Project Description


Townhouse Manor – 16 Unit Class B/C Townhouse Property In Mesa, Arizona

Issues Prior To Acquisition:

  • 33% economic occupancy
  • Woefully mismanaged
  • Significant deferred maintenance by original owner of 40+ years

DVP Actions:

Secured 60% LTC construction loan and vacated existing tenant base in 45 days. Completed unit renovation value-add program by framing in a 3rd bedroom and plumbing 2nd full bathroom to take advantage of 1400 square foot average unit size. Also repainted exterior, resurfaced parking lot, installed new roofs and AC units, replaced dated pool (liability) with BBQ/picnic area, vast landscape improvements, interior two-tone paint, 16” travertine tiles throughout to reduce turnover cost, new black appliances, and installed wireless internet at an average cost of $26,000 per unit. Sub-metered the water and shifted all utility costs to tenant. Turned a “Wal-Mart” property into a “Target” property supported by existing“Target” neighborhood and unit sizes.


100% occupancy in 3 months following 6 month renovation. 57% increase in rents from $625/mo to $982/mo. Full security deposits achieved. 10-year 5.05% interest rate, 65% Loan-To-Value commercial loan attained and returned 30% initial equity to partners upon refinance.

Projected Returns:

17.0% leveraged Return on Investment, 12.1% Cash on Cash on a 10-year average. Ahead of proforma.
Purchased for $960,000 in early 2014, renovation of $425,000.  Appraised value at refinance in January 2015 of $1,630,000 and 30% of original investor capital returned at tax-free cash out refinance.