Post by Arn Cenedella

Gary Lipsky provides some great insight here. In a normal market ie not a market with historically low interest rates and huge decrease in cap rates, operations matter. They make the difference between a deal that works and one that is in trouble. In a normal market, operators must win in the margins….with skill, experience, and expertise, professional operators can eke out an additional 2% to 3% in gross income and reduce expenses 2% to 3%. That 4% to 6% positive delta makes all the difference. A zero cash flow deal is now a healthy cash flowing deal. A deal on life support - not paying for itself - becomes break even and survives to fight another day - rather than go back to the lender or sale at a loss. Spark Multifamily Investment Group we are “de facto” vertically integrated. The property manager is a full and equal member of the GP team. The property manager shares in the “promote”. Do you think that might motivate the PM towards superior performance? The answer is obvious.