Real estate investing isn't about chasing projections—it's about understanding the fundamentals.
At 214 Capital, we use a disciplined framework to evaluate every deal we consider, whether it's multifamily, land development, or ground-up construction. These 10 core metrics help us filter high-quality opportunities, stress-test downside risk, and invest with clarity and conviction.
đź“Š Key Investment Metrics We Prioritize
- Sponsor Track Record
Execution matters. We look for operators who have taken deals full-cycle—and delivered on what they promised. - Market Fundamentals
Population growth, job diversity, and income-to-rent ratios drive long-term demand. Not all submarkets are created equal. - Property Basis
Smart deals start with strong cost basis—priced below replacement cost, market comps, or with clear value uplift. - Debt Structure
We evaluate DSCR, leverage, interest rate risk, and loan terms to ensure the capital stack can weather volatility. - Yield on Cost
This tells us what the project earns on all-in dollars. We aim for YOC that comfortably exceeds market cap rates.
🔍 What the Industry Is Watching
- Returns Must Be Real, Not Just Projected
IRR and equity multiple mean nothing if they’re built on aggressive assumptions. We test every deal for realistic timing and sensitivity to rent and cap rate shifts. - Leverage Is a Tool, Not a Crutch
We want deliberate capital structures—LTC and LTV levels that enhance, not endanger, outcomes. - Breakeven & Downside Protection
Every deal gets stress-tested for rent drops, expense spikes, and delayed exits. Margin for error is non-negotiable. - Exit Strategy Defines Success
We underwrite exits based on who will buy next, at what cap rate, and whether the plan still works if the market softens. - Fee Structure & Sponsor Alignment
Transparent fees and aligned incentives separate true partners from just fee-stackers. We invest with operators who put LPs first.
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