If a deal cannot support a 9% cash flow from day one, it is not considered a candidate for the fund. The evaluation process involves examining the property's rent roll, financials, and loan covenants to assess cash flow after debt service.

Viking Capital will analyze the property's rent roll, financials, and loan covenants, incorporating reasonable assumptions into their financial model to determine post-debt service cash flow. Our focus will prioritize the property's ability to meet debt service, and preferred payments, and maintain a strong Debt Service Coverage Ratio (DSCR), ensuring a resilient financial foundation.

One potential downside is the possibility of finding deals elsewhere with higher returns. 

Ensuring a thorough evaluation of Viking's underwriting capabilities, with a specific focus on deal modeling accuracy, syncing values, and transparent communication about property operations, is crucial when considering an investment. The primary risk involves potential discrepancies between promised and actual cash-on-cash returns. By aligning values and fostering transparency, investors can mitigate this risk and gain confidence in the competence of the team.

If a property is not paying distributions, it doesn't necessarily mean it's not doing well. Some properties may use cash flow to address issues like rate caps without needing support from the Hyro Fund. The fund assesses each property's situation to determine if additional support is required.

The fund should not be the only investment in one's portfolio. It serves as a tool to reduce overall risk in the investment strategy, particularly when larger, higher-risk swings are involved. Bonus depreciation can be obtained elsewhere as part of the puzzle in building an investment strategy.

If a sponsor goes into default, Viking can take over based on covenants in the agreement. The specifics, such as the duration of non-payment, are outlined in the loan documents. Legal proceedings may be involved, but Viking would assume control of the operating entity and work with the lender to create a workout situation.

As placements and investments are made, Viking plans to send out profiles of the deals that the funds are going into. However, all deals will adhere strictly to the defined buy box criteria, ensuring they fit within specific vintage, DSCR, and other criteria.

Viking will follow the strict buy box criteria, evaluating opportunities on a deal-by-deal basis. While the ESG opportunity looks promising, the decision to use the HYRO Fund will depend on the individual characteristics of each deal.

Profits above the preferred return (pref) have a 50-50 split. Depending on the class, investors receive the first up to 13%, and profits beyond that are split equally between pref investors and Viking as the fund manager.

If an operator did not hedge rate caps and the rates are floating, it may not be a fit for the fund, as stability is crucial. Finding a good operator in such a case would be challenging, and the operator would need to have an exceptionally strong deal to compensate for the lack of rate caps.

The cash-out timeframe typically falls within one to five years, with some properties possibly cashing out in the one to three-year range. As properties cash out, returns go back to the preferred return (pref) investors.

Yes, the time to exit is a crucial factor. The fund looks for deals that can be turned around swiftly, aiming for more immediate impact rather than long-term viability. The HYRO Fund is designed to solve immediate problems rather than serving as rescue capital for deals with extended timelines.

Vintage is considered, but the focus is on the condition of the property rather than its age. Properties with deferred maintenance issues, regardless of their vintage, may pose a higher risk. The fund evaluates each deal individually, taking all factors into consideration.