At NewlanD Family Capital Partners, our primary goal is safeguarding our investment partners' capital by concentrating solely on NewlanD family properties. Our strategy revolves around enhancing Class B & C apartment communities in secondary and tertiary markets across the country. Historically, NewlanD family properties have exhibited lower volatility during economic downturns while maintaining robust potential for growth during upswings. Within NewlanD family properties, Class B & C assets present particularly compelling investment opportunities, given the high demand and limited new supply in this segment
Acquisition Guidelines
MARKET FOCUS
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Demographics: Targeting the 18-35 age group, representing 22% of the U.S. population
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Income: Renters with annual incomes of $40,000 or higher
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Affordability: Properties where rent is 30% or less of the median income
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Trends: Meeting the demand of retiring Baby Boomers seeking maintenance-free multifamily living
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PROPERTY STANDARDS
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NewlanD family residential apartments preferred
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Preference for pitched roof construction
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Occupancy: Ideally above 80%, except for properties requiring renovation, provided they offer value-add opportunities and are well-located
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TARGET CRITERIA
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Size and Price: Properties with 50+ units ranging from $4MM to $50MM
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Returns: Targeting 7-10% Cash on Cash returns, with a minimum Debt Service Coverage ratio of 1.25
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Quality: Focus on C- to B+ properties in areas rated C- to A
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Property Age: Built in 1975 or later
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Location: Emphasizing emerging market areas showing strong indicators of near and long-term economic growth"
Emerging Markets
Choosing the “right” NewlanD apartment complex to acquire is a critical aspect of NewlanD Capital Management, LLC’s investment strategy. We are diligent in our exploration and focus on opportunities in emerging markets, where jobs and local economies are expanding.
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EMERGING MARKETS ARE CHARACTERIZED BY
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People moving in, rather than leaving the area
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Jobs being created and moving in rather than lost
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Rents and property values rising
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Local government dedicated to attracting jobs
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Markets starting to absorb oversupply
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There are many indicators and a lot of research that goes into identifying an emerging market in the US. We start out by performing thorough market research that includes the following areas:
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Job Growth Report
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Population Growth
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Path of Progress Reports
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Local Economic Reports & Trends
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Chamber of Commerce Reports
Acquisition Practices
NewlanD Capital Management, LLC prides itself on fostering relationships with local listing brokers to gain access to exclusive "pocket listings" and Bank Owned Properties (REO). Our proactive approach involves directly reaching out to property owners instead of solely relying on properties that are already on the market.
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Each potential asset undergoes a comprehensive due diligence process to verify both its physical condition and legal status, ensuring accurate valuations and feasible investment strategies.
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During the initial assessment phase, we develop a financing strategy tailored to each asset, considering factors such as property type, renovation scope, expected hold period, and investor objectives. Typically, assets are held for 5-10 years based on their specific business plans.
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INVESTMENT DISCIPLINE
Our asset selection process follows a systematic evaluation to identify areas with favorable demand dynamics, including job and population growth, demographic shifts, absorption rates, and supportive local policies.
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We prioritize markets with limited supply constraints, while avoiding those showing signs of oversupply such as excess land availability, zoning changes, and escalating building permits.
Value-Add Strategy
Think of it as a business rather than a building. The more income it generates, the more it is worth. When we purchase an apartment complex, we are looking for specific opportunities to increase the cash flow in different areas. These are called “Value Plays” or “Value Adding Components”.
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VALUE PLAYS WE CAPITALIZE ON
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Mismanagement caused by owner self-management
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Poor supervision of management companies
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Deferred maintenance
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High vacancies
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Below market rents
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Some examples of value-add plays we implement at NewlanD Capital Management, LLC:
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Improve curb appeal by enhancing landscaping, adding amenities like dog parks and carports, etc. Residents are willing to pay more when a property is well-maintained and offers desirable amenities.
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Purchase properties that are currently renting at least 10% below market rates. This provides us with the opportunity to increase rents and immediately enhance the property's value.
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Implement a water and sewage bill-back system to charge residents for their actual usage. This offsets expenses and boosts cash flow, as opposed to owners covering all water costs. This system also encourages residents to be more mindful of their water usage, leading to reduced operating expenses.
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Upgrade unit interiors with fresh paint, new appliances, countertops, and flooring.
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Install a coin laundry facility on-site to provide added convenience for residents and generate additional revenue.
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Address below-market rent rates to align with current market conditions.
Path of Progress Strategy
A Path of Progress is where the greatest amount of building and development is currently happening, or soon to be.
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A PATH OF PROGRESS IS WHERE:
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Properties rapidly shoot up in appreciation
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Majority of new construction is going on
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Families and individuals are moving into the area
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Investing in the Path of Progress yields the greatest returns in a short period of time.
