Thursday, April 09, 2009

Local Investors Buy 387-Unit Willow Pond

DALLAS-Local buyer WPA Investment Group Ltd. has pulled the 387-Unit Willow Pond Apartments from foreclosure proceedings. The new owners assumed a $6 million loan on the 42%-occupied asset and will invest just under $1 million to renovate and bring empty units back online.

Clark S. Willingham, who is sponsoring the investment group, tells that approximately 140 units are offline. The good news, he says, is that five units at the 6003 Abrams Rd. affordable housing complex will be back online within the first week of renovation.

Willingham says he became aware of the property when associate Tim Kay brought it to his attention. Willow Pond, built in the 1970s, was being held in receivership by Centerline Capital Group because former owner Homes for America Holdings Inc. of Yonkers, NY, couldn't afford to pay the loan.

"They'd been overly exposed in Florida, and were out-of-state owners," Willingham adds. "They just ran out of money." With the loan assumed, the note will return to KeyBanc, which issued the original paper. Jeff Dowdle and Mark Dowdle with Marcus & Millichap Real Estate Investment Services represented the seller in this transaction.
Willingham says the plan for Willow Pond is to improve cash flow by getting the units up and rented. He has no plans to raise the rents, either, noting the asset should provide nice cash flow once it's stabilized.

One thing in Willow Pond's favor is many of the competing apartments in the area have been scraped for planned mixed-use developments by Trammell Crow Co. Willingham says he has no intention of flipping the asset and is in it for the long haul.

"This is a Section 8 project. There are another 2.5 years in the primary term and 15 years after that," he says. "We're not here to renovate and get out. We're here to improve and operate."

Willow Pond has a mix of efficiencies and one-, two- and three-bedroom apartments. Unit sizes are between 400 square feet and 1,400 square feet. Monthly rents are from $429 to $999.

By Amy Wolff Sorter-