STRATEGIC ASSET EVALUATION. INTENSIVE ASSET MANAGEMENT.
HIVERNAN REALTY GROUP, LLC invests in workforce housing in strong performing secondary and tertiary markets. The risk to reward ratio of these markets is attractive because returns are based on existing, stabilized, in-place operations, and not future rent growth, property repositioning, or cap rate compression. Since it’s formation in 2013, Hivernan has purchased eight communities totaling 2.122 units with an aggregate purchase price of $89 million. When Hivernan’s strategic asset evaluation and intensive asset management are added, predictable value enhanced investment returns result in an opportunity for investors to earn Cash-on-Cash returns of 8+% and IRRs of 14+% over the projected life of the investment.
HIVERNAN purchases multifamily communities located in secondary and tertiary markets where there are more attractive risk to reward ratios than in the overheated coastal markets. These properties provide high initial yields and the opportunity for steady rent growth-proving stable returns even during economic downturns. An identifiable and growing employment base must exist in the area surrounding these communities to ensure a steady and increasing demand for housing.
HIVERNAN seeks to maximize cashflow through diligent oversite of property management partners, rigorous cost control and customer service. Value-add capital improvements are only undertaken after they have been thoroughly tested and have demonstrated that they are accretive to current and future returns.
25 years of experience in the operation, acquisition, and financing of multifamily properties
Chief Operating Officer
Director of Compliance and Procurement
HIVERNAN’S investment selection process is multi-tiered and top down. First, we seek markets or submarkets where there is a strong intrinsic demand for rental housing which is not being satisfied by the current supply. Second, we analyze whether or not there is a likelihood that the supply of housing will dramatically increase in the future. Third, we analyze the property that is being offered for sale to ensure that Hivernan’s operating model will be effective. Lastly, we analyze the physical condition of the property to ensure that the costs of operation will be consistent with our lean operating structure. At different points in the economic and investment cycles this philosophy will lead us to different markets and asset classes. For the past three years and for the foreseeable future, our philosophy has led us to focus on workforce and affordable housing in secondary and tertiary markets. By focusing on renters-by-necessity in markets with stable economic and population bases, we ensure that we will have customers for our units. In addition, rents for this type of housing does not justify the cost of new construction which limits current and future competition. By following this philosophy, Hivernan has made, and continues to find, investments in well maintained communities, that are 90%+ occupied at acquisition, generate 8+% cash-on-cash investor returns from inception, and provide the opportunity for additional revenue and cashflow growth and the resulting capital appreciation.
HIVERNAN brings a highly pragmatic and value driven asset management approach to property ownership. Our philosophy is focused on the following three principals: the property needs to be safe, the property needs to be clean, and the property needs to provide a value to its residents. The first two principals are paramount: value can’t begin to be generated unless the property is safe and clean for our customers. Our standard operating procedures focus on preventative maintenance and asset preservation. Once we have ensured that the property is safe and clean, we can focus on bringing value to our residents. Often times in the properties and the markets where we operate, providing safe and clean housing is value enough for our residents. Where there is demand and the financial returns justify it, selective in-unit upgrades have been undertaken. Net Operating Income is the yardstick by which all capital expenditures and expenses are measured. Our investments routinely and consistently meet, and more often, beat our original revenue, expense, and pro forma projections.