Nelson Brothers sells Chateau Sera and Tropicana student housing properties for $10.1 million, resulting in over $2 million in profit.
Aliso Viejo and Los Angeles, CA—Southern California-based Nelson Brothers Professional Real Estate recently closed on the sale of Chateau Sera and Tropicana, two student housing apartment complexes acquired in 2012 near the University of Southern California.
The initial total offering price to investors for the two properties was $8,055,000, of which approximately $3.85 million came from investor equity. The buildings were completely renovated; exteriors were completed in 2004, and interiors and design upgrades were finished in 2014. On July 1, 2015, the property sold for $10,100,000—over $2 million in profit. Since the property had amortized over $600,000 in that time frame, the capital gains on investor equity of the total return to investors following the sale was over 62%, culminating in just over three years of ownership. When factoring in income that had been paid out during their investment, the total return for TIC investors was close to 90%, which was an unexpected piece of good news.
“We’re really pleased with how the strategy played out with Chateau Sera and its sister property, Tropicana,” stated co-owner and Chief Marketing Officer Brian Nelson. “In just over three years of ownership, the team was able to upgrade and renovate unit interiors with a new, modern décor. We accomplished this with minimal impact on occupancy, at which time we were able to maintain 100% leasing in unaffected units. For the last two years, we distributed over 8% income on a California property in a major city while providing over 100% tax shelter without any vacancy.”
Mr. Nelson further discussed his belief in student housing as a possibly advantageous investment model. “We were pleased to be able to add as much as 60% appreciation in such a short time on the back end,” he stated. “Of course, not all of our investments will turn out this way, but this is why we like student housing and our own niche business model. We have historically had the ability to keep rent demand steady with little impact from market fluctuations and with upside potential as we add value.”
For more information about Nelson Brothers Professional Real Estate, please contact Brian Nelson, Principal and Co-Founder, at Brian@Nelson-Brothers.com
About Nelson Brothers
Nelson Brothers Professional Real Estate, LLC, offers individual investor direct ownership interests in institutional quality, professionally managed real estate. The company, founded by brothers Patrick and Brian Nelson, focuses on targeted growth opportunities and value-added investments for its clients through capital improvements, cost efficiency, and revenue maximization. Its entities include Nelson Brothers Professional Real Estate LLC, Nelson Brothers Property Management LLC, and Nelson Brothers Construction Management LLC. Nelson Brothers Professional Real Estate specializes in the acquisition, financing, and ownership of real estate investments in the niche areas of student housing and assisted living investments. Nelson Brothers currently manages over $300 million in multi-family housing real estate.
All investment involves risk of loss of some or all principal invested. Past performance is not indicative of future results. There is no guarantee that any investment model will perform as targeted. Securities offered through Emerson Equity LLC, Member FINRA/SIPC. Nelson Brothers and Emerson Equity LLC are not affiliated.