IRVINE, CA—Triqor Group works off one central active database for its agents, complete with a full support staff to update the 40,000 apartment-property listings—leading to YTD sales volume of roughly $200M for L.A. and OC, company principals tell Principals credit its growth to its approach to client service, which has resulted in the fastest-growing and largest market share in 16-to-100-unit transactions in the areas served. We spoke exclusively with principals Gary Tolfa, Chris Keramati and Justin White about the firm’s investment strategies, its outlook for multifamily this year and how apartment investors can gain an edge in such a competitive sector. What are your firm’s investment strategies?

Tolfa: Over the past eight years, our business has increased annually. 1031 tax-deferred exchanges comprise the majority of our transactions (between 70-80%) and should continue throughout 2016. At the end of 2014 and 2015, we had so much demand that we recruited Justin White from a large national firm to partner with us in order to grow our business model into additional markets of Southern California and Arizona.

Our model, established around our proprietary database system, allows us to fully collaborate between agents in all of our offices. This allows TRIQOR the unique ability to trade clients from long term ownership of a single asset to a much larger apartment property or even multiple properties in multiple markets of SoCal. Justin, who was with Marcus & Millichap, has taken on the task of growing the company to better serve all our clients; he has been instrumental in that respect. We see the Southern California apartment market as a very unique place with diverse employment opportunities creating a lot of demand for rentals. The multi-residential investment opportunities available in SoCal are unmatched, and our plan is to continue to grow.

White: When I joined the firm, I was impressed with how a company with few players was so dominant in Orange County. They put the client first. They shared information and collaborated, and their approach to 1031 Exchanges was advisory, from an overall look at what the clients’ needs were for the next 10 years to designing and implementing a strategy to get them there. My role is to add to our team to fill out areas of Orange County or L.A., adding people around Chris Keramati and Chris Walker’s success in L.A. and our opening of an office in South L.A.

Keramati: To my understanding, we are the only firm with an active database that the company works off of. Most companies have a database as a resource, but we all work off one central database for all the agents, with a full support staff to update the 40,000-property resource. We’ve gained a lot of market share in the South L.A. market, and we’ve been expanding ever since. We’ve looked to hire good, quality, ethical agents to our team here. We also don’t oversaturate the market with too many agents. We have specialists in each market and expect them to carry their weight in each market.

White: Agents specialize by geography, product size or specialty niche type. We trust our people to be experts so there is no need for internal competition and client confusion. The result is a collaborative database that is very robust from the consistent sharing of information.

Tolfa: At many other firms, you always have to worry about competing with the guy a cube or three over from you. What is your outlook or 2016 in the multifamily sector?

White: In 2015, our firm grew by 57%, and we’re on pace to well exceed that this year.

Tolfa: Our objectives are not only to grow the South Bay with Mike McKinney, formerly with Berkadia, but we are also looking to do the same in San Diego and the Hollywood area of L.A. A lot of agents out there are looking to come in and form the same teams as in the South Bay.

Keramati: We feel that activity has increased from 2015 to 2016, and prices are continuing to increase based on where interest rates are. But people can still enjoy a nice cash flow.

Tolfa: The main thing that helps move the values is the rental market has continued to go up—that is, a lot of people are not buying homes, and a lot of Millennials do not want to buy homes. Specific new projects are pressing rents to $1,000 above older properties, and this creates a better area—you’re getting more of a white-collar-tenant profile, and that’s helping older properties. All of these rents going up are pressing values. Looking at return and rent potential, I don’t see that slowing down. People are still moving into the state. Together with the inability to build in these areas, this creates demand. How can apartment investors gain an edge in such a competitive sector?

Keramati: Fundamentals are so strong, and there’s lack of supply that makes Southern California a great place to invest. A lot of the investors we talk to look at the fundamentals and information and know they’re going to be in the business for more than seven years. Southern California is the place to buy, and their goal is to buy as much square footage as they can. They have advisors in the marketplace that can find them opportunities that other people can’t, or they have an inside vision about neighborhoods that are changing and achieving significant rent growth because of improvements. That’s where the opportunities come from today. To really hit home runs every time you step up to the plate, you have someone with the experience to identify the next
opportunity—not just what’s hot today. What else should our readers know about your firm?

White: People should know we have a high level of client-first focus. We offer a level of service and expertise that clients couldn’t find anywhere else—understanding the client, figuring out how they want to grow their portfolio, what they want to leave to a future generation and coming up with strategies they’re not thinking of to help them get there. We have the staff and support level to allow brokers to go out and broker. We have the expertise to market an asset to promote its best qualities. Our service goal is to be the Nordstrom of the investment real estate business when it comes to selling apartment buildings.

Tolfa: Justin’s experience in training young agents and training them the proper way is key—first to understand the investment real estate business and begin to develop relationships with owners. Our agents quickly realize that it is not about making a quick buck or brokering a deal, but properly developing a career by earning trust and long-term relationships with active real estate investors. As a company, we take pride in giving the agents an opportunity to create their own financial rewards, earning significant income and investing themselves in the apartments they know.

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