We hope that you are settling in well to the new year. Walls Property Group has been hard at work in 2020 getting the final certificate of occupancy and inspections signed off at Bugge Apartments. Here’s what that meant for you.
As you are all aware, we refinanced Bugge Apartments with Banner Bank and received the wire for $620,000 on Friday, January 10th, 2020. Click here for more details regarding the proceeds from the initial wire and how we used the funds from the holdback. The holdback was put in place until the commercial space was occupied. The amount of the holdback was $270,000 and was released after the space was occupied.
We successfully executed a lease for the commercial unit and the new resident occupied the space on January 17th, 2020. The 6-month lease was signed at a rate of $1,575/month. The lease term will be up in the summer, when we will be in a stronger leasing environment. Our units typically rent for higher prices in the summer versus the winter and using a short term lease strategy to fill this vacant unit allows us some flexibility. In this case, we had a holdback that was contingent upon the space being occupied, and we feel this situation was mutually beneficial to both the tenant and WPG.
There are a few capital expenditures to address throughout the building for the upcoming year. Two of those are repurposing the garage into bike storage and updating the carpet throughout the common areas. We had previously mentioned removing the boiler from the building, but have decided that may be a project for some day down the road.
Bugge is stabilized and our plan is to pay quarterly preferred returns to all of our Bugge Investors. If you would like to change the way you receive these funds moving forward, reach out to me and I can help facilitate those changes.