The benefits of investing with us
The National Association of Home Builders (NAHB) notes that 22% of adults between the ages of 25 and 34 still live at home. That’s a market of over 8.7 million potential new renters, according to the Kaiser Family Foundation and the Census Bureau.**
Millennials clearly have an increasing appetite for apartment living as younger members of the workforce understand that rental housing is more convenient and more affordable than ownership. As more members of Generation Z enter the rental market and seek off-campus housing or their own apartments, demand for multifamily will be bolstered by this emerging demographic wave also.***
Being able to sign a short-term rental contract is an advantage for workers of all ages who don’t want to get locked into a permanent job or home ownership. The flexibility available to renters seeking job opportunities across town or across the country is well aligned with today’s job market, particularly the growth of the freelance and work at home economy.
Unlike single tenant properties or office space, multifamily properties do not depend on one or a few tenants but spread the lease risk over many tenants. In addition, leasing and renovations occur year around one unit at a time thus helping to maintain cashflow.
Rather than purchasing one property at a time these investments allow for the acquisition of multiple “rental properties” within one or more buildings.
Borrow at Low Rates and Potential Tax Benefits
Historically low interest rates and a sound fiscal policy have created favorable lending conditions for multifamily acquisitions. Multifamily properties qualify for low interest rate borrowing which can enhance cashflow and make the property easier to sell. They also qualify for a shorter depreciation schedule providing higher deductions up front to shelter cashflow.
Student Housing Benefits
Recession Resistant Characteristics
Student housing has been deemed as recession-resistant because the market depends on enrollment. When the economy loses jobs, it tends to gain students increasing the enrollment numbers of universities, thus making the student housing properties more attractive.*
Universities - A Stable Economic Anchor
Higher education is important to the U.S. economy employing about three million people, and during the 2017-18 school year pumped more than $600 billion of spending into the national gross domestic product. Colleges and universities are some of the most stable employers in municipalities and states. Since March 2020 due to COVID 19, a number of Universities have been closed or are holding online classes only. This could happen again at anytime. The effects of the pandemic may adversely affect the investment.
New Development Potential
Our strategy utilizes selected, well located, close to campus land parcels to construct state of the art purpose built student housing facilities. The goal is to create high desirability and stabilized occupancy. In turn this will potentially drive future value.
We believe that renovating and creating value-add improvements to well-located properties will increase student housing demand to help realize higher returns over time.
Class A Acquisition Strategy
Our acquisition team, after exhaustive due diligence, buys brand new purpose built student housing generally directly from the developer. The 2 main required parameters are proximity to campus and quality construction and amenities. The goal is to operate and lease up the facility with our own property management expertise to drive rents and occupancy which should enhance future value for disposition.
Initial Target Investments
We believe multifamily and student housing properties have the potential to offer a variety of benefits that matter to investors: monthly cash flow, stable performance, inflation compatibility, appreciation, and tax efficiency through depreciation, all from a brick-and-mortar asset anchored by the economics of a stable and growing employment base location or the historical stability of a university.