Invest differently.

Thoughtful investing begins with disciplined selection.

At Oak Street Assets, we evaluate private investment opportunities through three essential lenses: the experience and integrity of our operating partners, the fundamentals of the investment, and the alignment of its financial structure.

Our goal is to identify opportunities with compelling return potential, carefully considered risks, and a clear path to long-term value creation.

Explore how we evaluate investments and what we look for before committing capital.

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Investment Strategy

Every opportunity is judged on three things, in this order.

1

Who We Invest With

The right operating partner is just as important as the right investment.

We seek experienced operators with demonstrated expertise in their markets and asset classes, proven execution capabilities, and a track record we can evaluate beyond the projections in a presentation.

Our assessment focuses on:

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Experience & Track Record. We examine previous acquisitions, current portfolio performance, realized investments, and how the operator has navigated challenges, not simply their best-performing deals.

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Operational Capabilities. We evaluate the people, systems, property management resources, and financial controls responsible for executing the business plan.

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Financial Strength & Alignment. We consider the operator’s financial capacity, existing obligations, and the amount of personal capital committed alongside investors.

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Reputation & Relationships. We look beyond marketing materials to understand the principals’ experience, professional relationships, transparency, and history of fulfilling commitments.

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Communication & Accountability. We assess reporting practices, responsiveness, and how operators communicate when actual performance differs from expectations.

We favor long-term relationships with partners who demonstrate integrity, operational discipline, and a willingness to invest alongside us.

2

What We Invest In

A compelling investment begins with sound fundamentals, not an attractive projection.

We evaluate each opportunity on its underlying economics, market conditions, operating assumptions, and potential risks. Our objective is to understand what drives the expected returns, what could go wrong, and whether the opportunity remains attractive under less favorable conditions.

Our analysis focuses on:

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Market Fundamentals. Employment and population trends, household income, economic diversification, supply and demand, and the outlook for the surrounding submarket.

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Asset Quality & Competitive Position. Physical condition, location, tenant demand, competing properties, deferred maintenance, and opportunities for operational improvement.

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Financial Performance. Historical income and expenses, occupancy, collections, operating margins, and the assumptions supporting projected performance.

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Conservative Underwriting. We examine rental growth, expenses, renovation budgets, financing costs, and projected exit valuations rather than relying solely on a sponsor’s base-case projections.

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Stress Testing. We evaluate the potential impact of lower occupancy, slower rent growth, higher operating costs, delayed improvements, interest-rate changes, and less favorable exit conditions.

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Debt & Capital Requirements. We examine leverage, financing terms, maturity schedules, reserves, refinancing exposure, and potential future capital needs.

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Value Creation & Exit Strategy. We assess whether improvements can realistically generate additional income or value, and whether the investment has credible refinancing, disposition, or other exit alternatives.

For private real estate credit investments, our analysis also considers borrower quality, collateral coverage, loan seniority, and the underlying lender’s underwriting and servicing practices.

We look for investments where the potential reward justifies the risks, not investments that only work when everything goes according to plan.

3

How It’s Structured

A good asset can still be a poor investment if the terms aren’t right.

The legal and financial structure determines how risk, control, cash flow, and profits are allocated among investors, sponsors, and other stakeholders. We examine these terms carefully because alignment matters throughout the investment, not just at acquisition.

Our review focuses on:

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Alignment of Interests. We evaluate sponsor co-investment, compensation arrangements, and whether financial incentives reward long-term investment performance.

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Investor Economics. We examine preferred returns, distribution priorities, profit-sharing arrangements, fees, and how proceeds are allocated among investor classes.

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Capital Stack & Seniority. We assess the relative position of debt, preferred equity, and common equity, including the implications for risk, distributions, and potential recovery.

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Liquidity & Investment Duration. We consider expected holding periods, redemption provisions where applicable, refinancing assumptions, and the circumstances that could delay the return of capital.

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Downside Protection. We evaluate reserves, leverage, covenants, and other structural features that may help mitigate identified risks.

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Governance & Investor Rights. We review voting rights, reporting obligations, manager authority, capital-call provisions, dilution, and remedies available if circumstances materially change.

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Our Capital at Risk. We believe in investing alongside our investors and seek opportunities where our financial interests are meaningfully aligned.

We pay particular attention to how an investment performs when the business plan encounters delays, financing conditions change, or additional capital becomes necessary.

Our goal is not simply to find attractive projected returns, but to understand how those returns, and the associated risks, are shared among everyone involved.

Opportunities that pass all three reach our investors. Most do not.

How we approach multifamily.

Apartments are the core of what we own, so the standards are specific.

What we look for

Project size	$10 to $75 million
Type	Multifamily apartments
Opportunity	Value-add and development, through renovation, management and rebranding
Location	Emerging A to C markets with strong demographics and economic diversity
Condition	B and C properties, typically built in 1980 or later
Hold period	Typically 3 to 7 years, depending on the property and the economy

A typical business plan

1

Reposition

Renovate, rebrand where it helps, and improve management. Typically one to two years.

2

Stabilize

Fill more than 90 percent of units with long-term leases at market rents. Typically one to two years.

3

Operate

Run the property for cash flow while the improvements show up in income.

4

Refinance or sell

Return investor capital through a refinance or a sale.

What is a Real Estate Syndication?

A real estate syndication is a partnership between investors. These people combine resources (such as skills and capital) to purchase and manage a property together. A real estate syndication is a great way to generate passive income when you want to put your money into real estate without taking on the daily management responsibilities. It’s a significant endeavor that needs a lot of time and work. Together, we can take down bigger projects and enjoy bigger gains.

Who are the players in a Real Estate Syndication?

Sponsor– There is a person or company that organizes the real estate syndication and is responsible for finding and managing the property. They are interchangeably known as the Sponsor, Operator, and/or Syndicator and depending on the legal structure of the organization created for the investment, the Sponsor is technically known as the General Partner (GP) or Manager.

Investors– The people who provide the capital are often referred to as Passive Investors or Limited Partners (LPs) or Members depending on the legal structure. Limited Partners receive an equity share in the syndication along with cash flow distributions and profits.

– Sponsors manage the property, execute the business plan and update investors.
– Investors get perks of Real Estate investing, BUT have no tenants, no fixing toilets and broken doors…
– Limited Partners/Capital Partners sit back and get quarterly preferred return payments (and a K1 to give to your tax preparer/CPA).

What is a preferred return on investment?

A preferred return on an investment means that the Limited Partner gets paid their share of profits BEFORE any other partners. A Sponsor gets paid only AFTER investor/capital partners receive their distributions up to the specified allotment and any remaining profits are shared according to the deal structure. Such an arrangement assures Limited Partners that their interests come first and keeps the interests of all parties aligned.

Different Investments can offer a variety of Investor classes, some of which may be only preferred returns (10-12% annually) while other may offer a smaller annual preferred return (5-8%) but with retained interests in the project for a significant upside at disposition. Some people prefer the annual cash flow, some prefer the larger profits at sale, and others the tax benefits. Most syndications provide some of each of these, although each deal is unique due to the many variables.

Additional profit sharing after the preferred return payouts can vary from [75:25] to [50:50] (Investor:Sponsor) depending on deal criteria and investor class. Such equity investments return structures are project specific and can allow for significantly greater rates of return.