Brighton Multifamily DST
1287 S. 8th Avenue in Brighton, Colorado
Beneficial Interests: $24,099,126
Offering Price: $61,474,126
- Loan Proceeds: $37,375,000
- Current Cash Flow: 5.00%
- Loan-to-Offering Price Ratio: 60.80%
- Minimum Investment[1031]: $100,000
Brighton Multifamily DST (the Trust), a newly formed Delaware statutory trust (DST) and an affiliate of Inland Private Capital Corporation (IPCC), is hereby offering (the Offering) to sell to certain qualified, accredited investors (Investors), pursuant to this Private Placement Memorandum (the Memorandum), 99.5% of the beneficial interests (Interests) in the Trust.
Solaire Apartments
The Trust owns 100% of the real estate and improvements located at 1287 S. 8th Avenue in Brighton,Colorado, commonly known as Solaire Apartments (the Property). The Trust acquired the Property,consisting of approximately 16.38 acres of land, on November 10, 2016.Recently completed in 2014, the Property is comprised of 11 separate residential buildings.
INVESTMENT HIGHLIGHTS
An investment in Brighton Multifamily DST may offer the following benefits:
• Strong Location – The Property is located within the northeast sector of the Denver metropolitan area,approximately 20 miles northeast of the central business district of Denver. The Denver metro area is home to nine 2015 Fortune 500 companies. Employment in the Denver metro area increased 1.2% on a year-over year basis in January 2016, primarily driven by growth in the Education and Health Services and Leisure and Hospitality sectors, according to the Colorado Labor Department and Employment. In addition, in January 2016, the Denver metro area experienced the lowest unemployment rate in the nation among metropolitan areas with populations that exceed 1.0 million. See “Market Analysis and Overview” for additional information about Denver.
• Experienced Property Management – Inland’s management team has experience in all aspects of acquiring, owning, managing and financing real estate, including multifamily properties. As of September 30,2016, Inland had acquired and managed over 72,000 multifamily units throughout the United States, for an aggregate purchase price of approximately $4.2 billion.
• Long-term, Fixed Rate, Amortizing Loan – The Loan has a term of 10 years and bears interest rate at a fixed rate equal to 3.54% per annum. Additionally, for the final five years of the Loan term, the Trust is required to make monthly payments of principal and interest, with principal amortizing on a 30-year schedule. See “Financing Terms” in the Memorandum.
• Master Lease Structure – The master lease structure used by the Trust allows the master tenant, an affiliate of IPCC, to operate the Property on behalf of the Trust and to enable actions to be taken with respect to the Property that the Trust would be unable to take due to tax law-related restrictions, including,but not limited to, a restriction against re-leasing the Property. See “Summary of the Leases – Master Leases”in the Memorandum.
THE OFFERING
The Offering is designed for accredited investors seeking to participate in a tax-deferred exchange, as well as those seeking a quality, multiple owner real estate Investment. Only accredited investors may purchase Interests in this Offering.See “Summary of the Offering” and “The Offering.”
THE FINANCING
The Trust funded the purchase of the Property with a combination of cash and financing from PNC Bank,National Association, under the Federal National Mortgage Association Delegated Underwriting and Servicing loan program. The financing consists of a $37,375,000 loan (the Loan) with a 10-year term, maturing in December 2026, and bearing interest at a fixed rate equal to 3.54% per annum.The Trust is required to make monthly payments, comprised of monthly interest-only payments for the initial five years and fixed monthly payments of principal and interest, with principal amortizing on a 30-year schedule, thereafter. The Loan is secured by a Deed of Trust, and the Trust is responsible for repayment of the Loan. The Loan is nonrecourse to the Investors, meaning the Investors will have no personal liability in connection with the Loan.
PROPERTY OVERVIEW
Solaire Apartments
Recently completed in 2014, the Property is comprised of 11 separate residential buildings. With 253,116 rentable square feet, the Solaire Apartments have a best-in-class amenity package. There is an array of spacious one-bedroom, two-bedroom and three-bedroom floor plans to choose from, with a total of 252 apartment units. In addition, there are 483 parking spaces available to residents and guests. The Property sits on one of the largest geothermal energy systems in the nation, saving residents on heating and cooling charges compared to other communities.
ABOUT Inland Real Estate Group of Companies, Inc.
The Inland Real Estate Group of Companies, Inc. (Inland) is one of the nation’s largest commercial real estate and finance groups, representing nearly 50 years of expertise and integrity in the industry. As a business incubator, Inland specializes in creating, developing and supporting member companies that provide real estaterelated investment funds – including limited partnerships, institutional funds and nonlisted real estate investment trusts (REITs) – and real estate services for both third parties and Inland-member companies.
In March 2001, Inland Private Capital Corporation was formed to provide replacement properties for investors wishing to complete a tax-deferred exchange under Section 1031 of the Internal Revenue Code of 1986, as amended, as well as investors seeking a quality, multiple-owner real estate investment. The programs sponsored by IPC offer securities to accredited investors on a private placement basis.