Real Estate Insights

10 Key Components to the Financial Underwriting of Apartment Buildings

10 Key Components to the Financial Underwriting of Apartment Buildings Larry Jacobson, President Introduction   Most sponsors will look at dozens, even hundreds, of deals before making an offer on a property. In order to determine whether to move forward, most will begin with a multi-step due diligence process. One of the first steps in…

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5 Important Due Diligence Items for Apartment Investors to Consider

5 Important Due Diligence Items for Apartment Investors to Consider Larry Jacobson, President Introduction   People often assume that the cost to acquire a property is simply the cost of the property and any related closing costs. They overlook the significant time and resources that go into conducting due diligence on the property – costs…

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Apartment Building

The Importance of Alignment of Interests Between Sponsor and Investors

The Importance of Alignment of Interests Between Sponsor and Investors Larry Jacobson, President Introduction   Real estate is an illiquid asset class and, therefore, when someone invests in a real estate deal, they will often have their capital tied up for at least a few years. This type of commitment requires significant trust. An investor…

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Photo of house

What to Look for in a Real Estate Sponsor

What to Look for in a Real Estate Sponsor Larry Jacobson, President When someone decides to invest in a tech stock, they don’t blindly assume that each stock will perform the same. Apple, Microsoft, Amazon, Google – each of these behemoths has its own business model that will influence how their stocks perform. An investor…

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House and pool

What is a “Good” Return For Real Estate Investors?

What is a “Good” Return for Real Estate Investors Larry Jacobson, President Introduction   One way for investors to assess whether a prospective investment offers a “good” return is to begin by comparing it to their alternatives, starting with the 10-year Treasury bond rate, or the “risk-free” rate. If an investor buys $100,000 in 10…

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Larry Jacobson and Peter Linneman portaits

Multi-Family Investing with Peter Linneman

A Conversation with Peter Linneman Video Transcript:   Larry Jacobson: As we underwrite deals, we are encountering, what strikes us as quixotic rent growth assumptions. And, it’s conceivable that we’re just the old ladies. It’s conceivable that we’re the ones that are being too conservative. Yet, you know, I don’t think so. And, we try…

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Green lush landscaped apartments

What Kind of Returns Should Real Estate Investors Expect?

What Kinds of Returns Should Real Estate Investors Expect? Larry Jacobson, President Introduction   Many long-time commercial real estate investors have grown accustomed to earning double-digit returns on their equity (cash flow plus appreciation). Indeed, commercial real estate has performed exceptionally well over the past few decades. Those who buy-and-hold real estate have been able…

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modern interior of an apartment building

Why a Sponsor’s Approach to Leverage Matters

Why a Sponsor’s Approach to Leverage Matters Larry Jacobson, President Introduction   When evaluating real estate opportunities, many people become hyper-focused on the deal specifics – including the market opportunity, rents, and potential returns for individual investors. Often lost in the mix is a deeper look at the sponsor’s approach to leverage in the transaction,…

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Beautiful multifamily building

The Golden Age of Multi-Family

The Golden Age of Multi-Family Real Estate Larry Jacobson, President Given how many of our investors have been with us for years, in some case generations, I clearly don’t need to convince you of the desirability of owning apartment buildings. However, last week I listened to a webinar that was so powerful, I felt it…

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