David Meilan, Director of Investor Relations at Nighthawk is often asked how we find our deals.

To take a deeper dive into the process we use to source our deals, we asked President Drew Kniffin which markets stand out and why Nighthawk does business there.

Our focus and Nighthawk is in the southeast  for two main reasons. First, properties are less expensive there than they are in the rest of the country. It costs less money to buy $1,000 of rent.

Number two is that it also has growth. Now, not all of the southeast has growth. But there are big growth markets. If you look at where are Americans are moving to, it's generally to the south and to the west. There is good growth, and we see that growth in three different markets.

We see it in Huntsville, which is a smaller tertiary market in northern Alabama.

We see it in Atlanta, the premier city of the southeast.

And we also see it, broadly speaking, in the Carolinas.

Those are the markets that we really like. We've had success in those areas, especially in Huntsville in Atlanta. It's going really well there. They have great job growth trends in those markets, and have industry leaders in those areas.

A lot of people don't know this, but Huntsville has more STEM jobs and more tech jobs per capita than any other metro area in the United States, and that includes Silicon Valley. It's just STEM city – they have aerospace companies, they have defense contractors.

So we like these areas because they're growing, but they also have a relatively low cost to acquire units.

One aspect that's that's particularly advantageous about focusing on those specific markets is efficiencies of scale. What does that mean? And how does that concept benefit us?

Well, efficiencies of scale is the idea that when you're bigger, when you have a larger presence, you can do stuff, and it costs less. So in both of those markets, we have multiple properties. Whether it's Huntsville or Atlanta, we can share resources across properties. We will soon have four properties all in the northern rim of Atlanta. That benefits you from a labor perspective. It benefits you from a property management perspective. You can buy supplies in bulk.

There are so many different ways, when you have efficiencies of scale, you can run your business more efficiently and lower your costs and ultimately increase your profitability. That reduces risk for investors. It helps you normalize things that could throw you off, if you only had smaller properties. So we share staff across properties and we're able to go see our properties more often.

When I go to look at one property next week, I will absolutely go check on all four properties – walk the units, walk the property, talk to the property manager, even look at comp properties. That's just an easy thing to do, because they're all right there in that same location.

One thing that really helps Nighthawk find a lot of good quality deals is our Director of acquisitions, Garrett Lynch. Garrett, over time, has built out an extensive network of brokers and lenders to help us acquire properties.

When you have a presence somewhere, you're gonna have the attention of all the vendors in that area, including brokers. So we are talking to the main brokers in those markets all the time – having phone calls, asking, “What are you seeing; what are things trading at; what's coming up for market?” and we're getting an inside scoop on deals.

I would say three or four of our deals in Atlanta, we got because we had that strong network relationship with them. They know that we close on time, they know that we close without incident, without hassles.

So they put their thumb on the scales and directed a seller to working with us because they know that we're good to work with. We're easy to work with. The broker knows we're going to close, and of course the broker gets paid at the close, but the seller often really has a strong desire to close deals on time at a certain time.

Maybe they have a 1031 coming up, maybe there's a tax driven reason that they need to sell by the end of the year. We can deliver that very important thing for them. The great network of broker relationships can set us apart from the another buyer who's otherwise going to maybe bid at the same price.

If you're interested in hearing more about Nighthawk's properties, and you have not yet scheduled a call, feel free to do so. This will put you on our “deal ready” list, and it will enable us to notify you about any upcoming opportunities that we have. Schedule a call by visiting this link.