Paddock Club, 200 Units, Florence, KY
How We Got It Spyglass acquired the Paddock Club in August of 2012. Like Hawk Ridge before it, Paddock Club was a tired 1990’s vintage asset that provided a substantial value-add component. Located in a high-income suburb of Cincinnati with great schools, low unemployment, favorable demographics, and strong population growth, Paddock Club fit our acquisition criteria perfectly. Investment Rationale With rents and occupancy well above our original forecasts and expenses comfortably under budget, we grew the property’s annualized Net Operating Income substantially following closing allowing us to secure a large Supplemental Loan that was used to fund a special distribution to investors. We had originally projected this refinancing to be completed within 4 years of closing but got it closed well ahead of schedule. Results The property produced strong cash returns on investor’s remaining capital and was to remain a longer-term hold unless we got our “target” price. We got our target price and sold the asset in March 2020 and realized a 25.4% net IRR and a 3.51x multiple on invested capital (after exit costs and after the sponsor promote).