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apartments by marriott bonvoy

A New Innovation to Meet the Changing Needs of the Traveling Public By Carole VanSickle Ellis Almost 100 years ago, Marriott International began not as an international chain of hotel brands and bespoke service providers but, instead, as a small A&W root beer stand owned and operated in Washington, D.C., by founder J. Willard Marriott, Sr., and his wife, Alice. Over time, that company grew to include the East Coast’s first drive-in restaurant, the world’s first in-flight catering service, and, in 1957, a monumental shift into the hotel business in Arlington, Virginia. Today, the company is poised for another strategic expansion — this time into the serviced-apartment concept in the United States and Canada. Serviced apartments are fully furnished apartments available for short- or long-term stays, depending on the preference of the service provider. For Marriott, this shift is not really as monumental as it might first appear. The company has 26 years of experience with Marriott Executive Apartments operating in Asia, Europe, the Middle East, Africa, and Latin America. Apartments by Marriott Bonvoy is simply the next link in the chain. “We are always peeking around the corner, looking for opportunities for our company to grow and serve the traveling public in new ways,” said Noah Silverman, Marriott International’s global development officer for the U.S. and Canada. Silverman explained that the company has been tracking the travel preferences of today’s “digital nomads,” remote employees and freelancers who are location-independent and use technology to perform their jobs from anywhere, as well as consumers who are increasingly combining business and leisure travel. Since the advent of COVID-19 in early 2020, the concept of being able to work from anywhere has expanded into the mainstream, with entire families engaging in longer-term stays in intriguing locations. “Customer preferences have evolved as the digital nomad has grown up, and workplace requirements have evolved to allow people to work from locations other than their office,” Silverman continued. “We have also seen a significant increase in leisure travel and extended families all traveling together. This new product will meet the needs of that growing population, one that is looking for more space and the ability to park themselves for longer periods in a larger, residential-style apartment versus a traditional hotel room.” Paul Loehr, the company’s regional vice president of full service brands in the U.S. West Region, called Apartments by Marriott Bonvoy a “unique opportunity” not just for travelers, but also for real estate investors and developers to partner with Marriott in a new way. “We are already fielding many phone calls from developers and potential partners who have specific projects in mind that they feel are an ideal fit for the concept,” Loehr said. He added, “There has been incredible interest in the offering from parties ranging from existing hotel partners who increasingly see value in the serviced apartment space to traditional apartment developers.” Lisa Sexton, regional vice president of full service brands for the U.S. East Region, called the response to the initial announcement “incredible.” She explained, “It is not limited to one type of market or catering to one type of traveler over another.” All three agreed that the prevailing drivers of interest in this new offering are rooted in the Marriott brand itself and the potential for Apartments by Marriott Bonvoy operators to customize the projects to fit the needs of the development and the local market. “As a brand partner, we are able to deliver higher-rate premiums at lower cost than when developers do things on their own,” Silverman explained. “The product is appealing because of the reputational endorsement that comes with being part of the Marriott Bonvoy portfolio of brands, the significant advantage of our large-scale distribution platform, and our 170-million-plus members loyalty program.” Loehr emphasized that Marriott prioritizes developer and investor returns in a variety of ways early in the development process as well as once the doors of a new facility open. “We review each application carefully to make sure that the location and type of product will work together to optimize the partners’ chances of financial success,” he said. This means being willing to ask tough questions early on. “We ask about rates, revenues, and costs to build,” Loehr explained, noting that specific urban and secondary markets are well-suited for Apartments by Marriott Bonvoy. Expanding the Pool of Owners and Franchisees When Marriott first began considering the idea of premium-tier serviced apartments in the United States and Canada, the company was primarily considering how to meet a new and growing customer preference while expanding its pool of owners and franchisees. Silverman explained that they expected to attract primarily hotel owners seeking to diversify their existing holdings, and that expectation has proved valid. However, he continued, there has been substantial interest from the multifamily development community as well, even though that group of owners/investors previously focused almost exclusively on traditional, long-term rentals. “An increasing number of the investors expressing interest are hotel developers who are thinking about adding a few floors to a planned building