COMMUNITY INVESTOR
INVESTOR PROFILE
Home Away from Home PHOENIX REAL ESTATE PROS FIND THE PERFECT FIT WITH CORPORATE HOUSING FRANCHISE.
of these channels for renting out their properties and eliciting higher [short-term] rents, but they frequently don’t realize that vacancy rates are quite a bit different in short-term housing. Quite often, owners will try to do it themselves for a year or two, then start looking for a different type of solution and come our way,” she said. HOWTOUSEYOUR IRAFOR CORPORATEHOUSING Another unique thing about AvenueWest Phoenix is that the company is familiar with helping investors purchase and manage corporate housing rentals through their self-directed individual retirement accounts (IRAs). The Vosts have direct experience in this type of real estate investing, which, if handled incorrectly, can yield extremely destructive fines and penalties from the Internal Revenue Service instead of a solid, lasting retirement fund. “We actually have one person who has invested his entire self-directed IRA through our program,” said Mark, noting that AvenueWest Phoenix provides a “buffer” between self-directed IRA owners and their investments that is crucially important for the security of those investments. Meghan explained, “We do the furnishing, take professional photos to promote the property, set up utilities and do all the custom set-up because a self-directed IRA investor is not supposed to put any kind of sweat equity or direct value into their real estate investments. Unless you have someone managing the property like us who can handle every aspect of the investment, a self-directed IRA would be tough to utilize in corporate housing. This way, our clients can use their retirement accounts to invest in a type of rental that will probably yield much higher rates of return than a conventional rental property in the same area.” Tim Berry, J.D., a Phoenix-area self-directed IRA and 401(k) attorney
who operates IRAIdeas.com and serves as chief legal counsel for Self Directed Investor (SDI) Society, observed that in a market like Phoenix, this type of investing scenario works quite well because many times investors hope to eventually move into their luxury properties themselves during retirement. “You might have your IRA purchase an investment property, and the great part is that if you fall in love with the home, you can always distribute it out of your IRA and live in it!” he said. The Vosts are constantly on the lookout for properties that fit their list of requirements and that their investors might like to live in themselves as well, someday. “We do all the due diligence and make sure it meets all the criteria for corporate housing as well as for the individual investor, and then we close on it,” Meghan said. She added that often properties that have just closed require immediate staging and custom preparation for a corporate client. For example, she explained, “We closed on a property 12 days ago. Five days later, we had furniture delivered, completed maintenance and staged the property for photos. Tomorrow, we’ll go back and custom-stage with a “welcome” gift package for the incoming tenant who arrives for a two-month stay this week. That’s a lot of work in a three-week window, and a self-directed investor using an IRA couldn’t have done any of it, no matter how desperate the need. Our investor didn’t have to.” At the end of the (warm, sunny Arizona) day, however, what the Vosts say they and their investors love most about managed corporate housing are the people they are helping – and the high rates of return. “We work hard to get properties that we believe will stay occupied at least 80 percent of the time, and we typically see that our owners with the right type of property realize about a 20 percent higher annual return than
just doing a traditional, unfurnished, 12-month-type tenant,” Mark said, noting that the group gets its traditional market figures from the MLS.
