We enter all our multifamily investments with a proper plan, prepared for the unexpected and have a solid idea about potential costs. Specifically, our key risk mitigation approach is focused upon the following components:
FOCUS ON INVESTOR CAPITAL PRESERVATION: We develop a strategy to protect investor capital with a variety of available tools. Investment decisions are made with the primary focus on structuring investor capital for safety. Investors do not fear loss of principal, especially in a market downturn.
MARKET RESEARCH: We conduct comprehensive market research at the micro level. Prior to purchasing a property we know what improvements or new amenities result in higher rents, as well as know what renters want that we can easily deliver for them.
PURCHASE RIGHT: We buy the asset at the right price, with the right financing. We ensure that we are not over-leveraged or taking on too much debt, especially in a market downturn.
PROPERTY DUE DILIGENCE: We perform thorough property inspections and go over records with a fine-toothed comb. A property in bad condition or full of poorly screened residents is bound to provide financial headaches which we identify and plan for in our purchases.
TEAM APPROACH: We have the right team of experts for property inspections and financial record analysis. This allows us to effectively predict the costs of:
Deferred maintenance (immediate cash needs)
Capital improvements (cash reserve needs)
Loss of income from vacancy and/or poorly screened tenants
Renovations and improvements
PROFESSIONAL MANAGEMENT: We hire a property manager for our apartments. Having someone manage maintenance work, answer phone calls, offer customer service, and handle tenant reviews and complaints is essential to our strategy.
REALISTIC BUDGET: We create together a realistic look at property income and expenses during your first year or two of ownership. A pro forma budget analysis is used to assist us to avoid needing to raise more cash in the near future.