HASBROUCK HEIGHTS, NJ–Two veterans of multifamily housing at Marcus & Millichap have launched Redwood Realty Advisors, a real estate brokerage and advisory firm they say will focus exclusively on multifamily properties in New Jersey and New York, a property type they say wins “hands down” over office.
Multifamily industry leaders and long-time business partners Thomas McConnell, CCIM and Kevin McCrann formed Redwood and recently spoke exclusively to GlobeSt.com about their new enterprise.
Combined, the two have 25 years of industry experience. McConnell and McCrann most recently served as vice president and director of the National Multi Housing Group at Marcus & Millichap.
“We had great success at Marcus, we accomplished everything we felt we could at Marcus, and we decided it was time to move on,” says McConnell. “Kevin and I have worked together for more than ten years. We have a proven track record of multifamily sales.”
“What’s unique about our business model is that we operate as one team,” says McCrann. “We’ve created a business model that promotes teamwork and allows successful brokers to share in the profits of the company.”
Redwood Realty Advisors aims to create a better platform for today’s marketplace that focuses on true teamwork and a more thoughtful approach to each unique sales situation – all with the intent of helping clients maximize values. And the partners are bullish on multifamily as an asset type.
“It’s a phenomenal product type, and especially compared to the other assets out there, it makes for a better return and a safer bet, when it comes to an investor who is looking to invest in an office building or multifamily, they’re going to go with multifamily every day,” McConnell says.
The firm is currently marketing a 100-unit midrise complex in northern New Jersey, which McCrann thinks will attract “institution grade as well as private grade clients.” He points to a 125-unit Bergen County multifamily deal the pair negotiated at Marcus & Millichap where the buyer negotiated a “sub-five cap” rate, and after some serious capital improvements “was able to increase the rents 25 to 30 percent in some cases.”
“This particular product really gives the opportunity for an investor to come in and put in the granite countertops and other amenities that will push the rent up,” he says. “What’s exciting to us is to be able to show investors how to unlock that kind of value.”
Interest rates continue to be a concern, the pair says. “Right now we continue to have the ability to get sellers really strong numbers because interest rates are still at an all-time low,” McConnell says. “If they tick up, that will change the marketplace a bit. I think there will still be a strong appetite for multifamily, I don’t think that will change, but there might be a little price correction.”
Redwood will represent both private and institutional sellers and buyers of multifamily properties.
You can hear the complete conversation with McConnell and McCann in the audio player below.