BENA Capital Announces Multifamily Acquisition in Lexington, KY

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The BENA Capital Mosaic Fund is pleased to announce the acquisition of a new multi-family apartment asset in Lexington, KY.

Lexington has one of the nation's most stable economies, benefiting from a diverse and balanced business base. Named one of the best cities for "Businesses and Careers" by Forbes and ranked 10th in a list of America's most educated cities, Lexington has seen rapid economic growth the past few years, especially in the high-tech and life sciences sectors. The city is home to industry leaders such as IBM, OpenText, and the world headquarters of Lexmark. The county is a major health care hub in Kentucky, with the second-most health care establishments and employees in the state, earning the fourth-highest wages. U.S. News & World Report named UK (University of Kentucky) HealthCare as the #1 hospital in Kentucky for the fourth year in a row, and the Markey Cancer Center in Lexington is ranked among the best cancer centers in the nation.

The property is centrally located in downtown Lexington, next to the brand new $250MM City Center, a mixed use development featuring a 12-story office tower, two hotels, and retail. Less than 5 minutes away from the apartment sits the University of Kentucky and the $300MM Lexington Convention Center redevelopment that is scheduled to complete in Spring 2022. All units are currently 100% occupied. We are very excited about the prospects of this property due to its desirable proximity to demand generators, strong cash-flowing history, and the robust investment activity in the immediate vicinity.

The acquisition is the third of BENA Capital’s Mosaic Fund - a Stable Income Fund focused on generating strong rental income streams from core-plus and value-add assets in growing markets throughout the United States.

The Mosaic Fund is currently open to new investors through December 2019. If you are interested in earning stable quarterly dividends, feel free to reach out directly via email or call us at 408-421-8608.

Name *
Name

Warm Regards,

Kimberly Yeh
Managing Director - Real Estate Acquisitions

 

About BENA Capital

BENA Capital manages real estate investment funds, with a central focus on the acquisition and management of residential multifamily assets in growing markets. BENA Capital's funds provide investors with ease of entry, reliable quarterly cash flow, and portfolio diversification. Our proven strategies emphasize sound investing in carefully researched, quality properties that have steady, long-term capital appreciation potential.

Click for Mosaic Fund Overview PDF: Mosaic Fund Overview

Click for Investor Overview PDF: BENA Capital Overview

How To Sell Your Real Estate Investment: Top Five Preparation Tips

This article by Kimberly Yeh, BENA Capital - Managing Director, was originally published via Forbes

Just as important as acquiring a real estate investment is knowing how you are going to exit. Selling a property takes a great amount of knowledge and coordination, and it can take months to prepare and execute. The smartest investors map out an exit strategy for each property they acquire prior to closing on a sale. The sale may be years in the future, and the plan will be reassessed often to take into account the latest market trends, economic health and demand generators, but it is key to know the end game.

Once you decide to sell a property, these are the five most important areas you’ll need to consider to ensure the sales process goes smoothly.

1. Asset Condition: Whether you are doing the work yourself or working with a property management team, make sure the asset is in attractive physical condition. To maximize investment returns, you will want to keep work and expenses to a minimum, but there are several basic items that go quite a long way in attracting buyers. Enhance the property’s curb appeal by landscaping, adding lighting and cleaning all areas. You'll also want to touch up paint; repair any holes, tears or stains in the flooring; and remove clutter and unused inventory. All of these will make for a good first impression during open houses and buyer walkthroughs, especially if you are not planning to stage the property.

2. Stop CapEx: Capital expenditures are designed to produce a future benefit by adding value to an existing asset. This type of work includes new roofing, installing heating or air conditioning units, and purchasing major appliances, for example. As soon as you have decided it is time to sell your investment, you'll want to review all capital expenditures. With the exception of some rare cases, you don’t want to initiate any new capital projects, because you won’t be owning the property long enough to recoup the benefits of investment.

