HPI Plantation DST

2255 Switzer Road, Gulfport, MS 39507

Beneficial Interests: $8,700,000

Offering Price: $21,100,000

  • Loan Proceeds: $12,400,000
  • Current Cash Flow: 9.61%
  • Loan-to-Offering Price Ratio: 58.8%
  • Minimum Investment[1031]: $200,000

Hamilton Point Investments LLC (“HPI”) is a real estate investment firm founded in 2009 by Matthew A. Sharp and J. David Kelsey (“Principals”), after the two merged their former companies, which were formed in 2005 and 2007, respectively.

240-Unit Apartment Community Property

240-unit garden-style apartment community situated on 12.5 acres.Built in 1995 to class-A construction standards with large unit sizes, averaging 1,068 square feet.

INVESTMENT HIGHLIGHTS

Business Strategy
Hamilton Point Property Management, LLC (“HPPM”) will continue to management the property, as it has since October 2012.Self-management is a key tenet of HPI’s investment strategy and is a crucial element to maintaining institutional quality property oversight that includes revenue enhancement, cost control, tenant credit quality.

Net Income Enhancement
• Maintain strong occupancies above 94%. Vacancy rate was 5.7% at Plantation as of June 7, 2016 and 4.2% at the competitive set of seven properties. A 6% constant vacancy rate was included in the cash flow projections. (Competitive Set Source: Co-Star Market Analytics, 6/2/16)
• Increase rental rates. Although we may be able to achieve higher rental rate increases in response to the low vacancy rate and lack of new construction, we have assumed a 3% annual growth rate for both revenues and expenses.
• Continue unit interior upgrade program to include laminate hardwood flooring in ground floor units, refinished kitchen and bathroom counters and cabinets and replacement of brass colored fixtures with brushed nickel to allow for rental rate premiums on those units. While we continue to complete these modest unit upgrades, no rental increase attributed to them has been assumed in the cash flow projections.
• Continue with strict expense controls made possible by Sponsor’s self-management of the property. While third party property managers may significantly upcharge for property level employee, operating and capital expenses, Hamilton Point Property Management does not upcharge any items, leading to significant expense savings.

HPI Plantation DST

Investment Summary
• Class A- apartment community built in 1995 to high-quality construction standards
• Total capitalization of $87,917 per unit ($82.35 per square foot),which is well below replacement cost
• Investment offering 6% initial yield and 6.6% average yield over ten-year hold period

• 30-year amortization with three-year interest only period reduces debt by $1,664,198 during hold period

• $405,000 upfront escrow plus $68,160 per year ongoing capital reserve escrow

• Sponsor has managed Plantation for nearly four years; Sponsor also manages Oxford Point, direct comparable property in the market

HPI Plantation DST

PROPERTY OVERVIEW

240-Unit Apartment Community Property

• 240-unit garden-style apartment community situated on 12.5 acres
• Built in 1995 to class-A construction standards with large unit sizes, averaging 1,068 square feet
• Interiors with washer-dryers, nine-foot ceilings, crown molding,hard-wired alarms, walk-in closets, six-panels doors and private patios or porches. Fireplaces, wood flooring and vaulted ceilings in select units
• Amenities include a swimming pool with spa, clubhouse with grilling area, fitness center, business center, pet walk area, children’s playground and volleyball court
• Occupancy rate (June 7, 2016) of 94.3%. Average occupancy rate of 93.2% for trailing-12 months ending May 31, 2016

HPI Plantation DST

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.