Ashford Capital Partners

Shifting Dynamics for Residential Real Estate

2011-12-12T19:24:00.000-05:00

There’s a major transition underway for residential real estate in the US. For a number of years, inflated home prices have distorted the equilibrium between owning a house, signing a long-term lease.

Since the “American Dream” has been largely built on home ownership, purchase demand for homes jacked up prices to unsustainable levels, while rental rates were low due to depressed demand. But according to a recent study, the price points have reversed to a point where it is much more economical to buy than rent. From the Wall Street Journal:

“Home prices and mortgage rates have fallen so far that the monthly cost of owning a home is more affordable than at any point in the past 15 years and is less expensive than renting in a growing number of cities.”

If you think about it for a minute, this is the way the equilibrium actually should work. When you lease a car, you pay more per month because you are paying a premium for the flexibility of a short-term commitment. The same should be true when you rent a house. Renting keeps you from making a long-term commitment to a particular area – and for that flexibility, you pay a premium price.

Looking at the picture from the perspective of a home buyer, it also makes sense. If you’re going to buy a property to live in for 20 or 30 years, you should expect to get a “discount” for committing to that home for a long period.

And of course if you buy a home for the purpose of renting it out and collecting monthly income, the dynamics have to make sense. You need to expect to collect more in monthly rent, than your interest, taxes, and maintenance expenses.

Now that these price dynamics are back to a “fair” place of equilibrium, the entire market is affected.

Price Affects Supply and Demand

In most economic textbooks, we are taught to look at “price” as a function of supply and demand. The statement that we all remember from these classes is “All things being equal…”

But in the real world, supply and demand don’t operate in a vacuum. Consumers change habits based on price points, along with assumptions of value and long-term expectations. In the case of the residential real estate market, price often affects supply and demand (instead of the other way around.

Today, as individuals make decisions about where they want to live, they have a number of options to consider. They can rent space in a multi-family community (apartments or townhomes), they can rent space in a single family dwelling (there are plenty of distressed as well as premium homes for rent in the Atlanta market) – or they can take advantage of low mortgage rates and attractive pricing to purchase a new or used home.

Since the monthly cost of buying is now lower than renting, we’re expecting to see demand pick up in 2012 – leading to increased activity in the Atlanta housing market. This will result in two important dynamics:

• The “shadow inventory” of homes that banks and the FDIC are holding for sale will be absorbed by the market, resulting in a more stable real estate environment.

• Builders with low inventories of finished new homes will need to acquire land to keep up with the rising demand for new homes.

Seizing The Trend

We’ve all heard the phrase “make hay while the sun shines…” In business as well as when investing, it’s important to capitalize on opportunities when they are available. This requires both the ability to recognize an attractive opportunity, as well as the willingness to execute on the idea.

At Ashford Capital, we have worked hard to identify the most opportunistic properties in the Atlanta market. These are the developments that builders will be first to purchase – so that they can meet rising demand for new homes.

In terms of execution, we have stepped up to the plate and purchased these properties at an incredible discount. Our investors have made a similar decision by identifying our investment programs as an attractive way to benefit from the real estate opportunities in Atlanta – and they have executed by placing capital in our investment programs.

Is your investment program following a similar path? Are you recognizing the opportunities available to you – and executing by making your capital work for you?

If so, then I would love to chat with you about how Ashford Capital can offer strong absolute returns as well as diversification for a traditional investment program. If not, then what better place to start than with an investment company that has identified high-return situations and allows you to come alongside and share in the profits?

I would love to have a call with you and give you more information on our investment opportunities. Would you call me this week so we can set some goals for your investments in the coming year?

Wishing you every success,

Matt

Positive Report for New Home Sales

2011-10-27T16:59:00.000-04:00

This week we received the Commerce Department’s report on new home sales for the month of September. The data was very encouraging…

For the month, new home sales increased by 5.7% - the first monthly increase we have seen since early spring.

An increase in new home sales does two things for the residential real estate market. First, it helps to reduce the inventory of new homes currently offered for sale. As the supply of new homes decreases, prices will naturally rise. Think back to your high-school economics class and those supply / demand curves.

Whenever you reduce the supply, all other things being equal, you see an increase in the price…

The second issue is the effect that this report has on residential developers. When the rate of new home sales picks up – and when new home inventory begins to drop, this is an important signal to developers that it is time to begin building.

Over the last three years, these developers have worked hard to decrease their inventory. It’s expensive to hold on to large tracts of land and wait for the market to pick back up. Developers have to pay taxes, maintain the properties, and cover overhead expenses – whether the real estate market is hopping or not.

Many of our local developers have allowed their land inventory to dwindle, waiting for the right time to step back into business. This month’s new home sales report may be just the catalyst they need to begin negotiating to buy land – and it’s likely that when they start to look for good opportunities, the best lots will be those that Ashford Capital already owns – the very same properties that you are invested in…

Mortgage Relief Adds Another Catalyst

There’s one other big issue that has surfaced in the last week. On Monday, the Fed announced revisions to their mortgage refinance program which is designed to help homeowners arrange better terms for current mortgages.

The health of current homeowners is very important to us as real estate investors – even though our primary focus is on new homes.

In order for the new home market to improve, we need to see a parallel improvement for existing homeowners. If the default rate continues at a very high level, it will mean more existing homes on the market. The prices of these homes are typically very low – enticing buyers that would typically want to invest in a new home to consider fixing up a foreclosure.

If this new mortgage program turns out to be as successful as economists expect, it could be a game changer in terms of a turnaround in the residential real estate market.

According to the Wall Street Journal, this new program will allow 800,000 to 1 million current borrowers to refinance their homes at a better rate. This means lower monthly payments, quicker payoff of principal, and a significant overall boost to the broad economy.

The goal of this program is to allow homeowners to refinance – even if their loan balance is significantly more than the value of their home. So it doesn’t matter how far a homeowner is underwater, he or she should still be able to benefit from this program.

Swift Changes – Time Is Limited

When economic trends shift, they have a tendency to move quickly and catch unsuspecting investors off guard. This can be true because too many people believe one side of an argument and fail to think critically about a number of inputs they might not be considering.

In the case of residential real estate, we appear to be at the beginning of one such transition.

Investors have bailed out of real estate positions. Developers have reduced inventories, banks have foreclosed on properties, and real estate investors have moved on to other things.

But now that most have left this market, prices are very low and the tide is turning. We’re seeing the major home builders like John Wieland, Ashton Woods, and Beazer Homes all making investments in the Atlanta market. Business is picking up and it’s an exciting time to be invested in the recovering residential real estate market.

Are you ready to discuss how Ashford Capital can help YOU participate in this dynamic growth environment? I would love to take a few minutes and introduce you to some of the developments we are currently involved in.

Since each one of our investments covers a specific development, our investment space is limited. Once we fill all of the slots for each investment, the door closes and we move on to find new opportunities.

I want to make sure that you are able to participate in the best deals we are following right now. Don’t wait until the market has moved sharply higher before we talk. Give me a call today and we will figure out what opportunity fits best with your situation.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners

In Search of Yield…

2011-10-07T14:57:00.000-04:00

Investors and Colleagues,

This is a difficult environment for investors who rely on income from their investment or deposit accounts. Have you seen the interest rates banks are paying on CD’s or savings accounts? Last month, a number of large banks announced plans to start charging customers a fee just to maintain checking accounts.

Yields on 10-year treasuries are now below 2%, and if you’re investing in 5-year municipal bonds, you’re likely getting less than 1% on your money. So for investors who need just $50,000 in annual income, a balance of $2.5 million to $5 million is required to generate this kind of yield.

The low interest rates are no accident. The Federal Reserve is pushing interest rates lower intentionally – in an effort to force investors into more risky positions. The rationale is that if investors put money into corporate bonds, equities, or other high-yielding securities, the capital will help to stimulate the economy and help support the recovery.

A discussion of fed policy is beyond the scope of this letter today (but if you want to know my thoughts on this, shoot me an email or feel free to give me a call). Today, we’re going to talk about what Ashford Capital is doing to offer clients a better alternative for investment yield.

An Attractive “Preferred Rate Of Return”

Since we understand the need our clients have to generate income from their investments, Ashford Capital has constructed our programs to offer an attractive preferred rate of return for our investors.

