C-STAR SFR FUND CONTINUE DISTRIBUTING DIVIDENDS WITH FULL FOUR-MONTH RENT COLLECTION
New York, April 15, 2020: C-Star SFR Fund I has distributed the first quarter 2020 dividend of $0.5 per unit, representing 5% annaul dividend. As of the first quarter of 2020, C-Star SFR Fund I has achieved a portfolio of 100% leased rate, 7.7% capitalization rate, 7.8% current year Cash-On Cash and 21.1% projected 3-year IRR. Sherry Li, Founder and Chief Executive Officer, said, “2020 is a difficult year, it’s also a year for us to thrive from a reflection of our investment strategy and business modelnot only pursuing a growth during an appreciation period but also sustainability in a difficult economy.”
C-Star continues to generate quarterly cash return for investors and we have reserved extra cash balance to weather any changes of upcoming May and June due to COVID-19.
The Trend of U.S. Single-Family Rental Market
During the pandemic, there are some changes in the way people live and work, which affect people’s preference for housing locations and living conditions.
1. Seeking Healthcare Security
The pandemic has made people realize the importance of healthcare, and people will pursue suburban communities with better medical facilities and conditions. In the U.S., urban areas are usually populated at a higher density equipped with older public facilities and medical facilities and a lower number of doctors per capita. The medical facilities in the suburbs are relatively new, the population density is small and the number of doctors per capita is high. People are more likely to live in the suburbs seeking healthcare security.
2. From Apartments to Single-Family Homes
In March and April, we received a lot of applications from renters, many of whom were moving out of apartment buildings in the urban areas and looking for single-family rentals in the suburbs. Most apartment buildings are located in downtown, with dense population and people travelling by public transportation. Single-family homes are located in suburbs with a lower population density and people travel mainly by cars, which can effectively reduce spread of infections.
3. Working From Home Becomes a New Norm
Working from home is changing the way people live from the pandemic. With people spending more time at home, housing demand rises, and more people are pursuing high quality of living. The cozy, spacious spaces and home offices have become the most important factors for renters when they choose where to live. People worry less about the distance of commute but pay more attention to the qualities and conditions of living. As working from home becomes a new norm, single-family homes in the suburbs will become more preferential for people to live in.
4. The U.S Housing Supply Remains Low and Continue to Fall
The U.S. housing supply has fallen sharply since the 2008 global financial crisis and has not returned to a normal level. In the meanwhile, U.S. home-building activity collapsed in March as the coronavirus spread, with housing starts tumbling 22.3% from a month ago. (The Commerce Department) The continued decline in supply and increased demand for single-family homes in the suburbs are expected to be buoyant after the pandemic.
C-Star is a real estate investment management firm primarily in the Single Family Rental sector. It was founded in February 2018 and headquartered in New York.
C-Star successfully closed and fully deployed Fund I in June 2019 and aggregated a $5.7 million portfolio. It contains 36 assets located in 9 counties of Atlanta MSA.
In July 2019, C-Star launched Fund II and targets to raise $20 million USD of equity for investments in Atlanta and Triangle Charlotte MSA. C-Star SFR Fund II has made meaningful progress on fund raising, acquisition, financing and asset management ever since inception in October 2019. By the end of March, SFR Fund II has raised $7.12 million on equity and has closed 8 acquisitions of single-family homes in Atlanta mero area. 7 of 8 homes have been leased quickly after closing with an average lease-up period 8 days. The average time between renovation completed and the tenant move-in date is 20 days. The rent-price-ratio is 10.7%.
Investment Strategy of Fund II ：
Key Terms of Fund II:
- Minimum Capital Commitment: $100,000
- Investment Term: 3 year +1 year +1 year
- Distribution：Initially 5% – 6% increase annually, distributed quarterly
- Target IRR: 18% – 20% gross
- Acquisition Fee: 2% of Purchase Price
- Asset Management Fee: 25bps on AUM annually
Note: C-Star SFR Fund II has filed with the United States Securities and Exchange Commission (“SEC”) under Regulation D 506(c). www.sec.gov.
Investor Relations Contact
C-Star SFR Advisors
Tel: +1 (917) 755-5198
500 7th Ave, New York 10018