Street Smart Success Roger Becker

Most multifamily syndicators are facing major headwinds including interest rate increases, new supply, and escalating expenses. In order to thrive in this environment, you have to have an excellent organization that executes on business plans and maintains healthy working relationships with their lenders. Zack Haptonstall, Founder of Rise 48, has never made a capital call or missed a debt payment. For the properties he acquired in 2021, Zach’s now making distributions to investors. In the face of unprecedented rate increases, Zach accelerated the pace of renovations in 2023 and completed almost 2000 units. This enabled him to increase net operating income enough to continue making debt payments and distribute cash to investors. 

Eventually, ma and pa Mobile Home Park operators will be swallowed up by professional operators, so the opportunity to invest is now. The demand to live in Mobile Home Parks is growing while the supply is shrinking. The average Mobile Home Park owner stays in their home 17.5 years, some stay even longer. Many ma and pa owners, especially second or third generation family members, don’t reinvest into their properties and the assets become mismanaged and neglected. These parks can be great value-add opportunities for professional operators. Jack Martin, Co-founder and head of Investment Capital of 52/10, specializes in the acquisition, management, and development of Mobile Home Parks.

Even before covid, the Southeast was rapidly growing, but the trend accelerated during covid, and still continues. The population of Atlanta, for example, is projected to multiply three times in the next thirty years to over 15 million. Currently, office leasing activity in Atlanta is 80% of the volume of 2019, which was robust. As recently as 2022, however, companies were still questioning whether they would return to the office, now they’re focusing on the best way to outfit offices to best serve their employees. Joey Kline, a commercial Real Estate broker and Executive Vice President at JLL in Atlanta, helps tenants find new space or renew in downtown Atlanta and surrounding suburbs, plus other markets in the country.

Compared to most other Real Estate asset classes, Self-Storage has more resilience in the face of different economic climates. Self-Storage has a steadier revenue stream, a smaller percentage of operating expenses, and therefore greater margins and profitability. There’s also a shortage of self-storage facilities in smaller markets. Tom Dunkel, Managing Director of Belrose Storage, has acquired 14 Self-Storage facilities directly from sellers in the mid-Atlantic region and the Southeast, with big value-add components. Tom has consistently increased income and lowered expenses to achieve great returns for his investors. 

One of the time-honored ways to make money in Real Estate is flipping single family houses. For years, this is how many successful Real Estate investors have made a great living. In fact, many Real Estate moguls started with single family homes. Sharad Mehta, Founder and CEO of REsimpli, has flipped over 400 homes in Lake County, Indiana, 45 minutes outside of Chicago. Sharad currently owns 50 homes outright with no debt. As a home flipper and investor, Sharad recognized the need for better software to run his business. That’s why he created REsimpli, software that simplifies Real Estate investing by automating tasks that help investors manage their business more efficiently. 

Over the past several years, as prices in multifamily have escalated, the greatest value has been in acquiring older, C Class assets with the highest returns. As interest rates have pushed prices down more recently, however, and the market normalizes, great opportunities are also emerging in newer vintage Class B assets that don’t require as much work. Vadim Kleyner, CEO and Chairman of Smartland in Cleveland, is continuing to pursue lucrative Class C properties, but is also poised to take advantage of the course correction in B Class prices as well. Vadim has focused mostly on Northeast Ohio, but recently expanded to Miami, and is exploring other markets as well.