The Key to Multifamily Asset Management: Controlling Costs and Creatively Adding Value

Every so often I scan through the real estate forum on Wall Street Oasis and I recently came across an interesting thread titled ‘Contrarian Thesis: Acquisitions is the Least Interesting Job in Real Estate’.  The post argued that acquisitions is a repetitive job wrought with frustration and best-suited for young analysts who are hungry and proficient with the latest technology. Asset and portfolio management, on the other hand, tend to be the most valuable and interesting roles. The asset managers recognize the value-add upside, know what it cost to renovate, have intimate knowledge of...

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The Multifamily ‘Amenities Arms Race’ Shows no Signs of Slowing

Multifamily development has picked up considerably over the past few years, as the demand for high-quality apartment communities near major employment centers and entertainment has increased. Driven by demographics, couples getting married and having kids later, lifestyle choices, and pent-up demand, millennials, Gen Z, and some Baby Boomers are flocking to newly-developed class A communities. These individuals seek a lifestyle and expect way more than a nice place to live; they desire conveniences, technology, a robust resident event program and sense of community, and amenities. Lots of...

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The Key to an Effective Value-Add Strategy: Hands-On Oversight

In my role at Atlas, I oversee our value-add multifamily strategy. We buy 1970’s – 1990’s class B value-add properties and seek assets that are priced below replacement cost and comparable sales, where we can add value at then property level, and that are in markets we like long-term. Adding value is hard. It requires a hands-on approach, local market knowledge, creative-thinking, and great management skills. At Atlas, we’re a lean team and hire 3rd parties to assist with property management, construction management, design and architecture, and marketing. As such, my role is largely...

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5 Things I learned in 2018 and 5 Goals for 2019

Happy New Year, everyone! I hope you're able to unplug and enjoy quality time with family and friends. I find that time off, completely disconnected from the day-to-day grind of daily work is key to regaining focus and igniting the spark of creativity. 2018 was another productive year on ASotREG. I rolled out a site redesign (ASotREG 3.0), launched a new eBook on passive real estate investing, and published 14 new posts. I’m incredibly humbled and appreciative of everyone who has given me their attention. Your time is the most valuable asset you have, so it inspires me to do everything I...

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Who Says Workforce Housing Can’t be Sexy

Historically, class B/C garden-style apartment communities have been typified by dated 70’s/80’s architecture, uninspiring interior design, lackluster landscaping, and boring commodity amenities. Recently, the divide between class A and class B/C apartment communities has been exacerbated by the amenity arms race, with each new development looking to outdo its competitors. It’s common for new communities to include golf simulators, meditation rooms, indoor self-cleaning dog parks, rooftop pool/lounges, and generally over-the-top design and features, while class B communities still have...

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Integrating Data Across the Real Estate Life-Cycle

As the real estate industry becomes more institutionalized, there is greater demand for quality data. Data is the key to making informed decisions. Having a solid grasp of the current cap rates, financing markets, vacancy rates, rent growth projections, construction costs, population, employment, and income growth, are all critical to accurate deal underwriting and execution. However, most real estate professionals (myself included) only have access to select data-sources, providing limited data which may or may not be out-of-date. The data we maintain internally...

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Aspects of the Real Estate Acquisition Process I find Frustrating

Over the past several weeks, I’ve been deep in a new value-add multifamily transaction. Acquiring real estate is cumbersome, complex, and opaque, yet we continue to complacently accept this reality. Part of the issue is that acquiring real estate is very fragmented, with different players collecting disparate data, requiring 3rd parties, and all profiting from different elements of the process.  This complexity is exactly where opportunity lies. Based on my recent experience, here are a few of the aspects of the acquisition process I find most frustrating. Deal Sourcing The deal sourcing...

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How to Make Apartment Features and Amenities Sounds Sexy

We recently embarked on a project aimed at improving the online marketing process for all our multifamily properties. The intent was to greatly improve our web presence, access deeper analytics, build a multifamily brand, and control the process from the ownership-level. Since we utilize 3rd party property management, each asset utilized a different website template, property management software, paid search marketing strategy, lead tracking process etc. From the ownership side, we had little transparency into the effectiveness of each marketing channel and were unable to make data-driven...

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The Challenge (and Benefit) of Quarterly Reporting in Real Estate

In the wake of new regulation and rise of real estate crowdfunding platforms, there’s been significant growth in private real estate syndications where operators pool capital from a group of high-net-worth investors to acquire a property and execute a specific investment strategy. In the past, real estate syndications were done on a trust-basis; operators would go out to a handful of their buddies to raise the capital. Under this structure, reporting was less important. If things didn’t go as planned, operators had to deal with their uncle, best friend, and golf...

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The Real Estate Software Powering Our Growth: Featuring Dealpath

Over the past 7 years, Atlas has acquired 45 properties with a total deal value of ~$800M. Over that time, we’ve grown from 3 guys in a 100 SF shared office, to an integrated team with 5 operating platforms. It’s been a wild ride full of exciting expansion, but along with rapid growth comes growing pains. To continue to scale our acquisition process, we needed to put processes in place to efficiently manage investor reporting, asset management, acquisitions, and company operations. Luckily, real estate-specific software companies have sprung up to bring efficiency...

