420 Pyka Rd, Fredericksburg, TX 78624

Sunstone Real Estate Advisors is pleased to present the opportunity to acquire Windmill Oaks, a 44-site manufactured housing community offering a stabilized, cash-flowing asset with meaningful upside through rental realignment. The property is currently 100% occupied, with all sites tenant-occupied, providing immediate in-place income and minimal operational complexity. Current average lot rents are approximately $425/month, which are significantly below projected market levels, creating a clear path for revenue growth. With full occupancy and stable tenancy, the asset allows investors to focus on rent optimization rather than lease-up. This positioning provides both stability and immediate upside potential. In addition, the property offers a compelling expansion opportunity, with the ability to at least replicate the existing 44-lot layout and potentially increase density further, subject to buyer preference and compliance with city guidelines (see data room for details).

The primary value-add opportunity is driven by phased rent increases, with projected rents growing from $425/month to $700/month over a three-year hold period. Rents are underwritten to increase to $525 in Year 1, $625 in Year 2, and $700 by Year 3, while maintaining full occupancy. This strategy is supported by strong demand for affordable housing and aligns the property with market comparables. Additional upside is achieved through professional management implementation and modest expense controls. These initiatives collectively drive predictable revenue growth and improved operational performance.

Financially, the property demonstrates strong income growth, with Net Operating Income projected to increase from approximately $141,000 to $267,000 by Year 3. Total revenue is expected to grow to over $396,000 annually, primarily driven by rent increases. Expense ratios remain efficient at approximately 33%, reflecting a low-cost operating structure and strong margins. With limited capital expenditure needs and a straightforward business plan, Windmill Oaks offers a highly executable investment. Overall, the asset presents a compelling core-plus opportunity with stable cash flow and clear, achievable upside through rent normalization.

Overall, Windmill Oaks represents a compelling core-plus manufactured housing investment with immediate cash flow and substantial upside through rent increases alone. The combination of 100% occupancy, below-market rents, and strong projected NOI growth provides a clear and achievable path to value creation. Investors have the opportunity to capitalize on a proven rent growth strategy in a market with limited affordable housing supply. With stable operations and significant embedded upside, the asset is well-positioned to deliver both near-term yield expansion and long-term appreciation.