or developing an entire building for short-term rentals,” Silverman said. “If you are one of these developers or a multifamily developer looking to move into this space, Apartments by Marriott Bonvoy should be considered. Our system can reliably deliver customers in a cost-effective way, and we think savvy investors are seeing that and responding to it.” Silverman continued, “Previously, in the United States and Canada, our extended stay brand offerings topped out in the upscale quality tier with Residence Inn by Marriott and Element by Westin. Those are unbelievably powerful and successful hotel brands, but we believe there is a higher-end consumer willing to pay more for a truly differentiated, premium and luxury product, and that is what Apartments by Marriott Bonvoy will be.” Loehr noted that many parties expressing interest in the offering have specific developments already underway that could incorporate the Apartments by Marriott Bonvoy concept. “The developer will create a unique brand for the project and deliver an attractive

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Turning the Tide

NPLA & Pitbull Conference By Jon Hornik The National Private Lenders Association (NPLA) is the association that represents and protects the interests of Private Lenders as it pertains to new legislation and public policy. Our organization has built a community of members made up of lenders, capital providers, brokers, developers, and industry service providers. The mission of the NPLA is to support, protect, and grow the Private Lending Industry. Pitbull Conference is known as the “Market Maker in Private Lending,” producing the largest national Private Lending conferences three times per year. Serving the Private Lending space for more than 20 years, our success can be attributed to consistently producing premium events for industry professionals to network and grow their businesses. Although the association is independent of the conference, moving forward, the NPLA will play a more prominent role in the event. The conference will provide high-caliber networking opportunities, crucial real-time information regarding marketplace conditions and industry standards, and a lineup of entertaining events. We have established a strong foundation with the brightest minds in Private Lending. Now, the changes we are making will enhance the membership experience and transform the Pitbull Conference. We welcome you to join our community of members and conference guests. Below are our membership updates and conference lineup. NPLA Membership Updates We believe a diversified and engaged membership base will enhance the experience of our members. That is why we have expanded our membership options. If you have heard about the NPLA, but have been unsure about joining, consider an Affiliate Membership to get your foot in the door. Membership Details »          $2990/year membership for one »          $200 discount to Pitbull Conference »          Access to one NPLA conference call per month »          Access to all NPLA video conference call recordings »          Full access to the NPLA Portal (Member Directory and Active Lender Directory) »          Permission to display the NPLA logo on your company website and email signature »          Legislative updates »          NPLA lapel pin This membership does not include: in-person NPLA member-only events, voting eligibility, or committee participation. Limited availability for two years. Be Prepared for What’s to Come in 2023 The NPLA hosts biweekly meetings that have become a trusted resource for members. Members and special guest speakers discuss the most critical issues facing the Private Lending Industry. We are excited to announce our exceptional lineup ofcontent that will advance our mission to build community through education and mentorship. February »          Housing Market Forecasts and Economic Outlook for 2023Learn what various research houses are saying about house prices and the broader economic outlook for 2023. »          John Burns Real Estate Consulting Session: Single-Family Rental and BTR UpdateDanielle Nguyen, Senior Research Manager March »          Cash Management for Private Lenders — How to Maximize your Balance Sheet in Tough TimesManaging cash flow is paramount in times of constrained liquidity and is essential for a company’s survival. This encompasses cost management discipline, balance sheet velocity through quick loan sales, and proactive special servicing. »          Brokering Loans, White Label Table Funding, Closed Loan SalesThough liquidity is tighter, it’s still there under the right terms. Learn about the various methods of funding and understand the risks and benefits of each. April »          Funds, REITs, Syndication, CrowdfundingAs liquidity has dried up, the private lending market has gone full circle back to some of the old ways of funding. A few examples are private placement funds, co-lender or participation of loans, and direct retail investment through crowdfunding. However, some of these methods have been refined. Learn from different lenders about the various vehicles they use to fund their loans. »          Legal (MLPAs, Participation Agreements, Reps/Warrants, Buybacks)Understanding key terms in loan sale and participation agreements. In good times these agreements are rarely looked at; however, changing markets tend to reveal weaker lending practices, which expose lenders to asymmetric existential risks. This