Waterton acquired Villas at Hermann Park, a 320-unit community in Houston, earlier this year, with plans to renovate the community's common areas and residential units.
As prices for core multifamily properties continue to climb, investors are pursuing a greater variety of deals both geographically and in terms of the types of communities they acquire, with many turning to value-add investments whose inherent risks are sometimes offset by a higher potential yield. David Schwartz, co-founder and CEO of Taylor Johnson client Waterton Associates, which is actively acquiring multifamily properties through its 12th value-add investment fund, recently discussed the firm's strategy with Real Estate Forum. Schwartz explains why renovations don't always make sense, and how a few crucial missteps can torpedo returns.
