Track Record, Vesta Asset Services, Vesta 24-7

Track Record

Vesta's executive team has extensive experience in asset sourcing, acquisition, divestment, renovation, repositioning, conversions, property and asset management and financing of multifamily properties. The experienced team at Vesta has the industry knowledge and ability to opportunistically identify assets with significant upside potential.

With an outstanding track record in acquisitions, Vesta has a competitive advantage with better outcomes than traditional management firms. Because of extensive experience and long-term industry relationships, Vesta is often awarded privileged purchase opportunities based on its preferential access to transactions and performance track record.

The table below is an overview of four transactions undertaken by the Vesta team. These transactions demonstrate the ability of Vesta to create value and recycle capital.

The Cascades

West Palm Beach, Florida. Acquired November, 2003. Disposition July, 2006
316 units, Built 1991, 243,200 square feet
Purchase Price - $23,750,000. Sale Price - $36,500,000. Gain on sale = $12,750,000.
In-place NOI at acquisition - $1,450,000, 6.11% cap rate. NOI at disposition - $1,900,000, 5.18% cap rate.
Unleveraged IRR over period = 22.8%.
We spent approximately $915,000 ($2,896 per unit) on renovations including: Landscaping upgrades, exterior paint and wood replacement, exterior lighting upgrades, fitness equipment, interior upgrades to kitchens and baths, signage upgrades and roof repairs. During the holding period we grew in-place NOI by 30.3%.

The success of the Cascades transaction included several factors: Florida experiences annual population growth of approximately 500,000 people; the subject property is located in a sub-market of West Palm Beach where diverse and numerous businesses were expanding; the asset itself had the potential to be an attractive condominium conversion candidate; and there were significant barriers to entry for new product development, lack of available land, costly development permits and fees, and unprecedented escalations in construction costs. These factors converged to create high occupancies and rising rents, translating to a high asset sale price.

Milestone Apartments

Germantown, Maryland (suburban Washington, DC). Acquired November, 2003. Disposition, October 2006.
542 units, Built 1998-2000.
Purchase Price - $85,100,000. Sale Price - $100,000,000. Gain on sale = $14,000,000.
In-place NOI at acquisition - $5,400,000, 6.34% cap rate. NOI at disposition - $6,100,000, 6.1% cap rate.
Unleveraged IRR over period = 14%.

This was an acquisition in a vital, extremely strong market. It needed little capital investment, but was subject to intensive, laser-focused management improvement. We increased NOI by approximately 12% over the holding period, and sold the project in a frothy market at a very low cap rate for a significant gain.

Phoenix Portfolio

Phoenix, Arizona metropolitan area. Acquired June, 2003. Disposition, November 2006.
Two properties aggregating 1,124 units, Built 1995 and 1989, 907,524 square feet.
Purchase Price - $71,500,000. Sale Price - $84,000,000. Gain on sale = $12,500,000.
In-place NOI at acquisition - $4,645,000, 6.5% cap rate. NOI at disposition = $5,114,000, 6.09% cap rate.
Unleveraged IRR over period = 12.7%.

We spent approximately $2,000,000 ($1,779 per unit) on renovations including: Exterior paint and wood replacement, leasing office and clubhouse renovation, exterior lighting upgrades, fitness equipment, interior upgrades to kitchens and baths, signage upgrades and roof repairs. During the holding period we grew in-place NOI by 10%, and took advantage of cap rate compression on the sale.

Greenwich Park

North Miami, Florida. Acquired, June, 2003. Disposition, July, 2007.
402 units, Built 1985-1989, 332,300 square feet.
Purchase Price - $29,250,000. Sale Price - $42,000,000. Gain on sale = $12,750,000.
In-place NOI at acquisition - $1,890,000, 6.39% cap rate. NOI at disposition - $2,286,000, 5.4% cap rate.
Unleveraged IRR over period = 16,5%.
We spent approximately $965,000 ($2,400 per unit) on renovations including: landscaping upgrades, exterior paint, parking lot repairs, plumbing repairs, exterior lighting upgrades, interior upgrades to kitchens and baths, signage upgrades and roof repairs. During the holding period we grew in-place NOI by 21.2%.

The success of the Greenwich Park property was based on the same factors as Cascades above, as well as the property was located in relatively affordable North Miami, in a sub-market adjacent to one of the wealthiest communities in South Florida. Therefore, it provided a convenient, affordable alternative to people working in the wealthier sections of Miami. Capital invested commanded increasing rents in direct correlation to enhanced resident amenities.