This means that when you invest in an Ashford Capital deal, the clock immediately begins ticking and your interest starts accruing right away. We pay our investors a 15% annualized rate of return which is guaranteed, regardless of the profit on the actual transaction.

Here’s how the deal works for a typical investor:

Let’s say you invest $100,000 in the Ivey Estates deal I mentioned a couple weeks ago. If you remember, our cost per lot is roughly $33k and our conservative expectation is to sell these lots in 12-14 months at $75k each.

For simplicity sake, let’s assume that we meet our goal in 12 months. As an investor, you would receive your payment from three sources:

• First, you would receive your initial $100k back

• Second, you would receive your 15% preferred rate of return ($15,000)

• Finally, you would receive 60% of the remaining revenue with Ashford Capital taking 40%. In this example, the profit sharing portion would be $40,846 (netting out all fees & expenses)

So in this case, the total gain on a $100k investment would be $55,846 ($15,000 from the preferred rate of return, plus the $40,846 profit split). That’s a 55.8% return in just 12 months!

Why Offer a Preferred Rate?

A number of investors have asked me why Ashford Capital would offer a preferred rate of return in addition to a profit split. After all, most investment firms would offer one or the other – but not both sources of income.

From my perspective, this arrangement makes perfect sense. When we set up this structure, I wanted to make sure that Ashford Capital’s interests were aligned with our clients. For our clients, the very best outcome is for us to buy and sell properties with a very attractive profit – in the shortest amount of time possible.

The preferred rate of return starts the clock ticking for us as a company. We realize that we’re on the hook the moment we receive your investment – and we want to offer you a profit as quickly as possible. So the preferred rate of return simply adds incentive for us to get deals done in a short period of time.

The profit split is obvious – we want to make money only when our customers make money. So we benefit when you as an investor makes money. If you aren’t successful, then we’re not going to do well. But if you realize a strong profit, we’re going to succeed alongside our investors.

In today’s low-yield environment, we think a 15% preferred rate of return is very competitive. When you add on the 60% profit split, we think the opportunity becomes even better!

I would love to sit down with you and discuss how we can help you generate yield – and strong returns from your investment capital. Please give me a call so we can schedule a time to grab some coffee or share lunch. I think you’ll be excited about the opportunities we have on the docket right now.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners

678-231-4579
Matt@AshfordCP.com

The Inventory Silver Lining

2011-09-28T15:08:00.000-04:00

There’s a question I get from colleagues and investors almost every day…

Matt, How is Ashford Capital able to invest so successfully even in this difficult economic environment?

It’s a fair question… The media headlines have been overly dramatic, and often don’t accurately portray what is going on in the economy (not to mention the local real estate market). To be quite honest, this is one of the most opportunistic periods I have seen in a number of years – and today I want to explain just how we are creating wealth for our investors…

Let’s take a quick example of the most recent housing statistics. This week the media jumped on a report that showed a lower “median” price for homes, and lower sales activity for the past month. Most investors failed to notice the good news behind the headlines.

Median Price – A Flawed Metric

To begin with, let’s look at the “price” component of the most recent report. Since the “median” price was lower, investors believe that home prices continue to drop.

There are certainly some areas that are seeing price drops – but at the same time there are key areas of our country (and key areas in Atlanta) where home values are actually rising!

When the statistics report a “median” price, it simply notes the middle price of houses that sold in the past month. If the middle price is lower, that could mean that the market for lower-priced houses is more robust – maybe because foreclosed properties are moving quickly.

It could mean that owners of higher-priced homes are making fewer transactions because they have the financial ability to wait until prices rise.

A fall in the “median price” of homes sold does NOT directly equate to the value of homes that were not engaged in a transaction over the past month. Because of the way that this metric is calculated, an increase in transactions from low-priced homes can actually skew the numbers and lead to the wrong interpretation.

Inventory – You Can’t Manipulate This Number

At Ashford Capital, we look much more closely at inventory statistics which tell us exactly how much real estate is on the market right now – giving us a better understanding of the supply and demand picture.

The good news from the most recent batch of statistics is that the number of new homes for sale has hit a record low. There simply aren’t enough units on the market to meet the growing demand.

Sure, there are a number of foreclosed homes being sold by banks, but have you seen the shape these homes are in? There is a certain subset of the market – home buyers who have good employment and a strong savings account – who aren’t interested in buying a “fixer-upper.”

And today, the number of new homes that they have to choose from is at its lowest level since Case-Shiller began keeping records. This is a tremendous opportunity for builders who cater to these new home buyers who want a unit that is “move-in” ready.

This is How We Do It…

Ok, apologies for the bad song reference…

But seriously, this is how we create value for our investors. We study the supply and demand dynamics in our specific market – the metro Atlanta area.

• We analyze the demand for new homes in specific neighborhoods.

• We study the assets held by troubled banks and the FDIC.

• We contact builders to determine who is ready to undertake new projects.

• We work with our investors to raise capital for attractive properties.

• And we profit when our developments are sold to builders who are fulfilling the demand for new homes.

It’s that simple! Despite this turbulent economic period, Ashford Capital is offering investors value, growth, and investment stability. We buy residential developments at dirt-cheap prices and then sell to builders as demand picks up.

Every time we complete a transaction, our investors win. We’re involved in a number of attractive properties right now that I would love to discuss with you.

If you’re tired of watching your net worth swing up and down on the whims of the market makers on Wall Street, then please give me a call. We can work on an investment program that meets your personal needs and set you on the path towards financial stability capital growth.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners

678-231-4579
Matt@AshfordCP.com

Ivey Estates: A Defining Deal for Ashford Capital

2011-09-12T16:43:00.000-04:00

Investors and Colleagues,

Every now and then, an opportunity emerges with the potential to define a company – or change the course of an investor’s account…

Today, I want to introduce you to one particular deal that perfectly represents the investment approach that Ashford Capital stands for.

This model investment will give you a better picture for exactly what we look for when buying property, and for a short time, we are still accepting investors who want to participate in the Ivey Estates property in beautiful Cobb County, Georgia.

When searching for real estate opportunities in the Atlanta market, there are two variables that are crucial in deciding whether to invest or not:

1: Location

Of course we all know that location is the most important variable for real estate investment, but at Ashford Capital, we have perfected our location analysis down to a science.

When we look at the location of a property we have a proprietary method for analyzing the supply and demand metrics for real estate in the area, the employment opportunities for potential residents, reasonable price expectations for selling the property to a developer, and a timeline for when the investment opportunity will be completed and investors paid.

It’s a rigorous process, but one that has helped us to be involved with only the most promising locations in the growing Atlanta real estate market.

In the Atlanta real estate market, builders typically invest in projects when there is less than six months worth of inventory currently on the market. This ensures that when they are ready to sell the homes that are being built, the market demand for these new locations will be strong.

For the Ivey Estates development, our research indicates that there is a 5-month supply in the $225k to $325k price range – perfect for attracting builders to the market.

While we have confidence in our proprietary location analysis, it is helpful to note that a number of national builders including Beazer Homes, Ashton Woods, and John Wieland Homes are actively building out properties in the same area as our Ivey Estates project. In fact, John Wieland is developing three different locations within a 2 mile radius of our property!

2: Price

Our goal is to generate the very best returns for our investors – and since our interests are aligned with our investors, Ashford Capital makes the best profit when our investors are paid well.

For this reason, we’re only interested in purchasing properties at an extreme discount to “fair value.” When we are able to pick up attractive properties at a distressed price, our transactions are completed more quickly, at a higher rate of return for us and for our investors.

We have negotiated a price of $495,000 for the Ivey Estates property – and this price represents the cost for 15 lots. These are premium developed lots which already have access to utilities and are builder-ready.

Our “all-in” cost for this location is $33k per lot – representing a 65% discount to the price a developer paid for the same location just a short time ago. Because of our deep relationships with regional banks and the FDIC, we are typically able to buy properties at a tremendous discount.

With such a steeply discounted purchase, we are able to sell these lots to a builder – at an attractive price – and still make a very healthy return. For the Ivey Estate location, our conservative estimate is a selling price of $75,000 per lot to a builder in 12 – 14 months. Of course our target price is higher, but we want to set your expectations conservatively and if you are surprised, we want it to be a good surprise.

