TriArc March Update

Its that time of the year again. Tax Time. Its during this time when I am reminded of one of the reasons why I love CRE so much. This year we sent back over $10M in deprecation to our investors via several cost segregations. ?

Its been just over a month since we closed on Legacy at Cypress and the property is performing very well. We have started our renovation program and already seeing upward momentum in rents. This one is on its way to being another success. Meanwhile, our acquisition team is already bidding on new properties and we are currently in best and final for 2 properties totaling $170M and should find out this week if we are the winners.

Its gotten very tough to underwrite deals in Houston these days. Insurance and debt service are increasing like crazy yet sellers are demanding even higher prices. If you plan on buying anything near the coast, you must get an insurance quote first and then escalate it in anticipation of it increasing by the time you close, because it certainly will. Two of the major insurance providers/companies for windstorm in the region have left the market causing prices to increase dramatically. Add increasing interest rates and you have now significantly increased two of your biggest expenses.

We have also been meeting with several funding sources including FO’s, Funds and ultra high net worth investors. There seems to be an unlimited supply of equity for multifamily projects lead by qualified sponsors these days. We have also continued to grow our syndication business as we feel that market is under served and getting worse. ?

Speaking of syndication, as we gear up for our next raise, please complete this quick 3 question survey to help us gauge the amount of commitments we may have available.

As some of you may know, we went into New Development a few years ago and have 3 projects breaking ground in the next 18 months. I am excited to announce we have partnered with Kalterra Capital out of Dallas for our 2 new ground up developments here in Houston. The one shown above is our deal in an Opportunity Zone and on the Light Rail in Houston. We have had a few meetings so far and couldn’t be happier. Clint and his team definitely know there stuff and we have been thoroughly impressed by how thoughtful their improvements and recommendations have been. They are leading the development but have been very accommodating in explaining and getting our input as we go through the process.

Our Fix and Flip fund is making good progress as we just got the paperwork back this weekend for review. We hope to get this project launched by April 1 or soon after. If you haven’t already subscribed to our list for that, please do so in order to learn more info. Here is the link to join that list.

For those in Houston, we are hosting our monthly Happy Hour this Thursday at Highline Park at 6pm. If you haven’t attended one before, this is a great opportunity to meet our team and myself in person, plus learn about our current and past deals. There will be new and existing investors there also so you can network with them. If that wasn’t enough, the first drink is on us. RSVP here to attend. ?

I hope to see you Thursday. If you want to discuss anything further, please feel free to schedule a call with me here. ?

Invest for Tomorrow,

Joseph Bramante