Investment Strategy

Equity West Capital Partners seeks to invest in unique single and multi-family real estate opportunities primarily located on the West Coast.

 
SINGLE FAMILY STRATEGY

EWCP has created a privately managed real estate equity fund, EWCP TS FUND I, LLC. The fund will target the acquisition of foreclosed real estate assets. The Fund will seek to purchase residential real property (predominantly single family homes) from trustee sale auctions located at various courthouses in Southern California. Once purchased, these homes will be vacated, repaired and resold on the open retail market via MLS listings. Houses will be purchased at deep discounts with a minimum net profit goal of 10% per property. The Fund will aim to have average property turn times of 90 days or less. The fund's core markets are the Counties of Riverside, San Bernardino, Orange, and Los Angeles. The market climate for this business strategy is excellent due to the high retail demand fueled by the current housing affordability levels and ease of homeowner financing.

 
Acquisition Parameters
  • Target auction purchase price of $50,000-$500,000 per property
  • Seek to limit property locales to high-demand market areas
  • Prospective properties wil be eligible for FHA financing
  • Set conservative ceiling on purchase price to value ratio
  • Strong preference toward vacant properties
Buying Strategy
  • Property Selection: Utilizing Trustees’ websites to locate properties with minimum bids one week in advance; 24 hour updates and updates every 10 minutes the morning of the sale from our proprietary software which generates an equity potential based on the minimum bid vs our AVM values
  • Valuation: Utilizing a combination of our subscription AVM (VeroValue); cyberhome.com and eppraisal.com to find prospective deals that have profit potential; performing BPOs on the shortened list of properties with Minimum Bids and profit potential using multiple active, pending, and recently closed comparables
  • Title Research: Using County Records research to perform due diligence on title; investigating liens, encumbrances, city filings; utilizing TICOR Title for date downs on the title the morning of the sale to ensure title is still unclouded (dedicated title representative assigned to give live support to EWCP whenever needed)
  • Property Inspection: Day prior to sale, send out a team member to inspect each property to check for possible tenants, property damage, potential issues; morning of sale inspect any additional properties that have experienced minimum bid drops; talking to neighbors and/or prior real estate agents that worked on the property to gain history/perspective; talk to tenants or owners if appropriate
  • Bidding Process: Bidders will be sent to the court house with an appropriate sum of cashier’s checks and a list of properties to bid and maximum bid amounts; bidders will be in constant contact with their assigned analyst at the office who will be performing title date downs, minimum bid updates and final decision making for the purchase; bidders are required to sign a confidentiality agreement to protect the name and model EWCP is using
Asset Disposition
  • Occupancy Solutions: Utilize in-house negotiator to effect agreements to vacate with tenants where applicable and legal counsel to process evictions otherwise
  • Property Preservation & Enhancement: Perform basic cosmetic, safety, and finace driven repairs to minimize marketing time and maximize sales price
  • Marketing: Multi-pronged marketing approach through related brokerage entity to swiftly put property into escrow
  • Closing: Dedicated transaction coordinator will cross-qualiy Buyers and track escrow process to ensure short and successful close


 
MULTI FAMILY STRATEGY

EWCP looks for off-market transactions that provide potential to add value with a low tolerance for risk. Investments include direct equity capital combined with a reasonable level of debt where possible or in structured joint ventures with strategic partners.

EWCP tends to focus on rapidly growing infill locations that have limited land supply, strong job retention/growth, gentrifying surroundings and a long term potential upside in both rents and/or values. EWCP tries to stay away from outlying areas and higher risk acquisitions. Demographic, economic, and overall population mapping is used as a basis for all high level acquisition discussions.

EWCP aims to increase investor returns through a detailed due diligence and acquisition process. This helps to mitigate risk and increases portfolio stability. Our underwriting process entails:

 
Acquisition Parameters:
  • Locate low risk, infill areas for strategic investment
  • Seek to source deals from off-market sources including bank and broker contacts
  • Seek projects with a maximum 2-5 year hold period
  • Look for low risk projects that yield double digit returns
  • Asset size between 20-200 units
  • Class B or better properties
Due Diligence Process
  • Utilize current market studies and trending charts for projections
  • Stress conservatism with a multiplicity of outcomes focusing on potential risks
  • Hire consultants to verify underwriting assumptions and analysis
  • Model and present multiple exit strategies for each given investment
Strategic Partnership
  • Consider equity partners who share the same risk aversion and desire for stable returns
  • Look for partners who can close efficiently and consider various debt/equity structures
Investment Disposition
  • Utilize broker contacts and timely decision making to consummate dispositions in a timely and efficient manner
  • Underwrite disposition options to determine highest and best use – conversion, lease-up, repositioning, etc.