Market Overview

During the 50’s, 60’s, 70’s and early 80’s, Boston and the greater metro area was a 2nd to 3rd class city with stagnant to declining demographics. With an overweight in defense spending and health care, Boston and the MSA was the tallest midget in New England reliant on only 2 major drivers of the local economy (tourism being the third). 

Growth in health care, financial services, higher learning institutions, biomedical research organically led the resurgence of Boston. Today, it is a highly sought after first class city.  (GE relocating to Boston perhaps one of the best examples)  Commonly compared to NY City, Washington DC and San Francisco, Boston and surrounding communities now offer a 24 hour experience, growing younger population, highly educated workforce and a graduating student base no longer exiting Massachusetts after graduation, as it did for so many previous decades.

Massachusetts, unlike many other states but for the peers mentioned above, has high barrier to entry components of limited land availability, high land cost, high labor cost and general reluctance for housing growth. It is these barriers that continue to keep supply/demand in balance in favor of landlords. Yes, in time, newer product has and will be built appealing to the more affluent renter buoyed by high salaries, but Class B apartment communities are not being built and will continue to be in high demand in all parts of the business and real estate cycles.

While there will be opportunities outside of the Rt.495 belt, most long-term opportunities will exist within this ring. We should not lose focus on the fact that the business drivers mentioned above start in Boston and find themselves outward. Investing in the high barrier to entry properties, like in the past, will continue to pay off. We should not dismiss that the financial services, bio research, population growth, health care and high education are here to stay and not part of a boom that will go bust. There are many more legs of the stool supporting the local economy and Boston and surrounding communities are benefiting from each other unlike any time in the past.

Over the years, many investors lament of the day they sold their property. Looking back, they realize that the price was high for that moment in time, but in hindsight, realize that both income and values increase over time. The one-time gain on sale was initially exhilarating only to be followed with, “we need to put the money to work and get some cashflow, I don’t want to have it sitting in the bank”. Our philosophy is to invest in local, feel and touch properties we want to own for a life time. In time we may sell a property due to declining demographics, however, it is more optimum to hold, reinvest and provide tax free refinancing distributions than outright sale. With over 45 years of real estate acquisition, finance and property management experience, our focus will be on long term hold, return based capital investment and refinancing of existing assets. In turn, assets will grow in value simultaneous with growth in cashflow. It is expected with this philosophy that your investment will see tax free refinancing proceeds every 8 years with additional leverage being placed on the asset not exceeding 65% of the then value of the asset assuring no overleveraging and consistency in performance.