Reserving Slots for First-Time Investors

Because of the special nature of this model investment, I wanted to make sure that the Ivey Estates project is accessible to all of our investors. I’m particularly interested in opening this deal to first-time participants in an Ashford Capital offering.

At Ashford Capital, we understand that traditional investors may not be experienced when it comes to buying residential real estate property. Sometimes participating in a new investment concept is challenging and investors want to start small before allocating a larger portion of their capital down the road.

For this reason, we’ve reserved a few slots in this offering for first-time investors, and for investors with a smaller amount of capital. My hope is that by offering smaller investment opportunities in this model transaction, you will become comfortable with our investment process, and be more willing to discuss additional opportunities once you have recognized an attractive return on this property.

I should mention that with the Ivey Estates offering, you can even use capital from your IRA to invest – which carries its own tax benefits for you.
If you’re interested in participating in this model deal, I would ask you to do two things:

First, go to http://www.youtube.com/watch?v=sTkVCJ0QOns and watch our short video on this property. You can see an aerial picture of the location along with some of the proprietary location metrics that I have mentioned.

Second, give me a call so that we can set up a time to discuss this opportunity. We can sit down and discuss the specifics, you can get a copy of the offering document which details our preferred rate of return and profit sharing arrangement, and best of all it will give us a chance to catch up and discuss your financial future.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners

678-231-4579
Matt@AshfordCP.com

Are You a Short-Term Trader or a Long-Term Investor?

2011-08-30T09:19:00.000-04:00

Think about it for a minute – and be honest with yourself… Are you a short-term trader or a long-term investor?

You might be surprised to hear me say that there’s not a right or a wrong answer to this question. Sure, there are advantages and disadvantages with each approach, but BOTH short-term traders and long-term investors have the potential to make great returns over time.

If you’ve had a discussion with your traditional money manager this month, chances are good that you have sat through the tried and true “in it for the long haul” speech. And for true long-term investors, this is an important concept to keep in mind.

Long-term investors can’t get worried about volatile swings in the market. After all, they’re in it for the long haul. When prices trade lower, it doesn’t matter. They weren’t planning on selling any time soon and in time they expect their positions to rebound.

The luxury of being a long-term investor is that you don’t have to worry about the day-to-day gyrations in the market. You simply have to wait patiently and allow for long-term growth trends to send the value of your investments higher. Of course the downside of being a long-term investor is that you don’t get to take advantage of the “buy-low, sell-high” opportunities in a volatile market.

Short-term traders can either love or hate markets like this. When things are moving rapidly (and in every different direction) there are plenty of chances for short-term traders to make a lot of money. But at the same time there are plenty of opportunities to rack up losses too.

If you’re a short-term trader, you know that the day-to-day action can be a grind. Short-term traders don’t have the luxury of sitting back and patiently watching. But of course a talented trader can make a much higher return buying cheap and selling dear.

The Key is Discipline

As with most business ventures, the key to success (whether investing for the long-term, or actively trading) is developing a disciplined approach. Long-term investors MUST have a rigorous process for identifying strong, valuable investments that they can stick with for years.

Without this detailed analysis, the long-term investor will undoubtedly pick sub-par investments and will ultimately earn a less-than competitive return. But with a rigorous process for identifying quality investments, and the patience to hold on to these investments through the long-term, a disciplined investor can expect to beat the market over time.

Discipline is just as important for short-term traders. Using risk management techniques, stop losses, proper position sizing, and reasonable profit targets ensures that a trader will keep his capital base intact and grind out profits quarter after quarter.

Once again, the key to success is building a disciplined approach – and then sticking with the rules throughout the turbulence.

Ashford Offers the Best of Both Approaches

At Ashford Capital, we incorporate some of the strengths from both long-term investors as well as short-term traders. Our goal is to buy residential real estate at the lowest possible price, and sell to developers at a significant profit.

From a short-term perspective, we’re acutely aware of the day-to-day market dynamics and how they affect real estate prices. When banks are in dire need of capital, we’re able to negotiate tremendous deals – buying distressed properties at fire sale prices. When the FDIC is saddled with a portfolio of illiquid properties, we’re willing to buy – but only at a significant discount.

Looking farther down the road, Ashford can afford to be patient, waiting for the very best opportunity to sell these properties to developers. Since we buy quality locations that will rebound in value quickly, we can be confident in the ultimate value of our locations and ride out a turbulent environment without hitting the panic button and selling.

Does your investment process have the discipline to ride through both good environments as well as rough periods? If not, why not?? In times like this, you owe it to yourself to have a carefully crafted plan and to manage your investments with the utmost care and diligence.

I would love to chat with you one-on-one and see if Ashford Capital can help you work to build a disciplined investment approach. Today’s environment offers tremendous opportunity – but you have to understand how to manage your risk and develop a long-term plan. Let’s have a conversation this week!

Wishing you every success,
Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners

678-231-4579
Matt@AshfordCP.com

Is Your Net Worth Bouncing Like a Yo-Yo?

2011-08-22T11:01:00.000-04:00

Investors and Colleagues,

August has been a tremendously volatile month for most investors.

Two weeks ago, four of the five trading sessions for the Dow featured a 500 point range. (Remember when a 100 point move seemed like a big deal?). Last week, the stock market initially tried to rebound, but then finished the week on a sour note – with the Dow closing back below the key 11,000 mark.

Several of the financial advisors that I speak with are expecting the volatility to continue. Many investors will wait to make any adjustments to their portfolios until after they receive their August account statements.

Based on the action so far, the average retirement account is likely to see a double-digit percentage loss just for the month of August. Losses like this can have a tendency to be a self-fulfilling prophecy, as lower prices lead to panicked investment decisions – resulting in more selling and more price declines.

My point here is not to add insult to injury. Obviously no one likes to see their neighbors sustaining losses and struggling to protect their nest eggs. My purpose with today’s message is to help you develop a plan for this turbulent environment.

Stability Trumps Excitement…

As you probably know, my company (Ashford Capital Partners Inc.) invests in residential real estate developments that can be bought at a substantial discount and eventually sold to homebuilders and residential developers.

Our goal is to create stable investments for our clients. Investments that pay a preferred rate of return, which is agreed upon when we initially sign a contract. So it doesn’t matter whether the market is up, down, or sideways… that preferred rate of return is stable.

In addition to the preferred rate, our investors also participate in the profit when we sell a property. So there are essentially two ways our investors make money. Part of the return is stable and guaranteed by Ashford Capital. The other portion is based on the difference between our purchase price and what we can sell the property for.

The beauty of this arrangement is that our investments have both the stability of a “fixed return” investment, along with the profit potential of a more aggressive growth opportunity. For our investors, the stability of our investment approach is particularly comforting when the overall economy and the stock market is anything but stable.

Losses Are Hard To Recover

Albert Einstein called the concept of compound interest the “eighth wonder of the world.” An investment that continues to generate positive returns can grow exponentially as profits are reinvested and grow alongside the initial investment capital.

But while the compound effects of gains can be tremendous, the compound effects of investment losses are very sobering.

If your investment account loses 20% of its value, it actually takes a 25% return to get back to its original value. If your account loses 33%, it takes a full 50% increase to get back to even. A 50% loss requires a 100% return, and if you lose 66% of your account, you need a 200% return to recover your losses.

Based on these numbers, it’s extremely important for investors to protect against losses – so that they can actually participate in the eighth wonder of the world.

Considering the importance of protecting your account, don’t you owe it to yourself to put at least some of your assets into a more stable (and growing) investment program? Instead of watching your net worth bounce on the string of a yo-yo, why not create some stability into your investment process?

I would love to have a conversation with you this week about how we can help you protect your assets. Don’t wait until the Dow crosses below 10,000 – or 9,000 – or worse. Take action today and let’s create value and stability for your investments.

Wishing you every success,
Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners

678-231-4579
Matt@AshfordCP.com

Bank Failures and Real Estate Supply

2011-08-02T13:42:00.000-04:00

Last Friday, another three banks kicked the bucket…

At the end of last week, the FDIC announced that Integra Bank, Virginia Business Bank of Richmond, and Bank Meridian were officially insolvent and would be merged or taken over by the government.

