Investing Insight - Trusting the Process

Thirty years ago, Haverkamp Group developed our first project, an 8-plex in Ames, Iowa. Over the years, through a multitude of projects, an exceptional amount of hard work, and many mistakes, we’ve developed a proven process.

A few months ago, we completed the construction of our first building at one of our most recent developments, Emory North Liberty. We spent nearly two years bringing this project to this point. To start, we identified the market, found appropriate land, and put the land under contract. We then began our DDC (Design, Development, Construction) process: We designed a product that we believed the market would embrace, acquired all the necessary permits, and financially modeled the project.

We raised equity, hired additional construction personnel, financed the project to develop it fully, and then we commenced construction. About twelve months after starting construction, we finally had a building ready to rent. Then we hired our property management team.

At this point, we hope theory becomes reality. You see, we hadn’t rented a unit yet. All we really had was experience, projections, and belief. We didn’t know if the market was going to embrace our project. And if they did accept it, would they accept the price? If they embraced both, would there be enough residents to fill all 148 units of our first few buildings? 

This phase of the process is a time of acute interest for me because we are in between stages of DDC and property management–either the idea will materialize or it won’t. A well-rehearsed and proven process tilts the scale towards success.

So, when a multi-year, multi-million-dollar project like the Emory isn’t yet realized, you might ask the question, how valuable is this proven process? We have found the answer to this question.

In the middle of construction for Emory North Liberty, we connected with an institutional real estate investor (REIT) who was looking to make an investment in a multi-family development in the Midwest. At this time, all we had was our proven process – we hadn’t even rented a unit yet. This investor looked at our data, heard our story, believed in our proven process, and eventually made a multi-million-dollar investment.

Today, Emory North Liberty is well on its way to becoming a success. The design, development, and construction team has delivered an outstanding project. The property management team has already leased over fifty units in a short period of time. Upon reflection, our proven process has, again, shown itself to be invaluable!