Horizon Apartments: Cashflowing Multifamily in San Antonio
Deal Overview
Total Raise
$6.6M
Minimum Investment
$50K
Hold Period
5 Years
LP IRR
18%
Return on Equity
2.1x
Horizon Apartments is a 204-unit multifamily community in San Antonio, TX. This cashflowing asset presents an opportunity for accredited investors to participate in a value-add strategy targeting an 18% IRR and 2.1x equity multiple.
Executive Summary
Horizon Apartments is a 204-unit multifamily community located in the rapidly growing Northeast San Antonio submarket. This well-maintained workforce housing asset offers investors an attractive opportunity with stable cash flow and significant upside potential. Investors are buying into a cash-flowing property where their money starts working immediately, as significant improvements in NOI and heavy lifting on CapEx have already been completed. The property benefits from a favorable loan assumption with a low, fixed interest rate and long-term maturity, providing a secure foundation for the investment. Our value-add strategy focuses on targeted renovations, improved management, and enhanced curb appeal to maximize rents and increase net operating income.
Key Highlights
- Assumable Fannie Mae Loan at 3.78% fixed rate, maturing in 2032
- Projected 18%+ IRR and 2.1x Equity Multiple
- Minimum Investment: $50,000
- 506c Offering for Accredited Investors
- Purchase Price: $16,900,000 ($82k/door)
Investment Highlights
Key Investment Highlights:
- High-Growth Market: Located in San Antonio, a market experiencing rapid growth and strong demand for multifamily housing.
- Attractive Basis: Purchased at a competitive price of $82,800 per unit, well below replacement cost.
- Stable Financing: Assumable loan at a favorable fixed interest rate of 3.78% with a maturity date in 2032.
- Value-Add Potential: Opportunity to increase rents and NOI through strategic renovations and improved management.
- Experienced Sponsor: Massive Capital has a successful track record of acquiring, managing, and repositioning multifamily assets.
- Tax Benefits: Investors benefit from depreciation and other tax advantages associated with real estate investments.
- Cash Flowing Asset: Property generates immediate cash flow with potential for increased distributions over time.
Invest $250K+ and Earn a 10% Bonus! Limited Time Offer
Sponsor Team
The Horizon Apartments investment is led by Massive Capital, a real estate investment firm with a proven track record of success in identifying and executing profitable real estate projects. Our team brings extensive experience in acquisitions, asset management, and investor relations, ensuring a transparent and efficient investment process.
Sanjay Aggarwal
Principal
Principal at Massive Capital with 8+ years as an active investor across asset classes (Land/SFR/Commercial/Multifamily). Co-sponsored 1000+ units across Texas with an exit of 800+ units. 10+ years in Fortune 50 Companies (Capital One/Barclays) with numerous leadership roles in Portfolio and Strategy and Vendor Relationship.
MBA from Booth School of Business (University of Chicago)
Masters in Mechanical Engineering from University of Central Florida
Shahriar Khan
Principal
Principal at Massive Capital with 7+ years as an active investor purchasing over 180+ properties across asset classes (Land/SFR/Commercial/Multifamily). Co-sponsor for 1,300+ Units. 16+ years at Royal Dutch Shell with numerous leadership roles in Engineering, Corporate Planning, Portfolio Strategy and Business Unit Finance Manager (CFO) looking over $1B+ of portfolio value.
MBA from Jones School of Business (Rice University)
Undergraduate in Electrical Engineering from Prairie View A&M University
Mike Bailey
Principal
Principal at Massive Capital with 20+ years as an active investor across asset classes (Land/SFR/Commercial/Multifamily). Co-sponsored 300+ units across the Houston and Dallas market since 2021. 30+ years in Fortune 10 company (ConocoPhillips) with numerous leadership roles in Upstream Engineering managing projects across multiple counties, Corporate Capital Strategy, and Vendor Relationship.
Bachelor of Science in Petroleum Engineering from the University of Oklahoma
Property & Location Overview
Horizon Apartments is a 204-unit multifamily property built in 1974 and situated on a sprawling 6.65-acre lot in Northeast San Antonio, Texas, just off the I-35 corridor. This well-maintained workforce housing community offers a mix of one and two-bedroom units, catering to a diverse range of residents. Recent renovations totaling $1 million have enhanced the property's appeal and positioned it for future rent growth.
- Units: 204 (One and Two-Bedroom)
- Total Square Footage: 177,786 sq ft
- Average Unit Size: 870 sq ft
- Occupancy: 96% (at acquisition)
Strategic Location in Northeast San Antonio
Horizon Apartments enjoys a prime location in Northeast San Antonio, a rapidly growing area with high demand for quality workforce housing. The property's proximity to major employers, including HEB Distribution Center, Frito Lay, Amazon, Caterpillar, Pepsi, and others, ensures a consistent pool of potential tenants. Its location also offers easy access to major highways, retail centers, hospitals, and the San Antonio International Airport, providing added convenience for residents.
