Mid Month Update February 15, 2015

We’re gaining momentum with plenty of on and off-market deals coming our way these last few weeks.  The team is spending even more time reviewing property packages and after a bit of a dry spell, we have several new flip projects under contract.

 

Take a look below:

 

Funds:

Altus Hybrid Growth Fund

  • We are in contract on two flip projects.  One is a 4 bed 2 bath home in Sacramento that we will close on within the week. This will be a fairly quick turnaround with mostly cosmetic fixes.  The 2nd property is in Contra Costa County and will require more extensive repairs than originally anticipated.  We have gone back to the seller for a price reduction and are awaiting their response.
  • The permitting issue on the Palm Avenue property in Healdsburg is resolved and renovations are in full swing.  We anticipate having the property market ready in mid to late March.
  • The rental market remains strong and we continue to maintain 100% occupancy. 

Altus Multi Tenant Income Fund

  • We continue to research emerging markets and are looking at multiple deals daily to place the remaining ~$400K of MTIF funds.  We were outbid on a property in Oklahoma City, but the Buyer was unable to close the deal, so the Sellers have come back to us and we will re-offer early this week. 
  • We have 100% occupancy on one of our complexes (Villaggio) and continue to lease up units on the second complex (Shasta View) though we are collecting rent at 100% occupancy on this complex as well due a rent guarantee from the Seller at the time of purchase.

AE Commerce

  • Lot split plans have been submitted and we are waiting for the City of Rohnert Park for their opinion of the project.  The tenant in the front building has a strong interest in purchasing their building once the lot split is complete.  They are working on a proposed list of renovations to be completed as part of any purchase agreement.
  • One of the tenants has given their notice to move out March 31st.  We are working with our commercial leasing agent to market the property to prospective new tenants.  

AE One

  • We continue to work to liquidate this portfolio of homes per the original fund strategy. 
  • Since last month we have sold one property, listed a townhome unit for sale, one single family home is nearing completion of rehab and one more should go vacant this week and begin renovations.  The 10 acre horse property in Loomis remains in contract with the sale contingent on the buyer selling their current home.    
  • We have two properties in contract to be sold.

Opportunity Knocks:

Sonoma/Napa County:

  • Sonoma, CA – We just put a short sale property into contract.  This is a 4 bedroom, 2.5 bath house on a large lot needing mostly cosmetic fixes and landscaping with has an ARV in the mid $900’s.  We are excited to be working in the same neighborhood as a previous, successful flip project.  Closing should take place in early March. 
  • Graton, CA – Work is nearing completion on the vacant unit at this property.  We will be renting up the home immediately following.  Unfortunately the tenants in the remaining two units dug in their heels after being given 60 day notices to move out so we will be handling the matter through eviction court.  Once this is resolved work will begin immediately on these last two units. 
  • Sonoma, CA – Work continues on site though we have been slowed down a little while waiting on roof truss calculations for the addition from our structural engineer. Once those are signed off we will move on to the roofing and sheetrock stage. We still hope to have the property ready to go on the market in late March or early April
  • Napa, CA – With all minor repairs completed we have redoubled our marketing efforts to sell this house. After the last buyer backing out due to their inability to obtain financing we put the property back on the market and almost immediately received an offer $24,000 higher than the previous contract price.

Sacramento Area:

  • We have 10 apartment units in contract that we plan to purchase at $42,500/door and flip for $55,000/door after minor renovations.  This property is not in as good of a neighborhood as we prefer for our hold properties but should still work well as a flip with the fallback being a fully cash flowing property should there be any hiccups in the market.
  • We are continuing our due diligence on the 36,000 sq ft. office building in Gold River, CA.  Overall this appears to be a very profitable opportunity but because it doesn’t fit the profile of most of our investments we are unsure of the source of equity funding at this time.
  • Carmichael, CA - Condo units are still available either individually or in a discounted, bulk package. 

Other:

  • We are in discussions with a bank to pre-empt an auction sale of 474 units in Oklahoma City.  This project has significant upside and would be an ~$8M purchase with roughly $4.5M in renovations needed to bring these mostly vacant units up to market standards. 
  • In addition, we are in discussions with the owner of two off market complexes (85 units) in Tulsa.   A dozen of the units were damaged in a fire and the owner is looking to move on.  We would be looking to purchase these properties with an eye toward renovating them to the top of market rents and then reselling.

If you do not currently receive our Opportunity Knocks emails with specific investment opportunities or if you have any interest in discussing any of the above opportunities in greater detail, please reply to this email or call our office at (707) 932-5887.  We will gladly add you to our distribution list and/or schedule an appointment to discuss your investing needs further.

 
Best,

 
Kristy Brooks
Altus Equity Group, LP
Office:  707/932-5887
Fax:  707/544-2972