session will discuss methods to ensure that your loan production is tight and adheres to the reps/warrants you are making. May »          Warehouse LinesFrom seasoning lines (to quickly fund and sell off balance sheet) to longer-term hold lines — mark to market vs. committed. Learn about the types of lines available and how lenders use them to expand their balance sheets and create additional liquidity when capital markets are tight. »          John Burns Real Estate Consulting Session: For Sale Market Update (New Homes and Resale)Devyn Bachman, Senior Vice President June »          InsuranceThe cryptic world of insurance leaves most lenders inadequately covered. For balance sheet lenders and those selling loans to loan aggregators, insurance losses could trigger buyback risks and principal losses. Learn why Homeowners insurance is not enough and the types of policy features and limits that are required. »          John Burns Real Estate Consulting Session: JBREC’s Macro OutlookAlex Thomas, Senior Analyst Questions about the NPLA? Contact Amy Kame, amy@nplaonline.com Join the NPLA community at https://nplaonline.com/#join Experience the New Pitbull Conference 2023 March 25-27, Ritz-Carlton, Key Biscayne, Miami Our new event structure showcases the biggest players in the Private Lending Industry, educational and motivational speakers, and newly added networking sessions with hundreds of local brokers. We welcome you to join our community and attend our upcoming conference. Register at https://pitbullconference.com/march-2023-event-registration/ See What the Buzz Is About — Key Biscayne Event Lineup Saturday, March 25 »          NPLA Golf TournamentKick off the weekend with the NPLA Golf Tournament. Members and conference guests will enjoy a day on the greens at the Miami Beach Golf Club, including lunch, swag items, awards, and a cocktail hour. This is a great networking opportunity.             Tournament fee not included in registration. This event is complimentary for Corporate and Associate NPLA members. Sunday, March 26 »          NPLA Membership Meeting and Networking BreakfastNPLA members will meet to discuss progress, goals, and strategic initiatives for the association and the industry in the coming year. We will also be hosting a member-only networking breakfast. This is a closed event for Corporate and Associate NPLA members only. »          Pitbull Networking Session #1 (NEW Event)Start the evening in the sponsor hall and network

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Recipe for Success: Building Trust and Bringing Out the Best in People

John Gordon — Director of National Accounts, Home Depot By Carole VanSickle Ellis In 1980, a newly married John Gordon and his wife were heading toward Lansing, Michigan, where they expected Gordon to join computing powerhouse IBM in the company’s marketing department while his wife earned her master’s degree at Michigan State. They were loading the truck to head for Michigan when they got the call: IBM was in a hiring freeze and Gordon’s offer had been rescinded. The job was not available anymore. “This was 1980, and the unemployment rate in Michigan was either 16% or 13%,” Gordon recalled. “I can’t remember whether unemployment or interest rates were higher.” They arrived at their new apartment, unloaded the truck, and Gordon started looking for work. “I had paid my room and board in college doing handyman jobs and had enjoyed doing those kinds of things. I had worked as a carpenter’s helper in high school,” he said. “When my wife told me she saw a “Now Hiring” sign at 84 Lumber, I applied and got a job as a counter salesman. I worked there for 12 years in positions from salesman to VP of Regional Purchasing before joining Home Depot.” Gordon joined Home Depot early, starting out as an assistant manager in the Pineville, North Carolina, store. It was the company’s first store in the state. Ultimately, he took over as manager of that store before opening a store in Rock Hill, South Carolina, and eventually helping launch the company’s Pro Initiative in 1999. “When we started the Pro Initiative, we did it because we believed we could be doing business with professional customers as well as our DIY customers, so my 84 Lumber background made me a good fit. Today, that initiative accounts for about half the revenue of a $150 billion company!” “We Knew We Had Something Big” Gordon laughed when asked how things were in the beginning before the team knew for sure that the Pro Initiative would be a success. “It was great, and it was terrible,” he said. “I was doing all the things I like doing — dealing with contractors that I knew could benefit from all the resources at Home Depot and that previously had only shopped in our stores to a small degree — but we were already a really big, $30-billion business that only could change the way things worked so quickly.” Gordon described the process of integrating Home Depot Pro into the greater Home Depot body as “teaching a monster to dance.” He explained, “When your monster dances one way, it turns out you don’t have to teach the entire beast to dance differently. You just figure out which parts need to move and change those.” Gordon said the joke in the early 2000s was that every Home Depot was different. “If you saw one Home Depot store, you saw one Home Depot store,” he laughed. “So at every store, we had to go in and figure out what things had to change.” That involved everything from Pro Desk placement