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A FORWARD LOOKING INVESTMENT APPROACH

WITH TAILORED EXECUTION

OUR

STRATEGY

CORE/CORE-PLUS INVESTING

Stabilized income-producing properties provide a steady income stream and are generally considered to be lower risk. Targeted properties are substantially fully leased and carry an estimated 3 to 5-year investment hold. Acquisitions of such properties offer an average 8% – 12% annualized quarterly income stream with the opportunity for additional return through property appreciation at sale or refinance.

VALUE-ADD INVESTING

We seek to acquire undervalued properties and increase their performance through repositioning efforts and effective management practices. Through the implementation of a detailed redevelopment, realignment, operating and exit strategy, annual project returns range are targeted between 18-20%.

OUR

INVESTMENT APPROCH

Acquire Properties at an Attractive Basis

  • Target sub-250 units middle market properties priced below $45M per individual asset
  • Acquire multifamily assets with proximity to gain operational benefits of submarket scale
  • Leverage local relationships to source off-market transactions and identify motivated and/or distressed sellers
  • Seek to acquire assets w/ deferred maintenance at a significant discount to replacement cost from undercapitalized sellers
  • We structure our acquisitions with moderate leverage, seeking fixed-rate debt terms with a maximum portfolio-level leverage threshold of 75% LTV
  • Closing on marketed assets at a discount to intrinsic value Significantly Increase Cash Flows Through Aggressive Leasing and Cost

Significantly Increase Cash Flows Through Aggressive Leasing and Cost Control

  • Increase NOI through operational improvements and rent maximization
  • Seek to fill vacant units and maximize rents via (1) optimizing unit layouts and (2) leveraging submarket scale for tenant referrals
  • Mom & pop operators typically do not maximize rents, especially after long periods of ownership
  • A proactive approach to asset management leads to significantly reduced operating expenses (superior margins vs. unsophisticated competitors)
  • Utilize technology and processes for rent collection and tenant communications

Stabilize and Improve Properties

  • Comprehensive underwriting, capital planning, and project management capabilities
  • Renovate dated units and add bedrooms to drive rent growth and enhance property values
  • Identify and remedy maintenance issues at the time of acquisition to extend the useful life of major building components

Drive Returns via Distribution of Income, Return of Capital via Refinancing Stabilized Properties / Value Lift at Exit

  • Seek to stabilize operationally-challenged assets within 12 months of acquisition
  • Deliver a repeatable investment product by operating w/ consistent margins, sustained revenue growth, and attractive distributions
  • Gains were driven by increasing cash flows and attracting a larger buyer base seeking stabilized assets
  • We seek to achieve mid-teens gross IRRs and strong multiples of invested capital (“MOIC”) over the investment horizon on each individual investment
  • We target an up-front high single-digit stabilized distribution yield with an emphasis on the return of capital

OUR TYPICAL

INVESTMENT CRITERIA

Asset Type

Geography

Transaction Size

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