Mitt Romney’s sons part of value-add apartment play in KC
A Salt Lake City-based real estate investment group that includes two sons of 2012 Republican presidential nominee Mitt Romney as principals is continuing its value-add multifamily play with the completion of two more apartment complex renovation and rebranding projects in the Kansas City area.
The company, Sundance Bay, held an open house from 3:30 p.m. to 5:30 p.m. Monday at Haven (formerly Madison Park Apartments) at 10500 Hillcrest Road, Kansas City. The company spent $7.9 million fully renovating the complex, which includes 388 one- and two-bedroom units.
In addition, Sundance Bay will host grand-opening ceremonies from 4-6 p.m. Tuesday at The Wilder (formerly Oak Park Village) at 9670 Halsey St., Lenexa. The firm spent $12 million renovating that project, which includes 510 one- through three-bedroom units.
Sundance Bay was launched in 2013 by veteran real estate professionals and Brigham Young University graduates Ryan Baughman and Stan Ricks, who immediately recruited Craig Romney and Matthew Romney to the firm. The Romneys, too, were graduates of BYU. But Baughman forged the Romney connection at Columbia University in New York City, where he and Craig Romney earned their master’s degrees in real estate.
Travis Olsen, director of development and construction for Sundance Bay, said the firm specializes in the acquisition, renovation and repositioning of Class B and C apartment communities, typically of 1970s and ’80s vintage.
“If it doesn’t have a mansard roof and shag carpet, we’re not interested in it,” Olsen said, adding that properties of that vintage have proved to offer the most profitable value-add opportunities.
Sundance Bay is also partial to the Kansas City market, which has 44 percent of the units in its portfolio. The company has 11 properties in six states, and five of them are in the Kansas City area. The company is a buy-and-hold investor, Olsen said, and another part of its strategy is to provide its own property management in markets like Kansas City where it has multiple properties.
Larissa Porter, Sundance Bay’s community manager for Haven, said one factor that has enticed the firm to invest in Kansas City has been its growth in jobs for young professionals, including the 16,000 Cerner Corp. will add at its new Innovation Campus, which is a half-mile from Haven.
Olsen said Sundance Bay will continue looking for new properties to acquire in the Kansas City area. But with the ongoing Class A apartment construction boom driving up rents, finding appropriate price points has become increasingly difficult, he said.
“We purchased Madison Park (now Haven) in April 2014 for $13.8 million, or $36,000 per unit,” Olsen said. “Now prices are trending over $50,000, sometimes $60,000 a unit.”
Olsen said older apartment communities are becoming popular value-add acquisition targets because they allow owners to offer fully renovated units and amenities for price points lower than those of the new luxury units flooding the market. In addition, he said, existing apartment communities are generally well located and feature larger floor plans than most new Class A projects.
At Haven, Porter said, units range from 696-square-foot one-bedroom units that rent for $700 a month to 1,055-square-foot two-bedroom, two-bath units that rent for $1,015.
Besides clubhouses and pools that look brand new, both Haven and The Wilder offer upgraded kitchen and bath fixtures, finishes and, in some cases, layouts.
“We hire architects and interior designers to help us with the renovations,” Olsen said. “That’s one thing that helps us stand apart from the competition.”
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About Sundance Bay
Sundance Bay is a private real estate investment firm headquartered in Salt Lake City. With over $1 billion of assets under management, Sundance Bay specializes in middle-market multifamily investing, net lease investing, and debt lending. Across its different verticals, Sundance Bay seeks to create lasting value for the Firm’s investors and communities in which they invest. For more information about Sundance Bay, please visit SundanceBay.com.