We Unlock Unparalleled Multi-Family Commercial Real Estate Investment Opportunities Throughout the Southeast
Elevate Capital Group specializes in value-add multi-family property acquisition in the Southeast. We are a highly sophisticated team with advanced skillsets in deal flow, market analysis, underwriting, financial strategy, repositioning, renovations, and property management. Our proven asset identification model produces deals unavailable to other investors.
Why Multifamily INvesting?
1. Cash Flow
Multi-family properties produce positive monthly cash flow. We target properties that can produce healthy cash flow on day 1 with room to significantly increase via operational improvements.
2. Forced Appreciation
Multi-family properties are valued on a multiple of net operating income. As operations improve and the property’s net operating income increases, the value of the property increases in line with the cap rate (market multiple). For example, increasing annual NOI by $100,000 in a solid market would typically result in a $1,333,000 increase in property value. Through a value-add strategy, these gains are more reliable and predictable than investing in the stock market or single family homes.
3. Market Appreciation
We target growing markets with healthy fundamentals and room for rents to continue increasing. We prefer markets with tailwinds, but always treat market appreciation as a bonus, it’s not central to our value-add strategy.
4. Tax Benefits
Multi-family investing provides an array of tax benefits including long-term capital gains treatment at the time of disposition, dividend treatment for ongoing cash flow, and cost segregated depeciation that allows more depreciation to be claimed sooner for a greater offset to current year income. The end result can be a very low or negative K-1 for investors, especially in the first few years.
5. Principal Paydown
Revenues from rents will pay down the equity portion of the debt service which unlocks additional equity at the time of disposition or refinance.
6.) Strong Economic Fundamentals
Multi-Family Sees Very Low Delinquency Rates - Over the last ten years multi-family properties saw loan delinquency rates well below 1% on Fannie and Freddie mortgages. This compared to 9% for FHA single family loan delinquencies in 2009 at the height of the recession.
B and C Assets Offer Upside Potential and Downside Insulation - Our strategic selection of B-Class and C-Class properties means there are more opportunities to increase value through rent increases and operational improvements. Most new builds are A-Class leaving less relative supply for more cost effective housing. Rising rents create more demand for lower class properties. B and C-Class properties also absorb economic shocks and prolonged downturns because people downsize into them during recessions.
Get in touch
Connect with our team to learn more about our approach and current investment opportunities.