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Why we Prefer Value-Add Deals and Long-Term Holds

Real estate firms and investors each form their own investment strategy based on their risk-tolerance, desired hold period, expertise, and target returns. Some prefer core or core-plus investments which are typically high-quality assets in primary markets with little unrealized upside, while others prefer opportunistic investments such as ground-up development. Here at Atlas, we target primarily value-add transactions where we can execute a specific strategy with the aim of refinancing upon stabilization and holding long-term.  Value-add transactions possess upside...

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What’s Your Moat? 4 Forms of Sustainable Competitive Advantages at Atlas

The key to success in real estate investing (and business) isn’t simply finding a competitive advantage, it’s having a sustainable advantage that others are unable to replicate. Warren Buffet popularized the term economic moat, which refers to a “business’s ability to maintain competitive advantages over its competitors in order to protect its long-term profits and market share from competing firms.” As real estate becomes more institutionalized, the typical competitive advantages are arbitraged away; Informational advantages, even in secondary and tertiary markets, are not sustainable....

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Landing Your First Analyst Job in Commercial Real Estate

Having conversations with industry experts and talking as little about yourself as possible is the best way to learn. It's why I love the blog format so much - I get to engage with interesting people and invite them to share their experiences with all of you. I love being the less knowledgeable person in the conversation and asking the simple questions. In this post, Spencer Burton, a co-author of Adventures in CRE (A.CRE), shares his experiences and thoughts on landing your first analyst job in commercial real estate. Although this is a topic I've written about...

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Why You Need an Informational and Analytical Edge in Real Estate

One of my favorite podcasts is ‘Invest Like the Best’ hosted by Patrick O’Shaughnessy. He has a mix if incredible guests from all ends of the finance world (venture capital, authors, researchers, portfolio managers), and recently did an episode on quantitative investors. Institutional investing is becoming increasing quant-driven and firms are utilizing all sorts of tools and data-sets to produce alpha. To a layman, the sophistication of these shops is almost unimaginable (you quickly realize it’s impossible for a retail investor to compete!). Investors are...

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Juniper Square: the Real Estate Investment Management System Designed to Scale

Over the past 7 years, the Atlas portfolio and investor network has grown exponentially. What started as an intimate group of friends and family, has ballooned to a robust network of 400+ individual high-net-worth investors. Over time, the administrative burden of managing 1,200+ investor positions across 30+ deals making quarterly distributions became overwhelming. Here’s what our quarterly reporting process looked like: Draft a 3-5 page quarterly summary for each deal in MS Word, plug in an income statement in Excel, convert the document to PDF, and email to each...

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How Origin Investments Raised $10 Million of Equity in 1 Week: Part 2

In September, Ben Harris, head of investor relations for Origin Investments, shared the approach that enabled Origin to raise over $4M of capital online in a single week. Ben walked through the keys to building trust with investor’s online and aligning interest with investment partners.  However, what resonated with me most, was Origin's focus on the ‘long game’. When investing in private real estate deals, investors are often making a 10-year commitment, and sometimes longer. With that time-horizon in mind, the integrity of the people you’re investing with far...

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5 Ways to be an Entreployee Within Your Real Estate Company

After reading James Altucher’s book, Choose Yourself, I’ve been devouring his content (blog, podcast, books). He’s fascinating and focuses much of his content on how to be successful in the new economy. He’s a big proponent of starting a business, platform, or lifestyle where your fate is not tied to your boss. Incomes have been going down and relying on a job, promotion, and retirement savings is a thing of the past. Furthermore, the demand for middle-class jobs are disappearing, being replaced by automation and outsourcing. In today’s world, as James puts it, you...

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Evaluating Investment Performance – A Look at the Past and Going Forward

Anyone who bought commercial real estate over the past 7 years enjoyed the benefits of cap rate compression. Many investments, despite being mismanaged or poorly operated, provided extraordinary returns for investors. When looking at operators track records, how does one discern whether returns were driven by value-creation or simply good market timing? In this post, Matt Lasky, Managing Partner at Equity Velocity Funds shares how investors can evaluate past performance and 5 takeaways for investing in today’s market. -- The commercial real estate industry has...

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How Origin Investments Raised $4 Million in Equity in 1 Week: Part 1

With the passing of the JOBs Act in 2013, private real estate investing has become much more accessible to accredited investors. This has led to the emergence of crowdfunding marketplaces and the ability for companies to generally solicit, enabling investors to connect directly with sponsors all over the country looking to raise money from retail investors. The new transparency in the private real estate syndication space, a business that was previously 100% relationship-based, has led to increased competition. Syndicators are now competing directly with each other...

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How to Make the Most of Your Summer MBA Real Estate Internship

I was at the Columbia Business School real estate career fair a few months back and the program director mentioned the CBS real estate club was larger than ever. Real estate has become a popular career choice amongst top MBA students as the market has performed well and the business has become more institutionalized. MBA programs can be a great way to transition into the real estate business, allowing smart young professionals to engage in the real estate business in an academic setting and in the real-world through a summer internship. The summer internship is a...

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Views expressed in “content” (including posts, podcasts, videos) linked on this website or posted in social media and other platforms (collectively, “content distribution outlets”) are my own and are not the views of Atlas Real Estate Partners, L.L.C. (“AREP”) or its respective affiliates. The content should not be construed as or relied upon in any manner as investment, legal, tax, or other advice. You should consult your own advisers as to legal, business, tax, and other related matters concerning any investment.