Berkadia®, a joint venture of Berkshire Hathaway and Jefferies Financial Group, is an industry leading commercial real estate company providing comprehensive capital solutions and investment sales advisory and research services for multifamily and commercial properties. Berkadia® is amongst the largest, highest rated and most respected primary, master and special servicers in the industry. This advertisement is not intended to solicit commercial mortgage loan brokerage business in Nevada.
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hunter larocca
Director
402.227.9643
hunter.larocca@berkadia.com
Brian Hummell
Director
614.468.5773
brian.hummell@berkadia.com
Jay Gunn
Managing Director
jay.gunn@berkadia.com
License #9002106
Kevan Enger
Senior Managing Director
407.494.8541
kevan.enger@berkadia.com
Ian Hilpl
Managing Director
315.406.0900
ian.hilpl@berkadia.com
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1. BELOW MARKET RENTS
Across the portfolio, the current lot rents are well below surrounding market competition, leaving significant room for rent increases. The portfolio average rent is approximately $135 below the average market rate.
• By implementing a three-year rent increase schedule to match market rates, a $490,500 increase in Gross Potential Rent would be achieved.
2. PUBLIC UTILITIES PAID BY RESIDENTS
The portfolio benefits greatly from its utility situation. Each community is serviced by public utilities, which are paid for by the residents through sub-metering. Since the responsibility of the utilities lies with the residents, the net utility expense is kept at a minimum and helps keep the operating expense ratio low.
3. CURB APPEAL
Current ownership has done an excellent job of enhancing and maintaining the curb appeal and overall aesthetics at each community. The parks have beautiful landscaping, front exteriors with good visibility, and well-maintained infrastructure throughout. Recently, they have undergone significant capital improvements, such as:
4. EXPANSION POTENTIAL AT GATEWAY
Located in Corpus Christi, the 8th most populous city in the state of Texas, Gateway MHC is the largest community in the portfolio. It is currently 86% occupied on the MH units alone. This community has an expansion potential to increase the site count by approximately 160 sites. If a new owner capitalized on the expansion opportunity and was able to lease those sites to 86%, the effective rental income at the community would more than double.
INVESTMENT HIGHLIGHTS
Berkadia Manufactured Housing is pleased to present the Killeen-Corpus Christi Portfolio. This portfolio features 545 sites across four communities: Gateway MHC, Clear Creek Rentals, Cimarron Park Estates, and Hidden Valley Estates. These communities are ideally located in the Killeen, Corpus Christi, and Houston markets, providing immediate scaled entry into Texas. This portfolio showcases an economic occupancy of 76% and below market rents, allowing for immediate rental upside. Additionally, all communities feature public utilities and residents are currently paying for their usage through sub-metering; this is one less expense for an owner to be responsible for, and it helps increase overall cashflow. This offering presents the opportunity to acquire 4 well maintained communities in very strong markets in Texas with public utilities and immediate upside.
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EXECUTIVE SUMMARY
KILLEEN-CORPUS CHRISTI PORTFOLIO
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Property Tour: Cimarron Park Estates
Gateway MHC
• New Pool Fence
• Pad Prep
• Electrical Conversion
• Repaving Basketball Court
• Replastering
• Painting the Pool
• Replacing the Pool’s Plumbing
• Infrastructure and Pump
• Sewer Infrastructure Repairs
• New Maintenance Shed
• Re-Painting Multiple Homes
CIMARRON PARK ESTATES
• Conversion of Septic System to City Sewer
• Warehouse Renovation
CLEAR CREEK RENTALS
• Plumbing Infrastructure Repairs
• Re-Painting Multiple Homes
• Electrical Hookups for New Homes
HIDDEN VALLEY ESTATES
5. ATTRACTIVE ASSUMABLE FINANCING AT GATEWAY & CLEAR CREEK RENTALS
Both Gateway & Clear Creek showcase assumable financing that is favorable to a new buyer.
• Interest Rate: 2.92%
• I/O ended 1/1/23 – Currently in P&I
• Maturity Date: January 1, 2033
• Balance: $6,835,895
• Loan is Supplemental Application Ready
Gateway Loan Terms:
• Interest Rate: Swapped and Fixed at 4.92%
• Maturity Date: January 10, 2032
• Balance: $5,725,007
Clear Creek Loan Terms:
Due to today’s capital markets, these types of loans at such favorable rates are unheard of, and a new buyer would greatly benefit by assuming the debt.
6. SCALED ENTRY INTO ROBUST MARKETS IN TEXAS
Increasing by 470,708 people since July 2021, Texas was the largest-gaining state in the nation, reaching a total population of 30,029,572. By crossing the 30-million-population threshold, Texas joins California as the only states with a resident population above 30 million as of 2023. The enormous population growth is a large driver for the economy. This portfolio presents an opportunity for investors to gain immediate scaled entry in Texas by acquiring 545 sites across four communities. The communities are strategically positioned in the path of progress and reap the benefits of the Killeen, Corpus Christi, and Houston markets.
Cimarron Park Estates
Clear Creek Rentals
Gateway MHC
Hidden Valley Estates
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KILLEEN-CORPUS CHRISTI PORTFOLIO
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The Location
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Property Tour: Clear Creek Rentals
Property Tour: Gateway MHC
Property Tour: Hidden Valley Estates
Property Tour: Cimarron Park Estates
