Multi-Family Real Estate as an Impact Investment

Multi-Family Real Estate as an Impact Investment

I’d like to share my thoughts about multi-family real estate as an investment and present some OpenPath financial highlights from 2016.

We live in a low-interest rate environment that makes it challenging to earn consistent yields without allocating a big pile of your money to public equities. Deploying capital in private investment opportunities like OpenPath Investments can generate significant yields that are difficult to find in the public markets. One avenue to generate yields is to invest in multifamily real estate. Investing in multi-family real estate is supported by numerous long-term demographic, social, cultural, and financial trends.

Consider the following:

  • Access to homeownership is increasingly prohibitive.
  • Large swaths of Americans currently earn stagnate-to-slowly increasing incomes.
  • Younger adults are postponing home purchases.
  • Seniors are downsizing.
  • Migration to metro areas is amplifying housing demand; yet entitlement barriers continue to create roadblocks for additional supply.
  • Many new apartments are luxury apartments in major metro downtowns that serve a small fragment of the population.

Taken altogether, these factors will continue to create a pressurized situation for multifamily housing stock for years to come – high demand and low supply.  Moreover, with the ability to lock in 10-year, low, fixed rates alongside growing demand for multifamily, the stars start to align.  At OpenPath, we continue to be well positioned to participate and travel in the perfect symmetry of this economic galaxy called “multifamily real estate investment.”

Currently, our portfolio consists of nearly 3000 units and is valued at ~ $360M. While our aim is to provide investors with a 15% IRR, we’ve realized a 33% average IRR on exited properties.  Email me to learn more about OPI’s historical performance, or give me a call to learn more about how those big gains occur.

Moving forward, we are prepared to scale our offerings to bring investors additional opportunities for doing well while doing good.  With that intention in mind, we are accepting new investors interested in pursuing attractive financial returns, while generating social and ecological impact.  See below to learn more about OpenPath’s financial highlights in 2016.

RECENT EXITS

Barrington Regents (Phoenix)
Purchase Date & Price: 2011 – $7.05M
Sell Date & Price: 2016 – $11M
Equity Multiple: 2.5x
Realized IRR: 33%

The Preserve (Portland Metro)
Purchase Date & Price: 2014 – $16.25M
Sell Date & Price: 2016 – $21.50M
Equity Multiple: 1.86x
Realized IRR: 56%

RECENT ACQUISITIONS

Properties Acquired: Aspen Meadows (Jackson Hole, WY); Cheyenne Crest (Colorado Springs, CO); & Reflections at Highpoint (Dallas, TX)

Total Acquisition Cost: $79.4M
Total Units: 696
Investor Capital Raised: $30.5M
Projected IRR: 15%

Total Projected Exit Value: $104.84M
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