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Multifamily real estate investments generate strong and consistent returns while maintaining a hands-off approach for busy professionals.

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Real estate investment benefits include:

1) LOW RISK/SECURED ASSETS

2) HANDS-OFF INVESTING

3) CONSISTENT INCOME

4) CAPITAL APPRECIATION

5) TAX BENEFITS

Unlike most investments, real estate investments are backed by physical assets and provide exceptionally secure opportunities. This aspect allows valuable agency financing creating greater profits at sale for investors. Additionally, rental properties provide consistent returns via income cash flow. Investing in apartments will also lower your taxable income through depreciation. All of these benefits require minimal involvement from investor partners while prioritizing transparency and maintaining open communication.

Why apartments?

Only the real estate investment strategy offers appreciation, amortization, depreciation AND cash flow with the security of a tangible asset. While single family rental homes can be great, they are more susceptible to market fluctuations, maintenance fees, management costs and costly vacancy & turnover delays (ask us how we know!). The demand for affordable housing continues to increase in every major metropolitan area and the scalability of apartments buffers multifamily property owners from turnover costs. Additionally, apartments have the added benefit of forced appreciation (added value based on property income) inherent to commercial real estate.

Investment Strategy

We acquire mismanaged multifamily communities in order to:

Renovate and optimize operations

Provide tax advantaged cash flow to investors, and

Sell the improved assets after several years of ownership.

Oak Street Assets focuses on under-appreciated properties to limit risk during economic recessions and realize larger returns.

1) Our investment criteria include:

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Project Size

$10-75 million

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Type

Multifamily apartments

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Opportunity

Development and Value-add through renovation, management and rebranding

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LOCATION

Emerging A-C markets with strong demographics & economic diversity

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PHYSICAL

B/C property condition, typically 1980 build or newer

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DURATION

Projects typically held 3-7 years depending on property and economic factors (1-2 years renovation; 1-2 years stabilization)

2) Value creation / repositioning:

a) Renovation / Rehab

b) Rebranding (if necessary)

c) Optimize Management

3) Stabilization

Fill over 90% of units with long term leases at market rents.

4) Refinance / Disposition

Return of Investor capital through leverage repositioning or sale.

Together Everyone Achieves More

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 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?

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.

Check out these Blog links to learn more

Financial Education

Real Estate vs. Professional Financial Advice

Why Multifamily?