It's located two blocks from Indian Canyon, and the downtown Palm Springs tourism and entertainment scene. Built in 1980, the structures look good, and surrounding properties are up-scale condominiums and good hospitality.
The numbers look good to me:
- Positive leverage: this is what we call it when the cap rate is greater than the loan interest rate. In other words, the investor is making money on the loan.
- Rents are increasing: the market is very strong for apartment properties, with low vacancy and increasing rents.
- Location, location... oh, you know: not only is the property close to the Indian Canyon corridor, it's adjacent to The Courtyard, the site of the International Film Festival and the Tahquitz Road business community. I walk this area for enjoyment and exercise regularly.
- Cash on cash: a buyer may well buy the property for less than the asking price, and raise rents, and end up with a, say, 17% cash on cash return (this measures the net annual cash flow divided by the down payment, a good rule of thumb comparing investments). This could be the best deal around in a large apartment property.
It'll take a couple of million to get the property, but it may be the best two million an investor can place. Call me for more information.
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