Reserve at Stonebridge is a 301 unit, garden-style multifamily community located in McKinney, a highly desirable and fast-growing city in Dallas-Ft.Worth (DFW) MSA. McKinney has become a highly desirable suburban location within DFW offering a wide variety of indoor and outdoor amenities including the Historic Downtown McKinney, Stonebridge Ranch, Craig Ranch, Fairview at Town Center, and the Village at Allen. McKinney provides easy access to major employment nodes along the Dallas North Tollway including Legacy West, Hall Park, Granite Business Park, Frisco Station, the Gate, and Wade Park. Built in 2002, the seller had begun a renovation program at the asset and upon acquisition, Nuveen will continue with the renovation of the remaining 100 units and the common areas. The core-plus profile is attractive as the property will offer a stable cash flow with the existing upgraded units, while offering upside and optionality in the remaining renovations, which are projected to yield a 16% return on cost. The low-density property consists of 43 two-story residential buildings with 100% direct access garages across ±19.8 acres. The units are also desirably spacious, averaging 1,282 square feet. The low-density, large unit style is difficult to replicate with currently land and building costs, offering a competitive advantage in the market.
Reserve at Stonebridge will be the Fund’s largest acquisition to date and offers a hard to replicate product with additional upside through a renovation program, while also benefiting from a fast growing submarket within Texas.
- With 25 Fortune 500 companies headquartered in the market, Dallas attracts companies due to its low-cost relative to coastal markets, pro-business environment, and sizeable talent pool.
- Dallas screens favorably from a long-term growth perspective, where rent growth remains above-average once rental rates normalize in a post-COVID world. The market is well diversified across industries and has a strong demographic outlook in the near term.