Our Investment Strategy
We locate hidden potential in multifamily assets and exploit our superior vertically integrated capabilities to renovate and reposition apartment communities and obtain steady returns that consistently surpass the market.
Why Multifamily?
We believe multifamily housing is superior to other classes of real estate for several reasons.
Less Volatile
The dual combination of higher single family home prices and interest rates has created a generational low in affordability for home ownership. This has forced increasing numbers of Americans into the rental market, driving higher rents and occupancy rates.
More Resistant to Recession
Housing is not discretionary spending, leading to increased stability in the sector versus alternatives.
Closely Hedged Against Inflation
Due to the typical 12-month lease, rents can rapidly adjust to inflationary pressures relative to other real estate classes that feature longer lease terms.
Positioned for Increased Valuations
Persistent undersupply of new housing units combined with continued demographic growth indicates strong potential for rent growth in the medium-term.
Why Value Add?
We believe multifamily housing is superior to other classes of real estate for several reasons.
Attractive Valuations
Substantial capital has been deployed into core strategies for investors seeking moderate yield from high quality assets. This has led to attractive valuations for properties in need of interior renovations and amenity enhancements.
Large Pool of Candidate Assets
Nearly 50% of apartments in the country were constructed prior to 1980. This means there is a large pool of candidate assets to source from.
Growing Demand for Premium-Quality Units
Would-be homeowners forced into the rental market are higher-income and seek premium-quality units. This creates a prime opportunity to revitalize older properties in desirable locations and capture this demand.
Why Now?
We believe multifamily housing is superior to other classes of real estate for several reasons.
Loan Availability
Even as financing has dried up for other real estate classes, multifamily loans are still readily available from government-backed agency options including Fannie Mae, Freddie Mac, and US Department of Housing and Urban Development.
Decreasing Vacancy Rates
Multifamily vacancy rates are below historical norms and continue to decrease, fueling continued rent growth.
Favorable Conditions Compared to Other Real Estate Assets
Commercial real estate is experiencing a cyclical downturn with pricing divergences across property types, geographies, and asset classes.
Winning Opportunities For Competent Operators
Most incumbents are endeavoring to reduce risk in distressed areas, but dislocation is offering opportunities for new investors across public and private markets.
Investors with deal access who can competently operate assets in areas pushed forward by high-tech innovation, changing demographics, and sustainability will outperform.
Why Dallas?
We only invest where we have a competitive advantage.
Locating candidate assets that are optimal for revitalization demands an intimate understanding of a niche market. Our founders have a combined 75 years of local experience in Dallas-Fort Worth, offering an unrivaled perspective of local nuances that have an outsized effect on value.
Additionally, we believe Dallas-Fort Worth represents the most attractive market for multifamily investment and is well-positioned to continue its advantage into the future.
Population Growth
In 2022, DFW added more new residents than any other metropolitan area, particularly from domestic migration, benefiting from a broader shift southward across the county.
At the current pace, DFW will surpass Chicago as the third-most-populous metro by 2030.
Corporate Relocations
More than 175 corporate headquarters have moved to Dallas-Fort Worth since 2010, including eight Fortune 500 companies in the past six years.
Charles Schwab, CBRE, Jacobs, Core-Mark, McKesson, AECOM, Frontier Communications, and Caterpillar have all relocated to the area.
Relative Affordability
The Dallas-Fort Worth metropolitan area features a rent-to-income ratio of 20%. Well below other major markets:
- New York City (68%)
- Miami (42%)
- Los Angeles (36%)
- Boston (33%)
- and San Francisco (30%)
This relative affordability lowers tenant default risk and offers upside for rent growth.
Business Friendly Economy
- Permissive and predictable regulatory environment
- No personal or corporate income tax
- Right-to-work laws
- An expansive and well-maintained infrastructure including the second-busiest airport in the world, a large highway network, expanding rail access, and a central geographic location.
- Major universities contributing to a diverse and highly-skilled workforce.
- Geographic room to expand owing to a lack of water and mountains
