Lone Star Capital 101

What is Lone Star Capital?

Lone Star Capital is a vertically integrated, real estate private equity firm which invests in cash flowing multifamily properties. Through partnerships with real estate investment companies and high net worth individuals, Lone Star raises the funds required to acquire, renovate, and operate multifamily real estate.

How does Lone Star Capital make money for its investors?

Lone Star generates cash flow and increases asset value through the identification of underpriced opportunities and the execution of value-add business plans which include increasing occupancy, raising rents through interior renovations, and optimizing property management.

Why should I invest with Lone Star Capital?

Lone Star offers investors access to real estate investment opportunities that were previously only available to private or institutional investors. By providing direct access to these alternative investment opportunities, Lone Star gives investors the ability to invest in high yield opportunities without the added fees and complexity of blind-pool funds and real estate investment trusts (REITs). Additionally, Lone Star structures its investments so that investors can maximize their tax advantages, which complements their portfolio and maximizes after-tax returns.

What is the difference between investing with Lone Star vs a real estate investment trust (REIT)?

REITs are generally a blind-pool investment, meaning you don’t get to choose which properties your money is invested in. Additionally, REITs typically have higher fee structures. Due to the distribution requirements for REITs, there is not a strong incentive for managers of REITs to aggressively pursue value creation business plans since they may initially lack income.Lastly, REITs are a liquid security, making the urge to trade in and out of positions difficult to avoid, which is often detrimental to total returns. Conversely, Lone Star provides conservative, patient investment opportunities which include substantial tax benefits and higher total returns than what can be offered by REITs.