Income Property Organization is pleased to present Hidden Village Townhomes, which consists of 118 units, and is located in Warren, Ohio.
Hidden Village Townhomes is an attractive mix of two-and-three bedroom townhomes, spread out over 13 buildings, and is situated on approximately 6.50 acres of land. The buildings are comprised of 62 two-bedroom one bathroom units (949 ft.2), 24 three-bedroom one and a half bathroom units (983 ft.2), and 32 three-bedroom one and a half bathroom units (1097 ft2). Unique to this asset is the location; Hidden Village is tucked back in a quiet residential setting surrounded by single-family homes, and only minutes from major thoroughfares. Hidden Village is outfitted with Landlord-paid water and gas-forced air furnaces, as well as Tenant-paid electricity. Amenities at Hidden Village include private balconies and patios, backyards, play structures for the children, and on-site maintenance and management.
Recent capital improvements are unit renovations as well as completely new roofs in 2013. With 13 buildings, this was a significant capital expenditure that new ownership will not be burdened with. Currently, the asset is 54% occupied. Since January 2017, 23 townhomes have been rented, with another 7 applications currently pending. Each new tenant must pass both a background check and credit check to ensure stabilization.
Of the vacant units, 6 need a complete rehab, 10 are rent ready, and 39 need paint. Current ownership continues to get the townhomes ready and rented at a pace of 5 per month.
Situated off Commerce Avenue, north of the intersection of MLK Blvd. & W. Market Street and approximately 2 miles from SR-82, Hidden Village Townhomes offers residents a host of convenient features and reasons to call it home. Warren is the county seat and is located in southwest Trumbull County, which is home to approximately 210,312 residents per the 2010 U.S. Census. Strategically located north of the cross-roads of I-80 (Ohio Turnpike) and I-76, Warren is positioned 35 miles east of Akron, 50 miles southeast of Cleveland, 65 miles northwest of Pittsburgh and 15 miles west of Pennsylvania. Several interstates and highways converge on this region, including I-76, I-80, I-680, SR-82, SR-5, SR-11 and US-422. This excellent location facilitates commutes and enables convenient access to all of northeast Ohio and northwest Pennsylvania for residents and businesses alike. Additionally, Hidden Village is less than 60 and 70 miles away from Cleveland Hopkins International and Pittsburgh International Airports, which both services nearly 8.5M passengers a year.
Warren offers residents a dynamic living environment with mix of urban conveniences and suburban comforts and tranquility. The city was built upon a foundation of steel-making, automobile assembly and parts manufacturing. The local economy has diversified to accommodate various industries, including light manufacturing, service, wholesale, and retail sales. A combination of international companies as well as locally owned companies, provide good opportunities for residents to work within the City. Warren’s close proximity to Kent State University, Youngstown State, Hiram College and over 40 accredited colleges and university are located within 90 minutes of the city. Lastly, three of the nation’s most respected medical centers (Cleveland Clinic, Case Western Reserve University Hospital, and University of Pittsburgh Medical Center) are all located within an hour’s drive of the city. There are endless entertainment opportunities for residents, from the city’s minor league baseball team, the Mahoning Valley Scrappers, to the infamous Packard Music Hall, festivals, and countless museums, eateries, bars and boutiques. There are virtually limitless outdoor recreation opportunities in the Warren area, lending to the high quality of life, for this affordable and family-oriented market. There are more than 30 lakes, parks and recreation facilities, plus over 35 golf courses within driving distance
At the $3,665,000 asking price, this offering represents a 9.18% cap rate and potential 15.99% cash-on-cash return upon stabilization, based upon current rents. IPO has projected a year-one NOI of $336,461 after stabilization. As a result of a detailed rental study, it has come to our attention that current street rents at Hidden Village are below market on a street rent basis. Specifically, IPO has found that the two and three-bedroom townhome rents are below market by approximately $106 and $180, on a street rent basis. If a savvy investor were to successfully implement a modest rent increase of $75 for both units, they would add approximately $100K in value and substantial additional cash flow with no financial investment. If this adjustment were to be made, the NOI would increase to over $400,000, which would result in a 10.91% cap rate, with a potential leveraged return of 26.90%. There is tremendous cash flow to be earned through this investment.
IPO has seen considerable improvement in pricing over the course of the last 12 months and it is our professional opinion that values will continue to trend upwards through 2017 as a result of historically low interest rates. Hidden Village Townhomes represents a value-add opportunity that can be purchased at an attractive value.