Investment Strategy

 

Acquire mispriced and/or undermanaged commercial, multiresidential, and single-family real estate assets located in the southwestern and southeastern United States.

The company managers will leverage their broad network and extensive relationships to identify commercial, multiresidential, and single-family real estate assets that they believe to be mispriced and/or undermanaged in the targeted key markets. Many of these opportunities will be “off-market,” meaning that they are not widely marketed for sale.
 
The company managers will conduct an in-depth, detailed analysis during the acquisition process, including site inspections, market analysis, cash flow models, lease review, environmental and structural assessments, and legal due diligence.
The managers will seek debt financing terms from various lenders, finalize due diligence and debt financing with the selected lenders, and finalize the acquisition of additional properties.

 

Apply the sponsor’s professional active management philosophy to stabilize the assets and increase revenue.

Following the acquisition of an additional property, the company managers will promptly implement a professional active management strategy with the objective of stabilizing the asset and increasing operating revenue with minimal capital investment. The company managers benefits from a large network of local professionals. Utilizing these resources and its professional management expertise and experience, the company managers plan to increase margins and maximize operational revenue by (a) improving the quality of the tenant and tenant profitability using enhanced credit verification and stronger disciplinary measures for problem tenants, including eviction, and (b) improving the operations, customer service, and cleanliness of a property, thereby enhancing tenant loyalty, increasing margins, and maximizing operational revenue.

 

Renovate and reposition the assets.

In conjunction with the stabilization of an acquired asset, the company managers will begin a value-add renovation and repositioning program to allow for the repositioning of the asset within the marketplace, with the objective of increasing monthly rents and potentially generating a significant gain upon the divestiture of the asset.
 
The company managers will make structural and cosmetic renovations to the building’s common areas and apartment suites as well as improvements to the building’s energy systems.
 
The enhanced cosmetic appeal of the building is designed to allow for the repositioning of the building into a higher market for the purpose of reducing vacancy rates, while energy system upgrades—such as low-flow water technologies and high-efficiency lighting and air conditioning—will result in a decrease in energy consumption and improved operating margins.

 

Realize value through sales of properties.

The company’s exit strategy will be to seek to exit an investment promptly upon completion of the renovation and repositioning program in order to maximize returns for investors. The company managers will seek the highest value obtainable for each of the company’s repositioned assets.
 
The company believes that other suitable purchasers of the assets include public U.S. real estate investment trusts and pension funds with lower costs of capital.
 
The company managers have proven track records of sourcing, acquiring and repositioning commercial, multiresidential, and/or single family assets through capital investments in cosmetic, structural, and energy management systems, and by implementing professional property management strategies.

 

 

 

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