New home lot supply drops to cycle lows
Knowing how capital sources make decisions and analyze investment risk provides unique advantages to operators seeking capital. As our Managing Director Steve La Terra highlights, capital providers tend to have a formulaic approach and view opportunities within narrow investment parameters. This makes some sense when you understand that capital providers often see time (a non-renewable resource) as more valuable than money (a renewable resource). This is also why you may receive a very quick “no” when pitching a deal but getting to “yes” takes time. With decades of experience with private equity, institutional lenders and other large-scale real estate capital sources, Meyers Research has great perspective on the capital markets. Below we have assembled a few insights that may prove valuable to you when making a pitch for capital, including:
The good news is that once you have established a successful track record with a capital source, you have established a renewable “story” (relationship), have a successful advocate and you have addressed the operator risk component of the underwriting process. However, capital sources change their appetite frequently, so keeping your capital raising skills sharp will be an important advantage for your company.
Contact us to discuss how we can help with your next real estate development.
Steve La Terra, Managing Director – Advisory Phoenix
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