Location: Colorado Springs, CO
Asset Type: Class C multifamily – 70 units
Ownership period: 2013-2016
Return on Equity: 116.2%
Annualized return on Equity: 39.6%
Increase in value: 68%
Increase in NOI: 50%

Shannon Hills was the second asset acquired as part of the partners’ current portfolio and the first to be sold. As of the date of the sale, the partners had recapitalized all three of the first three assets purchased in this portfolio since its inception in 2012. The partners intended to hold Shannon Hills for a five to seven year term to fully maximize value. Under certain circumstances, however, we consider sales of assets prior to the end of our targeted ownership term. Through exhaustive market research, we determined that there was an opportunity to achieve our returns objective over two years before our target. After a short marketing period we obtained an offer from a highly motivated buyer. The result was a net return to our investors of 116.2% on equity invested in three years – the equivalent of 39.6% a year and an IRR of 31.3%.