Bank Meridian hit closest to home as the South Carolina bank was forced into a merger with SCBT Financial – another South Carolina bank. All together, these three banks represented about $2.5 billion in assets, and the total number of failed banks this year is now at 61.

A few generations ago, even one or two bank failures like this would have the potential to damage the entire financial system. If depositors lost their assets at one bank, consumers would be likely to pull their savings out of other financial institutions – igniting a run on the bank and sending the system into a state of chaos.

Today, of course, the FDIC protects depositors by ensuring the first $250,000 for each depositor. So as long as your savings account is below a quarter million, you can rest assured that a bank failure won’t result in you losing money.
Most people understand that the FDIC insures deposit accounts, but fail to realize what happens behind the scenes when a bank goes under.

The Proud New Owner of Real Estate

When a bank is taken over by the FDIC, depositors receive the full value of the assets in their accounts, and the FDIC actually takes over the assets of the bank. Sometimes the assets are able to be merged with another more healthy bank, but often these assets continue to sit on the FDIC’s balance sheet.

For banks who have made bad real estate loans, these assets actually represent property that has been foreclosed on.

Here’s an example… A southeastern developer might take out a $3 million dollar loan from Bank Meridian in South Carolina to purchase development property in Greenville, Nashville and Atlanta. Due to poor planning and a difficult economic environment, this developer goes out of business and the bank forecloses on the property.

Now a few quarters later, the bank is declared insolvent and is taken over by the FDIC. The FDIC pays the depositors cash and assumes ownership of the bank’s assets (including the developments in Greenville, Nashville and Atlanta).

The FDIC is now the proud owner of a few hundred acres of residential property. But of course this is not the position the government entity is supposed to be in. The FDIC’s assets are supposed to be held in cash so they have capital available to insure deposit accounts.

So what does the FDIC do with these developments? Well, the short answer is that they go looking for a buyer. Sometimes the assets are able to be merged with another bank, sometimes the real estate is sold to a private buyer, and sometimes the land is put up for sale by auction.

Today, the FDIC is sitting on a substantial amount of non-cash assets such as residential real estate developments. The number of bank failures over the past two years has been very high – and the longer it takes for our broad economy to recover, the more banks continue to fail.

Bank Failures Create Opportunity

Now no one wants to see banks continue to go under. But for us as investors, these bank failures actually translate to opportunity.

With the FDIC holding significant amounts of real estate (and needing more cash to cover deposit balances) there are some tremendous bargains available to opportunistic buyers.

At Ashford Capital, we are working directly with the FDIC to identify attractive properties and buy them at a significant discount. We only purchase properties in locations that we expect to rebound quickly – and this gives us a chance to sell the locations at a substantial profit for our investors.

Could we grab a few minutes to chat this week? I would love to give you details on some of the deals we are negotiating and help you grow your capital through one or two of these opportunities.

Wishing you every success,

Matt

Income Levels and Consumer Spending

2011-07-25T10:47:00.000-04:00

Investors and Colleagues,

Are you confident about your prospects over the next six months? Do you expect your income to remain stable or even increase? Are you willing to splurge on a totally discretionary big-ticket purchase (like a vacation or a new vehicle?)

Chances are, your answer depends on your income bracket. Of course it makes sense that individuals with good jobs and a healthy income level are more willing to spend money. But one of the more interesting issues in today’s economy is the broad gap in confidence between different income levels.

Last week, the Wall Street Journal had an interesting article regarding the rebound in optimism by those earning more than $50,000 per year:

When massive job losses hit in early 2009, all income groups turned equally pessimistic about the economy, as shown by confidence indexes constructed from the Conference Board’s indexes divided by income groups, along with Census Bureau household income data.

Confidence among households earning less than $50,000 a year improved in 2009, but has stayed weak over the past two years, while consumers earning more than $50,000 have registered a large increase in confidence.

This confidence is showing up in numerous areas of the economy and is especially evident when looking at different retailers.

Retail companies catering to the “average consumer” – companies like Sears Holdings (SHLD), Target Corp. (TGT) and Kroger Co. (KR), have been struggling to recover. As consumers below the $50k income line pinch pennies, profit margins are difficult to maintain.

On the other hand, companies like Harley Davidson (HOG) and Polaris Industries (PII) – maker of ATV’s and snowmobiles – have been killing it (in a good way…) Demand has been robust and profits keep growing quarter after quarter.

The Real Estate Market Mirrors Retail

When looking at investments in residential real estate, the income gap applies just the same. Consumers with incomes over $50,000 are more likely to invest in a house.

This is not true just because of the price issues (there are plenty of cheap houses that are within reach of a 50k income). The real issue is one of confidence – whether buyers actually believe they will still have a job six or 12 months down the road.

As a general rule, buyers with incomes above $50k are generally in more stable positions, more willing to make a long-term financial commitment, and they are driving demand for higher-quality housing.

This means that when we are looking through developments for Ashford Capital to purchase, we are primarily focusing on lots that are high-end, will feature more expensive homes, and will be the first area to begin selling as builders begin rolling out new developments.

Speaking of builders, the housing start data out last week was very encouraging. For the month of June, US home starts were up 14.6% over the May period. As high-income buyers re-emerge, the demand for quality housing is increasing. This means more new homes are being built, and home builders are willing to engage in new projects to meet the demand.

At Ashford Capital, we are one step ahead of this surge. Over the past several years, we’ve been buying distressed properties from the banks and the FDIC at pennies on the dollar. Our investors now hold attractive properties that represent great opportunities for builders.

As the builders look for new real estate for their projects, we will be able to offer them attractive deals while still locking in a tremendous return for our investors. It’s a truly exciting time to be invested in Atlanta residential real estate.

Are you one of our current investors, looking for another property to allocate capital to? Are you a new investor, ready to make that first purchase? Or maybe you’re just interested in learning a bit more about how our real estate opportunities are structured.

Regardless of your situation, I would appreciate the opportunity to chat with you. Ashford Capital may or may not have the right investment for your situation. But it doesn’t hurt to explore the opportunities and decide for yourself. Please give me a call this week so that we can discuss your options.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners
678-231-4579
Matt@AshfordCP.com

What Would Another Banking Crisis Look Like?

2011-07-19T10:33:00.000-04:00

As I write you this letter, Wall Street is under significant pressure. On Monday, US markets were hit by another round of selling – led lower to a large degree by financial stocks.

The newspapers and TV reporters had plenty of negative material to point to. The major US banks have been reporting relatively strong earnings, but when you look at the details, the picture is much less clear.

Banks are shifting capital around and “creating” income by cutting back on the amount of capital they have set aside as a risk buffer. This is financial engineering at its best… Positive earnings simply by moving numbers around on the balance sheet.

The charade isn’t fooling investors and traders, whose sell orders are now pushing the financial sector to its lowest level this year. And even as executives are wrapping up their conference calls, new risks are rising from overseas.

You see, the debt crisis in Europe affects our own financial system. European banks own large blocks of government debt that is becoming increasingly risky. US banks may not be very exposed to European government debt, but they certainly have plenty of interaction with the European banks.

If the trouble in Greece spreads to Portugal, Italy, Ireland or Spain, US banks could wish that they still had that risk capital set aside – and not moved into the “earnings” category.

Risk Overseas = Deals at Home

So how does a European debt crisis affect an Atlanta-based real estate company? The dots are more closely connected than you might think.

As the banking industry is forced to deal with their growing exposure to the European crisis, they need to unload risky assets to avoid a crisis like we saw in the fall of 2008. This means that we are still sitting down to the negotiating table, and able to command the very best prices for any properties that we purchase.

Negotiating from a place of strength is a very powerful advantage. When we begin discussions with a bank or even the FDIC, we always start by making one thing very clear:

We don’t need to complete this transaction.

We may want to buy the attractive development. We may even have a builder lined up to begin putting houses on the lots. We may have investors that are anxious to participate in the deal. But we always approach the negotiations from a detached perspective.

If the terms aren’t attractive, if the price isn’t low enough, if the stipulations are too constraining, we simply walk away – it’s that simple.

But the banks don’t have that luxury. For them, the clock is ticking and the risk is mounting. Every day that they are not able to move these underwater assets off their books, they lose capital. More importantly, they lose credibility. The banks are negotiating from a place of weakness which is why we have been able to ink so many attractive contracts over the last several years.

