MMG Real Estate Advisors is pleased to offer two adjacent assets totaling 100 units, Royal Park and Stoneside. Royal Park, a 56-unit property, and Stoneside, a 44-unit property, are located in Kansas City’s exploding Northland multifamily submarket. The properties are in proximity to Kansas City’s most significant demand drivers. They offer a prospective purchaser the opportunity to continue increasing value through interior upgrades of the remaining classic units, capturing the current loss to lease and improving operational efficiencies. There is a proven business model in place with a strong foundation for a new investor to build upon what has already been achieved through unit and property upgrades completed by current ownership.
- Substantial Recent Capital Investment of $3.3MM+
- $110,000+ in Loss to Lease Upside Potential
- Proven Value-Add with Significant Upside Remaining on Classic Units
- Convenient Highway Access to Kansas City Metro
- Portfolio Offered with Fantastic Assumable Agency Debt (also Available F&C)
- Tax Abatement Benefit that Runs Through 2034
Substantial Recent Capital Investment of $3.3MM+
Recent Capital Expenditures undertaken by the previous and current ownership have brought about substantial enhancements to Royal Park and Stoneside, establishing a robust foundation for a new investor to further reposition the asset. Over the past approximately 36 months, a significant investment of $850,000 has been dedicated to asset improvements and unit upgrades at Stoneside. Key transformations encompass the replacement of the main drain line, restoration of garages to operational status, repairs to sections of asphalt, and reconstruction of certain stairs and decks. Unit upgrades at Stoneside include stainless steel appliances, LVP flooring, granite countertops, new fixtures, tiled bathrooms and more. From 2018 to 2019, ~$2.5MM of capital was injected into Royal Park. The transformative project included interior and exterior updates, new mechanical systems, luxury unit finishes, amenity improvements and more. Unit upgrades at Royal Park include new cabinetry, stainless steel appliances, LVP flooring, granite countertops, new fixtures, and in unit W/D. These significant enhancements will enable new ownership to experience minimal maintenance requirements, allowing them to concentrate on operational aspects and conversions of the remaining classic units to upgraded finish levels at Stoneside.
$110,000+ in Loss to Lease Upside Potential
By minimizing the difference between the current effective rents and market rents, investors can amplify their monthly rental income and bolster overall cash flow. At Royal Park, effective rents currently amount to $949, trailing behind market rents of $1,025. Similarly, at Stoneside, effective rents stand at $916, while market rents reach $1,035. Bridging this gap, totaling over $110,000 annually, will result in a significant increase in net rental income.
Proven Value-Add with Significant Upside Remaining on Classic Units
Through various iterations of unit and amenity modernizations, Royal Park and Stoneside have realized a substantial return on investment. Given the success of the current business plan, new ownership will benefit from the opportunity to continue to capture significant rent upside and drive outsized returns. While 100% of the units at Royal Park have been renovated, 15 (~33%) of the units at Stoneside remain in classic condition. These classic units are primed for new ownership to capture rent upside of $200+ per unit through continuation of the renovation project.
Convenient Highway Access to Kansas City Metro
The strategic location of both assets provides residents with swift access to Highway 169, facilitating convenient commutes to work, school, and various entertainment options throughout the Kansas City metropolitan area. Positioned just 15 minutes away, residents can easily reach both the new Kansas City International Airport and the lively Downtown area of Kansas City.
Portfolio Offered with Fantastic Assumable Debt (also Available F&C)
Both assets are offered with extremely attractive assumable financing. Royal Park is offered with CMBS debt at a 4.12% interest rate and ~7 years of total term remaining. Stoneside features assumable Freddie Mac debt at a 4.83% interest rate, 1.5+ years of I/O payments, and 5.5+ years of term remaining. Both assets can also be acquired free & clear of existing debt, allowing the new owner to have full control and flexibility in shaping the financial structure of the investment and pursuing various financing options, depending on their specific requirements and preferences.
Tax Abatement Benefit that Runs Through 2034
Royal Park benefits from a tax abatement that runs through 2034, allowing for improved cash flow! The property’s annual tax for the year 2024 amounts to $22,036. According to the PILOT Schedule, there is an approximate annual increase of $20 during each reassessment year, with reassessments occurring biennially, and the next reassessment scheduled for 2025.
