Riaz Capital Fund V, LP - Distressed Value-Add Fund

INVEST IN VALUE-ADD REAL ESTATE

Take advantage of a wave of mortgage maturities
signaling distress and strong government incentives
to invest in a new real estate cycle


Play Now Track record performance metrics referenced in this video are gross of fees. Past performance is not indicative of future results.

Projected Fund Returns*

2-2.5x

Net Equity Multiple

12-17%

Net IRR

9.5-13.1%

Avg. Cash on Cash


OUR VALUE-ADD
TRACK RECORD*

2.3x

Net Equity Multiple

$18M

Total Distributions

9+

Year Hold

WE MAY BE AT THE START OF A NEW REAL ESTATE CYCLE

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$680+ Billion

Value of multifamily mortgages maturing from 2024 to 2026, forcing distress sales [1]

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2.5 M Units by 2030

California’s RHNA housing units goal, including >420K moderate-income homes [2]

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Speedy Approvals

Recent California ADU legislation enables small-format unit additions to existing buildings

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$500+ B in Incentives

The Inflation Reduction Act provides credits and rebates for renewable energy and energy efficiency programs, including for lower and middle-income housing.[3]

LEARN MORE

HOW WE CREATE VALUE IN THE FUND

Investing in value-add projects since 2012 has
helped us refine and inform our process.

Property 1

Data-Driven Deal Sourcing

Use direct-loan databases and broker networks to identify deals signaling distress

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Discounted Acquisitions

Acquire distressed or discounted assets with value-add potential

Property 1

Increased Density

Leverage California ADU legislation to add units through garage conversions and unit sub-divisions

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Energy Efficiency Upgrades

Leverage Inflation Reduction Act credits and rebates for solar installations and energy efficiency upgrades

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Reduced Cost of Capital

Access middle-income and affordable housing discounts on federal agency loans

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Enhanced Resident Experience

Optimize through technology: digital leasing, keyless entry & package e-concierge to drive up NOI and exit value

Our value creation process

RELATED THEMES IN THE MEDIA

HOW TO PLAY THE PROPERTY MELTDOWN IN FIVE CHARTS

Apartments might be a better bet for those hunting for distressed assets. Prices for multifamily apartment buildings have fallen by a fifth since March 2022…

The Wall Street Journal, Aug 30, 2023

'Granny flats' play surprising role in easing California's housing woes.

More than 23,000 ADU permits were issued in California last year, compared with fewer than 5,000 in 2017 — which was around when ADU permitting began to take off thanks to legislative and regulatory changes in the state...

The Washington Post, May 21, 2023

The Clearest Sign yet That Commercial Real Estate is in Trouble

Foreclosures are surging in an opaque and risky corner of commercial real-estate finance, offering one of the starkest signs yet that turmoil in the property market is worsening…

The Wall Street Journal, Nov 13, 2023

How will the IRA impact commercial real estate?

While you’ve no doubt heard about the Inflation Reduction Act (IRA), it may have evaded your sphere of concern as something only relevant to those focused on battling economic inflation or combating climate change...

Globest.com, Sep 21, 2022

DOWNLOAD FUND DETAILS

ATTEND OUR NEXT WEBINAR

Learn more about our Distressed Value-Add Fund

Join us for a discussion on how looming distress and federal and state legislation are uncovering opportunities for potentially high risk-adjusted returns.

Format: Presentation (40 mins), followed by Q&A (20 mins)

Thursday, Feb 29th, 2024 11:00 AM PT
REGISTER FOR THE WEBINAR
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Mathew Salter

Vice President of Investor Relations, Riaz Capital

Learn how we add value to properties

Learn more
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Rose on Bond

1638 47th Ave, Oakland, CA 94601

VALUE-ADD CASE STUDIES

Our decade-long track record of turning around distressed assets*

Property 1

2000 LINDEN

2000 Linden Street

3.76xGross Equity Multiple
9Years
Held
$3.4MTotal Distribution
$1.9MTotal
Profit

We purchased this property in October 2013 for $1.6M and sold it in April 2022 off-market for $5.2M. Our first successful implementation of micro-living, 2000 Linden, which was 100% leased within 30 days of opening, averaged an exceptional 95% occupancy in the first year.

Property 1

EASTWOOD

1715 High St.

2.10xGross Equity Multiple
2.5Years
Held
$3.0M Total Distribution
$1.6M Total
Profit

1715 High Street is a 33 unit apartment building in Oakland's Fremont. After executing unit upgrades, common area modernization, and building infrastructure improvements, we sold the building in 2016.

Property 1

Contra Costa

1460 Contra Costa

2.46x Gross Equity Multiple
2.9 Years
Held
$10.8MTotal Distribution
$6.4M Total
Profit

We purchased this off-market property with rents set at 60% of nearby institutional comparables. With extensive building repurposing and aesthetic upgrades, the rental rates beat those of local comparable properties with a basis of ~$13M.

Property 1

1844 7TH AVE

1844 7th Avenue

2.92xGross Equity Multiple
3Years
Held
$3.1MTotal Distribution
$2.1MTotal
Profit

We acquired 1844 7th Ave in 2013 for $2.9M. After improving the property's 32 units, adding infrastructure, and stabilizing operations, we sold the project for $5.5M in 2016.

*Performance figures shown gross of fees. Past performance is not indicative of future results.

NILES STATION -
A VALUE-ADD OPPORTUNITY

When we first encountered Niles Station through a trusted broker, the family who had owned the property for 40 years was ready to retire.

We acquired this 50,000 square foot site for its strong fundamentals and ADU potential at a $3M discount to its pre-pandemic value.

