Open Tribe Deal Webinar with RSN Property Group and Reed Goossens

See below for the description of the deal from RSN:

We are incredibly proud and excited to bring you an absolute cracker of a deal in one of our favorite markets, Phoenix, AZ!

“The Lennox” is a boutique 88-unit property located in the desirable Tempe submarket with easy access to Downtown Phoenix, major employers, and Class A retail directly adjacent to the property.

The seller is a Canadian-based owner/operator who has owned this asset since 2018. They run this asset from Canada without on-site professional management. This hands-off approach is simply not pushing the value of this asset, which is great news for us! We see immediate operational upside in the short-term and an underpriced asset with massive long-term potential.

Let’s start off with a few executive summary bullet points:

– Currently named “The Gallery”, we’ll immediately rebrand the asset “The Lennox” and dive right into our customary value-add business plan; renovating the exteriors, common areas, and 90%+ of units to force appreciation.

– In-place rents are well below market offering immediate upside before we even begin the renovations. Refer to page 32 of the prospectus to see rental comps showing a ~25-27% discount to the market.

– While you’re looking at comps, refer to the sales comps on page 34, showing that we’ve secured a purchase price at a massive ~25% discount to the market!
We have secured fixed-rate debt at 4.9% (I/O for 5 years), well below our going-in cap rate of 5.41%.

-Lastly, this asset will be in close proximity to our other assets in the Phoenix market allowing us to increase operational efficiency by sharing staff and equipment across assets.

Submarket Highlights
– Exploding Tempe Sub-Market Tempe has continued to see major growth as more people move to the area given its choice amongst many industry leaders in the Services, Finance and Utility industries. Tempe plays host to, and is surrounded by, a multitude of Company Headquarters, Fortune 500 Businesses, and Silicon Valley tech companies.

– Demographics: The neighborhood surrounding The Lennox Apartments (1 mile radius) has an average household income over $100,000 and average home prices in the submarket have increased over 30% within the past 18 months (up to $500,000).

– Desirable Location: The asset is located within easy access to loop I-101, Loop I-202, I-10 and US 60, making it a short commute by car or rail to Downtown Tempe, the home of Arizona State University.

Investment Highlights —

This project is a 506(c) offering open to Accredited Investors Only.

We are offering a three-tiered equity structure to allow investors to choose an investment class aligned with their investment goals. Based on our conservative underwriting, over a 5 year hold, investor returns are expected to be:

Class A Limited Partners: Pure Cashflow
– Minimum Investment: $50,000 total
– Fixed Return: 9%
– Average Annual Return (AAR): 9%
– Equity Multiplier: 1.45x
– Internal Rate of Return (IRR): 9%
– Average Cash Flow from Operations: 9%
– Profit Split Upon Sale: Cashflow only. No payout upon sale
– Class A limited to 25% of total equity stack

Class B Limited Partners: Equity and Cashflow
– Minimum Investment: $50,000 total
– Preferred Return: 7%
– Average Annual Return (AAR): 18.05%
– Equity Multiplier: 1.90x
– Internal Rate of Return (IRR): 15.15%
– Average Cash Flow from Operations: 7.2%
– Profit Split Upon Sale: 70%/30%

Class C Limited Partners: Large Investment – Equity and Cashflow
– Minimum Investment: $500,000 total
– Preferred Return: 8%
– Average Annual Return (AAR): 19.85%
– Equity Multiplier: 1.99x
– Internal Rate of Return (IRR): 16.26%
– Average Cash Flow from Operations: 7.2%
– Profit Split Upon Sale: 80%/20%