Prediction Not checkable as stated
Pandemic-era Sunbelt syndications face underwater debts and forced cash-in refinances
“Where we're sitting right now is a lot of those purchases, 20, 20, 21, 22, their debts come and do and they're underwater. Like they're going to have to do what's called a cash in refinance. Which is a capital call to their investor base, which is not good.”
Insight
Short-term rental revenue premiums are eliminated by high turnover and management costs
“The Delta just isn't really there for like the management burden that it creates, you know, so you can look at a unit and say, Hey, we're going to get two grand a month in rent for this two bed, one bath. And we could get three grand or 3500 bucks a month if w…”
Assertion Not checkable as stated
Veritas audited historical returns average an unusually high 30% to 31% annually
“Like our historical average is stupid high. It's like 30, 31% a year. When we go back and audit our deals, it's really high.”
Insight
Floating-rate debt is the primary way real estate investors lose everything
“The only way to really lose your shirt in this game is bad debt strategy, you know, getting into something that's too variable or too floating or assuming that rates are going to come down or whatever, and then buying deals with those assumptions.”
Insight
Executing a 1031 exchange in a syndication requires unanimous limited partner participation
“There's a little more nuance when you have like a syndication, you know, with an investor base, if we have 15 LPs in a deal all 15, basically, the whole group needs to go to the next deal.”
Insight
Real estate investors should execute deals at 80% certainty on fundamentals
“The biggest lesson, I guess, that I had is once you're about 80% sure, you know, just go, you know, like just go do it. Like it's, you're never going to feel a hundred percent on anything. It's not going to be perfect. But as long as you're doing the fundament…”
Insight
Class A multifamily profit margins are thin due to intense institutional competition
“Class A stuff is, is very thin. Like the margins are just thin. You know, the groups that are operating those and have been for 20 years are good. You know, the property managers that are managing those are good. People buying them are sharp, you know, like, a…”
Insight
Real estate deal vetting and negotiation cannot be outsourced to technology
“No matter what, I think for now, in this game, it's a people business, you know, you've got to have the relationships you're still buying from people, you know, like that, the purchase process, vetting the deals, negotiating the deals, you know, going in and a…”
Opinion
Direct real estate investment provides superior transparency to REITs and blind funds
“If you're looking to get into real estate, I think having a relationship with a group like ours where you're actually directly invested in assets as opposed to something like a REIT or a blind fund or whatever that you don't have any visibility into is, is pow…”
Disclosure
Veritas targets 6% to 9% annual cash-on-cash returns on multifamily deals
“They're generally all going to return a cash flow range in terms of a cash on cash return in the six to nine percent a year range and consider that sort of a dividend is how we talk to our investors about it. You're going to get that in terms of quarterly dist…”
Disclosure
Veritas targets a 1.75x to 2x equity multiple on multifamily assets
“In terms of an equity gain and net worth growth perspective, we are marching towards getting about a 1.75 to two X multiple on the cash that was put in the deal. So if an investor puts 200,000 bucks in, we'll operate these things for, you know, whether it's th…”
Assertion Not checkable as stated
Veritas locked a 5.84% fixed interest rate on a recent multifamily acquisition
“So we just got our most recent acquisition rate locked about two weeks ago at 5.84%. Fixed for seven years. And that's interest only for four years, three years of principal and interest. And that's with about a 30% down payment.”
Assertion Not checkable as stated
Veritas grew to $60M AUM without ever buying a listed property
“Just up to this point, over 15 years, we've got about 50, sixty million dollars in assets under management and these things that we've bought that we're currently running. We've never bought anything listed.”
Assertion Not checkable as stated
Birch grew a $200K investment into a $30M portfolio via 1031 exchanges
“We started with 200,000 bucks and got into a little eight unit in Seattle, and we literally just 10 31, 10 31, 10 31, up and up and up and built that portfolio to You know, being worth about thirty million dollars.”
Disclosure
Veritas targets sub-$10M Class B and C properties for operational inefficiencies
“We stay in that BC, you know, that sub-ten million dollar purchase price range for that exact reason.”
Disclosure
Veritas strictly eliminates cash and paper checks, mandating electronic tenant rent payments
“We go back to the tenants and we say, Hey, we're no longer allowing checks. We're just not, you know, like we're no longer definitely not allowing cash. Like you have to pay electronically.”
Disclosure
Veritas only acquires properties where financial models work at median rent levels
“We are only buying deals that are pro forma works at the median rent level.”
Disclosure
Veritas strictly limits investments to Washington state workforce housing outside Seattle
“We're a multifamily apartment investing fund out here in the Seattle, Washington area. So we invest in strategic locations in Washington state only. So we're not in Seattle. We're in surrounding tertiary markets and then close by to the city, 20 to 30 minutes …”
