Stonington Success Story
Stonington Estates Apartments is a 71 unit, Class A apartment complex built in 2005. Stonington’s tenant base is very stable, consisting of mostly residents who work at the area’s top employers. They include the United States Military and Mohegan Sun and Foxwood Casinos. Trion identified this property as passively managed with rents in place that were largely below market value. Trion’s strategy was to enhance value through light cosmetic upgrades and raising rental rates upon renewal.
The property appraised for about 8% over our negotiated acquisition price, affording all Trion investors with an approximate 20% increase in equity at closing. After our first quarter of ownership, Trion followed through with its forecasts by increasing rent on about 20% of the apartments, with an average rental rate increase of 13%. Further, our income and expense performance is on pace to out-perform our base case scenario and all investors have received their forecasted returns on time and without discount.
Washington Heights Success Story
Our acquisition on 181st Street in Washington Heights consisted of 57 residential apartments and 9 commercial spaces. Prior to the acquisition, Trion identified this asset as being both mismanaged and undervalued. Prior management was operating with vacancies consisting of 10 apartments, 2 stores, and prominent billboard space was also idle. The building also had significant deferred maintenance and high building violation counts.
After approximately 6 months of ownership, Trion renovated and rented 12 vacant apartments, leased an idle billboard, rented both vacant commercial stores, and discovered that 2 additional residential basement apartments could be added and rented. Other rent-stabilized apartments, that were under-rented, have also been identified and increased to full legal rent. Furthermore, nearly all of the common areas were upgraded and, as a result, the building violation counts have significantly decreased. Investors have once again received their promised returns on time and the building value has already been enhanced by an estimated 20%+ over our purchase price.
72 Co-op Units-Bronx, New York
This property is a seven-story, elevator co-operative containing 72 apartments for which we assumed management in August 2011. Upon taking over, our team identified many issues regarding bank escrow overages, unclaimed water bill credits, and excessive oil charges. Immediately we were able to reduce our oil charges by $.40 a gallon and we created an annual plan to inspect all units for water waste, window and door drafts and illegal use of washing machines. By focusing on all escrow accounts, shareholder arrears and reducing vendor costs, our accounting and management team was able to increase the reserve account by $54,089 in our first year of management. Our aggressive approach to analyzing all vendor and escrow accounts has resulted in this particular property’s largest reserve account in years. We are happy to say that in August 2012 we received a 3-year contract extension.
206 Condos-Hyde Park, New York
Hyde Park Greens is a 272-unit condominium complex located in the Town of Hyde Park, New York. In 2008 our team took over management of the 206 remaining sponsor units that are located within 19 buildings. The property is set upon sloping hills with mature trees and features a freshwater pond, swimming pool, tennis and basketball courts, as well as a dedicated building for laundry. At the time of takeover, the total operating expenses were $901,070 with a payroll of $181,541 and maintenance expenses of $60,660. Through extensive training and efficient planning, we lowered the annual expenses to $819,786. We implemented our employee management system and decreased payroll by 41% to $107,187. Under this system, all employees have defined tasks enabling a smaller workforce to perform at a greater rate of productivity. The maintenance expense was also lowered by 48% to $31,602 due to our material monitoring protocol. As a result of effective marketing and negotiations, the property insurance was lowered from $22,202 to $6,039.98. We are proud to state that by May 2011 the cost of operations declined by $81,284 under the supervision of our management team. In April 2011 we received a 3-year contract extension.
10 units & 2 Stores- Manhattan, NY
This is a 10,000 sq. ft., four-story, walk-up apartment building, containing 10 apartments and 2 stores. We assumed the management of this property in May 2011. The transition of the takeover of this property was simple but our transition team was able to identify many issues with leases and vendors. Our team identified a miscalculation of funds from CAM charges and we were able to collect $4,990 of charges dating back to 2008. Our team not only manages the property but we are diligent and persistent in trying to find ways to save.
24 Units & 6 Stores-Mount Vernon, NY
This is a 25,000 sq. ft., four-story, walk-up apartment building, with a live-in superintendent, containing 24 apartments and 6 stores. We assumed management of this property in December 2008. At the time of takeover the property had 5 occupied units due to a partial vacate order from the city. Our maintenance and management team created a plan to repair all units, upgrade all common areas and rent all the vacant units. The property was 100% renovated and rented by August 2009. Our staff worked closely with local officials and contractors to obtain all permits necessary and supervise the work. Our leasing team held public open houses and advertised the units weekly in order to reach our goal of 100% occupied. As of May 2011, we only have 1 vacant unit and the property has been consistently rented and maintains excellent curb appeal.
80 Units- Yonkers, NY
This is a six-story, double elevator apartment building, containing 87 apartments. We assumed management of this property in February 2010. Our transition team was able to identify many issues with arrears, leases, and vendors as we do during many of our takeovers. Our accounting and collection team was able to collect over $10,000 of arrears within the first two months of management. Our aggressive approach and dedicated staff for collecting arrears have resulted in this particular property’s largest monthly collection in years.
These case studies are just a few of our success stories that we have performed throughout the years. The performance of our staff is directly reflected in the increased cash flow of the properties we manage. Additional success stories are available upon request.