Dec 30, 2020 4:00:00 AM | 5 Min Read

How to Break Into Lucrative Florida Private Equity Markets

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KRI Partners
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How to Break Into Lucrative Florida Private Equity Markets

Are you trying to get in on some of the lucrative Florida real estate opportunities, but you're not sure how? Have you been trying, but keep striking out? If the answer to either of these questions is yes, then you are not alone. It is a frustration felt by many!  

If you have been looking for Florida real estate opportunities, then you know exactly what I am talking about. It is extremely tough to get access to the lucrative deals that you want. Most people try for a while, then they give up, only to go to another, slower market and try to invest there. The result is missed opportunities and usually significantly lower overall investment returns.

There are some very good reasons why it’s difficult to find Florida investment opportunities.  The most obvious is that there are lots of people chasing a limited number of deals. The tremendous opportunities that produce the extraordinary risk adjusted returns that you see in Florida exist in very few other markets in the United States. It just makes sense that everyone wants in.

Let’s figure out how you’re going to participate in these Florida investment opportunities. We will start by taking a look at some of the things you need to consider when looking for these Florida investment opportunities. Should you continue to try to find the deal yourself or should you invest with a Florida private equity firm, like KRI Partners? Let’s figure that out.

Finding Florida Investment Opportunities on Your Own

It’s important to begin by understanding why investing in Florida real estate opportunities is so profitable.

Like most things in business, it all starts with demand and supply. The state of Florida is growing by approximately 1,000 people per day. This means demand is increasing, a lot. Developers are building to try to meet this demand, but almost all the development is higher end apartments.  There has been no significant increase to the amount of housing available for the ordinary person and that is not expected to change anytime soon. This means the availability, or supply of housing for most of the people moving into the state, is not increasing to meet the increased demand. These two forces - increasing demand and stable supply, puts significant upward pressure on prices. More specifically, rental rates.

As you probably know, the value of multifamily real estate is driven by the Net Operating Income (NOI) of the property. So, it stands to reason that if you can significantly increase NOI, the value of the property should increase, right? This is where the demand and supply forces discussed above, have such a huge impact on the Florida multifamily real estate market. When rental rates go up, NOI is likely to also go up, making the value of your property increase.  

To put things into perspective, for every $1,000 increase in NOI, the value of a multifamily property goes up by about $20,000 (+/-). Imagine an increase in NOI of $100,000. That means a multifamily property’s value increases by about $2 million! Add leverage to the equation and the returns can be absolutely amazing.

Now that you understand why Florida real estate opportunities can be so profitable, let’s discuss what you need to do to get in on the action.

Finding Florida investment opportunities is not easy. First, you have to figure out what kind of asset you want to invest in. Medical, office, retail, multifamily? Lots of options. Once you figure that out, you have to determine where in Florida you want to invest. After all, real estate is always about location, right? Then, there’s the challenge of finding a deal, one that actually makes sense. And finally, you have to figure out how you’re going to “get” the deal in a very competitive real estate market.

A lot of this research can be done online. Let’s assume you do that research and you determine that you want to invest in multifamily properties in one of the fastest growing parts of Florida like central or northeast Florida. Next, you have to figure out how to find and analyze the deals. That means you have to spend an enormous amount of time developing contacts in those markets and learning how to analyze the deals.  

Then, you have to convince sellers that they should choose your offer over competing offers. And finally, if you do get the deal, you need to either hire a management company or figure out how to run the property yourself.  

This seems like a lot of work while still keeping your day job and trying to raise a family!

This doesn’t work for most people.  

Florida Real Estate Opportunities with KRI Partners

What does work for most people is to find a Florida private equity firm, like KRI Partners and leverage our expertise by investing in one of our Funds. This way you can keep your day job, spend time with your family, and still earn huge returns that come with Florida real estate opportunities. In fact, investors in KRI deals have previously earned 20%, 25%, even 30%+ annual returns on their investments with KRI.

The number one reason we have been so successful at KRI is our experience. There is no substitute for experience.  

  • The firm has been around for 23 years.  
  • Our senior management team has managed more than 15,000 apartment units.
  • We have invested in 15 deals worth about $60 million.

By investing in the KRI Multifamily Real Estate Fund, you will be able to leverage our experience and expertise and have the potential to earn extraordinary risk adjusted returns. Oh, and by the way, you will still be able to spend time with your family and keep your day job!

Topics: Articles

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