On today’s show we are making a distinction between new supply and value added opportunities. Investors over the past few years have focused on two different investment theses. Thesis number one is the traditional value added project. This is where you take an existing project that was built a number of years ago. It’s getting tired and the lack of modern amenities and finishes makes the property less desirable and therefore it attracts lower rent.
The idea is to vacate enough of the units that your can improve them over a period of time.
The second involves new construction. This is where developers come in. They are adding new product to the market. These gleaming new buildings have modern amenities. They are generally very desirable properties.
What these two approaches neglect is the real needs in the market. Where are the gaps? Is there a business opportunity to fill those gaps?
---------------
Host: Victor Menasce
email: podcast@victorjm.com