Calvera’s Investment in Active Austin Market Pays Off
Topic:
A splash of paint here, some new appliances there, and tidy profits are possible flipping apartments in Austin.
Just ask Tradewind Properties or Calvera Partners, firms that recently proved potential for returns for value-add complexes is still high in the Austin market.
Wildhorn Capital Operations purchased the 284-unit Class B complex at 8054 Exchange Drive in North Austin from Houston-based Tradewind, according to Travis County records.
The Austin-based firm borrowed $39.2 million from Raymond James Bank for the purchase, which comes to a little over $138,000 per unit, although an exact sale price wasn’t disclosed.
Called the Creekstone Apartments, they’re located just north of U.S. highways 290 and 183, about 8 miles northeast of downtown Austin.
Tradewind acquired the property in 2017 and described it as “an attractive acquisition opportunity due to its relatively underperforming fundamentals,” according to the company’s website. Interior and exterior renovations have taken place since the property’s acquisition.
Tradewind Properties has been investing in multi-family since the early ’90s and has investments in over 20 properties across Oklahoma and Texas.
Meanwhile in South Austin, a mystery buyer purchased the 304-unit complex at 6201 Sneed Cove from Calvera Partners. The price wasn’t disclosed, but a CoStar report shows Calvera paid $34 million for the property in 2020. The complex’s taxable value was assessed at $44 million last year, up from $32 million in 2020, according to Travis County Appraisal District records.
The complex, called Terrace Cove, is just east of Interstate 35 off Stassney Lane and less than a mile from an H-E-B Market. Calvera renovated the property, which was first built in 1986, according to a news release from the company.
The sale brought a nice return for investors, despite “whipsaw market conditions,” said David Saxe, Calvera managing principal.
Calvera first formed in 2019 and has invested over $65 million across 14 multifamily properties in Texas, California, North Carolina and Minnesota.
Austin’s population has skyrocketed since the pandemic, and apartments have been popping up across the city’s northern and southern metro areas. Austin has been working to expand and upgrade its metro system to facilitate travel from the suburb areas into downtown.
The North Austin metro that includes suburban cities like Round Rock and Georgetown recorded the quickest population growth in the state in recent years. The Austin metro has been the fastest-growing large metro in the nation for a full decade, according to population estimates from the U.S. Census Bureau.
Source: https://therealdeal.com/texas/austin/2023/01/12/tradewind-calvera-flip-class-b-apartments-in-austin/
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Multifamily values have declined 20-30% since 2022. They are likely to get a boost when the Fed starts cutting interest rates. Once that happens, it may be too late to get in. Don’t wait and risk missing a potentially significant multifamily market upswing opportunity.
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