Yield Opportunities

Stable properties purchased with very low leverage. Target cash on cash returns of approximately 6% and total returns of 8% to 9%.

Example: Triple Three Pampano Beach, FLA

Purchase of a reasonably upgraded and managed complex at a discount to replacement cost and slight discount to market. Opportunity to raise rents and manage more effectively. Conservative all cash transaction with no leverage. Current cash on cash return of approximately 6%. Ability to enhance returns by taking on modest leverage.

Value Add Opportunities-

Under managed properties with below market rents purchased at an attractive price where Axiom has the ability-through modest renovations and intensive management-to create solid NOI growth and strong capital appreciation. Target cash on cash returns of 8% to 10% and total returns of 12% to 15% plus.

Example: Sun Bay Apartments-Tampa, Fla

Sun Bay is located in the attractive South Peninsula submarket between downtown Tampa and MacDill Air Force base. Tampa has excellent demographic trends and strong employment growth (consistently high ranking in U.S. cities). The Peninsula submarket is experiencing rapid gentrification and rents have been increasing 4%-6% per annum. In addition, there is limited housing stock in the immediate area with only 9,000 units. Opportunity to purchase an undermanaged complex with below market rents in an attractive market with strong cash-on-cash returns and excellent capital appreciation potential. Purchased from an individual seller who had held the property for over 15 years.

Purchased at a 6.7 cap rate on Axiom pro forma. Financed with a $4.7mm 10-year term, 30-year amort, 3-year IO loan from Freddie Mac at 4.64%.

Successfully exited the property in 2019.

Repositioning Opportunities 

Properties that require significant capital investment, tenant base changeovers and intensive management. These investments will typically have low cash on cash returns in the first few years but 10% plus after stabilization. Target IRR's for this strategy is in excess of 20%.

Example: Hideaway North- located in Altamonte Springs, Fla an upscale submarket of Orlando.

Opportunity to purchase a significantly under managed property at a substantial discount to replacement cost and market rates. Rents 25% below market due to condition of the property and ineffective management. Purchased in an off-market transaction from and individual seller who owned the property for over twenty years.

Purchase price of $6mm or 55k per door- in a market where 85k to 90k per door is average. In addition, 500k of capital improvements will be made-including new roofs and interior renovations of all units. Opportunity to increase NOI by almost 50% through renovations. Financed in part with a 3 year, non-recourse bridge loan. Expectation is a cash-out refinancing of 80% to 130% of equity after 24 months once repositioning is complete.