The deal had everything we look for: a clear value-add story, forced seller, and it was in a high-growth pocket within a city we’re bullish on.
We structured a creative back-door equity participation with the seller, and we had pre-existing relationships with the preferred equity provider (decision-maker) and lender, who was on board to restructure the loan.
It had all the hallmarks of an ‘Atlas deal’.
Bids were due, and we came in just below guidance, confident in our offer. The next day, the broker called with news that Blackstone came over the top with an all-cash bid, over the asking price.
That was the wake-up call. This deal checked every box—except one crucial thing was missing: a clear path to winning the deal. We’d overlooked a fundamental truth of our industry. Blackstone and other large asset management firms are playing a different game altogether.
At Atlas, our ambitious goal is to acquire $1B of high-quality (2000 vintage and newer) value-add multifamily real estate across the Southeast over the next three years.
It’s an incredibly competitive space, and for good reason: The Southeast is attracting young, affluent renters with the means and willingness to pay for updated, amenity-rich communities.
For Atlas to succeed, we need to have a strict buy box, lean into the things we can do that other operators cannot, and go all in when we find a deal we want to own.
So what does an actual ‘Atlas deal’ look like and how do we identify and win those deals?
Our process starts with a specific checklist for every opportunity:
- The seller must be forced or highly motivated.
- There’s a unique mispricing angle.
- A strong, supportable business plan.
- The deal must be in a high-conviction submarket.
- And, most importantly, we must have a clear path to winning the deal.
If a deal meets all these criteria, we commit time and resources to it.
The most time-consuming element is getting the story straight. We verify everything we’ve been told, taking nothing at face value.
My role in acquisitions is like that of an investigative journalist, seeking to answer the following questions:
- Why is the owner selling now?
- Why is the deal mispriced?
- Why is there untapped upside in the deal?
- Why are we confident in our business plan?
- Why are we the best buyer and likely to win the deal?
That last question—“Why are we the best buyer?”—is essential.
The answer is what makes Atlas special. It’s our competitive advantage over any number of qualified buyers. Here’s how we think about it:
We do things that only Atlas can do. We have access to flexible HNW and family-office capital and are unencumbered by legacy portfolio issues. We take unique stances on markets/rent growth. We roll out mid-term furnished unit strategies. We bring tailored design and renovation programs. We lean into what only Atlas can do.
We know more than anyone else. The best operators know the most and we pride ourselves on being the most informed, the most researched, and the most thoughtful group. We’ve been investing in the Southeast for the past 14 years and have spent thousands of hours touring deals, allowing us to quickly identify opportunities and overlooked assets.
We are not afraid of making mistakes. If we’re not making mistakes, we’re not taking enough risks. We are willing to take calculated risks if the upside potential makes sense.
We’re relentless. When the first few people say “no,” we don’t back down. We push through barriers, pursuing opportunities with passion and focus.
We foster a culture of passion and continuous learning. Everyone at Atlas is committed to growing and staying informed, whether through books, podcasts, or conferences. This culture creates unique insights and perspectives that large firms can’t replicate.
These aspects change how we think about the risk/return of an opportunity. If we believe the market will grow faster than the forecasts, we identify a unique upside angle, and we’re willing to take risks, our upside case is more attractive, our downside is better protected, and sellers/brokers know we’re the most informed buyer.
This also changes the math regarding what we’re willing to pay for a deal, making us the most aggressive buyers.
We’re not being reckless; we just know more and have more conviction than other buyers.
Our goal is to identify 3-5 mispriced assets with strong downside protection and significant upside potential.
Is it easy? Absolutely not.
Are we positioned with the people, infrastructure, and desire to make it happen? You bet!
