Raleigh Real Estate Company recognized for creatively financing its 432-bed apartment property in Myrtle Beach
RALEIGH, NC – May 25, 2011 – The Preiss Company, one of the largest off-campus student housing providers in the nation, is pleased to announce that it has been awarded a Student Housing Innovator Award by Student Housing Business Magazine. The Raleigh real estate company won in the category of “Best Creative Financing” for its student housing property in Myrtle Beach, South Carolina—University Village at the Coast.
University Village at the Coast, formerly known as Campus Pointe at Myrtle Beach, is a 432-bed apartment property located three miles from Coastal Carolina University. The property’s 148-unit, three-bedroom apartments feature large eat-in kitchens, laundry rooms, and a separate living area. University Village at the Coast also offers a full-range of amenities including fitness center with cardiovascular equipment and circuit training, state-of-the-art computer center, movie theatre with stadium seating, resort-style pool with sundeck and stereo system, clubhouse with lounge, sand volleyball, gymnasium with indoor basketball courts, and game room with billiards room and foosball.
The Preiss Company acquired University Village at the Coast—its first acquisition in the Myrtle Beach area—in January 2009. The company recognized the value of the property early on, despite its lackluster rental performance and numerous ownership changes. When The Preiss Company approached RBC Bank with a purchase proposal, the property was at 50% occupancy with no pre-leases in place for the next school year.
“We brought to RBC Bank a pointed strategy to re-ignite University Village at the Coast’s usefulness to its community,” explains The Preiss Company founder and CEO, Donna Preiss. “With our long-standing interest in the property combined with our expertise in the student housing industry, the $15 million apartment complex was secured by a $12 million mortgage for $6 million down.”
As opposed to a conduit loan, The Preiss Company secured an interest-only, full-recourse loan for $5 million at 3.5% that granted an interest-only first year to allow for stabilization of the property. The remaining 30% needed to finalize the transaction came from a small collection of high net worth equity partners with which the company had fostered relationships.
“The unique equity partnership provided a boost to the transaction, allowing the loan to close efficiently with minimal drawbacks, which was hardly characteristic of any commercial real estate transaction during that period,” adds Preiss. “Our strategy for the property, which was to invest time and $1 million in a one-year stabilization effort, was made clear to the individual equity partners, helping them realize the value in a rapid close and quick launch into the lease-up of the property.”
University Village at the Coast is now fully occupied and completely rebranded throughout the community. The company’s private equity partners were returned 115% of their original $1 million, capping an exceptional physical and financial turnaround of a property considered an afterthought not a year before The Preiss Company’s acquisition.
About The Preiss Company
Founded in 1987 by Donna Preiss, The Preiss Company provides a wide range of services including acquisition, property management, due diligence, construction management, development, and consulting for multi-family real estate investments. Beginning its 24th year, the company has formed over 50 partnerships and developed over 20 projects stretching from Maryland to Texas. For more information, visit www.tpco.com.
About Student Housing Business Magazine
France Publications, Inc. is a growing business-to-business media company that offers an enthusiastic, creative and refreshing approach to publishing. As the leading publisher of commercial real estate magazines in the United States, France Publications currently offers 11 magazines that cater to all commercial property types to suit any reader in the industry. For more information, visit www.studenthousingbusiness.com