Investment Strategy – Spoke Real Estate Capital

Innovative Investment Strategies
Redefining Real Estate Markets

The key to success in any Spoke investment is the selection of a best-in-class operator and the utilization of a joint-venture structure that aligns interests amongst all parties within a transaction. Spoke operating partners are vertically integrated with property management, asset management, accounting and capital markets teams.

Operating Partner

Meaningful
Co-Investment

Spoke selected operating partners will invest approximately 25% of the total equity requirement into any given Spoke deal.

Spoke and their operating partner will align economic interests with all parties using a joint-venture structure.

Experienced
Investors

Spoke forms long-term relationships with operators that have a quantifiable track record of success.

Spoke aligns itself with groups that have deep expertise in the multifamily space and seasoned in-place acquisition teams.

Professional
Management

Spoke operating partners have in-house property management and asset management teams.

Spoke operating partners have managed through multiple economic cycles and can quickly adapt to changing market conditions and trends.

Preferred 
Borrower

Spoke operating partners’ management and ownership experience gives them preferential treatment with lenders.

Spoke Advisory Partners’ deep lending relationships allow access to unique debt structures with both banks and life companies.

Our Process

01 Preliminary Review of The Operating Partner

Spoke completes review of operating partner

Check lender and broker reference
Meet with members of the organizations
Tour assets of current portfolio
Review underwriting of a deal
Negotiate JV terms to ensure alignment of interests

02 Spoke Decides to Move Forward

Operating partner and Spoke completes individually

Market study
Site evaluation
Business plan review
Underwriting review
Go/no-go decision

Spoke presents

Business plan
Final IC presentation

03 Asset Management Phase

Operating partner and Spoke asset managament

Weekly leasing reporting
Monthly review of performance
Communication with operator and investors
Planned trips
Constant analysis
Understand the market drivers

Acquisition Pipeline

The Spoke acquisition pipeline is comprised of opportunities provided to us by operators that have identified these deals as worthy acquisitions. These operators intend to move forward with these transactions regardless of Spoke involvement. After reviewing approximately 150 pre-vetted opportunities per year, Spoke typically executes on 2–4 opportunities annually after the below internal vetting process.

Our vast network of relationships with brokers and best-in-class operators provides a consistent pipeline of quality marketed and off-market deals.

We select the best deals from the pipeline to fully underwrite for quality, feasibility of the business plan and, ultimately, returns for our investors.

The Investment Committee selects the best deals from the Initial Review. This phase enables us to target above-market returns, weighing macroeconomic impacts on the business plan and ensuring an overall fit with Spoke’s investment strategy.

By the time an opportunity reaches Execution phase, it has been thoroughly vetted by investment professionals at Spoke Real Estate Capital, as well as the Operating Partner on the deal. The Spoke team, with over 100 years of combined experience, has not only underwritten the deal, but has also invested meaningful capital in every opportunity alongside the investors.

Spoke Asset Management

Weekly

Analyze the leasing trends in the market alongside our partners.

Look for trends and collaborate with our partners on concerns at the property level.

Track both market and submarket performance to provide insights to our management team in order to adjust operations to ensure competitive performance.

Monthly

Review the financial statements and compare to budget and pro forma.

Have a meeting with our partner to dive in deeper, propose ways to improve, and continuously push each other for beneficial results.

Understand not only the performance for the month but also how the investment is trending.

Quarterly

Dive in depth with our operating partner to review the performance of each investment.

Compile financial data for the most recent completed quarter.

Provide a comprehensive report to investors of the performance of each asset and how it tracks to original underwriting.

Annually

Q4 Report will summarize the annual performance of each investment, along with distribution analysis.

Communicate with our partners on each investment and plan for the upcoming year in terms of performance and budget.

Visit each property and market to understand how the asset fits in the big picture.

Proven Strategies,

Tangible Results

Pointe Parc

Pointe Parc is a 360-unit, Class B multifamily property located in close proximity of a Class A office park and shopping center in the Jacksonville MSA.

Reserve at Lake Irene

Lake Irene is a 384-unit, Class B+ multifamily property located in Cassleberry, a part of the Orlando MSA.

Palm Valley

Palm Valley is a 264-unit, Class B+ multifamily property located in Goodyear, a part of the Phoenix MSA.