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Vareco advantage

VareCo has successfully built two critical divisions that drive our competitive advantage in the market;
construction and property management.

Prosper has successfully built two critical divisions that drive our competitive advantage in the market;
property management and construction.

Being able to force appreciation that leads to having multiple options on the exit are two of the main reasons Prosper focuses on value-add opportunities as opposed to building new construction, buying Class A, or stabilizing properties. Investors in stabilized multifamily assets mostly rely on market-driven rent appreciation or cap rate compression to deliver yield. Prosper can force appreciation through its proven process of adding value to properties through renovations and operational efficiency through its property management team. Historically, Prosper has been able to complete 90%+ of the value-add process within the first 12-18 months of acquisition, which would not be possible without an in-house construction management team. This kind of speed allows Prosper to drive yield through execution rather than relying on market forces.

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Before

This property is a total of 41 units, and was acquired in October of 2020. The purchase price on this property was $3.35M

After

VareCo held this project for 32 months with a disposition price of $6.75M and project level MOIC of 2.2x

Vareco advantage

In-House Property Management

Prosper Communities is a wholly owned subsidiary of Prosper that has turned and leased over 1,000 value-add units above pro forma since 2018. Prosper believes the best way to have its property management team aligned with the motivation of its investors is to have property management in-house. Most third-party property managers are motivated to grow their bottom line. In contrast, Prosper’s team is motivated to grow NOI and maximize each property’s potential.

Before

This property is a total of 41 units, and was acquired in October of 2020. The purchase price on this property was $8.0M. Legacy rents were $1,150 per month.

After

In under 12 weeks, the LivLavender property management team was able to lease all 41 units at an average of $1650 per month, averaging $200 above pro forma. Due the execution speed, VareCo held this project for 18 months with a disposition price of $12.8M and project level MOIC of 1.8x.

Vareco advantage

Construction Management

Prosper’s construction management team has over 30+ years of combined experience covering every trade needed to execute any multifamily and single-family remodel. Finding skilled labor continues to be the bottleneck in today’s construction industry. Prosper’s construction team are also fluent in Spanish which gives it a significant advantage in attracting, retaining and strengthening its relationships in the labor force. Prosper’s construction team also manages Prosper’s warehouse which stores all building and maintenance materials.

Before

The Iris, acquired in November 2021, had the same owner since 1975. We were very excited to modernize this property and maximize its potential.

After

Upon acquisition, the construction teams were able to renovate 230 units in the first 21 months of ownership when pro forma was estimated at 4 years to completion.