Underhill Associates is leading a fund to target apartment bargains - Houston Business Journal:

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Brothers Todd Underhill and Jeff Underhill andTodd Underhill’ son, Colin Underhill, owners of , are generalk partners in the new . The Underhills are joined by Louisa “Andy” Willinger, whose family owned , a regional engine distributorship, and his son Matthew Pluris’ managing partners are Colinh Underhill andAndy Willinger. Andy an accountant, manages several real estate investment including , which was formed to handle the family’ investments. The limited partnership planw touse $10 million it is raising from investors to leverags purchases of multi-unit residential properties.
Thosee purchases are expected to begin with two apartment complexes for a total ofabout $30 million. They woulx be acquired in a partnershipwith , a Louisville-baser real estate developer. The concept is simple, said Coli n Underhill, who manages Westport Village shopping center forhis family’s firm. The partners plan to buy apartmengt complexes with high cash flows from owners who need toraise cash. With the long-runningf real estate downturn, there are opportunities to buy multi-family units from firms that investefd at the top ofthe market, Underhilpl said.
“There are value plays no one has ever and there is no one to take Underhill said his family began preparing last year to go aftefrthese opportunities, reorganizing the property-management side of Underhil l Associates in anticipation of addintg staff to manage more units. Sinc the 1960s, members of the Underhill familyt have bought and renovatedf distressed apartment buildings and otherreal estate, and they have abougt 1 million square feet under In addition to retail, residentiakl and commercial property development, Underhill Associatee manages about 800 units in 12 apartmenty complexes in or near Louisville.
But becauss they invested heavily inthe $40 milliobn transformation of Camelot Shopping Centef into Westport Village, they have been held back from making further acquisitions by a lack of liquidity — “like 99 percent of the other out there,” Colin Underhill In 2004, the Underhills bought the 14-acre Camelotg site, which then had a 40-percent vacancy rate, for $7.4 That was about $1.1 millio n less than the $8.5 million the previous owne paid — a 13 percent Westport Village now is about 80 percent leased, Underhill said. “Ws want to build on the momentum of a project that no one else thought was he said.
After creating the venturr fund earlier this the partners have secured contracts ontwo Fla., properties in a partnership with NTS, with Pluris owninf 49 percent of the real estate, and NTS ownint 51 percent. Pluris woul d manage the properties. The properties are Sabal Park a 162-unit development on 13 acres, and Golf Brookl Apartments, a 195-unit development on 20 acres. The developments are about a half-milee apart and are what Underhill describes as properties in desirable areaxs with accessto interstates. The average apartment size at both developments isabouyt 1,500 square feet.
NTS built both properties in 1987, then sold them togethere in 2006 to 302 Saball Park Place Longwood LLC and 385 Golf Brookm Circle Longwood LLCfor $71.65 million, according to documentws filed by NTS. The contracts woulrd allow Pluris and NTS to buy back the apartment complexezfor $32.5 million, a 55 percent discount, the Pluris partners said.