Our Strategy
Wandery Capital identifies unique properties in supply-constrained markets and renovates the properties to position them for short-term rentals with luxurious amenities. Through these efforts, we target 12-14% cash yields upon stabilization.
Given that short-term rentals will eventually be institutionalized as the next real estate asset class, Wandery Capital is able to identify current market opportunities with target cap rate of 10% in anticipation of cap rate compressions upon exit as the assets gain interest from larger capital groups and institutions.
Value Creation as a Portfolio
By creating a portfolio, we attract larger buyers who seek out larger transactions such as institutional investors, private equity firms and family offices. These larger buyers will pay a premium price to own a portfolio of high cash flowing properties in a single purchase transaction.
Case Study
STR Pricing Arbitrage
$3.7M Net Value Creation
Purchased as a Single Family Home
$1.3M
Based on actual investment in Indio, CA.
Repositioned as an Investment
$3.0M
Maximizing NOI & cash flow (-$3M construction upgrades for a total basis of -$4.3M).
Exit Based on Cap Rate
$8.0M
Achieve over $1M+ Revenue or $600K at 7.5% exit cap rate = $8M asset value net value creation $3.7M.
STR Investment Advantages
Tax Benefits
Benefits from the same tax advantages as traditional real estate investments by offsetting profits with asset depreciation, construction costs, operating expenses, and by implementing other tax strategies.
Unique Investment
Alternative investment opportunity that combines the relatively low risk that comes with acquiring existing, passive income producing properties, with high opportunistic returns (on par with ground-up development), as STR investments are still in the “early adopter” stage of real estate asset classes.
Diversification
Opportunity to diversify outside of traditional real estate and other investments. Lack of correlation to standard market fundamentals creates an opportunity when the general market struggles.