3. The 3 C’s — Codes, Certifications And Contracts: In order for you to sell the property and transfer ownership to your buyer, you’ll need to ensure that the asset is in good standing with the city. Some cities require inspections prior to a sale; others may require rental certificates that must be periodically renewed. Make sure that your property is up to code and has all necessary certificates, as any violations could delay closing. Contracts are legal obligations that, in some cases, may be assigned to the new owner. As such, any existing contracts associated with your asset must be reviewed and presented to the buyer. It is important to plan ahead because in the event your buyer does not want to assume an existing contract, you will need to buy out or terminate the agreement prior to closing.

4. Employees: If you employ a management company or other employees at the property, you will want to be as transparent as possible with them about selling. The sale of your asset could cause the current group to lose their contract. By proactively addressing the sale with your employees or contractors, you control the messaging. Keep them informed of the timeline, and assuming that you've had a good relationship with them, make sure they understand that you would contract with them again should you acquire a new property in the area, and that you would not hesitate to recommend them to the buyer and others in your network. It will help to maintain the relationship and facilitate a smoother transition.

5. Taxes, Taxes, Taxes: Good news: You’ve made a sizable profit, and now you’re ready to cash out. Bad news: Selling your investment property could lead to a significant tax hit. When preparing to sell, engage a tax professional to talk through all your options for offsetting your tax burdens. Depending on your investment goals, income bracket and hold time, strategies may include tax-loss harvesting to deduct losses from capital gains or leveraging a 1031 exchange to defer taxes into the future. Developing a game plan before you sell will help you understand what you can do to maximize your investment profits.

You will need to consider each of these areas prior to selling an investment asset. Use this as a tool to create your own checklist of important action items and issues that need to be addressed. It's important to remember that selling your property is a complicated process, but with the right preparation and mindset, you'll be well-equipped to take on and overcome whatever roadblocks come your way.

Signs To Look For When Considering Investments In High-Potential Neighborhoods

Before thinking of investing in a property, most real estate investors need to ensure they know the lay of the land — literally and figuratively. Gaining insight into what changes are coming for a market can mean the difference between finding a long-term investment, or discovering that a property isn't worth half what you paid for it.

So what signs should real estate investors look for when looking in specific neighborhoods or regions? Which factors impact properties with high-potential values and how can investors find out about them?

BENA Capital’s Yousif Abudra and other members of Forbes Real Estate Council open up about the signs they look for when investing in certain regions with potentially high values.

Pay Attention To City Planning/Zoning Meetings

To be ahead of the curve, you can't wait until you see the cranes and construction trucks. Sign up for city planning/zoning update meetings, which are posted online for many municipalities. These will tell you where the next new major developments will be, giving you plenty of time to acquire and improve adjacent properties just before values increase. - Yousif Abudra, BENA Capital, LLC

To read more about what they look for, check out the original Forbes Council post here.

Smarter Investing For Today's 'Risk-Averse, On-Demand' Generation

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At a leadership conference last year, I heard the term “on-demand generation” used to describe American consumers today. Regardless of whether they are a boomer, Gen Xer or millennial, members of this “generation” are not bound by birth dates, but by the way people today consume products and services. We are a generation powered by on-demand media like Netflix, on-demand food delivery like DoorDash and on-demand transportation like Lyft. As a consumer, you can now marathon-watch entire seasons of your favorite TV show, order dinner without leaving the couch and then track where your food is — as it’s being made and picked up and then street by street as it’s getting to your front door. You can request a ride home with a click of a button and know that the driver is two minutes out so you don’t have to step outside in the cold until the car turns the corner.

This on-demand generation also happens to be extremely risk-averse. At our fingertips, millions of firsthand testimonials exist on Yelp, TripAdvisor and Amazon to take the risk out of our purchasing decisions. Before we even set foot in a restaurant or hotel, we know what’s on the menu and which rooms have the best view. There are even free browser extensions you can now install on Google Chrome and Firefox to compare Amazon products. Specs and ratings are listed side by side, including a YouTube video review and the same item’s price on eBay.

