There's Also Gold Outside the Box

IRVINE, CA—Finding a niche that the masses either haven’t yet discovered or aren’t interested in is one way to increase yield. For the Bascom Group LLC, focusing on class-B and –C properties has been a successful niche for one of its fund, says Chad Sanderson, a principal in business acquisitions and development for the firm.

As GlobeSt.com reported earlier this week, the firm has closed its second fully discretionary real estate investment fund, Bascom Value Added Apartment Investors II LLC. The fund provides up to $300 million of buying power, with leverage, for value-added multifamily acquisitions across an 11-state region. Since the start of the capital raise, the fund has acquired six multifamily properties and has specified another two properties that are expected to close in the first quarter of 2014. According to Jerome Fink, managing partner of Bascom, “Fund II is designed to acquire individual properties priced between $8 million and $45 million. The main focus of the fund is on class-B and –C properties that are often outside the typical investment parameters of many institutional investors. Historically, we have been able to find better risk-adjusted returns on value-added deals with these characteristics.”