Are institutional like returns possible with smaller assets?
Hello BiggerPockets community,
As I begin underwriting smaller acquisitions targets in both Logan Square and Englewood, I find it hard to project anything beyond a 10% IRR, CoC above 3.5%, and an equity multiple north of 1.06.
At the moment, I lack the sufficient experience, net worth, and UNHW LP base to analyze larger apartment deals.
In my view, smaller apartments are ripe for acquisition (i.e market inefficiencies, etc.) since fewer shrewd, sophisticated GPs are available to make offers.
Hence, less competition.
However, the pro forma will not appeal to a more affluent LP pool outside of Chicago. And this is necessary before I can accrue the necessary equity to make an offer on a prime opportunity.
Any thought?