PALMS OF CLUTE

146 SOUTH MAIN STREET CLUTE, TX 77531

Specifications

Property Type: 
Apartment
Class: 
C
Year: 
1965
Units: 
21
Rentable Sq. Ft.: 
11,676
Lot Size: 
0.81 acres
Listing Type: 
Status: 

The Palms of Clute, is a one story, garden-style, apartment community located in the Brazosport submarket of Clute, Texas. The asset was built in 1965. Residents enjoy ample amenities which include: mini-blinds, kitchen pantries, ceiling fans, laundry facilities, patios and balconies and walk-in closets. Now 100% occupied!

Be aware that the owner manages this asset remotely with his web site and virtual assistants. The property could use some cleanup. A buyer can convert the large storage shed into a unit and gain a unit. There is still a small storage unit leased at $80/mo (shown in misc income). The Broker proposes that a management company charge 7% management fee, and a leasing fee for new leases. No on site staff. All R&M will be done by contract. The owner says laundry income is low and will research.

The suggested asking price is $1,500,000 for Palms of Clute. Owner is expecting approximately $5,400.19 in Texas Rent Relief payouts and there are currently 4 units in delinquency totaling $7,354. Owner seeks to close by 12-31-2021 and will consider creative owner financing all assets. Say 25% down for the package, assume the first liens and owner to carry the balance secured by the 5 unit. Terms are negotiable. Last 7 Clute leases were $750/mo for 5 units, 1 at $775/mo and 1 at $800/mo. Market rents now are $800/mo.

There is a 120 month loan stepdown prepayment penalty on the Palms of Clute debt. Prepayment schedules as follows: 5% prior to the 24th payment. 4% on or after the 24th payment to the 48th payment. 3% on or after the 48th to the 72nd payment. 2% on or after the 72nd to the 96th payment and 1% on or after the 96th payment, and prior to the first day of the window period. The window period is three consecutive calendar months prior to the maturity date. Due to timing, paying cash here or new bank loan makes sense!

This is an opportunity for a first time buyer to step into some nice cash flow. $18,120 of CapEx for the months of March, April and August have been removed from Repairs and Maintenance above. Charges were for frozen pipes and roof replacement. Utilities were also reduced for March. The utilities(water expenses) were higher due to busted pipes from the freeze. The owner believes there is room to build a doggie park and the potential to add fences behind the units to make a dog run, which could potentially add $25-$50 per month in rent for the units with new fencing.

Supporting Documents
Private

Tom Wilkinson

Location: 
Houston, TX
twilk4.ketent@gmail.com
Office: 
713-355-4646 x 102
Fax: 
713-355-4331

Tom Wilkinson has performed real estate marketing serves for institutional and individual investors since 1972. He has a BA in Mathematics from Rice University and an MBA in Real Estate Investments from the University of Texas. In addition to brokering real estate, Tom previously owned and operated more than 80 properties. Tom has successfully marketed properties for and to dozens of individual, business and institutional sellers and buyers, including REO properties for the RTC, FNMA and FreddieMac.

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