Investment Strategy

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Stuart Acquisition's core mission of protecting and growing our investment partners’ capital begins with our sole focus on multifamily properties. The firm’s strategy focuses on improving Class B & C apartment communities in secondary and tertiary markets nationwide. Historically, multifamily has been the least volatile real estate asset class during downturns while still offering strong upside potential during upcycles. Within multifamily, Class B & C provides one of the most attractive investment opportunities due to the imbalance between the strong and growing demand and limited new supply of these units.

ACQUISTION CRITERA 

The following criteria is used to identify undervalued multifamily properties for acquisition, value optimizations, management and disposition.

Market Criteria 

• Location: Secondary and tertiary markets that demonstrate consistent rent growth, low vacancy, and a growing real GDP
• Income: Renters who earn $40,000 or more annually
• Price: Where rent is 30% or less of the median income

Property Criteria 

• Multifamily residential apartments
• Occupancy above 85% 
• C- to B type properties located in C+ to A neighborhoods
• 25-200+ units in the $2MM - $40MM range
• Underperforming management 
• Clear value-add opportunities to increase Net Operating Income of the property 

Asset selection involves a systematic, routine evaluation to identify favorable demand characteristics, i.e., job and population growth, demographic shifts, supply absorption rates and positive local legislation. Markets with supply constraints receive most favorable underwriting. Markets with signs of oversupply such as surplus land, changes in zoning and increases in building permits are avoided. 

We are also ultra-conservative when we underwrite deals. For example, we include repairs and replacement reserves “above the line”. In our underwriting we also don’t assume we can operate the property better than existing management.