STRATEGY
Factors Contributing to Demand
- Low Multifamily Construction Starts:
Due to tighter lending policies for new construction, new multifamily project developments are at multi-decade lows - Declining Home Ownership:
Demand for rental properties has steadily risen due to appreciation in home values and stringent lending policies - Rental Trends:
The Millenial generation is more likely to rent than buy - Class B & C Recession Resilience:
During good economies and bad, B & C class multifamily properties maintain higher levels of occupancy
Market Lacks Sophisticated Buyers and Owners for B/C Class Properties
- Limited Competition:
Institutional buyers often pass on these classes because they are looking to put more capital to work in larger properties with a more sophisticated ownership base. This creates an opportunity for a buyer such as TPCG - “Low Hanging Fruit”:
The lack of owners’ sophistication lends itself to multitudes of opportunities to increase operational efficiencies and NOI
Selection Criteria Highlights
- Supreme, densely populated location in desirable areas of Houston
- Strong fundamentals in property’s submarket
- Close proximity to major employment centers
- Favorable demographic trends
- Potential for RUBS / utility bill back