to product inventory and how to serve the needs of customers who would order 50 or 100 of an item at a time instead of fewer than 10. “It was an exciting time,” Gordon said. “It went screaming by, still feels like it was yesterday.” Gordon emphasized that in those early days with Pro Desk, as today, the group of people he worked with made up an incredible team and support system. He noted that many of his former team members and customers have gone on to work in high-profile positions across the industry, and he is proud to see them sitting on speakers’ panels onstage and still figuring out solutions to problems that real estate investors encounter today. “Working with all of these people, trusting them and having their trust as we figured things out in this industry, those are things of which I’m really most proud,” he said. “It’s About Relationships” One of the most constant themes in Gordon’s career in the industry has been his dedication to building and maintaining trust and solid relationships with peers and colleagues. At its foundation, Gordon said, this core behavior has its roots in a conversation he had with Dave Young, an executive and colleague from his earliest days at 84 Lumber. “Dave was getting ready to retire, and I think he was trying to make sure I understood that just because now I was in a big position at a big company it did not give me permission to be anything but respectful and to build strong, strong relationships,” said Gordon. He continued, “He told me a story about a time he was trying to sell a certain type of siding that he simply could not make profitable in a particular market. No matter what he tried, he sold at a loss or very close to a loss. When he shared that with the leadership at the siding company, they told him they would send him a separate blank invoice for that market and he could fill in the cost he needed that would allow for both competitive and profitable sales.” Gordon recalled being dumbstruck. “Who is going to give you a blank invoice?” he asked. Young told him, “It’s about relationships,” and 42 years later, Gordon has never forgotten this. “When I’m in a scenario to make decisions and be in the driver’s seat, I remember what Dave told me that day, and I make the decisions based on being the kind of person that people can trust.” This dedication to being trustworthy and honest has made Gordon a perfect fit for the Home Depot culture, he said, adding, “If you go in a Home Depot store today, there are people who have been there 20, 30, even 40 years, and I get asked a lot, ‘Why do people stay at Home Depot so long?’ The truth is that it is because Home Depot makes it easy to

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Utilizing Blockchain Technology in the Construction Industry

Is It Necessary? Will It Help? By Paul Gozzo New home construction is not broken. In fact, just the opposite; construction has evolved well over the last ten plus years. Builders of all sizes and specialties who build affordable houses all the way up to large custom homes, have adopted many new technologies into their processes. The majority of those innovations have taken place on the materials side of the building equation. These technological advances have historically focused on one area of need with a specific intent to improve that ingredient of the build. This includes concepts ranging from smaller components like leak detection systems to much more robust applications such as alternatives to concrete, all of which will continue to evolve and grow until they become generally accepted pieces of the residential build environment. Lagging behind these mostly material advancements and where we have yet to see any significant improvements is in the way new home construction is financed. We certainly have witnessed incredible amelioration with construction processes such as with prefabricated construction where entire sections of a new house are built off-site utilizing warehouse efficiencies including robotics. The sections are then transported to jobsites and assembled like an adult version of the classic metal toy, Erector Set.  And, 3D printing by innovators such as ICON continues to evolve, as well. In fact, Lennar, one of the nation’s leading homebuilders, has partnered with ICON to build 3D-printed homes at a project currently underway in Georgetown, Texas. Yet, the process by which houses are actually built has not changed much at all. While existing processes are not necessarily flawed, there is room for improvement. I believe the advancement of blockchain technology will affect positive change when it comes to scattered site new home construction and specifically, the relationship between borrowers and lenders as it relates to workflow and payments. Blockchain and the Lending Process Historically, a borrower seeking a new home construction loan would submit an application to a bank or private lender and would need to have roughly 10%-30% of the total project cost including lot value in cash to get a loan. Plus, they would need additional equity to make the first set of payments to contractors and municipalities before being reimbursed in arrears through the archaic draw inspection process whereby an independent third party is engaged by the lender to inspect the home being constructed. These inspections can occur 20-25 times during the building process. The inspectors then report back to their client confirming that the money being lent has been