Real Smart Asset℠ acquired 27 units of workforce housing apartments in Kansas City KS near our Redwood Estates property. This building has a mix of 1bed, 2bed units which will undergo major interior refinishes. This property will be our first intentional short term hold maximizing the benefits of our 24 month interest only period. We are excited for the repositioning l of this Value-add project then a positive 1031 exchange to a larger property.
REDWOOD is a stabilized townhome property in the suburb of the Kansas City KS metro with strong occupancy, opportunity for value-add, and significant upside from operational efficiency. Large basements offer bonus room potential for laundry, utility room and a 2nd common area. The exterior has beautiful grown trees, plenty of parking and 2 basket ball courts.
Our first apartment building purchase was two 1920's brick buildings we call Gladstone. The units were 50% occupied and were renting for up to $600/mth. We replaced roofs, performed grading, and installed new electrical boxes. We also remodeled the interior of all the units, retaining the natural charm of the historic building, while upgrading newer features like appliances and digitial door locks. Our tenants now pay $700+$45 per month rent. In 2020 we refinanced pulling out 90% of our initial down payment while keeping strong cashflow moving forward. During our 2 year project we also had the great opportunity to build and work with an amazing team, meet wonderful tenants, and get to know neighbors committed to improving the community.
Pendleton Heights Apartments was a dilapidated mid-1960s 18-unit apartment building. We purchased the property for $535k and immediately began a full renovation of all unit interiors as well as decks, stairs, lighting and paint which cost $550k. Rents were $695-$735/mth at acquisition. The property is now 100% occupied with tenants paying $885 +$65/mth. We received multiple offers in 2020 at $1.65M and decided to take the property to permanent debt, performed a cash out refinance and will continue to cashflow.
We partnered in a real estate syndication to acquire Oak St Mansion, a luxury boutique AirBnB-hotel at Nelson-Atkins Art Museum near the Plaza, Kansas City's premium outdoor shops. As a 20% limited partner, we learned what works well and what we would do differently in a managing our own real estate partnership.