Over the past decade or so, this way of living has become so deep-seated in our everyday lives that it’s impacting not only how we consume products and services but also how we approach investing our money. Today’s “risk-averse, on-demand” generation of investors wants control, convenience and capital preservation.

Up-Down, Up-Down

Stock market investors have been on a roller coaster ride. After seeing substantial gains in 2017, the FTSE All-World index, which tracks more than 3,000 stocks in 49 countries across different market sectors, plunged 12% in 2018. At home in the United States, this stock market volatility manifested as a $3.73 trillion tumble in household net-worth in Q4 2018, giving investors PTSD flashbacks of the 2008 global financial crisis. While markets seem to have rallied in 2019, many are left speculating when the ax will drop next, especially as tariff threats hover over recent U.S.-China trade negotiations. This “up-down, up-down” instability has Americans, on average, holding 58% of their assets in cash. But there is a solution for investors seeking more stable investment opportunities and more control: real estate.

Controlling Risk With Real Estate

Companies can go bankrupt and stocks can fall to zero, but there will always be inherent value in land and in tangible assets. Real estate is uncorrelated to stocks and bonds, providing opportunity to invest large sums in a very short period of time without singularly moving the market and raising prices. Strategic diversification protects your capital investment, and if you’re able to correctly identify the phase each market is currently in, good investments can be found, whether the market is in a recession or expansion period, by adapting your investment criteria and exit strategy. You can effectively control risk by doing homework on the local real estate market dynamics and assessing economic trends, future developments and demand generators.

Increasingly popular among the on-demand generation is the income enhancement strategy. This strategy is useful to investors seeking stable, long-term cash flows and high risk-adjusted returns in a real estate portfolio. By selecting leasing and property management talent or retaining a private real estate investment firm with a superior talent network and history of exceptional tenant relations, investors reap the rewards that accompany an optimized asset management strategy without the headaches of having to manage the properties themselves. Typically, an experienced real estate investment firm implementing this strategy will utilize a rolling approach to stabilize cash flows and minimize business cycle risks. Aging properties are slowly refreshed with new ones — capital improvements are made, vacancies are reduced, rents are raised while being cognizant of managing tenant turnover and economies of scale are achieved — yielding stable annual returns.

There is no such thing as a 100% guarantee when it comes to investments, but there is a next best thing — options like real estate — where there’s intrinsic value in the assets. This allows investors to minimize risk by being extremely selective and adapting their strategy to market demands and economic trends, and there’s the ability to exercise control over how assets are managed. Whether you are chasing dividend yield, looking for low-volatility growth or seeking safe haven from market fluctuations, allocating a slice of your investment portfolio to well-managed, quality real estate is a powerful tool for investors to build wealth, generate consistent cash flow and hedge against inflation and vulnerability in the stock market.

Seven Tips To Remember When Establishing Real Estate Goals

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Real estate can be a tricky industry. Success as an investor, developer, or broker requires one to pay close attention to cyclical market trends, both on the local and global level. At the same time, you must also consider bigger industry changes that stem from evolving technologies and consumer expectations.

BENA Capital’s Kimberly Yeh, Managing Director of Acquisitions, was featured in a Forbes Expert Panel discussion highlighting what to keep in mind when planning your real estate goals.

Sign up for monthly BENA Capital Real Estate Insights and Offering information using the Contact form below.

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Name

About BENA Capital

BENA Capital manages real estate investment funds, with a central focus on the acquisition and management of residential multifamily assets in growing markets. BENA Capital's funds provide investors with ease of entry, reliable quarterly cash flow, and portfolio diversification. Our proven strategies emphasize sound investing in carefully researched, quality properties that have steady, long-term capital appreciation potential.

Click for Mosaic Fund Overview PDF: Mosaic Fund Overview

Click for Investor Overview PDF: BENA Capital Overview

BENA Capital Announces Multifamily Acquisition in Rio Rancho, NM

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The BENA Capital Mosaic Fund is pleased to announce the acquisition of a multi-family apartment asset in Rio Rancho, NM.

