Capitol Real Estate Service’s advantage in multi-family investing is in its acquisition strategy. This strategy involves the investments in multi-family properties be centered on an Emerging Market. This is an area of the country that has specific, measurable, and valuable activities occurring that can be used to predict the future growth in apartment value growth. This strategy has been shown to foretell tremendous growth in apartment values over the course of 3-5 years. This consequently, is our intended holding period for each property. As long as the conditions are right and point to a continuing Emerging Market, we will remain. However, these same measurable activities also point to the coming end of an Emerging Market, and our strategy is to sell our assets when these winds of change are detected, roll the profits into a new and larger Emerging Market property using a 1031 Exchange strategy to further maximize our tax advantage.
Job growth is the engine that drives an Emerging Market and contrary to national news, there’s always pockets of this country that are moving into and out of Emerging Market status right now. Research shows now that there are no fewer that 10 markets around the country that are entering or have just entered the Emerging Market stage, and it’s these markets that we are performing our most active searches.
Although job growth is the primary measurement, it’s not job growth alone that triggers our interest. We review over 10 measurable activities that multi-family properties go through to identify an Emerging Market. Incentives given to tenants, vacancy rates, changes in property values, absorption, time on market, are just a few of the key indicators that a market is turning or is about to turn into an Emerging Market for multi-family properties