This property provides a value-add opportunity for Helvetica due to the high vacancy caused by poor prior management. Helvetica intends to take over the property and begin leasing and stabilization efforts immediately. The Company is optimistic about acquiring multi-family bank-owned properties in the near future.
“With many of the pre-2008 CMBS loans beginning to mature we are seeing a drastic increase in the number of bank-owned properties. We believe there is a great opportunity to acquire distressed multi-family properties with that value-add component. With the increasing demand in the rental market we are confident we can lease up some of these unstabilized multi-family properties. Rents are increasing in the Class A and B complexes so many renters are pushed to the Class C units, which are much more affordable. Many of these distressed Class C complexes have lower occupancy as the result of going through the foreclosure process without any leasing efforts being made by banks and/or special servicers. We intend to capitalize on the value-add component of these properties and begin leasing and stabilization strategies immediately”
Given the huge decline in homeownership rates in the U.S., the demand for rental units is the highest it has been in 15 years. Rental income has also increased as actual rent prices are up 12% since March 2011. Helvetica is positioning itself to capitalize on the increasing demand in the rental market as more and more ex-homeowners are now obliged to rent.