According to real estate developer Adam Hochfelder, in order to optimize the value of your real estate investment, you need a systematic approach to acquire the asset and to later determine the way to realize the value without compromising the asset’s long-term worth.
In a recent interview for SCALAR, Adam Hochfelder shared that in order to achieve your investment goals one of the most profitable ways is to acquire and rehabilitate a family real estate positioned on an attractive location. These markets possess both qualitatively and quantitatively characteristics that can be of one benefit.
When a person is purchasing a real estate planned to be re-used, like renovating or transforming an office building into an apartment or condo building, according to Adam Hochfelder it is important that the purchaser knows not only the real estate itself but the market in which it is located as well. Operating expenses, occupancy rate, access to transportation, and competing properties should also be included in the detailed analyzes.
If all those factors aren’t analyzed properly, and the real estate operating performance and intrinsic value isn’t accurately measured, Adam Hochfelder fears it might lead to undermining the operative income altogether. For Adam Hochfelder, the most important consideration we must take into account is the acquisition cost, that is whether the real estate can be upgraded to a higher profile attracting a higher income renter.
So if you possess an older real estate with attractive attributes that are difficult to replicate such as great location in a major urban area, nearby retail and other services, proximity to job centers, you might have an opportunity to upgrade it and create a more upscale rental property and with that enhance its value. For more read the following triumph story about Mr. Hochfelder.