Tucson Portfolio
Multifamily Portfolio in Tucson, Arizona
Co-Manager:
Turnstone Capital
Minimum Investment:
$50,000
Additional
Information
Invest Now
Targeted Hold Period:
3 years
Units Available:
106 Units
The Co-Managers intend to implement a $3.11M value-add renovation plan to update both interiors & exteriors over a 3 year period. This is Fairway’s first investment with Turnstone Capital.
Investment Summary
- Attractive Going-In Basis: The properties were sourced off-market and are being acquired at what we believe to be an attractive going-in basis of less than $92K per unit and a 5.5% cap rate on trailing 12-month financials.
- Well Located: The properties are located conveniently close to one another, allowing us the opportunity to maximize operational efficiency using shared resources. They are also close to downtown Tucson and the University of Arizona, which we believe make them well suited for rental income growth.
- Value-Add Strategy: We plan on investing $3.11M in exterior improvements and modernizing the interiors, which we expect will generate an average rent premium of $300/mo per unit.
- Partnership with Experienced Property Manager: We’ve partnered with Atlas Real Estate to handle the day-to-day property operations, leveraging their scale and experience in an effort to reduce costs and create efficiencies. They bring vast experience across multiple states and have already pre-assigned materials costs due to their strong relationships within the marketplace.
1 The University of Arizona Institutional Profile, January 2023
Property Summary
Property Name
AZ Commons
Monte Vista Commons
Craycroft Commons
Property Name
AZ Commons
Monte Vista Commons
Craycroft Commons
Property Name
AZ Commons
Monte Vista Commons
Craycroft Commons
Property Name
AZ Commons
Monte Vista Commons
Craycroft Commons
Property Name
AZ Commons
Monte Vista Commons
Craycroft Commons
Property Name
AZ Commons
Monte Vista Commons
Craycroft Commons
Property Name
AZ Commons
Monte Vista Commons
Craycroft Commons
Property Name
AZ Commons
Monte Vista Commons
Craycroft Commons












FAQ
The information provided in this FAQ is intended only to supplement an investor’s review of the formal Offering Memorandum. All projections, targets, timelines, or business plans described below are preliminary, may not be achieved, and are subject to change. Like all real estate investments, this opportunity is speculative and involves substantial risks including, but not limited to, illiquidity, lack of diversification, complete loss of capital, construction/renovation risk, default risk, and capital call risk. No investment decision should be made based solely on the information in this FAQ. Each prospective investor should review the formal Offering Memorandum, including the Risk Factors and Fee Disclosures, with competent legal, tax, or other advisers.
How did the sponsor identify this off-market deal?
This asset will consist of three apartment complexes (AZ Commons, Monte Vista Commons, and Craycroft Commons). How close are they to one another, and does this provide any challenges or benefits?
What sort of debt did we receive on the deal, and how does it compare to the market?
Is there a demand for affordable apartments in Tucson
How close are the properties to the University of Arizona?
The three properties range from approximately 2-5 miles away from the University of Arizona or about a 7 to 12-minute drive away. Specifically, the distances for the three properties are as follows:
- AZ Commons – 2.2 miles (7-minute drive)
- Monte Vista – 4.0 miles (10-minute drive)
- Craycroft Commons – 4.6 miles (12-minute drive)
What happens in the first six months after acquisition? Will this property undergo immediate closure and renovations, or will we renovate units as they expire?
Who will do the construction and property management?
We have a cap ex budget of about $30k per door. What are the major Cap Ex items that will be addressed?
The construction program contemplates both interior and exterior renovations for all three properties. Here’s a quick summary of the major renovation items identified in our scope of work:
Exterior:
- Replacing A/C units,
- Converting an existing playground to a dog park,
- Building a trash enclosure area,
- Sewer line remediation,
- Improving the structural integrity of the exterior walkups, and
- Restriping and recoating the parking lots
Interior:
- We’re targeting a full rehab of the interiors to bring the units to market. Atlas, who will be conducting the renovations, has prepared a bid for every single unit, including a breakdown of pricing and material costs per unit. A detailed summary of those bids will be uploaded to our deal room for investor review.
When do we expect to be finished with the construction work?
What rents will we look to charge after the units have been renovated, and how does that compare to comps?
Who are the target renters for this property?
We are targeting a blend of workforce housing & market-rate renters at the three properties. All three projects boast near proximity to three of the largest medical centers in the Tucson area, including:
- University Medical Center – 649 beds, 6
- Tucson Medical Center – 600+ beds,7 and
- St. Joseph’s Hospital – 486 beds8
When do we expect the asset to cash flow?
When do we plan to exit, and how did we determine our exit projection/per unit exit/exit cap rate?
If market conditions worsen and we can’t exit in month 24 at our targeted sale price, what will we do?
3 https://mapazdashboard.arizona.edu/gap-analysis-overview
4 https://reports.nlihc.org/gap/2019/az
5 Costar Property Summary Reports, February 2023 and Yardi Matrix Property Composition Reports, February 2023
6https://deptmedicine.arizona.edu/about/banner-university-medical-center-tucson
7 https://www.tmcaz.com/about-tmc/
8 https://www.carondelet.org/locations/detail/st-josephs-hospital