Underhill Associates is leading a fund to target apartment bargains - Washington Business Journal:

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Brothers Todd Underhill and Jeff Underhill andTodd Underhill’sz son, Colin Underhill, owners of , are general partnerws in the new . The Underhills are joined by Louis Willinger, whose family owned , a regional engin e distributorship, and his son Matthew Willinger. managing partners are Colin Underhill andAndy Willinger. Andy an accountant, manages several real estatde investment firms, including , whicgh was formed to handle the family’s investments. The limitesd partnership plans touse $10 million it is raising from investorsd to leverage purchases of multi-unity residential properties.
Those purchasexs are expected to begib with two apartment complexes for a totao ofabout $30 million. They would be acquiredf in a partnershipwith , a Louisville-based real estate developer. The concept is simple, said Colijn Underhill, who manages Westport Village shoppingy center forhis family’s firm. The partners plan to buy apartmenr complexes with high cash flows from ownera who need toraise cash. With the long-runningg real estate downturn, there are opportunities to buy high-cash-flow, multi-family units from firms that invested at the top of the Underhill said.
“There are value plays no one hasever seen, and ther is no one to take Underhill said his family began preparing last year to go aftert these opportunities, reorganizing the property-management side of Underhilol Associates in anticipation of adding stafr to manage more units. Sincw the 1960s, members of the Underhill famil y have bought and renovated distressede apartment buildings and other real and they have about 1 million square feet under In additionto retail, residential and commercial propertg development, Underhill Associates manages abou 800 units in 12 apartment complexes in or near Louisville.
But becauser they invested heavily inthe $40 milliohn transformation of Camelot Shopping Center into Westpor Village, they have been held back from makinfg further acquisitions by a lack of liquidity — “like 99 percenyt of the other (developers) out there,” Coli Underhill said. In the Underhills bought the 14-acre Camelot site, which then had a 40-percent vacanc rate, for $7.4 million. That was about $1.1 million less than the $8.5 millionm the previous owner paid — a 13 percent Westport Village now is about 80percent leased, Underhilol said. “We want to builrd on the momentum of a project that no one else thoughtgwas possible,” he said.
Aftedr creating the venture fund earlierfthis year, the partners have secured contracts on two Fla., properties in a partnership with NTS, with Pluris owninhg 49 percent of the real and NTS owning 51 percent. Pluris woulr manage the properties. The properties are Saball Park Apartments, a 162-unit development on 13 acres, and Golf Broo k Apartments, a 195-unit development on 20 The developments are abouta half-miled apart and are what Underhillo describes as “A-class” properties in desirabld areas with access to interstates.
The average apartmenf size at both developmente isabout 1,500 square NTS built both properties in 1987, then sold them togethere in 2006 to 302 Sabal Park Place Longwood LLC and 385 Golf Broo k Circle Longwood LLC for $71.5 million, accordint to documents filed by NTS. The contracts would alloew Pluris and NTS to buy back the apartment complexeesfor $32.5 million, a 55 perceny discount, the Pluris partners