Blue Top Capital targets capital inefficiency in the residential market through its model leaseback strategy

BERKELEY HEIGHTS, N.J., April 25, 2018 -- Blue Top Capital announced its intent to dramatically scale its model leaseback program to address some of the current capital market inefficiencies hampering the housing market. After closing its $6M inaugural model leaseback transaction at the end of 2017, the company is now actively engaged with other home builders and institutional investors to roll out this program nationwide.

Most home builders utilize model homes to help market and sell residential communities. Typically, these are the first homes to be built and the last to be sold, and are heavily upgraded to showcase the various options and finishes offered by the builder. While model homes may be considered a necessary marketing expense, they essentially constitute dead capital on the balance sheet of the builder, sitting for 1-3 years or until the residential community is sold out. Under the model leaseback program, Blue Top acquires these model homes from the builder and leases it back to them for 1-3 years, at the end of which the homes get resold to retail home buyers.

A Win-Win for Home Builders and Investors

“This is a true win-win for both the home builder and investors,” said Adnan Ahmed, CEO of Blue Top Capital. “The home builder is able to benefit from improved liquidity and ROE by freeing up capital locked up in model homes, and utilize this to drive growth, while the investors benefit from a monthly yielding investment with attractive returns backed by a portfolio of fully finished homes, and all without taking any development or construction risk. Due to the short duration (1-3 years) of the investment, market risk is also limited.”

A Unique Way to Tap into Attractive Housing Markets

Model leasebacks allow investors to tap into some of the most attractive housing markets in the nation, while diversifying risk across multiple geographies and properties. Per US Census Bureau statistics, housing starts remain far below historic averages despite strong employment growth, and supply continues to significantly trail demand in several markets across the nation. “By having a nationwide program, we are not limited to particular geographies and can be selective in terms of the markets,” said Faisal Abbasi, COO at Blue Top. “Our technology platform and proprietary data partnerships enable us to analyze a multitude of supply and demand metrics for all the major markets in the US in near real-time, allowing us to strategically target the most attractive markets.” 

About Blue Top Capital

Blue Top Capital, LLC is an innovative real estate investment company that aims to improve investing by providing institutional quality deals through an intelligent, easy-to-use technology platform. Blue Top’s unique, technology-enabled approach benefits investors by (a) leveraging industry leading data/ analytics to reduce market diligence cost and time while increasing transparency, and (b) scaling institutional underwriting and due diligence processes to the underserved $2-$20M space, where significant capital inefficiencies exist, thus providing investors with better risk/return opportunities. Blue Top’s investors constitute family offices, institutional investors, and high net worth investors.

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For more information, press only:

Adnan Ahmed
908-376-3064
[email protected] 

For more information on Product:

www.bluetopcapital.com