A lot of multifamily investors chased booming Sun Belt markets over the last few years. Mark Purtell and Preston Hartsell took a different approach. In this episode, the partners behind Valoran Capital Management explain why they are focused on workforce housing in secondary and tertiary markets across the Northeast, Midwest, and Rust Belt. They also discuss how rising interest rates and oversupply created stress in many multifamily assets and where they see opportunity moving forward. The conversation covers local operator partnerships, patient capital, and why supply-constrained markets may become more attractive over the next several years. Key Topics Discussed: Why Valoran focuses on workforce housing The risks of oversupply in fast-growing markets Why local operators matter in multifamily investing How their 10-year closed-end fund works The importance of matching debt terms to business plans Why they believe supply and demand may shift back in favor of owners Guest Information: Mark Purtell Preston Hartsell Valoran Capital Management Contact: mark.pertel@valorancapitalmanagement.com Website: Valoran Capital Management Call To Action: Reach out to Mark and Preston if you are an operator looking for equity partnerships or an accredited investor interested in workforce housing opportunities.

Why Workforce Housing Still Makes Sense with Mark Purtell and Preston Hartsell

Property Profits Real Estate Podcast

# Full Transcript

**Podcast:** Property Profits Real Estate Podcast

## Participants

- **Dave Dubeau** (None)
- **Mark Purtell** (Valoran Capital Management)
- **Preston Hartsell** (Valoran Capital Management)

## Transcript

Hey folks, welcome back. Today we have not one but two real estate entrepreneurs on the call. We've got Mark and Preston. They are partners with Valoran Capital Management. And gentlemen, welcome to the show. Great to have you. Hi, Dave. Pleased to be here. All right. So Mark, I think there's a little disclaimer that your lawyers wanted you to say, so let's go ahead with that first.

Sure. Thanks a lot, Dave. So this discussion for informational purposes only does not constitute an offer to buy or sell securities or any type of solicitation for securities. This is all informational. That's all we're looking for, for sure. All right. So let's just zoom out for a second. And Preston, maybe tell us a little bit about Valoran Capital Management. What do you guys do in the realm of real estate?

So at Valoran Capital Management, we run a series of closed-ended funds where we invest equity into workforce, most commonly value-add real estate in every state except for California. So we partner with local operators and provide anywhere from 9% to 99% of the total equity in their deals. And we look to partner on deals anywhere from a 1- to 10-year hold, anywhere from hold and sell to reposition to distressed assets.

Okay. So workforce housing, quite a variety there. What's kind of your typical buy box these days, gentlemen? The total capitalization is anywhere from $10 to $75 million. Equity checks, anywhere from $5 to $20 million. And we try to stick anywhere over 100 units. We like to have some sort of economy of scale at the property, at least a leasing manager and one or two maintenance technicians.

Okay. So are these A, B, C, D-class buildings? What kind of buildings are these looking like? Most of them fit in that B and C-class. I would say most of our investments are also in secondary and tertiary markets. Like in our last one, our number one market was Albany, New York, out of all places. So kind of looking for edge anywhere we can find it. Okay. Very good. And Mark, what kind of markets are you guys focusing on?

Preston mentioned it's kind of like all across the country, excluding California specifically. I think I know why. But tell me a little bit, what are the markets that you're most bullish on these days at mid-2026? Yeah. So, I mean, if you're going to generalize the country, we really like the Northeast. We like the Rust Belt. We like the Midwest. In a nutshell, it's markets that haven't had a large inflow of supply and are going through lease-up.

So that excludes parts of the Sun Belt, some of the mountain states. And in general, we're looking for markets that have high household median incomes relative to pro-forma rents. And to generalize, as Preston mentioned, we're looking for workforce housing. So a $3,000 ...

Why Workforce Housing Still Makes Sense with Mark Purtell and Preston Hartsell

Transcript

Built for investment professionals

Every day you wait, your competitors are finding
edge in conversations you're not hearing.

Why Workforce Housing Still Makes Sense with Mark Purtell and Preston Hartsell

Transcript

Built for investment professionals

Every day you wait, your competitors are findingedge in conversations you're not hearing.

Every day you wait, your competitors are finding
edge in conversations you're not hearing.