SPANISH COVE & HATHAWAY VILLAGEST. LOUIS, MO
Pepper Pike Acquisition Associates, LLC
Value Add Multifamily
Targeted Hold Period:
For information about potential returns, please request the OM
1 There is no guarantee that targeted returns will be achieved or that preferred return payments will be made.
The Co-Managers plan to purchase the Properties at a basis below replacement value. The Co-Managers believe the Properties are well-located in a desirable submarket with little new supply, and the Co-Managers plan to implement a significant value-add plan designed to modernize the Properties and pursue higher rents.
The Co-Managers intend to co-manage and co-execute the business strategy for acquiring, renovating, operating, and selling the Properties (the “Project”).
Business Strategy 2
Opportunity Highlights 2
- Acquiring at Basis the Co-Managers Believe is Below Replacement Value: The Co-Managers will acquire the property for $47.6 million, 28% below what the Co-Managers believe is the replacement value of the Properties, based on recent sale prices of comparable properties built between 1971 and 1988 (as reported by CoStar Analytics).
- Limited New Supply & Pending Demand: Investment activity in the St. Louis metro continues,4 driven by out-of-state investors seeking opportunities in the metro for its stability relative to coastal markets.5 Market research indicates recent employment growth in the metro has been driven by the trade, transportation and utilities sector, as e-commerce is driving a warehouse boom and tenants like Grey Eagle Distributors and Amazon have moved to the area.6
- Well-Located for Operational Efficiency & Renter Demand: The Properties are separate assets but are located less than four miles apart, allowing the Co-Managers to share onsite property management resources in an effort to maximize operation efficiency. Each Property is also located less than 14 miles (an approximately 25-minute drive) from downtown St. Louis and major employers like Anheuser-Busch.
Meet Our Co-Sponsor3
Pepper Pike’s experience has allowed them to form close relationships with brokers, managers, and owners. Pepper Pike is often presented with the “first look” at off-market deals, affording them the ability to negotiate deals with limited/no competition. Pepper Pike and its affiliates acquire, renovate, and manage each of the properties in its portfolio. Vertical integration strengthens Pepper Pike’s overall platform and supports its long-term investment goals. Pepper Pike is well respected in the market for its ability to close transactions quickly and at the agreed upon terms. As owners, Pepper Pike sticks to the business plan and only deviates if market conditions support it.
3 Source: Pepper Pike Capital Partners
4 Cushman & Wakefield MarketBeat: St. Louis Multifamily Q3 2021
5 Why the St. Louis multifamily market is ‘on fire,’ in or out of a pandemic.” St. Louis Business Journal, August 2021
6 Yardi Matrix Multifamily St Louis Report-Fall 2021, October 20, 2021