Only 20 minutes north of Albuquerque, Rio Rancho is the largest city in Sandoval County. It was named the “Best Place to Live in New Mexico” by MONEY’s Best Places to Live in Every State. One of the fastest expanding cities in New Mexico, it has grown over 15% since 2010. That growth is expected to continue steadily over the next two decades.

Rio Rancho is a thriving economic hub, and the area is supported by a diverse mix of industries, including tech & software, healthcare, education, manufacturing, customer service centers, retail and tourism. Among the high-profile employers are Intel, US Cotton, HP, PCM and Lectrosonics.

In recent news, Intel announced it will move technology development for its 3D XPoint memory technology to its facility in Rio Rancho. The move includes the addition of over a hundred jobs at Intel’s Rio Rancho site. Perhaps the most notable of newcomers to the area is Netflix, who inked a billion dollar deal to open a U.S. production hub in Albuquerque late last year. The deal is expected to bring an additional 1,000 jobs per year to the state.

The property is centrally located, less than 15 minutes away from some the city’s largest employers — the Intel and HP campuses, and the award-winning UNM Sandoval Regional Medical Center. It is currently 100% occupied. Over the next quarter, BENA Capital will work with local property management to make strategic capital investments to improve the property and enhance operating income. We are excited about the prospects of this property due to its desirable proximity to demand generators, strong cash-flowing history, and continued investment in the immediate vicinity.

The acquisition is the second of BENA Capital’s Mosaic Fund - a Stable Income Fund focused on generating strong rental income streams from core-plus and value-add assets in growing markets throughout the United States.

The Mosaic Fund is currently open to new investors. If you are interested in earning stable quarterly dividends, feel free to reach out directly via email or call us at 408-421-8608.

Name *
Name

Warm Regards,

Kimberly Yeh
Managing Director - Real Estate Acquisitions

 

About BENA Capital

BENA Capital manages real estate investment funds, with a central focus on the acquisition and management of residential multifamily assets in growing markets. BENA Capital's funds provide investors with ease of entry, reliable quarterly cash flow, and portfolio diversification. Our proven strategies emphasize sound investing in carefully researched, quality properties that have steady, long-term capital appreciation potential.

Click for Mosaic Fund Overview PDF: Mosaic Fund Overview

Click for Investor Overview PDF: BENA Capital Overview

The Top Three Metrics Every Real Estate Investor Should Know

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This article was also published on Forbes.com by Managing Director Kimberly Yeh: Top Three Metrics

I am often asked what my real estate acquisition team looks for when we obtain investment properties for our funds. It’s a complicated formula that takes into account a dizzying number of variables, including alignment of the specific fund’s strategy and objectives, the real estate cycle and the realities of current market demands. But the common thread that binds all our acquisitions is what I like to call the “Big Three.” These three location metrics inform every single acquisition I make, and are in my view the foundation of a successful real estate investment. So what are they, and why do they matter?

1. Demand Generators

Demand generators are factors that determine the local need for your investment property. It is essentially the presence of businesses, employers, transit, schools and attractions in the area that generate the consumers your property is intended to serve. Identifying demand generators is important — the absence of a thriving commercial center, for example, could indicate job scarcity. Without employment, there’s little to support the local economy. And if the local economy is weak, the population relocates in search of opportunity, and the demand for local real estate falls. Therefore, understanding access and proximity to your demand generators is vital to choosing a location for a successful real estate investment.

To peel back the onion even more, as with any product, it’s critical know your customers. Being familiar with local demand generators can be useful in pinpointing factors that influence prospective tenants and future buyers. Smart investors should not only consider current demand generators in assessing cash flow potential but also what that pool looks like years down the road to estimate appreciation at resale. This data then informs decisions on whether to purchase properties in a specific location and at what price point, as well as how much capital to put into renovations and when those improvements are made.

