Property Investment Case Studies

One project wasn't enough. We had to buy all four. Hosmer Street in Tacoma had a number of problem hotels clustered in a small area. Drug dealing was open and constant. Prostitution visible. Weapons common. Human trafficking documented. Police knew every property. Neighbors lived in fear. Converting one hotel while four others continued as problem properties would have limited impact. The problems would just shift next door. So we bought all of them. Day one: private security deployed before renovation began. The message was clear—the old way of operating was over. Police cooperation was essential. Officers who had been responding to constant calls became partners in transformation. They supported enforcement of new standards. The results: - 40% overall crime reduction within 12 months. - 100% violent crime elimination. What had been scenes of regular violence became quiet residential communities. - Instead of sending three officers to each call in the area, the police department only needs to send one. During a community mural project for one of the converted properties, a child approached a Sage Investment Group team member: "Thank you for getting rid of the scary drug dealers." That's the impact statistics can't capture. Children who can play outside. Families who feel safe. A neighborhood reclaimed. The financial lesson: Scale matters in transformation. One property conversion has limited neighborhood impact. Comprehensive transformation of entire problem clusters changes the equation permanently. The operational lesson: Security investment before renovation begins establishes new norms immediately. Waiting allows problems to persist. The human lesson: Hotel conversions aren't just property investments. They're neighborhood transformation tools. The impact extends far beyond the property lines.

Most operators think OpCo-PropCo is one playbook. That’s wrong. The structure shifts based on your track record, check size, and who's bringing the capital. Here are 3 real case studies that prove it: 1. Sam & FlexHouse Offices: The “Operator-first JV” Sam converts Class B office buildings (100-250k sf) into coworking and flexible suites. His advantage? He works at Elevated Properties and can test his thesis on their existing portfolio. The structure: • Hybrid management agreement with Elevated. • Joint ventures on new acquisitions. Why it works: • Proves yield enhancement before raising capital. • Uses someone else's balance sheet while building his OpCo. 2. Amelia & NewPath Homes: The “Seeded PropCo with Rent-to-Own tech” Ex-SFR exec launching rent-to-own single-family homes with "tenant-in-hand" model. Her challenge? Needs an investor who can seed both the first few homes AND the OpCo. The structure: • Seed investor backs initial portfolio ($250-400k per home) • This demands the integrated OpCo-PropCo to scale into institutional capital Why it works: One check funds proof of concept for both PropCo and OpCo. And creates a path to institutional scale. 3. Rebeka & Restored Hotels: The “Co-GP + Territory Agreement” Postpartum boutique hotels in major urban centers. Strong operations background, needs real estate experience. Her solution? Partner with experienced hotel developers as Co-GP. The structure: • Regional development agreement to secure pipeline • Co-GP investment structure Why it works: • Trades some upside for credibility and capital access • Gets institutional backing for $50-100M vision The Pattern: Your OpCo-PropCo structure isn't random. It depends on: • Your track record • Asset class maturity • Check size required • Capital source preferences It’s a spectrum from fee-light partnerships to fully integrated platforms.  Nail the structure and you unlock yield and scalable capital. Want to map the right structure for your concept? Join our OpCo-PropCo Structuring Workshop. We break down these agreements and help you design your approach. Link to register in the comments.

