A stabilized, cash-flowing asset in a supply-constrained submarket with a by-right 50% property tax exemption creating $3.1M in capitalized value on day one — acquired through a sponsor that already owns 40% of the apartments within one mile.
By reserving 50% of units for tenants at or below 60% AMI, the property qualifies for a by-right 50% real estate tax abatement — saving $201K+ annually with no rental pullback. At a 6% cap rate, this creates approximately $3.1M in capitalized value immediately upon closing, equivalent to 0.89% of net cap rate gain.
No new apartment deliveries are projected within a one-mile radius of Azur for the next five years. Current submarket occupancy is 96%, with 10-year average rent growth of 4.5% in the 1-mile radius. This supply-demand imbalance supports durable rent growth and occupancy over the hold period.
Post Real Estate Group already owns two nearby assets — Avila (327 units) and Sandstone (256 units) — both mid-90% occupied with 7–8% positive lease trade-outs. Acquiring Azur brings PREG's ownership to 40% of apartments within one mile, creating market-setting pricing power and operational economies of scale.
PREG's wholly-owned property management firm (TAM Residential) has managed Azur since January 2024 — giving the sponsor direct insight into property performance and eliminating transition risk. Azur is already at 96% occupancy, with minimal CapEx required beyond deferred maintenance and amenity refresh.
A 5-year initial term with a modest $9,200/unit CapEx budget focused on amenity upgrades and deferred maintenance — not interior renovations, since 63 units are already renovated and unrenovated units are achieving sufficient organic rent growth. The 50% tax exemption drives the majority of day-one value creation.
Waco sits directly between Austin, Houston, and Dallas — positioned to absorb unprecedented migration into central Texas. A $1B+ downtown redevelopment across 100+ acres is expected to transform the area over the next two decades.
Azur Apartments is fully subscribed. Seven Peak Income Fund I is currently open for new capital — a Rule 506(c) private credit fund targeting 14–15% annualized returns with quarterly distributions.