CFO CORNER: RISE48 EQUITY PORTFOLIO UPDATES OCTOBER 2021

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UPDATES ON RISE48 EQUITY

OPERATIONS UPDATE

Throughout our assets, we were able to increase rents by another 4.5% this quarter. On average, we’ve increased rents by 15.5% year over year. For deals that we took over in Q1 2021, we’re seeing that we can get our pro-forma renovated rents on our classic units. This means that we can effectively increase rents and burn off loss to lease with little to no pushback. From an expense perspective, we continue to see some increases in payroll as a result of the nationwide shortage on labor. We’re continuing to work with our PM to identify the right candidates and offer competitive salaries to our employees. The robust rental growth, coupled with stabilized expenses is resulting in us pushing past our NOI targets. We’re exceeding our pro-forma budgets across the portfolio and feel that all of the properties are performing very well.

CAPEX UPDATE

 

The robust rental growth, coupled with stabilized expenses is resulting in us pushing past our NOI targets. We’re exceeding our pro-forma budgets across the portfolio and feel that all of the properties are performing very well. 

PHOENIX MSA UPDATE

Realpage reported a year over year increase of more than 25.95% in rental growth in the market. Yardi reported a similar increase of just north of 20% year over year rental increase for workforce housing with more than 2.0% increase month over month. Yardi anticipates Phoenix to have approximately 21.4% rental growth for the next 12 months.
 
Berkadia also released their Q3 2021 Report Card for Phoenix, AZ. Overall, rents, occupancy, absorption, and employment are exceeding forecasts and deliveries are trailing the forecast. All of this is good news for current owners as the supply and demand squeeze continues to favor landlords.
Phoenix also ranked #1 in the nation for home price growth. According to the S&P CoreLogic Case-Shiller report, Phoenix home prices grew 33.% year over year while national home prices grew about 19.8% as of August 2021. 
 
From a macro perspective, BLS reported the month over month inflation increased by 0.4% which adds up to a 5.3% increase year over year. 

Rise48 Equity has completed $424,251,000 in total transactions since 2019, and currently has $384,251,000 of Assets Under Management, all in the Phoenix MSA.

To learn more about our investments, schedule a call: www.rise48equity.com/invest or visit our website: www.rise48equity.com