MultiFamily Connections, LLC specializes in making investments in existing apartment communities where we can provide Quality Workforce Housing to our residents. This type of housing can only come from EXISTING SUPPLY due to the high cost of new construction which requires premium rental rates to justify the investment. There continues to be an ever-increasing demand for Quality Workforce Housing due to changing demographics and trends. FIXED SUPPLY and INCREASING DEMAND is a GREAT combination when you are making a multi-year commitment to an investment!
Targeted Returns during Underwriting
Returns in a Multifamily investment come from two activities:
- The first return comes from the cashflow that is generated from ongoing operations. We only consider properties that can provide our investors an average annual return on their investment of six to eight percent during the hold period. This return is the most predictable during the underwriting process.
- The second return comes when the property is sold and is much less predictable during the underwriting process. The exact timing of sale is unknown due to the possibility of unfavorable market conditions at the time of the planned sale. Our goal is to double our investors money from ongoing operations and the sale of the property in five to eight years.
Our Investment Criteria
- Target properties located in growing Midwestern Cities with population greater than 250,000
- Acquire existing, stabilized Class B- to C+, 100 to 200-unit apartment community, in a location that has diverse, stable or growing employment opportunities in a Class B+ neighborhood.
- The apartment community should be underperforming due to lack of capital for needed improvements and/or proper management.
- Invest capital, as needed, to upgrade interior’s of each unit and the exterior and amenities to market levels during the first two years.
- Increase the rents up to market levels, at least 15% to 20%, based on the new level of quality living you are providing the residents.
- Hold the property for five to ten years.