NOTJUSTFOR RELOCATINGCLIENTS
by Carole VanSickle Ellis
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“We have such a varied client base,” said Meghan. “The lion’s share of what we’re doing may be with companies and corporate travelers, but we also work with people who are out here for extended health care, such as patients waiting on a lung transplant list for a medical program here in the Valley. One of the requirements for that list is that you move to Phoenix because when a lung comes in, you’ve got to already be here. We had one tenant whose grandchildren came out with him, and when he got his transplant and was released to go home, one of the little girls had written in sweet, backward letters, ‘Thank you so much for finding a nice place for our Grandpa to live.’ We kept that one!” AvenueWest Phoenix also works with people who have been displaced due to fires or floods and need a safe, comforting place to live with their children while their home is being restored. “You have to make sure you have places where the HOA allows pets,” Meghan said, noting that about two- thirds of corporate clients either travel with or are relocating with a domesticated animal. Fortunately for the Vosts’ renters and investors, it’s pretty safe to assume that no matter what your pet or your luxury- housing preference, the Vosts have already read the “fine print” on a property in their “stable” and can have it staged and ready for you to move into your home-away- from-home in no time flat. •
hen Mark and Meghan Vost started their real estate careers
owners now have portfolios with us,” Mark observed, adding that this is a good thing for everyone involved because of the Phoenix-Tucson area’s burgeoning presence as an extremely attractive alternative for high-tech companies fleeing the West Coast. “There are some people who say that Phoenix is the true Silicon Valley, but that it’s flying under the radar,” he said, pointing out that the Greater Phoenix Economic Council recently disclosed that a number of major corporations are expanding into the area and that there is a growing international corporate presence in the city as well. As Meghan explained, “Arizona is an extremely attractive area for international relocations uproot their family and relocate. There are certain things that make relocation appealing, and one of those things is sunshine.” Of the “sunshiny” states traditionally on the list for consideration, she said, “California can be prohibitive because of taxes and property values. Florida can be complicated for certain highly regulated industries in that state, and Texas, while it has some attractive areas, can’t beat Arizona’s low taxes and affordability.” because part of any company’s decision- making process for this type of move involves considering that they are asking their employees to
not only get the advantages inherent to owning property in Arizona, they also get to leverage AvenueWest Phoenix’s annual proprietary “heat index,” which helps the Vosts and their investors identify areas within the metro region that are particularly “hot” for corporate housing, and the company’s uniquely close relationship with many of the most exclusive developments in the area. “We take our proprietary market information and translate it to maximize occupancy for existing investors and then to identify communities in which we need to acquire more properties,” Mark said.
about two decades ago, they knew right away that they loved the industry and that they loved working with people with an investor mind-set. Their affection for the entrepreneurial and the creative found its “forever home” just a short three years ago, however, when the Vosts launched AvenueWest Phoenix, a division of AvenueWest Global Franchise, and immediately set to work putting a unique, attractive spin on corporate housing. “Most corporate housing is based around one entity – a company or an individual – leasing a property and furnishing it, decorating it, etc., and then subleasing it to a corporate client,” explained Mark. “What is different about AvenueWest Phoenix is that we’re also a fully licensed real estate brokerage in the state of Arizona.” This means the Vosts are uniquely positioned and qualified not just to manage the meticulous process of catering to high-paying corporate clients, but also to find properties for their investors’ and clients’ portfolios that fit the needs of those high-paying corporate clients to a T. Kimberly Smith, CEO of the AvenueWest Global Franchise, noted that in her opinion, the Vosts have already “created an excellent foundation for future success [thanks to] their systematic approach to growth and their talents connecting with the business community.”
AvenueWest Phoenix is “very intentional” about not just acquiring
properties, but also about establishing
relationships within the communities where it
works, he added. “We follow HOA guidelines however they want,” he explained. This creates firm partnerships between
AvenueWest Phoenix and the community, and it often translates to positive word- of-mouth endorsements that enable the company to access deals on new properties and enroll new clients in their program. “One beautiful thing about the Phoenix market is that [new properties] tend to find us,” said Meghan, noting that often they receive calls from investors who have purchased a property in the area, “perhaps as a second home or investment,” and expect to make mortgage payments by renting the property out on VRBO or Airbnb. “People get very excited by the idea
Carole VanSickle Ellis is the host of Real Estate Investing Today, a daily nine-minute
investing podcast, and the editor of the Bryan Ellis Investing Letter. Contact her at editor@bryanellis.com or visit www.selfdirected.org.
KNOWINGWHERE IT’S ‘HOT’ Investors who work with the Vosts
‘FLYINGUNDERTHERADAR’ “A lot of our existing one-property
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