Three Pillars Capital Group, a vertically integrated private equity firm specializing in Class B and C multifamily, today announced the acquisition of a 544-unit apartment community in Houston, Texas.
The 419,316-square-foot community was purchased from First Choice Management through a 1031 exchange. Other terms of the transaction were not disclosed.
Located at 10909 Gulf Fwy. in the neighborhood of Edgebrook, the community includes an assortment of spacious one-, two- and three-bedroom homes. The multi-bedroom apartments are equipped with washer and dryer units, and the living areas feature built-in bookshelves and pass-through kitchen bars.
“Houston is experiencing tremendous growth and demand for rental housing continues to soar as residents flee high costs of living in major gateway cities following the pandemic,” said Gautam Goyal, Founder and Managing Principal of Three Pillars Capital Group. “We are very proud of the acquisition of Del Mar Apartments. It’s a large transaction and is further testament to our firm’s ability to create value for our renters and strong risk-adjusted returns for our investment partners.”
Del Mar Apartments resident amenities include three pools and a fitness center. The community is just 15 minutes from Downtown Houston, with easy access to major Houston thoroughfares I-45 South and Beltway 8. The community is within close proximity to a host of shopping, dining and entertainment options, including both Almeda and Baybrook Malls.
Originally built in 1972, Three Pillars will oversee a strategic value-add repositioning of the community that will include the addition of granite countertops in kitchens and bathrooms, designer kitchen backsplashes and modern fixtures, as well as pull-down gooseneck faucets in kitchens. Additional upgrades will consist of vinyl wood-look flooring, crown molding, chair rail molding, new decorative interior doors and an updated interior paint scheme. Bathroom renovations will feature tiled bathtub surrounds, vessel sinks with modern single-handle faucets and framed mirrors. Additionally, showerheads, faucets and commodes will be replaced with updated water conserving variants.
Goyal adds,“We acquired this community through a 1031 exchange, and have structured many deals in a similar fashion. A 1031 exchange allows investors to snowball their initial investment into something potentially larger, and it’s a great vehicle for us because it brings in equity that we no longer have to raise. As demand for more moderately priced Class-B and Class-C housing across Houston increases due to rising rents spurred by inflation, Del Mar Apartments will help meet the needs of residents in the current climate.”
Del Mar Apartments will be managed by Three Pillars’ sister company, Greenline Apartment Management. Greenline brings a more sophisticated, hands-on approach to property management and, through collaboration with Three Pillars, delivers a secure, modern and clean living environment that prioritizes the needs and requests of residents.
Jim Hurd with Houston Income Properties represented Three Pillars Capital in the deal.