Providing Housing for Working Families

Mountain Path Capital is a vertically integrated real estate investment manager that seeks to acquire dislocated undervalued assets, generate value through focused improvements that drive income and appreciation, and provide a meaningful return to our investors.

Initially focused on middle-income housing, Mountain Path Capital appreciates the challenges that working families face when looking for moderate housing in great neighborhoods. The goal of the firm’s residential investments is to preserve and restore essential housing that is disappearing for families seeking a quality environment.

growing demand

Since 2007, the rate of home ownership has continually declined. Today, the rate of home ownership is nearly at its lowest level in 50 years at 63%. The factors leading to the historically low home ownership rate are complex, but the result is more households are renting than ever before. In the annual report published by the Joint Center for Housing Studies at Harvard University, the study estimates that 40 million households, nearly 1/3 of all households in the United States, need reasonable housing.

Diminishing housing Supply

Over 80% of recently built, multifamily developments have been luxury housing, out of reach for the millions of the middle-income households. Meanwhile, the supply of moderate housing has declined as older stock is removed from inventory. Builders often cite high construction costs to justify building middle income housing.

strong performance

According to the National Council of Real Estate Fiduciaries (“NCREF”), the multifamily sector has outperformed overall real estate composite bench during the last 30 years. A $1,000 investment made in 1986, would be worth $13,013 today, while an investment in the bench would have returned 24.5% less.

RESILIENT IN UNCERTAIN TIMES

The sector is also resilient during periods of economic uncertainty. From 2008 to 2012, during the Great Financial Crisis, a $1,000 investment would have returned $1,161 while a similar investment in the S&P 500 would have returned 6.5% less.

LARGER CASH FLOW TO INVESTORS

Multifamily distributes a larger portion of cash flow to investors versus other real estate asset types because of the significant cost differences of “below the line” expenses, such as leasing commissions and tenant improvements that impact the sector less. According to CB Richard Ellis Economic Advisors, the multifamily sector, on average distributes 83% of the Net Operating Income versus other product types, which range from 64% to 74%.