The Gables Apartments
San Antonio, TX 78230
Pref. Equity • MULTI FAMILY

Min. Invest

$25K

Target Hold

5 Yr.

Preferred Returns

8%

PROGESS - 45% PLEDGED

Investment Summary

RealtyeVest has a stake in all real estate investments offered in our marketplace.

RSN Property Group (“RSNPG”) and Wildhorn Capital (“WHC”) have exclusively retained RealtyeVest to offer accredited investors the opportunity to invest in REV Gables, LLC. The existing 192 unit apartment community is located in San Antonio, TX.

This offering is available with an annual 8% preferred return. Additionally, the sponsors are offering investors 70/30 waterfall participation in which 70% of the remaining cash flow will belong to the investors and 30% to the sponsors. Investors can expect to receive interest checks quarterly on the 8% preferred return.

Units will undergo stages of interior renovations, including: updated cabinets, countertops, new appliances, flooring, hardware and lights throughout each unit. Exterior renovations will focus on landscaping and fresh paint where needed.

Upon completion of the unit renovations and exterior beautification through landscaping and design, the 192 Unit property is expected to see rent increases between $.10 and .20 per unit, across the board.


Investment Type:
Preferred Equity
70/30 Waterfall Participation
after 8% preferred return
Term:
60 Months
No extensions are expected
 
Raise Amount: $1,500,000
 
8% Preferred Return
IRR: 17%
Deal Multiple: 2.0x
 


Why You Should Invest:

  • 8% Pref, 17% IRR and 2x Multiple: The sponsors are offering a 8% preferred return and 70/30 waterfall cash distributions with 70% belonging to the investors. The deal is slated to have an IRR of 17% and a Deal Multiple of 2.0x.
  • San Antonio: Located in the extremely desirable northwest submarket, the property sits less than 2 miles from the South Texas Medical Center/USAA employment center-- the largest and fastest growing employment hub in the market. This immediate area has seen rents grow over 15% since 2010 due to the proximity of major employment and interior location.
  • Value Add: This Class B asset is neighboring Class A properties that receive $350/month rent premiums. We can improve the overall property, increase rents, and offer residents a lower cost offering relative to the competition. Adding additional carports, implementing trash valet and creating private backyards are just a few of the additional revenue generating opportunities that have been identified by the partners.
  • Experienced Sponsor: RSN Property Group (“RSNPG”) and Wildhorn Capital (“WHC”) are currently General Partners on over 1140 units in Texas with a market value over 100,000,000. They are looking to continue to grow and expand within the multifamily spectrum and beyond.
  • High Demand: As the multifamily industry continues to expand, the market and quality increases exponentially. San Antonio is burgeoning into a tier one family market with quick passages to large gateway cities like Houston and Dallas.

Location Highlights

  • San Antonio has been named by Forbes magazine as one of the top places to be in business.
  • 6 major Fortune 500 Companies reside in San Antonio as well as companies like HULU.
  • Opportunity to quickly grow rents as property is located in a high growth corridor with many “Class A” apartment communities with much higher rents.
  • Close to trendy shopping and dining making this a popular location for its tenant base.

Due Diligence Highlights

  1. Extensive Research on Submarket, Rent Growths and Development of the Area.
  2. Examined current financials, rent roll and sponsors proforma to ensure business plan is achievable.
  3. Researched property management company, called and verified performance with references.
  4. Verified neighborhood is desireable through third party site.

Exit Strategy

The Gables will be renovated and stabilized to maximize the upside value. The sponsors currently plan to execute a cash-out refinance or sell the property outright at the end of the five-year hold period.


Sample Investor Returns

Sample Investment Amount: $100,000
Target Average Quarterly Payments: $2,234
Target Total Quarterly Payments: $44,684
Target Distribution at Sale: $154,409
Target Net Earnings to Investors: $199,093

Risk Mitigates

Market Expertise: Strong Experienced Team: RSNPG & WHC control a combined Texas portfolio of over 1100 units with a market value in excess of $100,000,000. We will partner with CLEAR Property Management, who runs 8 assets in the immediate San Antonio area.

Opportunity to Quickly Grow Rents: This Class B asset is neighboring several Class A properties, which receive $350/month rent premiums. Management intends to improve the overall property, increase rents, and offer residents a lower cost offering relative to the competition.

Strong Returns with Low-Risk Asset: Management plans to renovate an already highly-desirable property and place low-rate fixed debt on the asset, creating an excellent ratio of strong returns with mitigated risk.

Strong Property Management Group: Clear PM will bring a modern, best-in-class property management approach to tighten operations and increase tenant retention, which will increase performance of the asset throughout the hold period. The Company will be using Rental Management Software to ensure rental rates are optimized weekly. Clear PM has a strong track record in managing property renovations and improvements, and currently manages over 3,800 units ($500 million) across five markets in Texas.


Risk Disclosures:

The offering materials to be reviewed and considered by investors with respect to this offering include the information described in the website content relating to this offering (as amended and supplemented through and until the closing of the transaction) and the subscription agreement relating to such securities (see the "Documents" tab). We refer to all of this information collectively as the "Property Information Package". Investors should review the Property Information Package in its entirety before investing and should consult with appropriate legal, tax, and investment advisors. Please note that RealtyeVest is not serving as your fiduciary or advisor with respect to this opportunity.

