Diary of a Real Estate Fund Manager

Investment Summary:

Subject Property had a tenant that was vetted by our property manager prior to purchase.  The initial Cash-on-Cash returns subject to property tax revision next year is projected at a highly respectable 10.8%.  The acquisitions team places the sitting equity to be around 40% as-is.

This is a home-run by all accounts; however, there are qualifications to be mindful of. The difference in the internals of rented properties cannot be factored in as precisely as we would like when compared to nearby sales.

Even though the nearby sales support a value in the $130,000–$150,000 range once the property is cleaned up, the underwriting team recognizes that this equity is subject to how the tenant will leave the condition of the property.

Investment Summary:

This sits on one of our focal concentrated areas, very close to our other successful acquisitions such as 16725 Murray Hill, 18239 St. Marys, and 18951 Lauder.

18445 Steel also outperformed all of our original underwriting expectations.

The property was purchased on 2025-02-19, and was leased up by 2025-06-25, in 4 months, at half the rate of the 6 to 9 months underwritten for all of our vacant acquisitions. Upon repair completion, the property was given 30% equity growth by our conservative standards.  Zillow has given more, with its Zestimate of $143,000 as of September 2025,  suggesting a 65% increase over the project’s actual total budget. The final CapEx came in lower than originally underwritten, at $22,545.  The rent projection of $1,250 was also easily surpassed at $1,320.

Its simple Return on Capital, or Cash on Cash expectations for the first year, is projected to be over 13% (unadjusted for a tax hike to follow ownership change).

Investment Summary:

This was a value-add property in deteriorated condition — the proverbial “ugliest house on the street.” Our rehab team turned it into a cash-flowing rental exceeding underwriting expectations in under three months, even in the middle of a Michigan winter. The home leased within two weeks of repair completion, validating both our underwriting assumptions and confidence in the neighborhood.

Initial ROI expectations are approximately 9.9%, pending property tax adjustments under new ownership. Full rehab projects have become, and remain, extremely costly in the post-pandemic era.  In this particular project, this has lead to a lower equity capture than we typically target.

The strength of this acquisition lies in the area’s strong desirability, consistent rental demand, and the advantage of our on-the-ground presence. As a fund with long-term focus, we remain optimistic that this property will deliver value as the area’s home prices and rents appreciate into the next few years.

Investment Summary:

We acquired a property in excellent condition with an extremely reliable tenant who keeps the house in great condition. Nearby comparable home prices suggest an immediate equity capture of $40,000+ with minimal initial CapEx. The starting ROI is a staggering 12%, although in this area, the property taxes are likely to hike after purchase.  This investment will vastly outperform our typical value-add acquisitions targets of 1) ROI of 7%, and 2) first-year equity capture of 30%.

Property Overview

Address: 15351 Whitcomb, Detroit, MI 48227

• Purchase Price: $68,000
• Estimated After Repair Value (ARV): $120,000
• CapEx (Capital Expenditure): $5,000
• Current Rent: $1,200/month
• Square Footage: 1,321 sqft
• Year Built: 1929
• Lot Size: 40 x 130ft
• Property Taxes (2024): $2,904.39
• Zoning: R1 (Residential)