This Erica Court Apartments located in Dayton, Oh transformative project, occurring in just over 4 months of ownership, exemplifies the strategic execution of value-add strategies in multifamily real estate. With a focus on renovation and asset enhancement, Appelman Capital achieved remarkable results, including increased rental rates, revenue, and equity. Let’s explore the details of this endeavor.

Property Overview:

– 40-unit multifamily property

– 21 units renovated within 4 months

– Average Rental Rate Increase: $207

– Annual Revenue Increase: $47,000

– Equity Created: $675,000

Renovation Scope:

Exterior Renovations:

1. Replace Concrete Sidewalk
2. Implement New Landscaping
3. Install a Fresh Entrance Sign
4. Replace Shutters, Paint, and Pressure Wash

Interior Renovations:

1. Install New Modern Plank Flooring
2. Paint and Replace Cabinetry
3. Incorporate a Black Designer Lighting Package
4. Include a Black Designer Plumbing Fixture Package
5. Implement a Black Hardware Package
6. Upgrade to Granite Countertops
7. Paint Walls and Trim

Key Achievements:

1. Strategic Renovations:

– Appelman Capital strategically focused on both exterior and interior renovations, enhancing the overall appeal and value of the property. These improvements attracted higher-paying tenants.

2. Increased Rental Rates:

– The average rental rate increase of $207 per unit demonstrates the successful execution of the value-add strategy, resulting in higher monthly rental income.

3. Revenue Growth:

– The annual revenue increase of $47,000 showcases the financial benefits of the renovation project, contributing significantly to the property’s cash flow.

4. Equity Creation:

– Appelman Capital successfully created $675,000 in equity in just over four months, reflecting the property’s enhanced value and improved financial performance.

5. Targeted Returns:

– The project is on track to meet and exceed Appelman Capital’s return goals, with a projected 22% IRR (Internal Rate of Return) and a 2x Multiple, emphasizing the financial success of the investment.

Conclusion:

This case study illuminates the effectiveness of Appelman Capital’s value-add strategy in the multifamily real estate sector. With focused renovations, meticulous execution, and a commitment to creating value, Appelman Capital achieved impressive results in a short time frame. The increased rental rates, revenue growth, and substantial equity creation are a testament to the firm’s expertise in unlocking the full potential of multifamily properties. This case study serves as a valuable reference for investors seeking to maximize returns through strategic property enhancements.