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Breaking Down Starwood Farms in Cypress, Texas

 

Starwood Farms Project Info:


Transcription of the Breakdown of Starwood Farms

Steve Olson
Good afternoon, everybody. Steve Olson here with the Fourplex Investment Group. Thanks for joining us. I see a bunch of you piling onto the line here. Some of you are familiar with Starwood farms in Cypress, Texas, it's a 240 multifamily unit project. The construction began in September of 2019. There's amenities or good solid amenities here a pool, little clubhouse area, walking trails, dog park, right, all those kinds of things, some cool playgrounds to it's going to be very amenitized a good community with a 7% projected cap rate.

And let's break that down a little bit more. And I'm not, I'm not getting into the weeds on this, you can contact myself or Jon Metcalf if you want to get into the pro forma and why we think all these numbers are the way that they are, we'd be happy to go through that with you. But you've got your projected cap rate your year one internal rate of return is about 24% with a cash on cash of 7%. Once this property stabilizes, you should profit around $1,000 a month with a little over 12 years. thousand dollars a year. That's just on your cash flow. This is a map of the area where Starwood farms is. Hey, Jon, can you Why don't you try saying something? Let's see if we've got you.

Jon Metcalf
Thanks to be aboard Steve. Hopefully, everybody can hear me fine.

Steve Olson
Yeah, yeah, we you tell everybody what we're looking at here and then get into some details as to why an investor should care about this part of Cypress, Texas for the long term security of their investment.

Jon Metcalf
Excellent, happy to do so. This is the third development that big has done in Texas. The first two were also in what we consider Northwest Houston, four data points that I would bring up that may be helpful when they first moved here to Texas. They look at areas with population growth, job growth, low unemployment, and availability of land to develop, and Texas there are four large essays. There's the Houston area which we're talking about Dallas Fort Worth, San Antonio and Austin, both Houston, and Dallas. Fort Worth have populations of just over 7 million people down in the Houston MSA, the population growth has been tremendous every 10 years at about a million people.

This year alone, they project 120,000 new residents. Job growth is strong 71,000 projected jobs in 2019, unemployment rates, low 3.9, and availability of land. So this, this map that we're looking right now is a Cypress, Texas, which is in northwest Houston. In fact, all of those essays we just discussed, go right through Northwest Houston.

So I tend would go to the west and I'd take you to San Antonio, this is highway 290, which is the main road to Austin. And then I 45 going north is the main road to Dallas highway 290 that you're looking at right here goes right through Cypress and so you can see the kind of to the north. You've got react You've got hospitals all you have your kind of downtown Cypress, and also below south of 290. You have neighborhoods and lots of development.

This entire highway to 9034 miles has been in a seven-year development process. They're expanding it. That's a $2.5 billion expansion which is scheduled to be completed this year. This has resulted in an absolutely tremendous amount of growth in the Cypress area, investment, new neighborhoods, new retail, and the location that you can see right there site. That's where Starwood farms are going to be located. This is actually an interesting piece of property. There's not a lot of property in the area to be developed as you look at that map. in Cyprus, there's not a lot of large tracks.

This particular location was the former site of a quick copy. There was their question headquarters, quick copy back in the 70s and 80s. I was kinda like Kinkos. They had franchises all over the world. And this is where they brought all of their franchisees to be trained. It's about a 50-acre piece of property. property has never been available for sale until the owner passed away a few years ago. And his children have had now sold this property to developers. There are actually two parts to the site.

There are a Northern part 24 acres that's currently being developed as a mixed-use retail medical office Class A apartments and restaurants. It's under active construction as we speak, buildings are going up. The site's being developed. Start with farms is located on the lower approximately 10 acres. And that's where they will we will find the 240 townhomes.

We're quite excited about this area. This project, in particular, has enough land that it allows us to put in. As you mentioned, the neighborhood pool parks, walking trails, there's going to be a leasing office. And that's going to be completed in six phases. We're currently in phase one that's sold out.

That's starting construction next week. Phase Two is the next one that will be starting in October. That's mostly sold out. I think we still have three buildings left there. And then the remaining phases will be constructed from November through February. The site is located just under a mile from highway 290, going north on the tailgate, and about a mile two.

If you go to the west is the downtown area. I've been investing in this area for 15 years, I've got a portfolio of single-family homes. I've purchased three big fourplexes. And I'm also buying here in the Starwood farms. I've lived here for 24 years old, my kids attended the schools. So we're quite excited about this, this project here and start with Barb's

Steve Olson
thanks for that. And just to let everybody know this map, I didn't come up with this we, we poached this from capital retail properties there, the developer that's going into the north of us here. And you know, if you get asking around Houston and they find out, somebody finds out that you're developing next to capital retail, they go, Oh, well, that's good. They're known to be a quality developer that can look out on the horizon and the path of progress and the growth that's happening.

I figure you would all be interested in seeing this Marcus and Millichap one of the big commercial real estate firms that country released a multifamily report. They do this every quarter. I've kind of a screenshot of the report the front page over it on the left, but there's a few things to highlight there. They're stating that the Houston Metro has grown substantially over the past cycle, adding new households at nearly triple the national pace since 2010.

People are moving to Houston as the market expanded demand increase for healthcare, education, and professional services, adding even more to job creation. We also see specifically Cyprus in our third excerpt here where fewer units are supporting triple-digit vacancy declines across multiple submarkets, such as in Baytown and in Cypress slash Waller. JOHN Walters, just about 10 minutes up the road from here on the 290 correct. That's it.

Jon Metcalf
10 minutes past the Cypress going out towards Austin.

Steve Olson
Yeah. So even further so the growth is pushing out that direction towards Austin so that the final outlook is that faster population growth outside of Harris County bolsters rental demand in the metros outer suburbs, drawing both developer and investor interest so we're not the only ones that think this, in fact, all my formatting is awful. I'm so sorry. So the neighborhood scout report, excuse the chicken scratch here shows the makeup of the employment sectors here in the town.

The neighborhood, mostly education, scientific manufacturing health care, right, we see that over on your right side of the screen, we see ratings and I'll send you all a copy of this report if you reply to the email, because I realized my formatting is less than desirable here. But Lamkin elementary school, we're going through the website, great schools. org gets an eight out of 10 ratings. Arnold Middle School gets an eight out of 10. And cipher high gets a 10 out of 10. From great schools. org. So this is a high net worth area, with excellent schools and excellent growth. We view it as an investment that if you get into this thing and hang on, you'll be happy. You'll be a happy camper here in the age of attorneys.

A little bit of a disclaimer here that I'm going to read to you. fig is not a company but a marketing platform. All information needs to be verified by an independent study on your part that can't be guaranteed. We've made our best efforts to be accurate in the assessment of future rents interest rates, vacancies, and other details, but you should verify that. Please consult with your tax advisor, attorney, and other relevant professionals where appropriate.

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Each year, the Fourplex Investment Group releases new multifamily projects in a variety of markets. FIG's waitlist is the easiest way to grow your portfolio before reservations fill up.