Bluerock Announces 364% Total Return on DST Program
June 18, 2019 | Luke Schmidt | Blue Vault
On June 18, 2019, Bluerock Value Exchange (“BVEX”) announced one of the largest returns ever reported in the direct investment industry. BVEX announced the successful sale of the Residences of Stonebrook, a 320-unit apartment community located in Nashville, TN. The Company acquired the investment property for approximately $18.3 million in December 2011 while selling the property for $39.5 million in May 2019, resulting in a 364% total return on equity investment, or a 48.5% average annual return.
The property was acquired by BR Stonebrook, DST, a Delaware Statuary Trust structured for 1031 like-kind exchanges for accredited investors. This full-cycle event included an equity return of more than $26.9 million on an $8.7 million investment, resulting in a 309% return. This appreciation excludes the payment of consistent 6.5%-7.0% annual distributions, totaling approximately $4.4 million over the 7.5-year holding period, enhancing the total return to 364%.
“The sale of Stonebrook is an absolute grand slam investment return for our Investors”, said Josh Hoffman, President of BVEX. “Our asset and property management teams perfectly executed the business plan sustaining high occupancy rates of 98%-99% over the past 6+ years and increasing the property’s net operating income by over 80% which allowed us to maximize full value potential”, added Hoffman.
The Residences at Stonebrook is a 320-unit, Class B garden-style apartment community situated on approximately 21 acres located in Nashville, Tennessee. The property is located in the southeast submarket, one of Nashville’s most desirable areas due to its close proximity and accessibility to multiple employment centers, highway access, and abundance of retail services.
BVEX is a leading, national sponsor of Premier Exchange Properties™ and syndicated 1031 Exchange offerings with a focus on Class A properties that can deliver stable cash flows and with high potential for value creation. BVEX’s structured 1031 Exchanges programs include nearly $1.4 billion in total property value and approximately 8.6 million square feet of property. With capacity across nearly all real estate sectors and the ability to customize transactions for individual investors, BVEX is available to create programs to accommodate a wide range of tax requirements.
Sources: Bluerock, Blue Vault, SEC
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