Kingwood
Kingwood, TX (Houston MSA)
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Co-Manager
Vivo Investments, LLC
Asset/Strategy Type
Hotel-to-Apartments Conversion
Minimum Investment
$50,000
Additional
Information
Express Interest
Targeted Hold Period:
24 months
Post-Converted Units:
75 Apartments Units
Fairway America Management Group IV LLC (“Fairway”) and Vivo Investments, LLC (“Vivo”) (collectively, the “Co-Managers”) intend to acquire a 75-room suburban, 2010-vintage Extended Stay America located in Kingwood, Texas (the “Property”) and convert it to 75 apartment units (the “Project”).
Jointly, the Co-Managers have acquired more than 20 projects together as part of an opportunistic strategy to acquire functionally obsolete hotels at an attractive all-in cost basis in undersupplied markets and convert them into competitively priced apartment units. Once the conversion is complete, the Co-Managers intend to refinance or sell the Property.
Investment Summary
- Simple Construction Scope: Built in 2010, the Property rooms are already equipped with updated kitchenettes that feature a full-size refrigerator, two-burner stoves, as well as a sink and dishwasher.
- Attractive Amenity Package at a Discount: The Property will feature Class A amenities such as a large fitness center, a private courtyard with barbecue grills, a resort-style pool, and shared teleworking space. The Co-Managers have underwritten rents that they believe are 10%-19% below comparable properties in the surrounding area.1
- Well-Located Submarket: Kingwood is located in the Northeast Lake Houston submarket and is approximately 23 miles from Downtown Houston. As evidenced by ongoing population growth above the national average,2 outward expansion from Downtown Houston continues to be an ongoing trend, with the Lake Houston submarket benefitting from migration toward the suburbs.3 Additionally, the Co-Managers believe the Property can provide convenient workforce housing to employees of HCA Houston Healthcare Kingwood, a 457-bed acute care hospital serving NE Houston and located adjacent to the Property.4
*The business strategy is subject to change. There are many risks to participating in this opportunity. See “Risk Factors and Fee Disclosures” in the Offering Memorandum for a discussion of some of these risks, including loss of capital, illiquidity, lack of diversification, and capital call risks. This opportunity is unsuitable for investors who are not prepared to hold their ownership position indefinitely and who cannot afford a complete loss of capital.
1 CoStar Property Summary Reports, October 2022
2 ESRI Community Profile, October 2022
3 CoStar Analytics, Lake Houston Area Multi-Family Report, November 2022
4 HCA Houston Healthcare, Kingwood, October 2022
Property & Renovation Summary
Address
291 Kingwood Medical Dr
City / State
Kingwood, TX
Year Built
2010
Hotel Rooms (Existing)
75
Average Unit SF (Post Conversion) (Studio / One-Bedroom)
370 / 550
Rentable Building Area SF
28,720
Parking Spaces
93
Targeted Property Rents (Studio / One-Bedroom)
$925 / $1,000
CapEx/Unit
$15,943
Expected Hold Period
2 years
Total All-In Cost
$8,557,825