The I-35 corridor between Austin and San Antonio, where the property is situated, is experiencing substantial growth and is projected to house between 6 and 7 million people by 2030, representing a significant driver of future demand and value appreciation.
Business Plan
Our business plan for Horizon Apartments is built on a strategic, phased approach designed to maximize returns for our investors. We are focused on implementing operational efficiencies, capital improvements, and targeted marketing strategies to achieve stabilization and position the property for a successful exit within a 5-year timeframe.
Phase 1: Stabilization (First 120 Days) - Completed
- Transition to new property management company
- Address deferred maintenance and implement initial capital improvements
- Focus on tenant retention and attracting high-quality residents
- Refine marketing and leasing strategies to optimize occupancy and rental rates
Phase 2: Pro-Forma Target (Year 1) - Ongoing
- Implement RUBs (Rental Unit Upgrades) and introduce a cable package for additional other income
- Gradually increase rents towards market rates
- Improve lead generation and conversion processes through enhanced marketing and staff training
Phase 3: Optimization (Year 2)
- Maximize rental income by achieving market rents on renovated units
- Increase other income streams through storage rentals and other ancillary services
- Maintain low vacancy rates (under 5%) and minimize delinquencies/bad debts (~4%)
- Implement low-cost, high-impact interior and exterior improvements to enhance curb appeal
Phase 4: Cap Rate Alignment (Years 3-5)
- Sustain market rents and residential income growth
- Control expenses and optimize operational efficiency
- Monitor market cap rates and prepare for a strategic exit by Year 5
Capital Improvements:
Our planned capital improvements will focus on enhancing the property's curb appeal, modernizing unit interiors, and adding value-enhancing amenities. Key projects include:
- Pool resurfacing and furniture upgrades - Completed
- Exterior signage and branding updates - Completed
- Parking lot repairs and striping - Completed
- Building 1 roof replacement - Completed
- Parcel locker installation - Completed
- Interior unit renovations (select units) - Ongoing
- Exterior wood fencing - Completed
Sources and Uses
| Investment Summary | |
|---|---|
| Purchase Price | $16,900,000 |
| Loan Down Payment | $4,175,500 |
| Capital Improvement Budget | $1,164,663 |
| Closing Costs & Acquisition Fees | $591,500 |
| Operating Reserves | $668,337 |
| Total Capitalization | $6,600,000 |
| Financing Terms | Loan Assumption | Supplemental |
|---|---|---|
| Loan Type | Fannie Mae | Fannie Mae |
| Amortization | 30 years (from 2020) | 30 years (from 2020) |
| Loan Amount | 75% LTV | $2,574,000 |
| Interest Rate | 3.78% | 8.24% |
| Interest Only | None | None |
| Loan Term | 8 years remaining | 8 years remaining |
Estimated blended interest rate: 4.68%
Exit Strategy
Our exit strategy for Horizon Apartments targets a sale within a 5-year timeframe. The 7-year fixed-rate financing allows flexibility in aligning the sale with market cycles and achieving optimal returns.
Target Sale Year: Year 5
Key factors driving our exit strategy:
- Achieve a Net Operating Income (NOI) exceeding $1.59 million annually.
- Secure a favorable cap rate at or below 6%.
CoStar's 5-Year Cap Rate Projection
Cap Rate Compression and Decompression Sensitivity Analysis
| Cap Rate / NOI | Year 3 | Year 4 | Year 5 |
|---|---|---|---|
| NOI | $1,482,848 | $1,540,322 | $1,599,780 |
| 5.75% | $25,788,655 | $26,788,206 | $27,822,261 |
| 6.00% | $24,714,128 | $25,672,031 | $26,663,001 |
| 6.25% | $23,725,563 | $24,645,149 | $25,596,480 |
| 6.50% | $22,813,041 | $23,697,259 | $24,612,000 |
Projected Returns at Exit in Year 5
| Sale End of Year | 5 |
|---|---|
| Net Operating Income NOI | $1,599,780 |
| Cap Rate at Sale | 6.00% |
| Sale Price | $26,663,001 |
| Sale Price per Door | $130,701 |
| Sale Costs less Reserves/Escrow | ($1,333,150) |
| Outstanding Loan Balance | ($11,596,441) |
| Total Sale Proceeds | $13,733,410 |
| Remaining Equity Basis | ($6,600,000) |
| Capital Transaction Fee to Mgr | ($399,945) |
| Remaining proceeds available | $6,733,465 |
| Net Proceeds Paid to Class A Members / LP | $4,713,426 |
| Net Proceeds Paid to Class B Mgr Share / GP | $2,020,040 |
Invest in Horizon Apartments: Cashflowing Multifamily in San Antonio
Total raise
$6.6M
Min Investment
$50K
Hold time
5 Years
LP IRR
18%
Return on equity
2.1x
↓ More details available to qualified investors ↓
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