REI Consulting Group

The "REI Fund" has recently been created by the REI Consulting Group managers in order to invest in Miami's residential real estate. Currently, the inventory of new apartments on the real estate market is much higher than demand. This situation will lead many speculators to default very soon.

REI Fund is capitalizing on this opportunity, buying apartment lots filled with incapable and defeated speculators. The goal is to sell these units when the market outlook is optimal.

Here are the key characteristics of success:

Acquisition:

The Fund managers, who are specialized in the local market, determine the criteria that lead to high returns on investments:

• Selecting the buildings in the business district which are in the best locations
• Selecting apartments that have the best views
• Acquisition price 20% to 30% under the market value
• Rental ratio which is above 6%

Active Management:

• Structuring the advertising budget to rent apartments of the Fund
• Interior improvements valuing properties, to facilitate their rental
• Partnerships with rental professionals in Miami
• Flexibility of the amount of the rents in order to minimize vacancy

Optimization of expenses:

• Lease management dealt internally
• Advice from specialized lawyers
• Optimal tax management

Financing:

Fund managers operate with a loan to value ratio of 70% to 80%. This high leverage enables to obtain large returns on investments.

Characteristics of the REI Fund:

• Quarterly subscription for one and a half years
• Lock-up of the funds for a period of 3 to 4 years.
• Projection of an Internal Rate of Return of 15%