2009-10-04 Carlos Vaz was recently featured in a Dallas Business Journal article on his activity buying distressed properties. The majority, (slightly truncated) article is below... "CONTI STEPS UP DISTRESSED APARTMENTS INVESTMENT" Dallas Business Journal - by Katherine Cromer Brock Friday, Septemeber 25, 2009 The Conti Organization is starting a second $10 million fund to bolster its ability to purchase and renovate distressed apartment properties. Dallas-based Conti is the latest in a string of companies starting or adding to funds that target distressed multifamily properties. In the past year, it has spent $9.94 million on distressed real estate and now has holdings valued at more than $40 million, said Carlos Vaz, president of The Conti Organization. It owns about 2,000 units -all in Texas. The company has closed 10 deals in two years. The new fund will come from private investors, Vaz said. "Right now, you're turning left and right, and there's a distressed sign," Vaz said. "(But) just because it's a bank-owned property doesn't mean it's a good deal. Sometimes it's not about the price you're paying for the property." Vaz said his company scouts for apartments that aren't "in a war zone,"but that are on busy streets, near national retail chains and perhaps close to a school or college. Conti typically purchases the apartments for 30% to 40% of market value, fixes them up, renames and rebrands them. Conti relocated from Boston in 2007. In March 2008, it purchased its first property, a 208-unit complex in Fort Worth, toward a goal of 2,000 units by year's end. In April, Conti purchased 232 units at Eastfield Village in Dallas for $3.2 million from an unnamed bank, and has completed 90% of the budgeted $800,000 rehabilitation on that project. It has been renamed Villa Bonita Apartments and is about 76% occupied. But Vaz expects that rate to rise. On Sept. 1, Conti made its first move into Houston when it bought the note on the 266-unit Lenox Court Apartments for $3.45 million. Conti bought the complex out of foreclosure from a national insurance company, has since renamed it and plans to sink more than $1.4 million into renovations. While the company has only acquired 2,000 units in 2009, the goal for the year is to get close to 10,000 in the portfolio, Vaz said. A couple deals are in the works that could help Conti reach that goal, he said. Conti isn't the only company positioning itself to take advantage of apartment sales, experts said. Projections are that 45 apartment properties will be sold in the D-FW area this year, an additional 55 will take place in 2010 and 75 in 2011, Brian O'Boyle, managing broker of the Dallas office of Atlanta-based Apartment Realty Advisors, recently told the Dallas Business Journal. As recently reported, Bostonian Investment Group, a Boston-based multifamily investment syndicator with an office in Dallas, is raising as much as $100 million for a private equity fund that will focus on buying mortgages backed by distressed multifamily properties in North Texas... "(The Conti Organization) is smart, and they're early," said Michael Puls, president of the Dallas-based multifamily real estate consultants Foley & Puls Inc. | Archive
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