Below are certain risks associated with this investment that should be carefully reviewed prior to any investment in this opportunity:

Forward-Looking Statements: Investors should not rely on any forward-looking statements made regarding this opportunity, because such statements are inherently uncertain and involve risks. We use words such as “anticipated,” “projected,” “forecasted,” “estimated,” “prospective,” “believes,” “expects,” "plans,” “future,” “intends,” “should,” “can,” “could,” “might,” “potential,” “continue,” “may,” “will,” and similar expressions to identify these forward-looking statements. Similarly, the financial forecasts contained herein and in any other offering materials are based on numerous assumptions. Although these assumptions are believed to be reasonable, they are all subject to uncertainty. Non-Transferability of Notes: The transferability of the Company's Notes is restricted both by the subscription agreement for that entity and by U.S. federal and state securities laws. In general, investors will not be able to sell or transfer the Notes. There is also no public market for the Notes and none is expected to be available in the future. Moreover, although there is a defined redemption date for the preferred equity investment in the Fund, an extension option may be exercised and in any event, there can be no assurance that the investment will be liquidated at or promptly after such maturity date (as it may be extended). Persons should not invest if they require any of their investment to be liquid. This is particularly important for persons of retirement age, who should plan carefully to assure that their assets last throughout retirement.

Real Estate Market Risk: Investments related to real estate are subject to market valuation risks that may be caused by changing economic and local market conditions such as local real estate market conditions, prevailing interest rates, the rate of unemployment, the level of consumer confidence, the value of the U.S. dollar, energy prices, changes in consumer spending, the number of personal bankruptcies, disruptions in the credit markets and other factors. Such conditions are beyond the control of the Company and of the Fund. Real estate markets are affected by many factors, such as general economic conditions, supply and demand for real estate investments, interest rates, the availability of financing, and other factors, all of which are beyond the control of both the Company and the Fund.

Borrower Credit Risk: The Company’s obligation to make payments on a Note will not be guaranteed for the length of the term corresponding to the borrower’s loan. The Company (and thus investors) will be relying on the borrower for the execution of its business plan in a way that enables the sponsor to repay the principal of the corresponding borrower loan. The borrower may not have a significant record of performance and may be unable to sell or refinance the underlying property in a way that enables the borrower to fulfill its obligations under the corresponding borrower loan. The borrower loan is being made with respect to a property that does not generally meet the financing criteria for conventional mortgages from institutional sources. Credit risk is inherent in the mortgage lending industry, and there can be no assurance that the creditworthiness of the borrower will be sufficient to assure the full repayment of the underlying borrower loan. The Company does not guarantee payment of the Notes or the corresponding borrower loan, and the Notes are not obligations of our borrower.

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Property Summary

The Gable Apartments, is a pet-friendly, 192 unit apartment community located in northwest San Antonio. The current owners have upgraded 17 units, at an $87.00 per unit rent increase for each. The 1983 property is a class B asset, positioned in a solid growth corridor. Surrounding the property are many class A retail centers and Class A apartment communities, to favor the unit upgrade program and effectively raise rents on the remaining units.

The Property is located in northwest San Antonio—near the intersection of I-10 and Huebner Rd, just 10 miles from downtown and the Riverwalk. It sits within 2 miles of the city’s major employment hub – The South Texas Medical Center / USAA complex and feeds into Northside ISD, one of the top three school districts in San Antonio. Among the nearby acclaimed schools is Clark High School that is five miles from UTSA campus, with 30,000 students and 10,000 employees.

Current floor plans offered are one and two bedroom floor plans. The property has a stabilized occupancy of 98%. Currently, the property is averaging $.99 per Sq. Ft. yield on rents. However, this number could easily be $.10 - $.20 higher with more effective management and thorough unit upgrades.

Amenities include full-size washer / dryer connections, vaulted ceilings, fireplaces, and large over-sink kitchen windows. The Gables Apartments property has a billiards room, swimming pool with year-round Jacuzzi, and fitness center.

Property Name: The Gables Apartments
Property Type Multi Family
Year Built 1983
Units 192
Occupancy 95%

Market Overview

This 1983 vintage apartment community has 192 units and is located in the northwest region of San Antonio, TX. The San Antonio market is highly stabilized after the fourth largest U.S. population spike in 2015, making it the seventh most populated city in the U.S, and third most populous city in Texas. The population is over 2.4 million people.

Home to historic sites such as: The Alamo, The Riverwalk, and Towers of America, San Antonio also houses five-time championed: San Antonio Spurs. Laterally, there are six Fortune 500 companies and a medical center that services all of south Texas.

The median household income is almost $54,000 and unemployment is less than 3.7%. With a strong military presence and 31 higher learning institutions, the average income is closer to $62,000. Statistics reveal that 33% of the housing market are occupied by renters rather than homeowners. The average home is around $200,000.

The top 5 major employers in the region are:

Lakeland Air Force Base 37,000+ employees
Fort Sam Houston Army base 32,000+ employees
H-E-B 20,000+ employees
USAA 17,000+ employees
Northside ISD 12,750+ employees

A strong workforce base, stabilized economy and lower cost of living than other cities within Texas, make San Antonio a great business location and source for many company origins. Companies such as Petco, Whataburger, H-E-B, Toyota Manufacturing Company, Oracle, Medtronic and Microsoft were all launched and grown by San Antonio’s flourishing market.

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