Published on 18, Jul 2023

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Please see updates I made to the google doc above. 

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Vilicus Capital Launches Program to Create Affordable Housing

Grand Rapids, MI - Vilicus Capital, a real estate investment firm based in Michigan, is making waves in the industry by spearheading a unique initiative that focuses on renovating hotels and converting them into affordable workforce housing. With a mission to address the growing demand for affordable living options while revitalizing communities, Vilicus Capital is making a significant impact in the real estate landscape.

Alexander Cartwright, Vilicus Capital Managing Partner, is Associate Professor of Economics at Ferris State University and sees the housing shortage as chronic. Housing affordability is often measured by rent to income ratios, a measure of tenants ability to afford rent, which continue to rise. In fact, the percentage of renters spending over 30% of their income on rent recnetly hit a record high. https://www.jchs.harvard.edu/blog/number-renters-burdened-housing-costs-reached-record-high-2021

Cartwright points out that of all the apartments under construction, not only is the quantity of construction not nearly enough to meet current demand, but also the type of apartments being constructed are mostly luxury apartments. Developers usually find it more profitable to construct buildings with higher end finishes and luxury amenities instead of affordable housing. 

Vilicus Capital looks for hotels that are either struggling financially or owned by groups uninterested in remodeling them. Hotels are typically in convenient locations, have excellent amenities and can be purchased for a small fraction of what apartment buildings costs - making them attractive buildings that can be converted into workforce housing. 

Vilicus upgrades the hotel rooms to studio apartments (or small one bedroom apartments) and works with local government to secure the zoning approval needed to convert the properties into apartment buildings. Once the hotels have been both physically and legally converted into apartment buildings, they increase in value significantly - allowing Vilicus to offer investors both excellent returns and the opportunity to fill a need in the marketplace other developers cannot fill without governemnt subsidies. 

“As an Economics professor I try to teach my students about the virtues of free markets and the importance entrepreneurs have in sustaining economic growth. However, I worry that when my students graduate and get an entry level job they see a high portion of their income go toward rent which makes them feel like the economy is stacked against them - I want to do something that combats that - hence, my team and I focus exclusively on finding hotels that can be converted to apartments. 

The ‘Hotel to Apartment’ conversion strategy is so profitable, Multifamily Entreprenuer Charles Dobens of MultifamilyOS recruited Hotel Conversion experts David Peters (https://www.cnbc.com/2021/02/04/want-to-own-an-apartment-building-buy-a-distressed-hotel-cheap.html) and Alex Cartwright to teach a masterclass on how to convert hotels to apartments. The class will take place July 28-30 in Chicago IL ( https://www.multifamilyinvestingacademy.com/offers/iPXKbb8w?coupon_code=ALEX ) where Alex will be teaching students how to find, finance, and operate hotels that can be converted to apartments. “Growing a network of real estate professionals interested in hotel conversion will help us create more affordable housing” according to Cartwright. “I’m interested in teaching others what I’ve learned & be part of putting on the first ever event dedicated to hotel conversions. Currently there is not a network of people working on these kinds of projects, so we need to create the network.” At the event, Cartwright is going to give participants the Vilicus Capital underwriting model, copies of the contracts his firm uses, and invite them to be in his Economics reading group.  

Vilicus Capital is engaged in multiple conversion projects - mostly in the southeast. www.Vilicus.Capital 

Managing Partner Alexander Cartwright says that the firm’s vision is to become one of the largest owners of workforce housing in the country. “We predict that we’ll have over 10,000 units under management that have been converted from hotels to apartments within the next five years,” Cartwright shares. “We’re fully dedicated to creating meaningful change in the real estate industry and setting a new standard for socially responsible investment and development.”

Alexander C. Cartwright, PhD, is an Associate Professor of Economics and Chair of the Management Department at Ferris State University. He is a renowned scholar with his Economics research being published in various scholarly and national news outlets. As an affiliated scholar with multiple think-tanks, including The Mackinac Center, he has written extensively about the economic benefits of free markets and the role of property rights and entrepreneurs in driving economic growth. 

Outside of academia, Cartwright is actively involved in various business ventures, including his role as the managing partner of Vilicus Capital, where he focuses on acquiring hotels for conversion into affordable housing. With a strong background in economics and extensive experience in real estate transactions and construction projects, Cartwright brings a unique perspective and expertise to his endeavors. He holds a B.S. in Mathematical Economics from Hampden-Sydney College and an M.A. and PhD in Economics from George Mason University, where he was a F.A. Hayek Fellow.

About Vilicus Capital

Vilicus Capital is a real estate investment firm that focuses on acquiring hotels and converting them into affordable workforce housing. The company sources properties, provides underwriting services, secures debt, and makes purchases prior to converting hotels into apartments, and then installs property management and handles administration.

Website: https://www.vilicus.capital/ 

Contact Alex Cartwright: AlexCartwright@vilicus.capital