2. Supply Indicators

As part of every due diligence effort on new markets, identify the direct competition based on the three Ps: price, product and proximity. When considering a specific property type for investment, gauge the existing demand for that property type and then take into account future developments that could over-saturate supply. These attributes impact a market’s current and future vacancy rates, which are key components in forecasting investment performance. For commercial real estate investments, I consider healthy vacancy rates typically less than 5% for multifamily, 8-12% for office and 5-10% for retail. When evaluating a specific location for investment opportunities, make benchmarking comparisons for a specific property type, but look at all three commercial metrics as indicators of a local real estate market’s overall economic health.

Most cities or chambers of commerce will publish useful data points, and various real estate databases will have transaction details that will inform supply and demand metrics. Keep an eye out for articles from local news outlets highlighting economic trends and future developments. Don’t overlook these resources when performing a market study — they are invaluable in analyzing financial feasibility for an investment and can be instrumental in determining whether to pursue the acquisition.

3. Market Comparables

The final metric that makes up the “Big Three” is comps, or the comparable lease rates and sales prices from the past three to six months. Comps are important because they indicate how much revenue you will be able to generate from the investment and whether a certain location is crowded with too much supply. When evaluating real estate comps, it’s essential to recognize that different regions, even sections of a city on a street-by-street level, can have very different lease rates and sales prices. These metrics should be carefully researched to filter for property type and to benchmark the specific location.

While comparing price per square feet can be helpful, the best comparisons for benchmarking and determining investment revenue will also take into account the age of the property, the use and unit mix, and structural and cosmetic upgrades.

The “Big Three” should be a critical part of the initial evaluation in determining where you make your real estate investments. Always make sure that the results are appropriate for your individual investment goals. It is crucial to establish a solid framework to organize what otherwise could be a chaotic, overwhelming process.

 

About BENA Capital:

BENA Capital manages real estate investment funds, with a central focus on the acquisition and management of residential multifamily assets in growing markets.  BENA Capital's funds provide investors with ease of entry, reliable quarterly cash flow, and portfolio diversification.  Our proven strategies emphasize sound investing in carefully researched, quality properties that have steady, long-term capital appreciation potential.

Click for Investor Overview PDF: BENA Capital Overview

To learn more about BENA Capital, visit: http://www.bena-capital.com/

BENA Capital Announces Multifamily Acquisition in Granbury, TX

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BENA Capital is pleased to announce its latest acquisition of a multi-family apartment asset in Granbury, Texas.

The property is located in a growing suburb of Fort Worth, 5 minutes to the downtown town square, across the street from the Lake Granbury Medical Center, and 45 minutes from Fort Worth. We identified Granbury as a prime target for the fund because the city has been growing at roughly 40% per decade, and the population is expected to grow by another 50% over the next 20 years. Both the unemployment rate and the poverty rate are below the national averages.

Given its proximity to Fort Worth, many families choose to live in Granbury for its safe, small-town feel while working in Fort Worth, which is the fastest growing metropolitan area in the country, adding over 146,000 residents in 2017. Fort Worth is the 15th largest city in the United States and continues to grow substantially, both in numbers of residents and jobs. Over the past 12 months it has added jobs at twice the rate of the national average. Cities with this type of robust growth are rare, and an effective strategy to capitalize on this growth is to acquire solid properties in areas just on the fringe of this rapid growth. These types of properties tend to benefit from price appreciation as the population searches for additional housing units.

As a result, we are excited about the prospects of this property for the BENA Capital Mosaic Fund, focused on generating stable rental income streams for investors. We acquired the property with one unit vacant and had a contractor in the unit ready to perform make-ready work the day of closing. The vacant unit was leased in 4 days at an above-market rate and we are having rent increase discussions with the current tenants. Our goal is to maximize cash flow while also moving up rents over the next 6-12 months.

The Fund’s all-cash offer, paired with niche market knowledge and strategic partnerships that enabled a quick close, beat out 6 other bids. These attractive terms allowed us to acquire the asset at a competitive price.

We plan to implement a phased strategy to improve the property during Q1-Q2 2019. Initially, we will target value-add projects and repairs to improve the appeal of the property. In parallel, the hands-on property management team we have hired is familiar with the local market, and will increase current rents to further enhance cash flow.

