Villas Del Sol: Vibrant Culture Flourishes in Austin, TX

The welcoming landscaping and vivid, optimistic colors greeting residents in Villas del Sol’s main lobby highlight the vibrant culture at the Austin, Texas, property. Comunidad Partners acquired the 1982 vintage Class B property from a nonprofit in 2012. 

Comunidad Partners added style to appeal to a culturally rich workforce demographic by addressing deferred maintenance issues and upgrading interiors with fresh, modern design and a cheery paint theme.

The property was already in a prime location near The Domain, a new development at the time that offers major employers, schools and easy access to the MoPac highway and light rail transportation. Using its operational expertise, Comunidad Partners introduced targeted social impact programs for the residents including ESL education, tax refund seminars, vocational skills training, job fairs and more.

Acq./Exit: Mar 2012/Nov 2015

Total units: 294

Invested equity: $2,563,000

Total Cap./Unit: $12,440,000/$42,300

Exit Price/Unit: $19,215,000/$65,400

Cash-on-Cash: 14.3%

Rent CAGR/NOI CAGR: 9.5%/39.5%

Gross IRR/MOIC: 84.9%/5.0x

Leverage: 79.4%

Value Creation

• Invested about $7,500 per unit for physical and cultural upgrades that increased resident retention.
• The improvements were rewarded with 95% occupancy, 70% resident retention, and an NOI increase of more than $1 million.
  
• In 2015, Comunidad Partners sold the property for over $65,000 per unit to a regional investment firm largely due to substantial NOI growth.