We’ve invested roughly $12.9 million in the acquisition and renovation of Twin Lakes apartments, a 262-unit apartment community in Palm Harbor, Florida, a northern suburb of Tampa and St. Petersburg. This project is part of a two-asset portfolio located in the area, where population growth has more than doubled the national average since 2010.

As we shared last week, all signs point to us being even later in the business cycle, with asset prices at near-record highs across the economy. However, a brief period of low interest rates and a dip in prices in Q2 2019 created a window of opportunity for us to invest equity into apartment properties like these ones at much better expected returns than we have seen at any time over the past nine months.

Side note: If you haven’t yet, we suggest reading CEO Ben Miller’s recent letter sharing our view on the current state of the market, and how we fortify your Fundrise portfolio against turbulence by making investments like this one.

Business plan

At the time of our acquisition, the property was roughly 96% occupied. Our partner, TruAmerica Multifamily, plans to renovate all 262 apartments, as well as refresh the landscaping and improve the clubhouse and fitness center. Plans for in-unit upgrades include kitchen renovations with new appliances, cabinets and countertops, and new flooring throughout.

Following the completion of renovations, they plan to hold and manage the property for roughly 10 years before seeking opportunities for an exit via sale or refinance.

Our goal is to earn consistent income over the duration of our holding period, with the potential for long-term upside by selling the property for more than we paid for it.

Why we invested

  • Experienced sponsor: TruAmerica is an owner and operator of apartment communities across the US. With a portfolio of over 40,000 apartment units valued in excess of $8 billion, they have valuable experience with this strategy.
  • Fast-growing area: The Tampa - St. Petersburg - Clearwater metro area grew by nearly 13% between 2010 and 2018, more than double the national average. With 3.1 million residents as of 2018, the metro area is the second-largest in Florida. We believe the Palm Harbor area presents a strong opportunity, as it has demonstrated consistent demand for housing, with little new construction being built nearby.
  • Income-generating asset: The apartment community was roughly 96% occupied at the time of our investment, generating consistent cash flow through rental income.

As always, please don’t hesitate to reach out to investments@fundrise.com with any questions or feedback.