketball court. Units feature faux wood floors, ceiling fans, walk-in closets, extra storage space and galley kitchens with granite-style countertops and updated appliances. Developed in 1969, the complex is located close to Loop 12, Interstates 20 and 30 and Pinnacle Park.
The deal, going full circle in 90 days, was completed with a Fannie Mae loan. Anthony Tarter at PGIM Real Estate Finance arranged the financing.
Pettigrew has closed six off-market transactions to date this year. With the DFW market experiencing above-average rent gains, owners often need to be persuaded to sell, with pricing generally as the deal maker.
"This buyer made a strong offer to a longtime owner, who was ready to cash out of Dallas and invest in other Texas markets," Pettigrew adds.