Multifamily investment firm ZMR Capital has made its foray into the Phoenix housing market with the off-market acquisition of District Flats Off Dobson, a 112-unit apartment community in Mesa, AZ for $18.2 million.
District Flats off Dobson is located at 1045 S. San Jose St. in Southwest Mesa, 16 miles east of downtown Phoenix. The property benefits from its proximity to Mesa Community College the largest of 10 colleges in the Maricopa County Community College District with a student population of more than 20,000. It is also within walking distance of Downtown Mesa’s Fiesta District, a $500 million redevelopment project that includes new commercial office and a vibrant mix of restaurants, retail, hospitality and entertainment venues.
The majority of District Flats off Dobson’s studio and one-bedroom units have not been significantly renovated since the property was built in 1975 providing ZMR with an attractive value add opportunity. In addition to renovating the exterior to improve curb appeal, ZMR plans to make improvements to the unit interiors as units roll. Improvements will include upgraded countertops and cabinetry, stainless steel appliances, and new plank flooring.
Despite an increase in multifamily construction, the supply of multifamily product in Phoenix will not keep pace with demand, according to ZMR CEO Zamir Kazi, who along with Vice President Colt Connor led the firm’s acquisition team.
“The majority of the 20,000 units being built in Phoenix is expensive luxury product catering to the high end of the renter spectrum,” said Kazi. “As one of the most affordable markets in the Phoenix MSA, Mesa continues to be an attractive option for renters in the Phoenix area. At our cost basis, we will be able to improve the overall character of the property while still keeping rents in line for the majority of renters in or moving to Mesa.”
District Flats off Dobson represents the first acquisition in Phoenix for ZMR whose portfolio includes approximately 4,000 multifamily units in Florida, Georgia, and Texas. With a robust number of potential deals in its pipeline, the firm plans to grow its Phoenix portfolio quickly, according to Kazi.
Cliff David, Executive Managing Director in the Phoenix office of Institutional Property Advisors marketed the property for sale on behalf of the seller.