Diary of a Real Estate Fund Manager

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)

Investment Summary:

In value-add turnarounds, even with a dream team like ours, there are times when the budget runs over. This project required $11,000 more in repairs than we initially projected — yet we still delivered an initial net ROI expectation of nearly 10%. This outcome highlights the margin of safety we build into every deal, allowing us to perform even when costs shift.

Property Overview

Address: 22477 S Kane St, Detroit, MI 48223

• Purchase Price: $50,000
• Estimated After Repair Value (ARV): $125,000
• CapEx (Capital Expenditure): $40,000
• Rent Potential: $1,200/month
• Square Footage: 914 sqft
• Year Built: 1952
• Lot Size: 46 x 118ft
• Property Taxes (2024): $1,141.64
• Zoning: R1 (Residential)

Neighborhood Analysis

• Location: Eliza Howell neighborhood
• A quiet brick street close to Schoolcraft/I-96 and Outer Drive, allowing easy access to the nearby suburbs
• Market Insights: The Zillow Home Values Index shows this area’s average property values to be about $90,000 in 2025, about 15% higher than the rest of Detroit, showing its desirability to the local residents
• The I-96 allows the residents to enjoy nearby suburban lifestyles, such as access to Costco in Livonia (7 mins) and Meijer on Grand River (8 mins).  It is also 20 minutes’ drive from the Detroit Metro Airport on the Route 39.

Investment Summary:

The simple ROI expectation on this property is 9%.  The Team was able to save approximately 20% on the original cost to repair.  We estimate a conservative 30% equity growth out of the project.

Property Overview

Address: 19352 Westmoreland Rd, Detroit, MI 48219

• Purchase Price: $65,000
• Estimated After Repair Value (ARV): $135,000
• CapEx (Capital Expenditure): $45,000
• Rent Potential: $1,200/month
• Square Footage: 1,029 sqft
• Year Built: 1949
• Lot Size: 40 x 112ft
• Property Taxes (2024): $2,402.23
• Zoning: R1 (Residential)

Neighborhood Analysis

• Location: O’Hair Park neighborhood
• Close to the 8 Mile Road that divides Detroit with its suburb Southfield, offering excellent access to many supermakets such as the walking distance Appollo, Save A Lot, Food Land and even Sam’s Club.
• Sits on a quite all brick road, the golden standard for Detroit housing
• Market Insights: The Zillow Home Values Index squarely placed this zip code to have appreciated over 6% YOY
• Proximity to amenities such as hospitals, pharmacies and restaurants