New Developments In Progress

While we’re constantly researching any number of different properties for a potential investment, there is a specific real estate development that I am particularly excited about.

I can’t give you the specific details because we haven’t yet signed the contract. I don’t want to risk this letter reaching a competitor and jeopardizing our negotiation. But I would love to speak with you personally about this opportunity.

The neighborhood in question is in a suburb outside of Atlanta and is one of the more desirable communities in the region. The amenities are beautiful. The surrounding neighborhood is pristine. The community is well established. A builder simply became overextended and was foreclosed on by the bank.

Now we have the opportunity to pick up a number of lots at a tremendous value – and should be able to quickly turn around and sell them to a builder for a tidy profit.

I’d love to discuss this opportunity with you – and determine how we can help you grow your investment capital. Would you call me this week to set up a time? I look forward to our conversation.

Wishing you every success,

Matt

Another Catalyst for the Banks

2011-07-11T10:38:00.000-04:00

If the banks and the FDIC weren't scared before last week, they certainly are now.

On Friday, the non-farm payroll report for June was released, indicating that the economy added a mere 18,000 jobs during the last month. This was in comparison to expectations for an addition of 80,000 jobs.

As if this news wasn't bad enough, the figures for last month were revised lower... a LOT lower. For the month of May, the economy added only 25,000 jobs, less than half of the previously reported gain of 54,000 jobs.

As it now stands, the unemployment rate is now 9.2% and rising. This is bad news for the majority of US banks with real estate exposure. If the employment picture is not recovering as quickly as expected, then the banks' portfolios of foreclosed real estate likely holds more risk than they expected.

This means that major US banks are once again sitting down at the negotiating table, and willing to take almost ANY offer - just to reduce the amount of risk on their balance sheets.

This is a great development for us at Ashford Capital. Not only are we able to buy these properties at an extreme discount from the financial institutions, we're also seeing an improving environment for builders who will be BUYING our properties in the next several months.

The Silver Lining for Housing

In addition to the non-farm payroll report, there was another news report that caught my attention last week…

The Wall Street Journal published an article noting that apartment rents were rising, while vacancy rates were ticking lower. The piece made a bullish case for owning the stocks of apartment companies - but it also has an interesting application for the residential housing market.

If rents are going up, consumers actually have a stronger incentive to own their own homes. Interest rates are still at historically low levels, and credit-worthy buyers can get a great deal when purchasing a new home.

The other benefit of higher rents is that existing homeowners who bought investment properties are more likely to be able to rent out these homes and be cash-flow positive. This also applies to new investors purchasing distressed houses and in-turn renting these houses out.

A Thawing Real Estate Market

As the economics for residential real estate improve, our investment opportunities become even more attractive. Expectations for the amount of time it will take for our developments to sell are declining, while the actual profit margins are remaining stable or even increasing in some cases.

Ashford Capital continues to close transactions at incredible valuations, which is a benefit to our investors. We continue to be in the sweet spot of this economic cycle (at a point where banks are selling cheap, but select areas of the market are still recovering nicely).

Considering the volatility on Wall Street and the uncertainty in the financial markets, it's important to have a diversified and balanced approach to your investments.

At Ashford Capital, we have the flexibility to tailor a real estate investment directly to your needs. We offer plans that are compatible with your IRA, and we will work directly with you to make sure understand exactly what you are investing in.

Don't you owe it to yourself to protect your capital and grow your investments (regardless of the market environment?)

Please give me a call today so that we can discuss the best plan for you and create a wealth-building strategy that fits your investment objectives. I look forward to the conversation.

Wishing you every success,
Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners
678-231-4579
Matt@AshfordCP.com

Another Catalyst for the Banks

2011-07-11T10:36:00.000-04:00

If the banks and the FDIC weren't scared before last week, they certainly are now.
On Friday, the non-farm payroll report for June was released, indicating that the economy added a mere 18,000 jobs during the last month. This was in comparison to expectations for an addition of 80,000 jobs.

As if this news wasn't bad enough, the figures for last month were revised lower... a LOT lower. For the month of May, the economy added only 25,000 jobs, less than half of the previously reported gain of 54,000 jobs.

As it now stands, the unemployment rate is now 9.2% and rising. This is bad news for the majority of US banks with real estate exposure. If the employment picture is not recovering as quickly as expected, then the banks' portfolios of foreclosed real estate likely holds more risk than they expected.

This means that major US banks are once again sitting down at the negotiating table, and willing to take almost ANY offer - just to reduce the amount of risk on their balance sheets.

This is a great development for us at Ashford Capital. Not only are we able to buy these properties at an extreme discount from the financial institutions, we're also seeing an improving environment for builders who will be BUYING our properties in the next several months.

The Silver Lining for Housing

In addition to the non-farm payroll report, there was another news report that caught my attention last week…

The Wall Street Journal published an article noting that apartment rents were rising, while vacancy rates were ticking lower. The piece made a bullish case for owning the stocks of apartment companies - but it also has an interesting application for the residential housing market.

If rents are going up, consumers actually have a stronger incentive to own their own homes. Interest rates are still at historically low levels, and credit-worthy buyers can get a great deal when purchasing a new home.

The other benefit of higher rents is that existing homeowners who bought investment properties are more likely to be able to rent out these homes and be cash-flow positive. This also applies to new investors purchasing distressed houses and in-turn renting these houses out.

A Thawing Real Estate Market

As the economics for residential real estate improve, our investment opportunities become even more attractive. Expectations for the amount of time it will take for our developments to sell are declining, while the actual profit margins are remaining stable or even increasing in some cases.

Ashford Capital continues to close transactions at incredible valuations, which is a benefit to our investors. We continue to be in the sweet spot of this economic cycle (at a point where banks are selling cheap, but select areas of the market are still recovering nicely).

Considering the volatility on Wall Street and the uncertainty in the financial markets, it's important to have a diversified and balanced approach to your investments.

At Ashford Capital, we have the flexibility to tailor a real estate investment directly to your needs. We offer plans that are compatible with your IRA, and we will work directly with you to make sure understand exactly what you are investing in.

Don't you owe it to yourself to protect your capital and grow your investments (regardless of the market environment?)

Please give me a call today so that we can discuss the best plan for you and create a wealth-building strategy that fits your investment objectives. I look forward to the conversation.

Wishing you every success,
Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners
678-231-4579
Matt@AshfordCP.com

Home Sales and Bank Regulations

2011-06-29T14:29:00.000-04:00

The economic news just keeps getting better for opportunistic real estate buyers.

This week, the National Association of Realtors released their report on pending home sales for the month of May. The results showed that last month had the strongest improvement since last November!

The pending home sales index was 13.4% above its level from last year. And on top of the stellar May data, the Association also revised the April reading higher.

The NAR’s chief economist was quoted in the Wall Street Journal as saying:

“This solid gain in contract signings implies that home values in many localities are or will soon be stabilizing as inventories get absorbed at a faster pace.”

The key point is that “many localities” (namely, attractive neighborhoods in communities with strong economic growth) are seeing price improvements.

The data is encouraging because obviously the overall housing situation is getting better. But as an investor, you still have to be very careful where you make your investments. Attractive housing areas are getting more attention and prices are moving up. But if you invest in the wrong neighborhood, your capital could still be tied up for years, waiting for the local market to improve.

At Ashford, we’re pretty pleased with the quality of real estate that we have been able to pick up – and we’re already beginning to see a dramatic turnaround in demand. For many of our properties, we now have to make the decision of whether to sell for good gains today – or wait for tremendous returns a few months down the road.

… not such a bad spot for our investors to be in…

Banking Regulations Still Lead to Opportunities

At the same time that housing statistics have been improving, large blue-chip banks have had to deal with some bad news.

Last week, the Bank for International Settlements (BIS) announced an agreement on capital requirements for large “Globally Systemically Important Banks.” These are the banks that are “too big to fail” and the BIS is an international regulatory agency that helps set the rules for the largest global banks.

The new agreement required huge banks to increase their capital ratios over the next few years. Considering the leverage that these banks currently have, the new regulations are a pretty big deal.