To learn about our investor benefits and how you can invest in the Mosaic Fund, request information below or feel free to reach out directly to us at 408-421-8608.

Name *
Name

Warm Regards,

Kimberly Yeh
Managing Director - Real Estate Acquisitions

 

About BENA Capital

BENA Capital manages real estate investment funds, with a central focus on the acquisition and management of residential multifamily assets in growing markets. BENA Capital's funds provide investors with ease of entry, reliable quarterly cash flow, and portfolio diversification. Our proven strategies emphasize sound investing in carefully researched, quality properties that have steady, long-term capital appreciation potential.

Click for Mosaic Fund Overview PDF: Mosaic Fund Overview

Click for Investor Overview PDF: BENA Capital Overview

14 Ways The Real Estate Business Is Going To Change This Year, According To Experts

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This article, featuring BENA Capital’s Yousif Abudra, was originally published via Forbes.

Yousif Abudra talks about the power of networking on this month’s Forbes Real Estate Expert Panel post:

The best opportunities will go to investors with the best networks. Competition for the assets has increased, so new investors absolutely need to have a robust, experienced team in place to help them identify, close and execute each deal. We are strengthening our broker, property management and contractor networks in all markets we invest in to prepare for a more competitive market environment. - Yousif AbudraBENA Capital, LLC

Where’s Your Financial Parachute?

by Kimberly Yeh, Managing Director - Acquisitions

Who remembers the classic Bond scene from the 1977 movie The Spy Who Loved Me – the ski chase leading to that iconic moment when Bond hurtles off the edge of a snowy cliff into a spiraling free-fall?

That’s what I am reminded of when I think of the rise in interest rates and the looming impact on bonds. After the 2008 Financial Crisis, we’ve had nearly 10 years of historically low rates in the US. But rising interest rates have been steadily creeping up on us – the Federal Funds rate has nearly doubled since this time last year.

Over the past 3 years, the Aggregate Bond Index (“AGG”) returned a meager 0.97% annually. If you paid for a financial advisor, your actual 3-year average return is close to 0%. With continuing rate hikes on the horizon, many investors are realizing that they’re stuck with low yielding bonds that are at risk of losing more value.

Equities are also hovering on the brink of a bear market. Goldman Sachs’ Investment Strategy Group published a 5-year outlook on US equities and Municipal Bonds earlier this year. According to their forecasts, a low-risk investor with an 80% fixed income/20% equity portfolio, can expect a 2.68% return over the next 5 years, before adjusting for inflation[1]. Anemic returns like that, combined with the recent turbulence of the market, should prompt savvy investors to seek out alternative assets to re-balance their portfolios.

This is where we stop holding our breaths, wondering what comes next (and I don’t mean Bitcoin, which plunged below $4,225 to a 13-month low this month). In The Spy Who Loved Me, fortunately for Bond, he deploys a Union Jack parachute to the rescue. Fortunately for us, there are alternatives to the traditional investment options of stocks and bonds. Whether you’re chasing dividend yield, higher ROI, or simply seeking shelter from the market volatility, consider allocating a percentage of your investments to alternatives with low market correlation to increase returns and reduce risks. There’s no safety net at the bottom, so don’t be left without a parachute.

Click here to learn about Real Estate as an alternative investment.

About BENA Capital:

BENA Capital manages real estate investment funds, with a central focus on the acquisition and management of residential multifamily assets in growing markets.  BENA Capital's funds provide investors with ease of entry, reliable quarterly cash flow, and portfolio diversification.  Our proven strategies emphasize sound investing in carefully researched, quality properties that have steady, long-term capital appreciation potential.

Click for Investor Overview PDF: BENA Capital Overview

To learn more about BENA Capital, visit: http://www.bena-capital.com/

[1] Goldman Sachs, Investment Strategy Group, Jan 2018, 5-year nominal return for US equities at 3%, 5-year nominal return for Municipal Bonds at 2.6%