Our value-creation process resulted in a cap rate increase of 178 basis points and a ~81% increase to project-level net operating income over the project's development period.

Download the Case Study

About Riaz Capital

Riaz Capital is a Bay Area-based real estate development and asset management company, focused on moderate-income and student housing in California. Operating in the Bay Area since 1977, Riaz Capital has profitably developed housing in California across 160 different residential and multifamily projects.

~$760M

Total Real Estate Assets Under Management

3,000+ Units
57 Buildings

Under Management and Development

20+ Years

of Real Estate Experience in California

RIAZ TAPLIN

Principal and Founder

MAX RESHULSKIY

Chief Portfolio Officer & Partner

SETH LANG

Senior Vice President of Development & Partner

PAUL DICARLO

Chief Investment Officer & Partner

ARIEL BOYCE-SMITH

Human Resources and Legal Affairs

MATHEW SALTER

Vice President of Investor Relations

LISA VILHAUER

Vice President of Design and Entitlement

TIM ROONEY

Vice President of Development

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THE RIAZ CAPITAL ADVANTAGE

We create value for residents and investors while implementing smart cost reduction measures.

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Design Ingenuity

With decades of construction and design expertise, we develop premium-quality small-format housing that increases density and rental yield.

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Streamlined Marketing & Operations

We leverage technology to reduce leasing and operating costs including an integrated online leasing platform, virtual tours, and keyless entry. We've leased over 200 units without tours.

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Enhanced Risk Management

We underwrite with downside protection and maintain low leverage. By qualifying for 60 bps rate discounts, we gain 11% more loan dollars, reducing our cost of capital.

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Quick & Efficient Development

We leverage state housing laws to speed up project entitlement and sidestep local opposition. Our expertise in ADUs (currently 55 across 9 projects) leads to faster entitlement and execution.

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Use of Government Legislation

We have a 40 year track record of leveraging federal and state legislation like Opportunity Zone, ADUs, and IRA. We have employed the State Density Bonus Law across 23 buildings and 1900+ units* to increase density and lower costs.

Know More

FAQs

USD $250,000 (inquire about grouping).

For Accredited Investors only.

2.0-2.5x Net Equity Multiple, 12-17% Net IRR, and 9.5-13.1% Target Average Cash on Cash following investment period.

The fund target size is $100M with a $250M cap.

The fund will invest in distressed and other value-add assets with the potential for greater densification. The target properties will be located in Western U.S markets, primarily in California.

The investment term is 7 years with 2, 1-year extension options.


     What are the Management Fees?

There is a 2% Asset Management Fee on effective gross income plus additional property-level construction, management, and financing fees.


      Is there a Preferred Return?

Yes, Limited Partner investors are entitled to an 8% preferred return before the General Partner is entitled to any profit sharing.


     Are there any Fee Discounts available?

Yes, carried interest discounts are available for larger investments and commitments made prior to the fund's first close on 12/31/23.


After Limited Partners receive their 8% preferred return, the General Partner is then entitled to a 25% catch-up. Carried interest to be split 75% to Limited Partners and 25% to the General Partner thereafter.

The fund closing date is December 31, 2024.

This fund is not a Qualified Opportunity-Zone Fund.

CONTACT US

TO INVEST IN RIAZ CAPITAL FUND V, LP (DISTRESSED VALUE-ADD FUND)

Riaz Capital Fund V, LP - Distressed Value-Add Fund is offering securities under Rule 506(c) of Regulation D to accredited investors. Investments made under Regulation D involve a high degree of risk and those investors who cannot afford to lose their entire investment should not invest. Investors who interested in learning more or are considering investing request additional information from Riaz Capital Fund V, LP - Distressed Value-Add Fund and then should review the risks and disclosures provided.

While this website contains some information, it only provides preliminary and general information about the securities and is intended for initial reference purposes only. It does not summarize or compile all the applicable information. If an accredited investor expresses interest in the securities offered by the Riaz Capital Fund V, LP - Distressed Value-Add Fund, we will deliver confidential offering materials and additional documents about the company and offering. No offer or sale of any securities will occur without the delivery of confidential offering materials and related documents.

In addition to information about the securities, this website may contain forward-looking statements and information relating to, among other things, the company, its business plan and strategy, and its industry. Any operational projections or financial projections or returns shown on this website are estimated predictions only, are hypothetical, are not based on actual investment results and are not guarantees of future results or actions. Estimated projections do not represent or guarantee the actual results of any transaction, and no representation is made that any transaction will, or is likely to, achieve results or profits similar to those shown. In addition, other financial metrics and calculations shown on this website (including historical returns paid) have not been independently verified or audited and may differ from the actual financial metrics and calculations for any investment. Any investment information contained herein has been secured from sources that Riaz Capital believes are reliable, but we make no representations or warranties as to the accuracy of such information and accept no liability therefor. Nothing on this website should be interpreted to state or imply that past results are an indication of future performance.

This website is not an offer to sell or buy any securities. The information is not directed to any person who is not believed to qualify under the definition of an Accredited Investor under the rules of Regulation D of the 1933 Securities and Exchange Act.

The Riaz Capital Fund V, LP - Distressed Value-Add Fund securities are not registered and are offered in reliance of an exemption from registration. Neither FINRA, the SEC, nor any other securities regulator have approved of any of these securities. Further, these securities not listed on any exchange. A secondary market for these securities does not currently exist and may never develop. Investors should not purchase these securities with the expectation that a market eventually will develop. Further, even if a market did exist or develop, the securities have significant restrictions on their transferability.

It is advised that you consult a tax professional to fully understand any potential tax implications before making an investment.

Source

Value Creation why us