Axiom Workforce Fund I LLC ("AWF")
The Axiom Workforce Fund I LLC invests in income-producing single and multifamily workforce housing assets.
AWF sources, analyzes, purchases, and operates stabilized and non-stabilized multifamily ("MF") assets producing pre-specified yields to provide stable cash flow with consistent appreciation and annual rent growth. The Fund may also make opportunistic investments in single family rental ("SFR") workforce housing properties, not to exceed 5-10% of the Fund's total assets. The Fund is structured as a Texas limited liability company open for investment for two years. The anticipated term of the Fund is two years from the close date, subject to the Manager's election to extend the term of the Fund up to three one-year increments.
Value Proposition
Opportunity
Demand for high-quality, affordable workforce housing far exceeds supply and is projected to continue to do so for years to come. As a result, Class B/C multifamily and sub-$1,500 rent single family rentals have enjoyed strong rent growth and high occupancy rates.
Team
The principals of the Fund's Manager have extensive, years-long experience with all aspects of single and multifamily real estate investments. They collectively have originated, rehabbed, managed, and sold thousands of residential housing units (both MF and SFR).
Technology
AWF benefits from a proprietary, vertically integrated real estate platform that includes all required systems, processes, and resources to efficiently buy, rehab, lease and manage the Fund's assets.
Summary of Key Terms
| Entity | Limited Liability Company (Texas) | ||||||||||
| Structure | Closed-end Reg D 506(c) fund | ||||||||||
| Investor Profile | Accredited Investors | ||||||||||
| Offering Period | 2 Years | ||||||||||
| Investment Period | 2-5 years from end of Offering Period | ||||||||||
| Preferred Return | 7% | ||||||||||
| Target Return | 12%+ IRR (net of fees) | ||||||||||
| Management Fee |
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| Profit Split |
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| Acquisition Fee: | 1.0% of asset purchase price | ||||||||||
| Minimum Investment | $100,000 | ||||||||||
| Manager Co-investment | 5% of equity (up to $1,000,000) | ||||||||||
| Redemptions | Subject to manager's discretion | ||||||||||
| Leverage | Up to 3:1 at the SPE level | ||||||||||
| Investment Manager | AWF MGR LLC | ||||||||||
| Administrator | Opus Fund Management | ||||||||||
| Audit | Saville, Dodgen & Company | ||||||||||
| Treasury | Origin Bank |
Investment Approach & Projected Returns
The Fund acquires stabilized and non-stabilized multifamily workforce housing real estate assets at pre-specified Net Cap Rates to generate 8-12%+ annualized returns including appreciation.
The target acquisition ratio of stabilized to non-stabilized assets is 75/25. Stabilized assets (renovated with rent-paying tenants) produce positive net cash flow from Day One, while non-stabilized assets benefit from an initial bump in value upon stabilization. Stabilization of a distressed multifamily property may take three to twelve months on average.
We anticipate that current financing by leading financial institutions, both public and private, will continue to be favorable for stabilized multifamily apartment communities, with terms in the 70%+/- LTV and 4.5-5.5% interest rate range.
The Fund intends to take advantage of the "Tax Cuts and Jobs Act of 2017" which provides for "bonus" depreciation on all projects through Cost Segregation Studies performed on the assets; this will potentially result in significant tax deferral/savings to investors.