Remarkable shifts in demographic, economic and social patterns underpin a strong, continuing demand for rental housing for the foreseeable future. Currently, there is a very substantial supply deficit in the U.S. apartment inventory. Vacancy rates are down, rental income is up, and projected development of the new properties is not poised to close the supply gap for years to come.
While about a third of new properties being built will be concentrated in the six largest markets (Washington D.C., New York, San Francisco, Los Angeles, Boston, Seattle), cap rates in these markets have already experienced a significant compression. Properties in secondary and tertiary locations, however, have higher cap rates, which White Oak believes are increasing in value.
We believe the best investment opportunity in apartments today, from a risk / reward perspective, is in existing properties in these markets, which have not yet experienced significant cap rate compression.
We acquire, upgrade and asset manage properties across the U.S. Applying our broad market knowledge and experience, we find quality assets at below replacement cost prices and low cost debt, to hedge against inflation and enhance the property’s attractiveness at sale.
We conduct detailed, on-the-ground research, analyzing supply and demand, while observing ongoing developments, market drivers and trends, including housing affordability. We identify markets where there is compelling evidence of single family home pricing stability, job and income growth and an underserved demand for apartments.
We co-invest in every asset and believe in pay-for-performance, as our compensation is heavily weighted to the results we achieve for our investor partners.