Case Study- Vantage at Tomball

Vantage at Tomball
(Midwest Multifamily)

 

Prevail Alternative Assets – in partnership with ClearWorth Capital – is pleased to announce Vantage at Tomball – a multifamily acquisition opportunity located in beautiful Tomball, TX, a NW suburb of Houston, TX. Vantage presents an opportunity to acquire a recently-developed asset in a growing corridor with favorable macroeconomic trends.

Vantage at Tomball is a rare newly constructed asset (2022 vintage) in a booming submarket surrounded by multiple Fortune 500 employers, fantastic school districts and direct access to the every growing Grand Parkway Toll Road (TX-99).

ClearWorth Capital specializes in revitalizing and repositioning underperforming multifamily real estate assets – they have 25 years of experience in the greater Houston area and have developed, acquired, and managed 3,000+ units within 10 miles of Vantage.

If you are interested in this opportunity or have any questions, please reach out to your advisor or contact Regan Smith at rsmith@prevailiws.com

Investor Return Summary*

      • LP Common Equity Contribution
        Class A Common Equity – $4,000,000
        • 9% Preferred Return
        • Net IRR Target: 24% – 26% (36 Month Hold)
        • LP Net Equity Multiple Target: 1.92x
        • Stabilized Cash Yield Target: 6.50%

      • Class B Common Equity – $3,019,632
        • 9% Preferred Return
        • Net IRR Target: 24% – 26% (36 Month Hold)
        • Net Equity Multiple Target: 1.83x
        • Stabilized Cash Yield Target: 6.50%

Investment Snapshot

        • Total Project Cost – $43,888,480
        • Senior Loan – $29,003,337
          • 65.2% Loan-to-Cost
          • 5.95% All-In Rate
        • LP Equity – $15,019,632
          • Prevail Equity – $11,000,000 (46.7%)
        • GP Equity – $1,668,848

Property Information

  • We are purchasing a 2022 vintage asset from the original developer at a price significantly below replacement cost. A previous buyer was seeking tax-credit agreements and was rejected, which led to the buyer backing out. The developer extended their loan one final time and was forced to sell.
  • No other multifamily units are under construction or proposed within 5 miles of this asset. Within a 10-mile radius from the asset, only 2 other multifamily properties are under construction. The area is undergoing rapid absorption of existing multifamily units, which we believe will create a favorable supply/demand dynamic after acquiring the asset.
  • Two Fortune 500 companies – ExxonMobil and Hewlett Packard – recently relocated their headquarters to new campuses located 10 minutes from Vantage. Additionally, several retail and mixed-use developments have been delivered in the last 5 years. Retail in the immediate surrounding area includes 2 HEBs, Target, Sprouts, Cinemark, Academy Sports, and 20+ restaurants. Affluent areas like The Woodlands, Tomball, Spring, and Klein are all located within a 15-minute drive from Vantage.
  • We believe Vantage at Tomball’s zoning to Klein ISD – combined with 2-and-3-bedroom floorplans and amenities – will make it an attractive place to live for both individuals and families.

*These are all preliminary estimates, with no guarantee of performance, and involve risk.

Important Information

This communication is neither an offer to sell nor a solicitation of an offer to buy any security. An offer may only be made via a written offering document by Prevail Alternative Assets, LLC (“Prevail”). Prevail will provide such offering documents (“Documents”) only to qualified accredited investors and has prepared this communication solely to enable you to determine whether you are interested in receiving additional information about it or the real estate project summarized above (the “Project”). This communication must be read in conjunction with the Documents prior to making any investment decision. Information about the Project contained herein has not been audited or reviewed by any third party. While projections about the Project’s future performance is based on Prevail’s experience and good faith judgments, the recipient should understand that projections are based on numerous assumptions, including that the current economic environment continues, that existing asset performance trends will continue to track business plans, that historical behavior of the Project’s property type will not change, that perception of market opportunities for disposition will hold true, and that the competitive landscape within which the Project operates will not change. Returns to investors would be contingent upon numerous events occurring and subject to considerable risks. Significant assumptions were made by Prevail to calculate the presented projections, including assumptions on the amount of leverage used by the Project, the Project having sufficient assets and cashflows, debt service and capital expenditures, the continuation of favorable leasing terms, the operating costs for the Project, the costs of taxes and insurance, the absence of claims against the Project, that lease terms (including rental rates) continue, that projected occupancy and rollover rates continue, that management and other expenses remain constant, and that property-level debt will not need to be refinanced at less favorable terms.

The Project’s future capitalization will be contingent upon numerous events occurring and subject to considerable risks. The occupancy and rollover rates of the Project will be dependent upon many factors beyond the control of the Project or Prevail. Any expression of targeted rates is merely a statement of a goal. Significant assumptions were made by Prevail to calculate the presented occupancy and rollover rates. Many factors can impact the Project’s after-tax returns, including the risk that tax laws may change. A myriad of factors may impact the Project’s ability to achieve any returns. Any number of factors could contribute to results that are materially different. All investment opportunities presented by Prevail involve substantial risk and may result in the loss of some or all of your investment. Please do not forward this email.

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