RealSource Announces Investment Opportunity: Crown Pointe, an 84-Unit Class B Value-Add Community in Georgetown, KY

This rare off-market acquisition arises from a seller facing a distressed situation due to a variable-rate loan initiated in 2020. Under pressure from two majority owners, the decision to sell was made at a time when most multifamily property owners are only willing to divest if forced or presented with compelling capital opportunities. With current cash flow constraints and a need for more professional management, Crown Pointe presents significant upside potential through strategic property enhancements and professional asset management. Rental rates at Crown Pointe are currently $300-$500 below renovated rent comps in the submarket, offering a clear pathway to maximizing revenue.

Crown Pointe is located just three miles from The Mill, an apartment community acquired by RealSource in 2017, that has consistently been one of our top performers. This proximity allows for operational synergies and economies of scale, further enhancing Crown Pointe's potential. Nestled in a neighborhood known for minimal collection issues, Crown Pointe benefits from RealSource's extensive operational expertise and proven track record in managing assets within this market.

Georgetown, Kentucky, just twelve miles north of downtown Lexington, is home to the world's largest Toyota manufacturing plant, which is expanding to produce electric and hybrid Toyota SUVs. This expansion underscores the area's robust economic activity and stable employment base, particularly in healthcare and education, anchored by institutions like the University of Kentucky in Lexington.

The multifamily market in Lexington and the Georgetown submarket are robust, with Georgetown reporting a high occupancy rate of 97%. Unlike other areas experiencing a surge in apartment development, Georgetown has strategically avoided excessive new construction aimed at higher rental rates, which often require significant justification due to elevated construction costs. According to Costar, the Lexington Metropolitan Statistical Area (MSA) ranks 7th for rent growth over the past year among MSAs with populations exceeding 400,000. These strong fundamentals position Lexington favorably for continued stable rent growth in the foreseeable future.



• Attractive Basis: Priced at $123,800 per unit, well below the replacement cost in the range of $200,000+ in Lexington.

• Highly Educated Workforce: #11 Most Highly Educated Labor Force, with 45% of the population over 25 holding a bachelor's degree or higher.

• Major Employer: Toyota employs nearly 10,000 people and produces about 550,000 vehicles annually. Toyota has announced an additional $1.3 billion investment into the Georgetown plant.

• Business-Friendly Environment: #14 in America's Top States for Business Climate (CNBC, 2024) and #4 Top State for Cost of Doing Business (CNBC, 2024).

• Purchase Price: $10,400,000
• Investor IRR: 15.8%
• Cash-on-Cash Average: 7.1%
• Cash-on-Cash Returns:

2.3% (Yr 1), 6.5% (Yr 2), 7.8% (Yr 3), 8.9% (Yr 4), 9.9% (Yr 5)

• Equity Multiple: 2.0x
• Projected Exit: 5 years
• Debt: 67% LTV, 30-year fixed rate loan
• Option to exit at year ten without a defeasance cost
• Equity Required: Approx. $4,670,000
• Minimum Investment: $50,000
• Anticipated Closing: November 22nd, 2024

This property has been examined by our analysts, investment committee, and capital expenditure team; however, return assumptions may slightly fluctuate as we work to complete our in-depth due diligence process. If you are interested in investing please click the "I'm Interested!" button. Please note, this does not guarantee you a spot in the deal. Reservations will be on a first-come, first-served basis. Full executive summary coming soon.

RealSource was established in 1989 with the central focus of putting our investor clients in the right place, at the right time, to help ensure their maximum profitability. Putting the investor in the right geographical location in the right economic conditions is the heart of location investing and what we call "Prime Time Investing".

In real estate investing, buying low and selling high is a matter of knowing where and when, and that requires research. In order to place our investments in the right "where and when" circumstances, we track 160 domestic markets.

RealSource | www.RealSourceProperties.com

 2089 E. Fort Union Blvd, Salt Lake City, UT 84121

Office: (801) 601-2700