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Buying Distressed Homes in Dallas and Fort Worth

September 30, 2009

Buying distressed homes in the Dallas and Fort Worth area is one of the investment goals of Dallas-based property investor Carlos Vaz and his company called The Conti Organization.

Over the past year, Vaz and his firm have already spent $9.94 million in buying distressed properties. Now, the Conti Organization has around 2,000 housing units valued at over $40 million. It has closed ten property transactions in two years.

For this year, Conti has started its second investment fund with $10 million. It plans to acquire distressed and foreclosed apartment properties and then renovate them.

Among the distressed multifamily properties that Vaz has already acquired this year is the Villa Bonita Apartments located in Dallas. The apartment building was formerly part of a development at Eastfield Village. It paid $3.2 million to acquire 232 housing units from a bank and then renamed the development as Villa Bonita.

Conti has already completed about 90 percent of the $800,000 needed rehabilitation of the complex and around 76 percent of the units are already occupied. It expects the occupancy level to rise as the rehabilitation project is completed.

In the first week of September, Conti put into action its goal of buying distressed homes in Houston. It paid $3.45 million to acquire the 266-unit apartment complex called Lenox Court Apartments, which has been foreclosed by a national insurance firm. It has renamed the apartment building and has allotted over $1.4 million for renovations.

So far this year, Conti has already acquired 2,000 housing units, still far from its goal of purchasing 10,000 units by the end of the year. Vaz said that he is currently negotiating deals that could help the firm reach its goal.

Conti is just one of many real estate investment firms targeting distressed multifamily complexes in the Dallas-Fort Worth area. Brian O’Boyle, manager of the Dallas unit of Georgia-based Apartment Realty Advisors, said that 45 apartment buildings will be purchased by the end of the year and that an additional 130 apartment buildings will change owners in 2010 and in 2011.

Bostonian Investment Group, a multifamily investment firm based in Boston, has been raising $100 million to acquire distressed multifamily buildings in North Texas.

Another Dallas-based property investment company, J Alexander Realty Group, is raising its own $10 million to buy smaller apartment complexes.

Meanwhile, a Los Angeles-based investment firm called Learning Links Centers, has been readying up to $40 million in funds for buying distressed homes and multifamily complexes in the Dallas area over the next 12 months.

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