Los Angeles, California | March 13, 2021
On behalf of Transformation Housing Fund L.P. ("THF"), Aii Capital Management LLC, the General Partner of THF, is pleased to announce the acquisition of two assets in 2020:
Burbank Boulevard Apartments in Tarzana, California
This 11-unit multifamily property was acquired in December 2020. It is located a block north of Ventura Boulevard, which is the main commercial artery in Tarzana, California. The property was originally built in 1988 and has a secure parking garage on the bottom level, with two stories of residential units over. The unit mix is very desirable, with 10 units of 2-bedroom and 2-baths, and one unit of 1-plus-1. A rooftop deck, large walk-in closets, and oversized living spaces make the property a desirable choice for professionals and young families to work from home and live with space in city environs. Tarzana and the San Fernando Valley enjoy many diverse economic drivers and job opportunities; it is a highly desirable neighborhood to call home.
Our market research has revealed that the rents in place at this property are 33% below current market rates. We expect to achieve this 33% increase-to-market over a 5-year period, a conservative view to future expectations.
This asset was acquired at a price that will generate current cash-on-cash returns and provide for long-term appreciation and a return on investment for years to come.
Planned property improvements include new common area flooring, landscaping, exterior painting, upgraded interiors at vacancy, and installation of a new roof. It is a non-rent-controlled apartment complex and the market value is expected to rise as the property is professionally managed and leased.
Village at Moorpark in Moorpark, California
This shopping center was acquired in February 2020 in an off-market transaction sourced through an existing broker relationship. The property was purchased below market and at a favorable cost basis compared to the appraisal obtained at acquisition.
The General Partner envisions a strong cashflow, with steady and substantial cash distributions for investors. The property was acquired at 55% below replacement cost and is situated in a tight market, with quick lease-up opportunities. The shopping center is 76% occupied in a submarket that has a 94% occupancy rate. The average household income averages $132,440.
The business plan for this property includes improving operations by negotiating with prospects for all vacancies with a local leasing agent who is #1 in the area. Our plan envisions renewed leasing with current tenants, as well as negotiating with replacement tenants for big box spaces in the shopping center. There is current demand for boutique spaces, which include a dental office, a sushi restaurant, a taco restaurant, a beauty salon, an ice cream parlor and a learning center. Property improvement plans include painting the exterior of the center and upgrading street signage to increase the overall curb appeal.
Michael Chesser, Founder and Manager of THF's General Partner, said, "Village at Moorpark will benefit the local community and offer opportunities for shopping, dining and other lifestyle services. Burbank Boulevard Apartments will be in high demand for professionals who prefer to work at home. The large living areas in the apartment units, and the proximity to the surrounding retail neighborhood are very desirable attributes."
About Apartment Income Investors
Founded in 1994, Apartment Income Investors (Aii) has a proven track record of buying underperforming Class B multifamily and commercial 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.