spent on that exact project so that the lender can release the next payment to their borrowing client. With blockchain technology, the power to automate all components of the construction process now exists allowing for greater visibility and a faster construction process. For example, draw inspections alone can become obsolete as the need to confirm dollars spent on a project can shift from scheduling third party inspectors for approval to instant verification because blockchain can automate the contractual process and record all of the transactions along the way, including local building codes. While process improvement and clarity between lender and borrower are helpful, the existing methodology works, so this is not a situation where something is broken and needs to be fixed. However, among the many positive potential enhancements that blockchain can offer new construction comes in the speeding up and expediting of the process. For example, in most of the counties where I have built new homes, the municipalities inspect the job five to seven times during construction. This probably will not change any time soon, but if the draw inspection process can be built around these municipal inspections, then in theory the need for third party loan verification approval (20+ inspections) can be omitted and the build process can move along quicker and thus speed up project delivery. Blockchain and Construction Data Another benefit of blockchain technology infiltrating new home construction is in the collection and transfer of construction data at the time of sale. This means that all the details of the newly built house are transferred to the new and subsequent owners upon sale which can be tremendously helpful for homeowners and investor/landlords alike when diagnosing an issue at a later point in time. Think of not only having the product name and serial number for a microwave or AC unit to determine what the warranty status is but having that information in much more detail for every aspect of your investment property. This would include not only data on each big ticket item beyond mechanicals to include plumbing, windows, and doors but also at a more granular level to include paint colors, fixtures, hardware, and lighting, to name a few. Then further out, any additional remodeling work can be documented on the blockchain resulting in a very clear and detailed view of the home from its inception. As an investor, wouldn’t you like to see this level of detail prior to submitting your best offer? Other potential applications include the way subcontractor work is tracked and payments are processed. This would include concepts such as what can be most closely associated with a “score card,” whereby vendors are rated similar to the way you and your Uber driver rate each other. In this case, blockchain can be used to track timelines and budget metrics for each subcontractor culminating in quantifiable performance reporting which is helpful not only to general contractors and builders, but also to contractors (at least the ones that perform well anyway.) Smart Contracts Additionally, if contractors can adopt the same technology as builders, then “smart contracts” can be used as an accountability measure defined in advance between builder and contractor and where automated payments can occur when predetermined milestones are met. By definition, a smart contract is a self-executing contract with the terms of the agreement between the parties being directly written into lines of code. The code and the agreements contained therein exist across a distributed,

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Where is Build-for-Rent Headed?

The Market is Still Fundamentally Strong By Adam Stern For context, my firm provides Advisory and Investment Sales Services for regional builders looking to break into or expand in the Build-For-Rent segment, and showing them how to take residential projects and fit them into the Build-For-Rent mold in order to sell their neighborhoods as rental communities to long term buy-and-hold operators. Let’s start with a view of where things just were and where they are right now before delving into what lies ahead.  The Past and Present The housing market in general is coming off a white-hot run where everything from resale homes to new construction homes were flying off the shelves shortly after they were listed. But the market changed in Q4 of 2022. There was a tangible and abrupt shift in the buying patterns of investors in the institutional Single Family Rental (SFR) industry, from the largest publicly traded REITS to smaller private equity and privately funded SFR investment firms. I would estimate buying velocity is down now by as much as 80% from a year ago. Firms that were continually buying particular homes in certain markets have shifted to buying opportunistically. This means they are not so much buying homes that fit a fixed set of criteria, but are now looking for homes that both fit that criteria and have a special circumstance that could lead to a lower than market acquisition price. Those firms that have made the shift are now competing with smaller fund buyers (who were generally always buying opportunistically) for that very inventory. So, professional investment firms active in buying both existing homes and new construction homes overall represents a relatively small segment of the real estate market. These firms, until recently, were very actively funneling capital