VUE ON MACGREGOR

4460 S. M acGregor Way • H ouston, T X 77021

Total Offering Price $40,559,000

Anticipated Investor Equity $14,559,000

  • 1st Year Targeted Cash-on-Cash Return 6.50%
  • Anticipated Loan Amount $26,000,000
  • Anticipated Loan-to-Value 64.10%
  • Minimum Investment $50,000

Vue on MacGregor is a Class “A”, 115-unit, 347-bed student housing property within walking distance to the University of Houston campus. Built in 2014, the property currently offers students spacious units, luxury amenities, advanced security and excellent city views.

4460 S. M acGregor Way • H ouston, T X

The property was voted “Best Off-Campus Apartment”
for 2015 and is fully pre-leased for the 2015-2016 school year, which
includes 12-month leases.

Market

The University of Houston is the 3rd largest university in Texas and a Tier One Research University. The school enrolled approximately 40,000 students in 2014. Further, Texas Southern University “TSU” is also less than a mile from the Vue on MacGregor and enrolled 9,600 students in 2014. With close to 50,000 students enrolled at both institutions, Nelson Brothers believes the campus to be situated in a key location within a primary market. The company’s goal is to leverage what we believe to be favorable economics for student housing: the steady and potentially growing demand and limited supply while attempting to preserve high occupancy, monthly cash flow and a healthy rental rate growth.

property Profile

  • Number o f Units 115
  • Number o f Beds 347
  • Parking Spaces 290
  • Year o f Construction 2014
  • Net Rentable Square F eet 120,638
  • Pre-Leased Occupancy 100%

Target Strategy

Nelson Brothers anticipates that Vue on MacGregor with its luxury construction, high-end look and amenities, excellent location and advance security make it one of the most compelling places for students to live near the University of Houston campus. As a Tier One school, located in the fourth largest city in the country, Nelson Brothers believes the University of Houston to be a phenomenal economic anchor that has demonstrated solid growth over the last decade. The target strategy is to leverage the historical stability of the university, the property’s location and high-end appeal to affluent students as well as maintaining consistently high occupancy with solid year-over-year rental rate to produce monthly cash flow, tax efficiency and long-term appreciation.

Student Housing

Nelson Brothers believes that students will pursue degrees from major universities regardless of the economic climate. The company’s strategy is based upon that belief and contends that well-positioned properties can stay well-occupied and profitable even during economic downturn. For investors, the target of this strategy is to help provide stable cash flow and diversification to assets that may be less correlated to the economy.

Location

Vue on MacGregor is a pedestrian property located just a few blocks from campus. Nelson Brothers believes that the University of Houston housing market has significant barriers to entry with the areas surrounding campus currently bound by freeways, established affluent neighborhoods and park land.

Loan Details

Non-recourse. 10-year, 30-year amortization, 5 years interest-only. Anticipated interest rate, 4.55%. DST structure.

About University of Houston

  • Founded in 1927
  • Tier One Research University
  • 3rd Largest Public University in Texas
  • 2014 Enroll ment: 40,914 students
  • Over $200M Sp ent on Recent Campus Improvements
  • $721 Mill ion Endowment

 

Targeted Benefits

  • 6.5% 1st Year Cash-on-Cash Return
  • 100% Current Occ upancy (2015-16 Sc hool Year)
  • Location: 2.5 blocks from UH campus
  • Tax efficiency from pass through depreciation
  • 4th Largest City in the U.S.

ABOUT Nelson Brothers

16B Journey | Aliso Viejo, CA 92656 (800) 580-1031

Current Management Portfolio At-A-Glance:

Founded in 2007, Nelson Brothers specializes in what the firm considers to be well-positioned student housing properties. Headquartered in Orange County, CA, Nelson Brothers manages over $500 million in real estate with more than 100 employees.

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