Two people. Completely different incomes. But similar investment outcomes?!? 𝗣𝗲𝗿𝘀𝗼𝗻 𝗔 – 𝗛𝗶𝗴𝗵 𝗲𝗮𝗿𝗻𝗲𝗿, 𝗘𝗧𝗙 𝘀𝘁𝗿𝗮𝘁𝗲𝗴𝘆 • Gross income: 250.000 € • Net income: ~12.000 €/month • Invests 10% of net → 1.200 €/month into an ETF • Plus: 22.200 € lump sum at the start (same as Person B’s purchase costs) • Assumed ETF return: 10% p.a (optimistic). After 10 years: • Total paid in: • 22.200 € upfront • 1.200 € × 120 months = 144.000 € • → 166.200 € cash in • Portfolio before tax: ≈ 299.000 € • Gain: ≈ 133.000 € After 25% + Soli on the gains (~26%): • 👉 Net profit after tax: ~98.000 € Strong result. Until you meet Person B. 𝗣𝗲𝗿𝘀𝗼𝗻 𝗕 – “𝗡𝗼𝗿𝗺𝗮𝗹” 𝗲𝗮𝗿𝗻𝗲𝗿, 𝘁𝗮𝘅-𝗼𝗽𝘁𝗶𝗺𝗶𝘀𝗲𝗱 𝗿𝗲𝗮𝗹 𝗲𝘀𝘁𝗮𝘁𝗲 • Gross income: 80.000 € • Net income: ~4.000 €/month • Also invests 10% of net – but into an investment property • Buys a 250.000 € new-build in Brandenburg • 100% financed, mixed interest ~3,2% • Upfront purchase costs (notary, tax, fees): 22.200 € (paid at the start) • The property qualifies for double depreciation: • 5% degressive AfA • + 5% Sonder-AfA (§7b EStG) Calculator assumptions: • Property price growth: 3% p.a. • Rent growth: 3% p.a. • Marginal tax: ~41–42% From the calculator over 10 years: + 85.979 € appreciation + 47.765 € tax savings from depreciation – 28.599 € operational result This –28.599 € is the sum of all yearly cashflows (rent – mortgage -maintenance) and the upfront costs. In other words, over 10 years, Person B has to top up ~6.399 € from salary to carry the property – that’s their “10% of net” at work ➡️ Total profit (property side): 105.145 € And total cash out-of-pocket is: 22.200 € upfront purchase costs 6.399 € cumulative top-ups → ≈ 28.599 € paid in over 10 years So the deal for Person B is roughly: Cash in: ~28.599 € Wealth created via property: 105.145 € 👉 They more than trippled their money. IRR: ~19,9% p.a. Side-by-side Person A (250K salary, ETFs) Cash in: 166.200 € 𝗡𝗲𝘁 𝗽𝗿𝗼𝗳𝗶𝘁 𝗮𝗳𝘁𝗲𝗿 𝘁𝗮𝘅: ~𝟵𝟵.𝟬𝟬𝟬 € Person B (80K salary, new-build rental) Cash in: ~28.599 € 𝗡𝗲𝘁 𝗽𝗿𝗼𝗳𝗶𝘁 (𝗳𝗿𝗼𝗺 𝗰𝗮𝗹𝗰𝘂𝗹𝗮𝘁𝗼𝗿): 𝟭𝟬𝟱.𝟭𝟰𝟱 € Lower income. Same 22.200 € at the start. Same idea of “I invest 10% of my net every month”. Higher absolute profit due to leverage and German tax rules. What this actually shows: 1️⃣ It’s not just how much you earn – it’s where you steer your 10%. 2️⃣ Tax savings can be more powerful than a higher salary. 3️⃣ A clean, tax-optimised real estate setup can beat a high earner’s ETF 4️⃣ Doing nothing with your savings is the most expensive strategy of all. Don't get me wrong, I love ETFs as well, but most people forget that during a crisis, ETFs can slide 55% in a given year. The optimal strategy is a combination of both, typically starting with a property and then investing the excess returns into ETFs.

