Case Study | Multi-Family Portfolio Sale

Case Study | Multi-Family Portfolio Sale

$145 mm Sale of 1,392 Unit HUD Financed Portfolio – Southeastern United States

• In 2010, amid the market downturn, Encore Multi-Family recognized the attractiveness of HUD financing to fund and develop multi-family assets across the Southeastern United States
• Over the next few years, the Company developed seven Class A, HUD financed properties across Texas, Oklahoma, and Louisiana
• Encore’s in-house asset management team conducted successful lease-up of all assets and achieved between 94% to 96% physical occupancy across all properties by April 2014
• In the same year, Encore recapitalized the portfolio through an institutional hedge fund partner, Och-Ziff Real Estate, representing a state pension fund
• Existing investors exited the portfolio and benefitted from significant capital appreciation while Och-Ziff was able to rollover the HUD financing at an attractive, long-term fixed interest rate
• Encore retains a minority interest in the portfolio and continues to actively manage the assets

Note: Each of the properties in the portfolio were acquired at different points in time for an average hold period of 3.7 years, therefore Encore does not disclose a specific time period for IRR calculations when presenting portfolio case studies

(1) Loan-to-value calculated by dividing total debt by total capitalization

Financial Highlights