Overview

Located in Worcester MA, Tatnuck Square (the “Property”) is a 120-unit, Class C+/B- apartment community built between 1969 and 1972. The Property sits along Brookside Ave and Mill St, in the West Tatnuck neighborhood of Worcester which offers some of the priciest homes in the city. Route I-290 and downtown Worcester are just 3 miles from the Property. The I-290 provides residents connections and access to the Mass Turnpike (I-90) which is a direct route to Downtown Boston and Logan Airport in 60 minutes. There is also an MBTA commuter rail service to Boston and Worcester Airport less than 2 miles from Tatnuck Square. The apartment complex attracts a host of middle-class workers who typically have a workplace less than 20 miles from their residence. This type of tenant and property is consistent with Arrowpoint’s current and historical portfolios, and one that the Company is most familiar with. Arrowpoint is purchasing the Property for $26,700,000. and has obtained conservative, fixed-rate debt from a local savings bank headquartered in Worcester, MA. UniBank for Savings (the “Bank”) will provide a loan amount of up to $18,355,000 (fully funded with CapEx). Additional equity in the amount of $5 million (48%) has also been secured by a “preferred equity” group called Base Equities out of Los Angeles, CA. Arrowpoint will contribute up to $2,085,000 (20%) from its internal fund (Arrowpoint Multifamily Fund I or “AMFI”) and is looking to raise an additional $3.34 million (32%) to complete the $10,425,000 in total equity required to acquire, renovate and operate the Property. The additional equity of $3.34 million and funds from AMFI will be considered “common” equity and will be subordinated by the preferred equity in this deal. Value-Add Opportunity-This investment represents an excellent opportunity to create additional value through continued unit renovations and revenue growth. The Property, though owned for a short time by a national investor, made several improvements costing well over $2 million. We are acquiring a well-maintained property with plenty of room left to grow rents organically as well as continuing a unit renovation program and adding new amenity space. Arrowpoint sees a tremendous opportunity to implement its proven “value-add” strategy that will continue to raise the Property value, increase revenues and create very attractive returns for investors.