An Ignoble Experiment: A Low-Risk Investment Strategy

2024/04/06

A Low-Risk Investment Strategy – MLG Capital

Dear Investor,

At MLG Capital "believable and achievable assumptions" isn't just a marketing tag line, it's a philosophy that all MLG employees embody and ultimately builds the foundation of their investment strategy. MLG's analyst team reviews over 100 deals every month and yet they only acquire 20-30 deals per year, this is a result of their rigorous underwriting process that stress tests prospective investments in every way imaginable. By utilizing the concept of believable and achievable assumptions MLG can easily weed out deals that contain too much risk for them and their investors, instead focusing on deals that have a promising outlook without making any outlandish assumptions about the performance of the asset or the future economic climate.

By way of disclosure, we have an advertising relationship with this MLG Capital, meaning we get paid for making this introduction and sharing this content. As always with these types of deals, consider this an introduction and not a recommendation. Every deal is unique and the responsibility to vet any and every deal you invest in still lies with you. This opportunity is available to accredited investors only.

Here are some of the factors that heavily influence MLG's investment strategy:

Rent and Sales Comps: When evaluating whether to purchase an asset, it's extremely important to understand what neighboring properties are renting at and are valued at. MLG specifically seeks out assets with below market rents and valuations, showing that there is opportunity to improve the financials of the property through proper management.

Job and Population Growth: Multi-family assets make up the majority of MLG's investments, meaning it's important to understand how housing demand will change in various geographic markets across the country. Estimated job growth in a particular market can help MLG predict population growth and therefore overall housing demand in an area providing insight into the occupancy level of the asset in coming years. Without tenants occupying units and paying rents it surely would not have a profitable investment!

Operational Efficiencies: Understanding how the prior owner of the asset managed and improved the property over time tells a lot about the potential for growth in the coming years of the asset's life. Many deals that MLG purchases have obvious operational inefficiencies that their asset and property management teams view as huge opportunities to grow the value of an asset. Understanding these inefficiencies and how MLG can improve on them over the hold period gives confidence in the long-term appreciation of MLG's investments as well as the short-term cash flows.

Protecting investors original equity is at the core of their financial goals at MLG Capital. They do so by using believable and achievable assumptions in their underwriting process and not stretching the numbers to make an asset seem like it is a once in a lifetime home-run investment. Smart real estate investments are what MLG Capital does best, taking chances with their investor's capital and fudging financials beyond what is believable and achievable has never been an option for them.

MLG Capital

If you'd like to consider an investment with MLG Capital or to learn more about how they work tirelessly to reduce risk for their investors, please do not hesitate to reach out to CJacques@MLGCapital.com or by visiting www.mlgcapital.com/whitecoatinvestor.