into the housing market, and are now waiting to see where the market is going before resuming business as usual. Where the Market is Headed Some of those firms from large to small that have been actively pursuing both existing home acquisitions and new construction single-site projects (what is traditionally known as Build-For-Rent), seem to be shifting the majority of their focus to just Build-For-Rent. While the overall pace of acquisition in the institutional SFR sector cools, the desire of firms to see Build-For-Rent projects from builders is actually increasing. It’s a very strange time in this still relatively new and nascent market niche. The economy is slowing, inflation is high and interest rates are high, but inventory is still very low in many markets around the country. Builders are looking at investors to be a second option for them to sell their inventory to while still hoping for strong retail sales. Investors are being very solicitous to see that very inventory, but to make a deal work, both sides of the transaction need to squeeze to make deals come together. Investors need to accept lower overall returns for projects in order to make the option viable for builders, and builders need to be good with thinner margins in order to pen a deal to sell all units in a subdivision to investors. It cannot stay like this forever. So, the question remains… Where is Build-For-Rent headed?  The highest value opportunities being sought by larger scale investors are single-site subdivisions in prime markets that are large enough to house an amenity like a pool and have an onsite leasing office. If a sub-market within a certain Metropolitan Statistical Area (MSA) is proximal enough to the major population centers in that market, meaning being drivable within 30 minutes to major employers, and close to shopping and retail thoroughfares, those communities have been and will continue to be highly sought after.  For a while, there has been talk about the Build-For-Rent trend moving to smaller markets outside of top large markets with populations over 1 million people. I have seen and even attempted to sell projects that fit this mold. It is very difficult to get firms interested in projects in smaller markets unless they are already sold on owning in that market. It is an arduous road. What is happening now on a limited basis and is more likely be the case in the years ahead, is we will see some differentiation in strategies from fund investors where they will do the heavy lifting to get comfortable with certain smaller, tertiary markets and affirmatively start looking for opportunities there. Builders in markets like these will either have to find those firms or set themselves up as evangelists for their particular markets and look to draw firms in with opportunities. This is why Strata SFR was set up to be an Advisory firm to builders first, and an Investment Sales organization second. The task of taking a project that is already under way, building it out, and then structuring the subdivision for sale as Build-For-Rent is a critical first step. Only then does a builder have a chance at either working with a firm like ours or trying on their own to make a market for those communities with a Build-For-Rent investor audience.  The Case for Smaller Projects Behind large single site subdivisions in major and tertiary MSAs are smaller projects that generally are not big enough for an on-site leasing office or amenity. These types of projects, generally ranging from as little as 20 units to high double digits, are a hard sell to most larger fund investors. If a project sits in proximity to other assets or communities of a current rental operator, they can be very attractive, as that operator can look to add doors and scale up their footprint in a particular area. This is only attractive so long as the performance of their current portfolio of homes in the area is strong, and the new units will not directly compete with their already operating inventory. We generally like seeing these smaller projects in good locations in large markets where the potential buyer pool is large and where any firm operating rentals in the area would be a potential take-out buyer. These smaller projects in tertiary markets without large scale investors already owning there generally won’t be

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Greenville-Spartanburg, South Carolina

The Palmetto State’s “Emerald City” is Still a Prime Location for Investors By Carole VanSickle Ellis The Greenville, South Carolina, real estate market has normalized, and that means the Palmetto State’s “Emerald City” is looking more alluring than ever in 2023. Ranked fifth on Realtor.com’s “Top 10 Real Estate Markets to Watch in 2023 and Into the Future,” Greenville boasts a combination of “better housing affordability, greater numbers of renters who can afford to buy a median-priced home, stronger job growth,” and more according to NAR analysts. “Job growth is robust in this area, but job growth in the information industry is even stronger,” wrote NAR’s research group, headed by chief economist and senior vice president for research Lawrence Yun. Information industry jobs, those that deal with data and its management or strategic analysis, are among the most well-paying jobs in the country at this time. These positions pay about 50% more than average, occupy prime positions in a variety of rapidly growing business sectors, and boast an employment