At TruAmerica, which was founded in June 2013 in partnership with The Guardian Life Insurance Company of America, Hart and his colleagues bought $3 billion in apartments from October 2013 to October 2015.
As former CEO and president of Kennedy Wilson Multifamily Management Group and now, at TruAmerica, Hart has run predominantly Class B portfolios for households making between $50,000 and $75,000 a year.
"We're not building Taj Mahals," Hart says. "We're trying to offer a better-quality product to people who are blue or gray collar."
Hart recently chatted with MFE about how he provides this essential housing:
Tell us a little about your renter profile.
What's the competition like for B assets among investors?
Are you seeing Class A buyers come down to the B space in search of yield?
How do you underwrite rehabs in the Class B space, where renters are more sensitive to price?
We're doing what we have to do while still offering a decent product. We're not doing $30,000-per-unit turns; we're doing $10,000-per-unit turns. We understand that there's sensitivity to price. Workforce housing is what I've been doing for 30 years. We're renting to the guy who works at the post office or who works at Walmart. It's more of a permanent renter.
Has credit quality changed?
How have Class B amenities changed?
We try to configure amenity spaces for larger fitness centers and create more issuable outdoor area for dog parks and pool decks. We're trying to create both indoor and outdoor spaces where people can spread out a bit and still enjoy a higher quality of life in their apartments.