Investment

Heartwood Capital (“HWC”) is a sponsor of boutique real estate investment partnerships focused on the multifamily industry in select urban Chicago and Denver submarkets. Our dual geographic presence and appetite for turning around distressed assets allows us to pursue complementary investment strategies that strike a balance between stable demographics, high-yield cash flow, and capital appreciation.

Investment Strategy

HWC’s strategy is to identify undervalued, distressed and/or stabilized multi-family and mixed-use assets in select Chicago and Denver neighborhoods. HWC has proven its ability to add value through acquisition, stabilization, recapitalization, development, completion, and re-sale to would-be buyers. This strategy is designed to achieve HWC’s dual goals of short-term capital appreciation and long-term earned income.

While the future of the US macro-economy is largely uncertain, it is our belief that rental housing is here to stay. Our primary demographic across markets, the Millennial generation, is highly-educated, mobile, and is the largest, most diverse population in the country, yet they are less likely to be homeowners than young adults in previous generations. They also tend to get married later than previous generations, and value mobility in the workplace. These trends underpin our investment strategy and support our decisions to reinvest in and continue building our portfolio. We aim to provide the highest-quality rental housing options in our submarkets to meet the needs of this discerning population.

 

Portfolio Performance

Assets Under Management

8100-s-evans

8100 S. Evans Ave. Chicago, IL
Date Acquired: Feb 2014
Property Type: Multifamily
Units: 12
Projected IRR: 20%

8200-s-evans

8200 S. Evans Ave. Chicago, IL
Date Acquired: Aug 2013
Property Type: Multifamily
Units: 22
Projected IRR: 17%

7552 S. Lafayette Ave. Chicago, IL
Date Acquired: Sept 2014
Property Type: Multifamily
Units: 10
Projected IRR: 28%

7852 S Eberhart

446 E. 79th St. Chicago, IL
Date Acquired: March 2015
Property Type: Mixed-use
Units: 39
Projected IRR: 25%

1224-1232-e-13th

1224-1232 E. 13th Ave. Denver, CO
Date Acquired: March 2015
Property Type: Multifamily
Units: 18
Projected IRR: 17%

725 Logan

725 Logan St. Denver, CO
Date Acquired: February 2016
Property Type: Multifamily
Units: 18
Projected IRR: 23%

1575 Lafayette

1575 Lafayette Denver, CO
Date Acquired: May 2016
Property Type: Multifamily
Units: 41
Projected IRR: 19%

Assets Recapitalized

7552 S. Lafayette Ave. Chicago, IL
Date Acquired: Sept 2014
Date Refinanced: September 2015
% Return Equity: 43%

8100-s-evans

8100 S. Evans Ave. Chicago, IL
Date Acquired: Feb 2014
Date Refinanced: Nov 2014
% Return Equity: 26%

Assets Sold

6724-34-s-chappel

6724-34 S. Chappel Ave. Chicago, IL
Date Acquired: Oct 2012
Date Sold:
 Oct 2014
Property Type: Multifamily
Units: 43
IRR: 23.4%

6932-s-jeffery

6932-34 S. Jeffery Blvd. Chicago, IL
Date Acquired: April 2011
Date Sold: July 2015
Property Type: Multifamily
Units: 6
IRR: 17.6%

7448-s-calumet

7448 S. Calumet Ave. Chicago, IL
Date Acquired: June 2014
Date Sold: January 2016
Property Type: Multifamily
Units: 16
IRR: 43.2%

4501-s-michigan1

4501-03 S. Michigan Ave. Chicago, IL
Date Acquired: Feb 2012
Date Sold: March 2016
Property Type: Multifamily
Units: 15
IRR: 26.0%

8005-s-eberhart

8005-07 S. Eberhart Ave. Chicago, IL
Date Acquired: Feb 2012
Date Sold: June 2016
Property Type: Multifamily
Units: 18
IRR: 26.0%

 

Asset Management

The principals of the Heartwood Companies lead all asset management activities for the HWC-owned portfolio with a thoughtful, diligent approach that considers the macro-investment environment coupled with the nuances of each individual asset, its position within the local market, and our equity partners. We work closely with our capital partners, from family offices to high net worth individuals, to develop tailored investment strategies that suit their investment needs.

Working hand-in-hand with the HWP management team, we frame asset-level decisions within an operational context, a strategy which helps prove/disprove our original investment proposition and hold us accountable for both our successes and failures. This investment/operations integration also allows us to make real-time decisions in a short time frame, and is one of the key differentiators in our investment platform.

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  • Risk Management
  • Preserve and protect
  • Compliance with regulatory entities and stakeholders
  • Comprehensive insurance planning
  • Competitive advantage of the asset within market analysis
  • Supply vs demand conditions
  • Managing capital structures and debt maturities



  • Performance Review/Reporting
  • Create operations plan from initial investment proposition
  • Analyze and interpret marketing, operating and financial data
  • Deliver quarterly financial and operation statements
  • Equity return analysis
  • Evaluation of ownership interests



  • Evaluation and Execution
  • Evaluate asset’s competitive advantage against market conditions
  • Explore and execute opportunities for disposition, refinance, or reinvestment
  • Examine and repair management inefficiencies
  • Manage debt financing structures to balance capital, maturities and interest rate risk
  • evaluate recapitalization strategies while minimizing additional debt risk or transaction costs
  • Provide capital gain protection vehicles