Investing in multifamily apartment communities can be incredibly rewarding, as demand is high, supply is relatively low, and a good apartment community investment can even be used to lower one’s tax rate. Joe Fairless from Ashcroft Group manages a whopping $2.5 billion in investments and has many years of experience in purchasing, renovating, and selling apartment communities at a profit. He offers insight to help investors who are new to the field understand how it works and what it takes to turn a profit.
Joe Fairless explains that the ability to pick the right location is key to Ashcroft Capital’s success. The company conducts extensive research to identify cities with consistent employment and population growth to ensure there will be continued demand for housing for the foreseeable future. Fairless also considers multifamily fundamentals, that is, the formation of households in any given area. An ideal city for investment is one with a high number of families who would be looking for the top-tier yet affordable housing opportunities Ashcroft can provide.
At the same time, Fairless explains, it’s not just about the city. Careful research is also conducted when choosing each development. While it’s true that demand is outpacing supply, Joe Fairless explains that the secret of his firm’s high profits lies in identifying properties that already have good amenities. These amenities are then upgraded and improved; in some cases, this may involve completely renovating entire interior units while in other instances, Ashcroft focuses on improving operations and lowering costs.
It’s a team effort, Joe Fairless explains. The firm currently has more than three thousand investors, with new ones joining on a regular basis. There is an asset acquisitions team that focuses on finding potential properties, an asset management team to supervise repairs and renovations, a construction team that does the repairs, renovations, and upgrades, and a property management team to provide assistance to tenants and handle day-to-day operations.
Furthermore, because Ashcroft Capital is a trusted name in commercial real estate investments, the firm has a network of sellers it can partner with to find and purchase profitable real estate. In fact, four out of ten acquisitions are on off-market properties that other investors aren’t aware of, allowing Ashcroft the luxury of researching a potential property for sale without competing with other investment firms.
It is no secret that investing in multifamily real estate can be incredibly profitable. Current statistics show that mean profits are higher than those for retail, office, industrial, and hotel real estate investments. A whopping 60% of millennials are opting to rent housing instead of buying it, and experts expect this trend continue as Generation Z comes of age.
Rising mortgage interest rates are another factor driving demand for rental space. However, Joe Fairless is quick to emphasize that his firm’s success doesn’t just lie in picking a profitable niche. Rather, careful research, attention to detail, and collaboration with teams of experienced experts have made Ashcroft Capital a successful company trusted by sellers, business partners, and tenants alike.