Los Angeles, California | August 23, 2018
Apartment Income Investors (Aii) is pleased to announce the sale of Barcelona Apartments, a 127-unit apartment building located in the Galleria area of Houston, Texas.
Aii acquired the property in December 2013 when we saw the opportunity to improve property operations and rental demand, as well as the potential to increase effective rents. The prior owner had not raised rental rates for a few years, while our market survey indicated there was over $100 per unit upside in rents, with additional upside if the property was improved.
Aii implemented a business plan to improve operational efficiency and the physical property. Revitalizing the exterior and common areas included upgrades to the pool, roof and stucco repairs. Improvements to the living units included new black appliances, brushed nickel fixtures/hardware, and new flooring, all giving the units a sleek, updated feel. As a result of the business plan, rental rates increased by 23.5% and NOI increased by 25.3%.
Michael Chesser, President and Founder of Aii, said, “Barcelona is an example of the Aii team implementing a business plan to exploit a property’s competitive advantage and serve the tenants well. Creating apartments where people love to live―a place to call home―results in a strong property, an improved community and profits for investors. It’s a win for everyone.”
Aii sold at a premium price due to the condition and location of the property and the aggressive profile of the buyer. Along with a positive time in the real estate cycle, these conditions created an ideal situation to harvest profits. For more information, also see this case study showing how the Barcelona investment exemplifies Aii’s investment process.
About Apartment Income Investors
Founded in 1994, Apartment Income Investors (Aii) has a proven track record of buying underperforming Class B multifamily properties and implementing renovation and repositioning strategies to improve operations and substantially increase the value of each property. This strategy has proven successful through several real estate cycles with above-average returns to investors. The company’s goal is to transform homes, lives and communities while delivering superior investment returns.