multiplier of 5.7, meaning that for every information job in an area, nearly six additional jobs are created. In both the Greenville and Spartanburg areas of South Carolina, information employers are congregating in increasing numbers. Of course, the presence of technology and engineering companies in the Greenville-Spartanburg area is nothing new, which makes it a straightforward process to extend the state’s expertise on courting these industry sectors to information and high-tech operations. Nearly 40 years ago, Lockheed-Martin opened its first South Carolina site. Today, that location is the sole location for assembling F-16 fighter jets and is in the process of hiring to bring its employee total to 1,200. The state has long recognized the value of bringing in employers operating on the cutting edge of technology, offering millions of dollars in support to target industries and even adjusting how air and freight facilities operate in order to make companies’ existence easier and more profitable. This dedication, recently brought to bear on the information industry in particular, is paying off. Last year, Spartanburg’s BMW headquarters for North American car manufacturing announced it would make a $1.7 billion investment to begin building all-electric vehicles “for the U.S. and world markets.” BMW employs 12,000 in the Spartanburg area, and will bring in an additional 300 tech jobs to support its $700-million, 1-million-square-foot high-voltage-battery plant. “BMW and Michelin anchor a strong manufacturing base in South Carolina’s Upstate [where Greenville is located],” said local investor and broker Arn Cenedella, who specializes in multifamily and single-family residential investments. “The Michelin North American headquarters are located here as well, and dozens of manufacturing firms that support BMW, Michelin, and GE.” He noted that as new residents continue to move into the Greenville-Spartanburg area, home prices and rental rates are both still rising. “Average single-family home prices were up 18.4% in 2022 over the year prior,” Cenedella noted, “and our multifamily developments are showing a 94.4% occupancy rate with average rents at $1,340.” Bosch, a leading global supplier of technology and services, is investing $200 million in Greenville and creating 350 new jobs. Soon thereafter, Diversified Medical Healthcare, a holding entity “dedicated to providing solutions to improve patient care,” announced it would also invest $51 million to create 185 new jobs in the Greenville area. Bryan Grady, director of labor market information at the South Carolina Department of Employment and Workforce (DEW), predicted that valuable job opportunities like these are likely to increase in 2023. In fact, DEW predicted in January of this year that the number of jobs available could increase by nearly 13% by the end of 2023. “There is a wide range of occupations that will fuel this increase,” Grady observed, making particular note of healthcare-related jobs and information technology jobs. “Jobs like information security analysts and software developers [are] expected to be in high demand, as are other technical professions like supply-chain experts, statisticians, and market analysts,” he said. For Donnie Chandler, an investor specializing in the redevelopment of older homes and a realtor with Keller Williams Drive in the Greenville area, the incoming population and those households that will come to fill job positions in other roles supported by these high-tech roles represent ideal residents for his company’s “mill homes,” which, he explained, can still be purchased at discounted prices. “This often allows for enough equity after forced appreciation to qualify for the BRRR [buy, rehab, refinance, repeat] strategy, but most of the mill homes on the west side of Greenville are resold as the values have been crazy in that area,” he said. Chandler focuses on the older, lower-priced mill homes in surrounding communities as well. South Carolina’s mill homes were originally built as early as the late 1800s throughout the state to house mill workers and families. Although many of those initial structures are long gone, the mill village communities that formed in counties like Greenville and Spartanburg remained. These communities often are the last to appreciate and, as a result, are an ideal place for investors to look for deals proximal to higher-value housing and development. They also offer affordable options for new residents hoping to rent or buy near the city centers. The Perfect Combination: A Top Place to Live & Highly Affordable The Greenville-Spartanburg area is attractive to real estate investors, homebuyers, home-sellers, and employers because it is highly affordable relative to the rest of the country, is located in the temperate southeast, meaning employees can enjoy year-round outdoor activities, and offers a vast array of employment opportunities. “I have said that if people can afford to live anywhere, Greenville is the place [they] are choosing more and more,” said Jackson Herlong, chief strategy officer for Joan Herlong and Associates Sotheby’s International Realty. He added that the housing market in the Greenville-Spartanburg area is also unique because it is neither a buyers’ market nor a sellers’ market. “We are going back to normalcy,” Herlong proclaimed. “A smart, calculated marketing strategy is what you really need to sell

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