Deciding where to invest money can be a difficult process for real estate investors, especially with the always changing housing market. For Pangea Properties, a private real estate investment trust (REIT) that focuses on providing quality and value at an affordable price point, taking the time to fully evaluate each aspect of a building is the key to successful acquisitions.
“Since our focus is in lower-middle income neighborhoods, our theory is to select each of our buildings with precise care,” says Pangea Properties CEO Al Goldstein. “We want to be as involved as possible in every aspect of the purchase. It helps us know the building from the inside out to make sure we have the most influence and control over the end product to benefit our residents and community members post acquisition and renovation.”
Below are five steps every acquisition team should complete before purchasing a building:
1. Research the location: Certain aspects of a building’s location can help draw new customers and retain old residents. For example, having schools in walking distance or easily accessible via public transportation is an important factor for families. In addition, neighborhoods with many board-ups can pose challenges or deter potential residents, while local commerce can help the building thrive.
2. Examine building type: Whether it’s a mixed-use, multi-family or a standard apartment building, each has its benefits and draws different renters. Consider the size of the building, unit count and types of units before purchasing a building. Having a combination of unit sizes can attract an array of customers, making the building an option for a single renter and families alike.