What this means for real estate investors, is that the large banks are going to have even more incentive to get rid of foreclosed developments sitting on their balance sheets. The new regulations require much more “Tier I” capital – and residential property doesn’t qualify. So once again, buyers like Ashford Capital have the upper hand when negotiating to purchase residential developments.

Isn’t it time you took a look at the opportunities we are pursuing at Ashford Capital? Regardless of whether you’re an institutional investor (with several million to allocate) or an individual with retirement assets to put to work, we can find a good investment for you.

The current economic season offers more opportunity than I have seen in years, and I am truly excited about the returns we are generating for our investors.

Ashford Capital typically structures each deal so that our investors are paid a preferred rate of return along with the ability to participate in the profit once we liquidate a particular holding. This setup aligns our interest with our investors, so that we make money when our clients are successful.

I would welcome the opportunity to show you exactly how we can help you generate excellent investment returns. Please call me so that we can set up a time to chat.

Wishing you every success,
Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners
678-231-4579
Matt@AshfordCP.com

Ashford Capital Partners Website

2011-06-21T10:28:00.002-04:00

Checkout Ashford's website and all the cool content: www.AshfordCP.com

Spectacular Bargains and Desperate Builders

2011-06-20T16:38:00.000-04:00

June has been an exciting month at Ashford Capital. The Atlanta real estate market is undergoing a dramatic shift and we are active on the front lines.

Not only are we finding some incredibly attractive opportunities for us to put new capital to work, we are also in discussions with a number of residential builders who are desperate to build their inventory of properties.

Considering the wide economic swings in the broad economy, I have become accustomed to seeing one side of our business – or the other – experiencing tremendous activity. When times are difficult and unemployment is high, we are able to buy properties at exceptional values. When the expectations turn toward recovery, we are able to sell these properties and book significant profits.

But today, we’re actually experiencing the best of both worlds. I’ve been fielding phone calls from bankers and the FDIC – desperate to get rid of real estate on their balance sheets… And then sitting down at the negotiating table with residential builders who need new attractive properties to build.

Let me give you a couple of details…

Pennies On the Dollar??

To show you the kind of deals are possible in this environment, consider a deal we have in the hopper right now.

A few weeks ago, we became aware of a small distressed development on the market. Typically, we would not be interested in this type of investment. The size of the development was smaller than the properties we usually purchase. Considering the due diligence process, the closing costs, and administrative burden, we have found that our best opportunities are with larger properties.

But the seller appeared desperate and we knew we could get a good deal. I must admit, however, that even I am surprised at the price tag we walked away with.

To give you a bit of background, the development covers 20 lots, each of which is expected to hold a $200,000 single family home. What would you be willing to pay for a lot? $40k? Maybe 20k?

I’m proud to say that Ashford Capital is under contract for $46,000. Oh, and I should mention that we are paying $46,000 for the entire development! So our effective price for each lot is only $2,300! What a steal…

Getting in at such a low price gives us a lot of options. We could hold this investment for a couple of years and wait for a developer to pay $40,000 per lot – giving us more than a 800% return… Or we could offer the property for $20,000 per lot and move our inventory more quickly. The point is, when you take advantage of deals and pay less than ten cents on the dollar, your options are wide open in terms of selling that property for an incredible profit.

Flexibility For Investors

In addition to the tremendous profit opportunity, tracking down deals like this smaller development give us more options when it comes to the amount of capital we can work with.

Maybe you have been hesitant to invest with Ashford Capital because you expected to have to put up a lot of capital at once. It’s true that most of our investors put a material amount of capital to work when they participate in an opportunity.

But at this point we are able to accept smaller commitments from individual investors. This is good news for you because you can start out small and then reinvest your profits along the way as the size of your capital base grows.

Believe me, Ashford Capital will have a number of deals for us to pursue over the next few years, but you are unlikely to see the kinds of opportunities we have in play this summer. It’s a unique market and we are focused on finding the very best deals possible for our investors.

Would you be interested in looking at some of our offerings? I would love to show you what we are working on.

Please give me a call this week and we can schedule a time to meet. I think you will be excited to see how Ashford Capital can be your partner in growing your wealth and giving your family (or your clients) financial stability.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners
678-231-4579
Matt@AshfordCP.com

Happy New Year

2010-01-06T14:12:00.000-05:00

Investors and Colleagues,

A new decade has begun and with the turn of the calendar we are starting to see signs of a turn in the real estate market. A recent Bloomberg article stated that the S&P Case-Shiller home price index increased for the second straight month, giving investors and homeowners reason to celebrate. The price levels are still below the same level a year ago, but the most recent months have begun to see improving trends.

There are two primary forces behind both the increase in residential real estate prices, and the higher level of activity in the real estate market.

1. ATTRACTIVE MORTGAGE RATES

The Federal reserve has maintained a record-low interest rate target, which has helped to push rates on deposits, mortgages and many other financial instruments to historically low levels. At the same time, the government is buying huge blocks of existing mortgages and has guaranteed capital to Fannie Mae and Freddie Mac to protect against losses through 2012. The result is that interest rates have dropped to a very compelling level. Whether buying property for a residence or for an investment, the low mortgage rates are catching the eye of purchasers and driving more activity in a formerly dormant market.

2. TAX CREDITS

Part of the recent stimulus measures has included a "first time homebuyers" tax credit which is actually available to a broad number of potential home buyers. The program has helped to provide an incentive for homebuyers to go forward with prospective purchases and has added new life to the real estate market. Some of the "shadow inventory" (which represents homeowners who are looking for an opportunity to sell) has been sold to long-term purchasers which in turn has improved the ongoing real estate environment.

In November, existing home sales actually rose to a 6.5 million annual rate. This is the highest level seen since February of 2007. The Obama administration has extended the homebuyers tax credit from an original ending of November 2009. Now homebuyers have through April 30 to take advantage of the opportunity which should help to maintain the high level of home sales.

While the level of foreclosures still remains high, this is presenting opportunities for savvy real estate investors. In an improving environment, it makes sense to buy distressed properties at the lowest price possible, as there is a good chance that the better environment will lead to a relatively short holding period. For real estate investors, the shorter the time period the higher the potential annualized return.

VININGS 21 APPROACHES CLOSING

Ashford Capital is nearing the closing date on the "Vinings 21" investment opportunity. This townhome development is being purchased from the FDIC which seized the property from a foreclosed bank. Our negotiated purchase price offers us an exceptional entry which should yield substantial returns over the next 24 to 36 months. When purchasing real estate, location is the most important dynamic and timing is a significant consideration as well.

It appears that we are making this purchase just as the market is beginning to turn. This could be an exceptional opportunity and it is rare that investors are able to find a situation with so many positive features:

• Our purchase price is exceptionally low • The premier location should be one of the first to rebound • Market timing appears to be in our favor • Infrastructure development is already in place

As of today (January 6th) there are only 25 days remaining to participate in the Vinings 21 opportunity. After that point, the deal will be closed to new investors. I would hate for you to miss the strong investment gains from this purchase, but it with only a few remaining slots and a rapidly approaching closing date, time is of the essence.

Please call me today so that we can discuss the opportunity and determine if it is right for your investment portfolio. I look forward to helping you realize significant investment returns in this new and exciting decade.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President,& Managing Director
Ashford Capital Partners
678-231-4579
Matt@AshfordCP.com

Happy New Year!

2009-12-30T21:53:00.001-05:00

Happy New Year to All!

Closing Out 2009

2009-12-14T11:24:00.000-05:00

As we wrap up the 2009 calendar year and reflect on the year in real estate, the picture is quite sobering. We have survived an economic crisis led by a dramatic failure in the financial system coupled with a sharp decrease in demand for residential real estate. The resulting lower property prices have created both pain and opportunity. The pain has largely hit over-leveraged investors who held real estate that they couldn't afford financed by institutions who had minimal risk control.

The opportunity, however, favors those who have been conservative with their capital and can now spend that capital buying properties at sharply lower prices with significant potential for appreciation. Buying property from the FDIC which has received the assets from foreclosed banks has proven to be one of the most opportunistic investments seen in a generation.

