RK Properties, a sponsor of alternative private placements and 1031 exchange offerings, has sold Del Mar Apartments located in Phoenix, Arizona for $27 million. The sale was facilitated on behalf of one of its 1031 exchange (tenant–in-common) investment programs and the RK Opportunity Fund III.
The property was originally purchased in August 2013 for $14.4 million.
Coupled with cash flow generated during the hold period, the company said that the sale resulted in a total IRR to the TIC investors of approximately 107.3 percent and 107 percent to the shareholders in RKOF III (calculated based on the aggregate amount of original capital invested in the property). The hold period was 6.4 years resulting in an annualized IRR of approximately 16.7 percent and 16.7 percent, respectively. This does not include the pass through of tax benefits throughout the hold period.
Additionally, about 80 percent of the TIC’s are doing another 1031 tax-deferred exchange into a new RK Properties acquisition, the company said.
Built in 2008, Del Mar Apartments is a 144-unit Class A community comprised of one-, two-, and three-bedroom floorplans with private detached garages. Unit amenities include nine-foot ceilings, full-sized washers/dryers in each unit, walk-in closets, and patios or balconies. Exterior amenities include a swimming pool, heated spa, barbeque station, fitness center and a business center.
RK Properties offers multifamily replacement properties for 1031 tax deferred exchanges, as well as straight capital investment opportunities for accredited investors who are seeking a real estate investment. As of January 2020, the company has sponsored 153 private placement programs. Of the 153 programs, 138 programs have gone full cycle.