RARE SCALE IN BIRMINGHAM’S TOP RENTAL SUBMARKET
Southside 161 provides the opportunity for investors to build critical mass in a submarket that poses high barriers to entry. The Southside submarket averages 96% occupancy with rents of $1.26 psf. However, ownership throughout the area is fragmented, and most assets are 30 units or less, making it difficult to achieve scale.
PROVEN UPGRADE PREMIUMS
Currently, 66% of the units in the portfolio have been renovated. By completing the value-add strategy across the portfolio, GPR can be increased over 10% or over $150,000 annually. Additionally, management has recently implemented monthly other income charges for pest, garbage, etc. Currently, 61% of these potential charges have been adopted; a new investor can capture an additional $53,000 annually by implementing these charges in the remaining units.
The portfolio is within walking distance to the heart of Birmingham’s medical, financial, and tech centers. Chef-driven restaurants and boutique retailers are intertwined with the assets, and UAB (23,000 employees; 21,000 students) lies immediately north of the properties.
OUTSTANDING CASH RETURNS
With 94% occupancy and market rents of $1.17 psf, new investors will benefit from both stable existing cash flow and tremendous revenue growth potential. The portfolio can be acquired well below replacement cost and is poised to produce outstanding returns for a new investor.