About Us
Vortex Real Estate Capital is a Texas-based real estate investment firm that seeks to achieve superior risk-adjusted returns through investments in self-storage properties. We invest in existing value-add properties as well as new construction in secondary and tertiary markets fed by the Dallas-Fort Worth Metropolitan Statistical Area (MSA). Our Leadership team has a combined 100+ years of experience managing (assets, properties, and investments), due diligence, capital markets and underwriting and has managed approximately $2B of assets including a portfolio of 46 self-storage assets with an exit value of approximately $200M.
Team
Why Self-Storage Properties
Self-Storage Properties provide resilience during economic downturns as renters need to downsize. Close to 10% of households use storage units. They have low management and maintenance costs as there are few utilities to maintain. These investments have attractive return on investment as this sector has been outperforming retail, office, apartment and industrial space since 2009. Diversified tenant base includes households, retail, and commercial. Within this asset class, we target properties in underserved locations.
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recession resilient
Self-Storage has proven the ability to weather challenging economic periods. During 2008, all real estate sectors experienced negative total annual returns, except for Self-Storage.
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inflation hedge
As multi-decade high inflation continues into 2023, the ability to respond to changing market conditions is paramount. Self-Storage leases are typically a month in duration which provide operators the opportunity to quickly reprice rents to market value.
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strong demand drivers
The strong demand for Self-Storage comes from a diverse set of factors. People who are downsizing turn to Self-Storage to store items that do not fit in their smaller living space. Individuals retiring and moving into smaller living spaces, create additional demand. Finally, small businesses utilize self- storage units for storing inventory and as inexpensive work locations.
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long-term outsized returns
The Self-Storage sector has produced outsized returns over the past several decades. Since 1994, the sector has produced an annualized return of 16.54%, which was the highest of all REIT sectors.
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diversified tenant base
The structure of Self Storage Properties provides a number of advantages over other real estate sectors. Even smaller Properties often have over 100 units which makes it is easy to diversify the tenant base in order to protect cash flows. Additionally, it is generally cheaper to manage a Self-Storage Property as the breakeven occupancy rate to service debt is approximately 45%, as compared to 65% or more for the retail, office, and commercial sectors.
Our Investment Portfolio
Vortex Self-Storage Syndication I
Our objective is to build a Self-Storage portfolio of seven-ten assets in high-growth secondary and tertiary markets in the Dallas-Fort Worth Metroplex area; cash-out refinance in three years (conditional on the interest rate environment); exit to an institutional buyer or larger public storage operator after five years and deliver 10%+ targeted average annual distribution over the life of the syndication (monthly distributions will begin in Year 2 after initial investment) with a 22%+ targeted average annual return upon exit.