In a 2014 deal, the rarest thing of all happened. (Long-time real estate pros will laugh at this.) The deal was a condo building in an A+ location in Chicago’s Wicker Park neighborhood. At the time of the purchase, we had another building in Wicker Park. The buildings were: -> Built by the same builder. -> Built with the same layout. -> Built within a few years of each other. But there were 2 key differences: 1) The building we owned was in an inferior location within the neighborhood. (We're talking about an A+ location vs. an A- location, but there's a difference.) 2) The units at the building for sale were rented for an average of $2,740. (We were renting the units at our other building for $3,200 despite being in a slightly less ideal location.) Now, if you've been doing this for a while, here's the part where you'll chuckle. This is one of the very few deals in my life where we knew we could get even higher rents than the broker OM suggested as proforma rents. (If you don't get it, brokers are often... optimistic... when it comes to market rents.) We went ahead with the purchase and executed the same strategy we’ve done more than a dozen times over the years: • Repaint units with more modern colors. • Refresh the common areas. • Reevaluate all contracts. After that, we aggressively marketed the property charging full-price rents. At acquisition, the average rent was $2,740/month. Within 12 months, the average rent was $3,268/month — a $528 average increase — just like we drew it up using our comp. 14 months after acquiring the property, we refinanced the loan in order to return our initial LP equity tax-free. The property was appraised for $4MM during the refinance — a 17.65% value increase in just over 12 months. This is a great example of why it’s so important to specialize in something. Chicago is our “backyard” and where we’re based. Multifamily is the asset class we specialize in. The best way to get ahead is to have an information advantage. The best way to get an information advantage is to play the game for a long time. -- P.S. If you're interested in exploring passive investing opportunities, we'd love to get in touch. Sign up here to join our investor list: https://lnkd.in/dix7jCxC Disclaimer: This is not an offer to sell or a solicitation to buy securities. Past performance is no guarantee of future results, and investors may experience different results than those shown, including the loss of principal. You should not rely upon forward-looking statements as predictions of future events.

How we're turning neglected properties into profit machines. Here's what we look for before acquisition: 1. Underperforming property in an emerging market. 2. Room to raise rents $120+. 3. Operational inefficiencies. 4. Distressed sellers. To some, these look like big problems. To us, they scream opportunity. The core of our business plan? - Solve problems, add value. In doing so, we buy at a discount and boost returns. We acquired a 46-unit, distressed property in September. Here’s what we’ve done so far: → September: Collected $15,331. → October: Collected $49,033. → November: Collected $50,470. We also: ↳ Addressed the final 6 delinquencies. ↳ Rented out 3 of 5 garages, with the rest ready to go. ↳ Improved tenant screening to attract reliable renters. What that means for investors: ✓ Stabilized property = reduced risk. ✓ Additional income streams = boosted returns. ✓ Targeting an 18% IRR. When you buy right and execute your plan, you mitigate risk and produce incredible returns. Here's our playbook: https://lnkd.in/dQu-n2jJ

One of my first properties was previously owned by a slumlord. High occupancy made it look good, but under the covers was a ticking time bomb. Bad debt taller than a mountain, ageing and neglected infrastructure and residents that did not care because no one had cared about them. We see this often with neglected buildings. - The residents and the owner at against each other. - They are not being treated right (nor is the building). - Therefore they don’t care about the building (or surroundings). And things continue to get worse and worse. This is where we came in ✅ In 14 months we renovated 30 of 64 units, Turned 30 more and increased rent from an average of $877 to $1017. (Just by matching the city's HUD rental rates). No crazy tactics or under-the-table deals. Just a solid strategy to improve the building and improve life for the residents inside. The result? ROI on capex spent = 27%. So without future rental increases year over year, the investment pays for itself in 3.7 years, versus the 5-7 year hold term. Which is great for residents. Great for the building and community. And great for both us and our investors. Impact investing done the right way ✅

2 phone calls almost derailed our project. Or should I say not making 2 phone calls. It was 2018 and we had just bought a multifamily property at a great price. The plan: • 15k per door value add • Sell it in 3 years • 16%+ IRR The problem: • A drug dealer moved into one of our units • Rents weren't increasing like we wanted • Vacancy increased How did this happen? • Standard Operating Procedure wasn't being followed • 2 reference were not called It's possible that the drug dealer would have still been accepted. He had lots of cash but another layer deeper could have been uncovered by calling the references. At a minimum, the property management group would have covered themselves by following SOP. The solution: • We got a new property management company that had better attention to detail • We refined our SOP's and brought added focus and clarity within them The results: • Screening of residents improved, rents increased and vacancy decreased • Property slightly out performed projected IRR reaching 17%+ • Sold the property 1 year earlier than projected There was certainly luck involved in buying at a time when appreciation soon followed. Lessons learned: • Buy right • Follow SOP's • Call references • Take action quickly 10 minutes of phone calls could have saved us thousands of dollars. We were able to overcome it but returns could have been even greater for our investors and us. ----- Follow me for more content on lessons learned from our historical track record. #buildtorent #multifamilyrealestate #experience