With the University of Rochester, Eastman School of Music, Strong Memorial Hospital, and Highland Hospital there are many undergraduate & graduate students, faculty, university and hospital staff, nurses, and doctors all competing for housing around the campus and surrounding area. These are professionals who bring great paying and stable jobs. We specifically target areas where this type of tenant is looking to live.
We have selected high yield / low risk markets within the Greater Rochester area. Rochester is continuously ranked as one of the most stable markets in the country and in May 2019, was named the number one hottest real estate market in the nation by the Democrat and Chronicle and realtor.com.
Our primary criteria when selecting a deal
We use various forms of financing, including:
We buy underperforming residential multifamily properties (1-4 units) and add value through renovation, improved tenant screening, active management: this leads to higher rents, lower vacancy rates, and low maintenance expenses.
We manage our portfolio internally and refinance our properties with bank financing as quickly as possible which considerably reduces overhead costs.
We buy underperforming or undervalued residential multifamily properties in growing B to C class neighborhoods in the Rochester area which border high income neighborhoods. Structurally sound properties with 2-4 bedrooms that show incredible potential for rent growth and a higher demand over the next 3-5 years. We look for properties with 2-4 bedrooms as opposed to 1 bedroom units or 5+ bedroom units because 1 bedroom units have higher vacancy rates and 5 bedroom units prove unnecessary for many families in the city of Rochester.
We bring the renovation experience of dozens of high value flips in the Westchester area of New York State. Not only do we underwrite and property manage internally, but our team hires and manages subcontractors internally for our projects which eliminates the need for a General Contractor. This approach further reduces overhead and increases control over our projects.
Today’s economic climate is making it more difficult for people to quality for home loans which has created an increased demand for multifamily housing. Our strong relationship with community banks have allowed us to acquire properties using creative financing that is overlooked by other investors.
We focus on very specific markets within the Rochester area that allow us to understand our target markets with incredible detail. We look for properties within the city limits due to lower taxes and a desire by officials and tenants for stable housing.
We strive for 18% cap rate and above for our properties in the city after repositioning. Due to low property values we cannot leverage equity as strongly within the city limits. Therefore our focus is on maximizing our Net Operating Income and minimizing vacancy. These cap rates are not seen in many other markets.