HPGA Real Estate Strategy

Deal Sourcing

  • Source deals through reputed brokers
  • Mid-Market Sector (A,B & C Class)
  • Work force Housing with Value Add
  • Analytics driven Acquisition Criteria
  • Adherence to Established Criteria
  • Quality Assets in Decent neighborhoods
  • Underwriting based on historic averages
  • Consult Industry experts in Target market
  • Emphasis on Location & Environmental Issues
  • 18% to 25% Investor IRR & 1.5X to 2.0X Equity Multiple

Acquire

  • Checklist driven Detailed Property Tour
  • Checklist driven Detailed Manger Interview
  • Market Survey before LOI
  • Budget & Proforma Rents before LOI
  • Negotiate Early Access to mitigate Risk
  • Aggressive terms versus Price
  • Thorough Due Diligence with 2 vendors
  • Up to 75% LTC Non-Recourse Loans
  • Non-Recourse Bank loan – Deep Value add Deals
  • Vendors from Exterior Upgrades
  • In-house for Interior Upgrades

Stabilize & Add Value

  • Stabilize with operational efficiency
  • Address Safety & Deferred Maintenance Items
  • Upgrade to Increase Rental Income
  • $1K to $6K/Unit Rehab Budget
  • Optimize Expenses & Push other Income
  • Aggressive Conservation (Water/Electric)
  • Traffic Monitoring & Improve Marketing
  • Performance based Incentive for Property Managers
  • Extend Quality Customer Care to tenants
  • Distribute Cash Flow Quarterly
  • Sell / Refinance in 3-5 years

Market and Asset Criteria

  1. Primary & Secondary MSA’s in Landlord Friendly Growth Markets
    • Markets which display consistent above average Jobs & Population Growth
    • Markets which consistently display strong rent growth
    • Markets with very diversified demographics and employment opportunities
    • Markets which are business & landlord friendly
  2. Mid Market Segment
    • Work force Housing
    • A,B & C Class Assets
  3. Value –Add & Core Plus Assets
    • Proven/Verifiable Value- Add potential
    • Underwrites to Stabilized Cash flow of 8% (in 6 to 24 months)
  4. Location of the Asset with
    • Min. $36K HH Median Income in 1-mile radius (Gross Annual Income = 3X Rent * 12 months @ $1000/Unit Ave. Rent)
    • Proximity to major economic drivers & employment opportunities
    • Access to major highways with at least 5k vpd street traffic
    • At least 20% Hispanic Demographic in 1 Mile Radius (Fastest Growing Demographic in US)
    • No Concentration above 20% of Housing tenants, Same Employer
    • No Crime issues (Aggravated Assaults and Shooting etc..)
    • No Rent restrictions