Identifying Value Add in MF: Large CAPEX

[Matthew Metros]

I am looking to understand how CAPEX plays into the MF value add strategy. For example roofs and HVAC.

How do these two elements play into value add? 

Do they:

Lower the purchase price - because we identified the need to replace 

OR
Do they go into rehab costs because they increase rents and the appraisal value?

Overall, I am trying to understand how larger CAPEX plays into the overall picture.