O’Fallon, Ill.—Gateway Multifamily Group has acquired the Park Entrance Apartments, a 78-unit multifamily community in O’Fallon, Ill., in the St. Clair County submarket of St. Louis. The property is 85 percent occupied and traded for $4.6 million, representing a 4 percent cap rate.
Park Entrance Apartments, which is on 5.4 acres, includes seven three-story buildings, with all of its units having two bedrooms. The buyer plans to invest $2.5 million to completely upgrade the interior of the units and enhance the exterior of the property.
Interior renovations will include the addition of new stainless steel appliances, energy-efficient heating and cooling systems, vinyl plank flooring, granite countertops, doors and trim, new paint, and plumbing/light fixtures. Exterior renovation plans call for the replacement of the parking lot, landscaping, and outdoor pool.
The acquisition marks the third property purchased by Gateway Multifamily Group in the St. Louis area in the last three years. “The Park Entrance Apartments allows us to grow our presence in the St. Louis market while also acquiring a property in a submarket that continues to experience strong rental demand,” said Gateway Multifamily Group Principal Raj Tut.
O’Fallon is a growth spot in suburban St. Louis. According to the Census Bureau, its population was about 21,900 in 2000. In 2015, about 29,000 people lived there. The transaction was arranged by BarberMurphy Group’s Paul Murphy, who represented both the seller and the buyer.