Industry

Real Estate

Company Type

Real Estate Equity Investor

Size

$250 Million

Investment Type

Equity

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Overview


DVO Real Estate, a successful investor in ground-up and value-add multifamily properties since 2012, is seeking up to $250 million for its fourth equity fund


Will pursue a “gap equity” investment strategy in which sponsors subordinate their equity until the fund achieves a 10% IRR


David Valger leads an accomplished team with extensive experience in all aspects of real estate investing, finance, development and management


Strategic partnership with Cypress Equity Investments (CEI), a successful CRE platform – provides additional expertise


Invested in almost $330 million of equity and generated a 21% net IRR to investors on realized transactions for gap equity transactions and 27% net IRR to investors for GP co-investment transactions


Opportunity


The US housing market (including multifamily) faces chronic shortages, as new construction has not kept pace with household formation


The National Association of Realtors estimates the housing shortfall at 5.5 million single family homes and multifamily units, a gap which could take ten years to close


The cost of owning a home has surged ahead of renting, favoring the rental market


Multifamily remains “solid”: 16% increase in rents as of June, 2022 and occupancy well above average


About 25% of Millennials, the nation’s largest generation, believe they will always rent primarily due to the lack of affordable homes as well as the increased flexibility of renting


Solution/ Strategy


Target value-add and new development opportunities with successful sponsors that have access to superior opportunities


Focus on regions with strong and diverse job markets, favorable demographic trends, growing population of renters, and an undersupply of rental product with high barriers to entry


Leverage relationships with intermediaries to gain access to off-market transactions or seek direct relationships with sellers to acquire at favorable pricing


Strategic partnership with CEI adds the perspective and expertise of a successful developer that can also assist in managing DVO projects if necessary


The DVO team has collectively and independently invested in 20,000 units with an aggregate transaction capitalization of $5 billion+


Executive Management


David Valger – President and Founder

Responsible for DVO’s overall management, operations and investing activities


Extensive experience in all aspects of real estate investing and finance, including originating, structuring, underwriting and managing real estate and corporate private equity transactions valued at more than $6.3 billion


Previously, a partner with RCG Longview Debt Funds, originating, structuring and underwriting a variety of real estate mezzanine and preferred equity transactions, investing more than $450 million in over 25,000 multifamily units


Developed and led an exclusive joint venture with Fannie Mae Multifamily platform


Former member of the BOD and Executive Committee of the UJA/Federation of New York. BA, Binghamton University


MBA, Real Estate & Entrepreneurial Management, Wharton School at the University of Pennsylvania

Michael Sorochinsky – Principal

Joined DVO in 2018 and is a significant minority owner


Founder and CEO of Cypress Equity Investments (“CEI”), a strategic partner of DVO


Oversees CEI’s $5 billion real estate portfolio


From 2001 through 2005, focused CEI’s investments in the value-add multifamily space, leading the purchase of over 70 properties comprising of 3,500 apartment units and retail


In 2010, before large numbers of developers jumped into the multifamily space, saw an opportunity to build Class A apartments in top markets around the US and led CEI to amass a development pipeline of nearly 5,000 luxury apartments with a projected value in excess of $2.8 Billion


Prior to 2001, practiced law at two international law firms – Perkins Coie and Milbank Tweed – representing creditors in distressed real estate debt and equity reorganizations. BA, University of California Irvine. JD, UCLA School of Law

Ryan Shore – Director, Acquisitions

Responsible for DVO’s acquisitions and dispositions


Over 12 years of experience in commercial real estate investing and finance, including originating senior debt and mezzanine loans, debt restructurings and equity investments


Originated and managed over $2.6 billion in total capitalization of real estate transactions


Previously an associate with Bank of America, managing a $500 million loan portfolio of retail, office and residential properties, restructured more than $1 billion in senior syndicated notes related to under-performing assets and originated over $140 million in new loans


BA, Finance, Boston University’s School of Management


MS, Real Estate Development, Columbia University

DVO Real Estate

Learn More About This Transaction DVO Real Estate
Thank you for your interest in DVO Real Estate. Please fill out your information and we will contact you shortly with more information on this opportunity.

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Hi. We're not around right now. But you can send us an email and we'll get back to you, asap.

Thanks, Ken

Ken Margolis | Managing Partner Castle Placement, LLC
1460 Broadway Street, Rte 400
New York, New York 10036
(212) 418-1188 | C: (516) 712-7784
kmargolis@castleplacement.com

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