Case Study: Mercer Tower – Mercer Island, WA
- AGM REAL ESTATE
- Apr 28
- 2 min read
In 2023, we acquired Mercer Tower, a 25-unit multifamily community located on the highly sought-after north end of Mercer Island. Through a comprehensive renovation program, we are targeting a transformative repositioning of the asset, driving a projected 50% increase in net operating income (NOI).
INVESTMENT SNAPSHOT
Phase: In Progress
Location: Pacific
Property Type: Multifamily
Size: 25 Units
Acquisition Date: 2023
Purchase Price: _________
Equity Raised: $3,000,000
Strategy: Value Add
INVESTMENT THESIS
Premium Location: Mercer Tower is ideally positioned on the north end of Mercer Island, offering immediate access to Seattle and Bellevue, highly ranked schools, and affluent demographics supporting higher rent growth.
Substantial Value-Add Potential: At acquisition, the property featured original interiors and deferred maintenance. Our comprehensive renovation plan includes unit upgrades, common area improvements, exterior enhancements, and operational efficiencies, designed to significantly elevate rental income and property value.
NOI Growth Opportunity: The renovation strategy is projected to drive a 50% increase in net operating income, repositioning Mercer Tower to compete with newer Class A properties at a fraction of replacement cost.
Strong Market Fundamentals: Limited new multifamily supply, high barriers to entry, and sustained rental demand on Mercer Island provide a favorable backdrop for execution.
CURRENT STATUS
Renovation Execution: Full-scope interior and exterior renovations are underway, with phased lease-up at newly established market rents.
Operational Improvements: Implementation of professional management practices and technology upgrades to streamline operations and reduce expenses.
Market Positioning: Early lease-up activity supports underwriting assumptions, with demand for newly renovated units exceeding projections.
Exit Potential: Targeted disposition upon stabilization at significantly increased NOI or potential refinance to return capital to investors while maintaining ownership in a premier asset.
