$100M Value-Add Fund

Opportunity description

Fund Economics

• Target Fund Size: $100,000,000
• Assets Purchased: $300,000,000
• Projected Gain: $112,000,000

Projected Returns

• Class A Investors: 8% Preferred Return
• Minimum Investment: $50,000 (Limited Time Only)
• 80/20 Equity Split until 15% Net IRR
• 70/30 Equity Split after 15% IRR achieved
• Class B Investors: 10% Preferred Return
• Minimum Investment: $1,000,000
• 80/20 Equity Split
• Investor Projected Multiple: 2x
• Properties to be Purchased: 3,000+ Doors

Smartland’s $100M Value-Add Fund will primarily acquire Class B and Class C multifamily assets in the Southeast and Midwest with a focus in Florida and Ohio with the opportunity to push value through the implementation of professional management practices and the execution of strategic capital expenditures that will culminate in strong value creation. The Fund does not intend to invest more than 30% of the capital commitments in any single investment. The Fund will target IRRs of 17.0-19.0%, 8.0% – 10.0% cash-on-cash yield, and a 2.0 equity multiple.

The Fund offers investors diversity from multiple assets, is targeting a $100,000,000 raise, and anticipates acquiring 3,000 units over the investment period. The Fund will acquire underperforming properties and seek to increase NOI by increasing rents through bringing smart technology and units, strategic interior and exterior renovations, rebranding of the properties, and hands-on management. Each asset will likely have a two-phase holding period starting with an 18-month reposition followed by 3-5 years of stabilized operations. The Sponsor has a competitive advantage by having in-house acquisition, project management, property management, investor relations, and construction teams.

Key deal points

• Multi-Family Communities
• Value-Add and Nonperforming Notes
• Capitalize on others’ mediocracy
• Focus on market expansion
• Convert vintage multifamily properties into gorgeous B’s (little to no comps with B’s whichincreases the value between C & A properties)
• Unit and Community Amenities-Focused

Monitoring

Fund Administrator monitoring occurs on a quarterly and annual basis. Sponsors will inform us before the quarter or year begins when they will deliver their monitoring report. Fund Administrator usually takes about 5 days to process the information and submit the report.