OVERVIEW
Harborfields Realty Investors LLC invests in multifamily rental apartment communities that have been a bedrock of housing in America during all economic cycles and interest rate environments. The Co-Founders of Harborfields have acquired and continue to own multifamily properties which have historically delivered stable cash-on-cash returns that have increased steadily while the underlying real estate has appreciated in value. Our investment properties have delivered superior risk adjusted returns and are an effective hedge against inflation. This sector of the real estate market experiences the least volatility in the most turbulent periods.
Harborfields does not focus on properties situated along picturesque harbors or shorelines or adjacent to rolling fields and parklands. Instead, we seek properties that, under our stewardship, will provide a safe harbor for your investment dollars and consistent cash flow distributed quarterly on a tax advantaged basis.
Our investments are not exciting, exotic, or flashy. The only excitement these investments will provide are reliable quarterly distributions, institutional quality reporting and open transparent communication from the Co-Founders.
PLATFORM
“Our platform was set up by two risk averse real estate investors looking for stable cash returns and value creation over time. That is what we have achieved and are confident that we will continue to deliver.”
-Tom O’Connor
The Co-Founders have acquired and continue to own more than twenty properties with over 5,000 residential units in the Northeast United States. The collective sixty-five years of experience of the Co-Founders has resulted in significant relationships in the real estate industry which are built upon mutual trust and respect. This gives Harborfields a competitive advantage in transacting with sellers and sales brokers as well as agency, bank and other lenders in order to acquire properties at smart prices with the best available financing terms.
The Co-Founders of Harborfields seek stable cash-on-cash returns and an overall superior risk adjusted return through that cash flow combined with value creation and appreciation. Our investors, who have invested with us repeatedly alongside our own capital, share the same objectives. We care for our investors’ capital as much if not more than our own and structure our investments so that our collective interests are completely aligned throughout the investment period. The Co-Founders invest a substantial amount in each property as the platform was originally founded as a way for us to invest our own capital, generate tax efficient cash flow and create wealth.ealth.
Each investment is fully capitalized when the property is acquired. We acquire properties with moderate first mortgage debt (generally 60% to 75% of total costs and reserves) on a long term (7 to 15 years) fixed rate basis. Our objective is to achieve a cash-on-cash yield in the first year that exceeds the return on high quality ten year municipal or corporate bonds by 1% to 2%. While the yields on such bonds remain flat with no capital appreciation at maturity, we acquire properties with cash yields that we can increase over time causing the property to appreciate in value. Therefore we are targeting average cash yields during the investment period of 7.5% to 9.5% and an overall IRR of 11% to 15% or more.
Harborfields is not a fund. On each investment property that we acquire, our investors decide for themselves if they want to participate. Harborfields’ investors are generally family offices and high net worth individuals. Several accounting and law firms use our investments to supplement their partners’ investment and retirement portfolios.
STRATEGY
“Simply put, Harborfields’ strategy comes down to basic fundamental real estate analysis combined with proactive management and attention to detail.”
-Sam Kirschner
We believe that superior risk adjusted returns begin with cash flowing properties in regions with solid real estate supply-demand fundamentals. We have been investing in multifamily apartments since 2009 in regions with a stable population and employment base where renter demand outpaces apartment supply, keeping occupancy high and allowing for regular rent increases. We focus on areas with a comparably low cost per unit and a pattern of slow steady rent and population growth without big swings in either a positive or negative direction. At the same time, we avoid regions that are highly subscribed and so competitive that surges in prices have driven down investment yields.
Harborfields has the expertise to execute all types of value-add opportunities. We develop a business plan for each property depending upon the opportunity and then capitalize the deal and staff the operations and management team accordingly. We have acquired assets where we believe we can operate at better margins than the prior owner. Some properties allow for increasing value by bringing below market rents to market. Many properties allow for adding value through cosmetic interior upgrades while some apartment communities require a substantial redevelopment and capital plan. Often, we can create value through a combination of these strategies.
Historically, we have always partnered with a best-in-class local property manager we have previously worked with or known and respected. Again, we align interests by requiring the property manager to make a meaningful cash investment in the property while having them share in the carried interest earned after a return of and on investors’ capital. This incentivizes our management team to maximize property performance and returns to our investors. Each property manager will lead the local day-to-day property management, leasing and tenant experience efforts relying on its property management system, critical mass of managed properties in the region, deep vendor relationships and leading technology to maximize returns. Harborfields retains control and final decision making. As asset manager, Harborfields provides institutional quality oversight and reporting assuring that each property is operated professionally and within budget while executing the business plan in a timely and cost effective manner. Harborfields leverages its relationships and expertise to acquire desirable properties and obtain the best available financing that is accretive to our investment returns.
We will lose or walk away from many more deals than we will ever buy as we will only move forward when we believe the economics of a deal will more than satisfy our and our investors’ mutual goals. Harborfields will only have our investors contribute their capital after our due diligence process is complete and we are ready to close on the acquisition.
