We are pleased to report on the ongoing success of our Jacksonville, FL apartment portfolio. In less than 24 months, we have completed renovations that increased net income by 30%. This has in turn increased the value of the property by approximately 38%, according to a recent appraisal ordered by Capital One as part of the project’s refinancing.
When we first acquired the property, it was in need of a serious facelift. The finishings were outdated, and the units felt small and dark. Based on our carefully diligenced business plan, our partner was able to complete the renovation of the entire property with great speed. They replaced countertops and cabinets, upgraded bathrooms, and remodeled the common areas.
As a result of all this work, we’ve been able to charge much higher rents for the renovated units. This directly translates into an increase in the property’s net income, which in turn has driven the appreciation in property value.
What this means for your portfolio
As an investor, you can expect to see the benefits of this success in two ways. First, the increase should be partially captured in the growing Net Asset Value (NAV) of your shares in the near term. Second, if the asset is sold in a future liquidation event, you would capture the remaining value via a) an additional NAV increase or b) a distribution.
Looking ahead
While results to date have been strong, we believe this property has plenty of room for continued growth. Thanks to a large shipping and military presence, Jacksonville should continue to be one of Florida’s strongest economies. The climate and generally affordable cost of living makes the area a desirable place to live. As of January 2018, unemployment was 3.9%, below both Florida and the nation’s averages.