Real estate investors have a myriad of statistical information to use when making strategic decisions. All of the data can sometimes offer conflicting viewpoints on whether a recovery is in place or not. Real estate investments can be particularly tricky because of the regional differences in trends. The three keys to real estate investing have always been considered to be 1) location, 2) location, and 3) location... And despite everything that has changed in real estate over the last 18 months, this truth remains firmly in place.

FORECLOSURE ACTIVITY DECREASES

Over the past few months, we have begun to see some thawing in the residential real estate market which could point to a sustained recovery. According to a recent Realty Track press release, US Foreclosure Activity Decreased 8% in November. Government stimulus programs along with improving consumer sentiment has helped to temper foreclosures across the nation. While November foreclosures were still greater than the year ago levels, the last four months have seen sequential improvement in foreclosure activity.

"November was the fourth straight month that U.S. foreclosure activity has declined after hitting an all-time high for our report in July, and November foreclosure activity was at the lowest level we've seen since February." ~James J. Saccio, CEO RealtyTrac.

Looking more carefully at the regional aspects of these numbers, it is clear that Georgia is faring better than average. According to the press release, Georgia saw the foreclosure rate drop 22% in November compared to the month earlier. Compared to November of 2008, we saw the foreclosure rate drop 3.39% while the national foreclosure rate actually climbed. It is clear that Georgia is ahead of the curve and has likely seen the worst of the residential real estate crisis.

THE IMPORTANCE OF EMPLOYMENT

One of the major driving forces for real estate recovery is improvement in the employment picture. We are still waiting for major signs of new job growth on a national level and while there are encouraging statistics pointing to fewer jobs lost, the tide has yet to completely turn.

Locally, the employment picture appears to be just a bit better than the national average. According to the Georgia Department of Labor, Georgia employment has stabilized since July with roughly 3.9 million jobs. In October, there was a marginal improvement in the jobs level and we are still waiting on November figures. The point is that Georgia appears to be primed to see its employment levels improve more quickly than the national average which could be very good news for Georgia real estate prices.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President, & Managing Director
Ashford Capital Partners
678-231-4579
Matt@AshfordCP.com

Ashford Capital December, 2009: Commercial Opportunities

2009-12-01T16:47:00.000-05:00

Investors and Colleagues,

Several of you have recently asked me if Ashford Capital is pursuing opportunities in the commercial real estate market. With vacancy rates up sharply from last year, and prices on premier commercial properties down to attractive levels, this is a reasonable question. However, the opportunities in commercial real estate are still developing and may take several months until we reach the perfect buying opportunity.

Sam Zell is widely considered to be the primary authority when it comes to investments in commercial real estate. The "Grave Dancer" as he is not-so-affectionately referred to is notorious for purchasing properties which are extremely distressed at unbelievable values. It is exactly this kind of bargain hunting that allowed Zell to develop Equity Office Properties Trust which he eventually sold to the Blackstone Group for $39 billion.

Last month, Sam gave a speech in Chicago in which he echoed the sentiments I have been explaining to Ashford clients over the past few months. Zell believes that the time for buying commercial properties is still a ways off because both property owners and lending institutions have yet to face the sobering reality of the current economic crisis. He stated that another 30% drop in rent rates and property prices is likely to occur, and the result will be significant mortgage restructurings, along with devastating losses for property owners... (now you see why they call him the grave dancer)

When this shakeout occurs, Ashford Capital intends to be an active buyer, taking advantage of desperate pricing and what could be a once-in-a-lifetime buying opportunity. But until the commercial real estate market fully discounts the cash flow crisis, I want you to invest your capital in a more attractive and timely residential opportunity.

Ashford Capital Buys "Vinings 21" From the FDIC

As you have probably heard, Ashford Capital recently negotiated an agreement with the FDIC to purchase a townhome neighborhood in the Vinings area. This "Vinings 21" property includes 21 lots which already have access to utilities and are ready for development. Due to the crisis in the residential mortgage industry and the backlog of properties now owned by the FDIC, Ashford was able to force the FDIC into accepting an incredible price for this attractive asset.

Our target scenario involves selling this property to an eager developer in the next 24 months. The Vinings 21 location will likely be one of the first properties to sell once the market begins to thaw, due to its desirable location and the infrastructure which is already in place.

Developers are currently biding their time, waiting for the economic picture to clear. But once housing demand picks up, these developers will want to purchase land that they can quickly build on and sell to residents. Since the Vinings 21 property already has water, sewer, electricity and gas piped in, our location will be prime real estate and fetch a premium price.

There are only a few slots left for investors to participate in this opportunistic purchase. Once the transaction is funded, the offering will be closed to outside investors and we estimate returns will be paid in 24 to 36 months. I would hate for you to miss out on this exciting investment so please call me so that we can arrange a meeting. The slots are flexible enough to work with a wide range of investment accounts, and we can usually arrange for a purchase with IRA capital or other tax efficient accounts.

Wishing you every success,

Matt

Matthew J.Riedemann
Founder, President,& Managing Director
Ashford Capital Partners

678-231-4579
Matt@AshfordCP.com

Ashford Capital Partners: November 2009

2009-11-19T08:17:00.000-05:00

KENNESAW, GA. (NOVEMBER 19, 2009):

On November 17, 2009, the Wall Street Journal published a front page article naming the FDIC as "America's Newest Land Baron." The report went into great detail, explaining how property developers took out massive loans in order to buy land to build townhomes, subdivisions, gated communities and the like. In recent months, these loans have been foreclosed upon by the banks, and in turn many of the banks have been taken into receivership by the FDIC.

The end result is that over the last two years, the FDIC has taken over 150 banking institutions and seized more than 5,000 houses, subdivisions, and other properties which were held by these ill-fated financial institutions. Currently, the FDIC is sitting on a backlog of $1.8 billion in properties that it desperately wants to sell at nearly any price. The current environment certainly favors us as opportunistic buyers.

Atlanta's Name in Lights

It was a bit ironic to see that a property in Atlanta was used as the special interest feature in the Wall Street article. The financial capital of the Southeast has certainly faced significant challenges when it comes to real estate development. In fact, Georgia represents the state with the most foreclosed assets held by the FDIC with 411 properties represented.

Often, financially sound communities which face the most significant losses during a real estate crisis are the ones who also experience the most aggressive rebounds. Atlanta still boasts a thriving community with attractive employment opportunities. At least a dozen Fortune 500 companies call Atlanta home. The bottom line is that real estate activity is likely to increase tremendously in our city compared to many locations with less business activity.

But for the time being, the opportunities favor buyers as the FDIC struggles to liquidate its ballooning balance sheet of residential properties. The Wall Street article profiled a planned town home community where the property had been purchased by a developer, financed by Main Street Bank in Covington, and fell into the hands of the FDIC after a series of unfortunate events.

Currently the partially completed project is on the selling block and can likely be purchased for pennies compared to the original price the developer paid. Situations like these are exactly the types of opportunities that Ashford Capital considers in order to generate investment returns for clients.

The Value of a True Professional

The mechanics of real estate investment can be deceivingly simple. Investors should buy properties at distressed prices, and look for opportunities to sell them at significant gains. The process sounds relatively easy and straightforward. But there are reasons why it pays to have a professional on your team.

Often, real estate deals are not as opportunistic as they first appear. The town home development featured in the Wall Street Journal actually has a few stipulations that could have been missed by an unwary buyer. While the FDIC owns the actual property that the structures are built on, all the adjacent land including the sidewalks, entryways, and stairs are owned by BB&T. So buying the property from the FDIC in this case could have been a disaster!

An unsuspecting individual could easily have scraped enough cash together to purchase the building without understanding the risks. But Ashford Capital's intense due diligence would have uncovered this deal breaker very early in the discovery phase. It pays to work with a team who understands the nuances of the business and has extensive experience in real estate transactions.

Opportunities in Vinings

Ashford Capital has recently unveiled its latest investment offering, purchasing a townhome neighborhood in the desirable Vinings area. The location holds tremendous attraction due to close proximity to the Vinings Jubilee shopping area and historical downtown Vinings. The Home Depot also has its national headquarters within a few miles of the location which should increase the demand for this prime real estate.

While we have experienced substantial interest in this "Vinings 21" offering, there are still a few slots available for individual investors. I would welcome the chance to speak with you about this opportunity and the trends I am seeing in the Atlanta real estate market. Please give me a call when you have a moment and I look forward to the conversation.

Wishing you every success,

Matt

Matthew J. Riedemann
Founder, President,& Managing Director
Ashford Capital Partners
678-231-4579
Matt@AshfordCP.com

Real Estate: Opportunities of a Generation

2009-10-28T10:40:00.000-04:00

KENNESAW, GA. (OCTOBER 28, 2009):

The current economic climate has opened some very unique and historical opportunities. You have probably heard of the large number of foreclosed properties sitting on bank balance sheets. But what you may not have realized is that the FDIC represents one of the most motivated real estate sellers in the market right now.

So far this year, there have been 100 banking institutions which failed and were taken over by the FDIC. The number continues to grow and may actually be higher by the time you read this. As the FDIC takes control of many of the assets on the books of these failed banks, foreclosed properties are being offered to the public at fire sale prices.

Recently, the FDIC issued a report which stated that an additional 111 institutions have been added to its "black list." These institutions are being closely monitored and many will represent additional failures. The bottom line?

The FDIC is running out of capital to insure these banks and needs to sell assets off it's books as quickly as possible!

During the fourth quarter I expect an onslaught of real estate assets to be sold by the FDIC to the public. While the bargains will likely be historical in nature, buyers will need to be ready to act at a moments' notice and transactions will hit the closing table within weeks. The opportunity is incredible, but many would-be investors will miss out because they do not have their capital in place to take advantage of the deals.

Ashford Capital Partners, Inc. has positioned itself to be a major beneficiary of these opportunities. Our firm has created investment vehicles which purchase these real estate bargains at pennies on the dollar. Our goal is to then sell these properties for a substantial profit when market conditions rebound.

Time is running out. These deals will not likely be available in a few short weeks. Please call me today so that we can discuss how Ashford Capital Partners Inc. can be your resource for taking advantage of today's historical opportunities.

Sincerely,

Matthew J. Riedemann
Founder, President,&Managing Director
Ashford Capital Partners, Inc.
678-881-0830

2009-07-16T16:03:00.000-04:00

Thursday, July 16, 2009

Ashford Capital Partners, Inc. Managing Director, Matthew J. Riedemann, is seeing extraordinary transfer of wealth occurring as hasn't happened in our generation. This transfer of wealth is occurring now. For more information on this and how you can prosper from this, contact Matthew Riedemann.

Ashford Capital Partners, Inc. was acquires strategically located, investment grade real estate at substantial discounts to its current market value. Matthew J. Riedemann is the driving force behind the company, bringing to the table over 17+ years of building and real estate experience. Matthew has been involved with over a quarter billion dollars in real estate transactions. Ashford's offices are in Kennesaw, Georgia.

To reach Ashford Capital Partners, Inc.: (678) 881-0830 or www.AshfordCP.com.

For more information:
125 TownPark Drive, Kennesaw, GA 30144, (678) 881-0830 Office, www.AshfordCP.com

Ashford Capital Partners, Inc. Announces Formation of Strategic Asset Fund (SAF)

2009-03-30T15:48:00.000-04:00

United States of America (Press Release) February 27, 2009 --
Ashford Capital Partners, Inc. Managing Partner, Matthew J. Riedemann, announces the formation of Ashford's Strategic Asset Fund (SAF). The fund hopes to identify and acquire $100 million in stragically located assets throughout the southeast over the next 12-24 months.

Ashford Capital Partners, Inc. was founded in 2008 to acquire strategically located, investment grade real estate at substantial discounts to its current market value. Matthew J. Riedemann is the driving force behind the company, bringing to the table over 17+ years of building and real estate experience. Matthew has been involved with over a quarter billion dollars in real estate transactions. Ashford's offices are in Kennesaw, Georgia.
source: FPR

To reach Ashford Capital Partners, Inc.: (678) 881-0830 or www.AshfordCP.com.

For more information:
125 TownPark Drive, Kennesaw, GA 30144, (678) 881-0830 Office, www.AshfordCP.com

Ashford Captial Partners on the Money in 2009

2009-03-30T15:47:00.000-04:00

Matthew Riedemann founded Ashford Capital Partners Inc. after more than 17 years in the real estate industry. Ashford Capital Partners Inc. is a metro Atlanta-based real estate company that invests in low risk, high return, development-grade real estate assets in the Southeastern United States while emphasizing within Georgia.

Riedemann has more than 17 years in the real estate industry, providing the experience necessary to successfully identify strategically-placed, undervalued lots and tracts of land that can be acquired and resold for profit by Ashford’s private investor network. Riedemann has been involved with more than $250 million in real estate transactions with approximately $150 million in land transactions in the last six years. The projected length of Ashford’s deals range from 1 to 5 years. The variables in determining the projected deal length depend upon the scope, surrounding growth patterns, market conditions, available utilities, and zoning.

The goal of Ashford is always to maximize the investors' return on investment while creating a synergistic relationship within the communities it serves. Ashford aims to build long-term relationships with investors by offering a preferred annual rate of return plus profit sharing. Ashford Capital represents an ideal investment vehicle for investors because of limited downside risk that is typically associated with stocks, bonds, or other equity investments.

GOATLANTA: Given the tough economy right now, how can individual’s best invest their money?

ASHFORD CAPITAL PARTNERS: Given the tough economy right now, Ashford believes that it is more imperative than ever for investors to evaluate their entire portfolio to ensure that each dollar is working overtime and is achieving the highest possible return for the investor while minimizing the overall risk. Where can individual’s best invest their money? There are several areas of the economy that have taken hits from the recent economic downturn, but perhaps not more than the real estate industry. Real estate in 2009 is the new “Gold Rush”. Now is the best time that many have seen in generations to acquire high quality real estate assets for very significant discounts. Many of the future generations’ wealth will be created thru real estate that will be acquired in this downturn. It is very important that you investigate any potential acquisitions thoroughly to ensure that the asset(s) is what you expect it to be.

GA: For business owners looking to expand or open a business, what are some good areas of investment?

ACP: With the soft real estate market (both sales and leases) - business owners looking to expand their business haven’t had a better time in decades to negotiate great terms on buying or leasing their present or new space or building. Take advantage of this. You may want or need additional space for your business in a year or two, but the time to secure that building or space is over the next six to 12 months.

Other areas of investment that will pay dividends in the long run are the systems that run your business. Take the time now to streamline and invest in your business systems that make your business unique and run profitably. Make sure that you capitalize on all the incentives that are available to you now as they won’t be “On Sale” forever.

GA: Do you expect the proposed stimulus package to help investors? If so, how will it assist?

ACP: The stimulus package should help investors in multiple ways. One of the most important ways that the stimulus package will help investors is with the new Financial Stability Plan that was released and is still a work in progress from the Treasury Department. This should help to ease the banks liquidity crises and get the dollars flowing again. From the increased transparency and disclosure that the banks will be required to have (those that take funds from the Treasury) to the Public/Private Investment Fund that will be set up ($500 million – $1 billion) Ashford believes that lending should see a substantial increase in the coming quarters.

GA: Where do you see Ashford Capital a year from now?

ACP: Ashford will have positioned itself to benefit from the present market conditions – remarkable conditions that have not been seen by the present generation and will have acquired tens of millions of significant institutional grade real estate assets through thru its strategic partnerships with its private investor network. The portfolio will be a mixture of short, medium, and long term plays.

For further information on Ashford Capital Partners Inc., contact Matthew Riedemann - founder, president, & managing partner at (678) 881-0830 Office (678) 231-4579 Cell Matt@AshfordCP.com. The company is located at 125 TownPark Drive, Suite 300, Kennesaw, Ga. 30144.

Ashford Capital to acquire Real Estate Portfolio

2009-02-26T15:16:00.001-05:00

KENNESAW, GA. (February 25, 2009) - Ashford Capital Partners, Inc. ("Ashford") is under contract to acquire a distressed real estate portfolio of properties in Metro Atlanta. Through its private investor network Ashford is acquiring this portfolio at a substantial discount to even todays depressed asset pricing. Ashford portfolio includes real estate assets throughout the Southeast. Ashford's offices are in Kennesaw, Georgia. For more information please visit: www.AshfordCP.com or contact Matthew J. Riedemann, Managing Partner, at (678) 881-0830.