Quality AFFORDABLE housing for working families in America
INSTITUTIONALIZING
THE MISSING MIDDLE
Our MISSION:
To acquire, renovate, and manage Affordable Small-Format Multifamily (“SFM”) residential rental properties in secondary metropolitan areas in the eastern and central regions of the U.S. - institutionalizing a generally disregarded, under-managed, and undervalued real estate sector in order to:
- Pursue superior returns while controlling risk for investors by capturing an institutional "First-Mover" opportunity.
- Provide safe, comfortable, affordable housing managed in a respectful, reliable, and responsive manner for moderate-income ("MI") families.
SFM: Mission-DRIVEN Investing without sacrificing returns
Moderate-Income ("MI") Households have become forever renters.
Moderate-income families represent the 44% of U.S. households who earn 60%-120% of area median income ("AMI"), including a majority of the nations essential workforce. MI households comprise the single largest and least supported U.S. demographic segment. More than half are rent cost-burdened, spending over 30% of their gross income on rent and utilities alone. With a savings rate approaching 0% and mounting consumer debt, most MI households cannot accumulate the downpayment needed to buy a home. They have become “Forever Renters.”
Small-format multifamily ("SFM") is a large, resilient sector with a stable MI tenant base.
Small-format multifamily (“SFM”), rental properties with 3 to 49 units, is the primary source of rental housing for MI households. SFM is not a new market. It is a well-established housing sector with about 20 million units and an estimated market value exceeding $3 trillion nationally. Yet it remains overlooked by institutional investors. Only the local individual investors who own most SFM properties seem to appreciate the stability and loyalty of its MI tenant base, characteristics that make the SFM sector exceptionally resilient. While the multifamily sector has repeatedly shown its ability to hold value better and rebound faster than other real estate sectors, industry research shows that multifamily serving moderate-income households outperformed both the luxury and low-income multifamily segments with regard to these metrics during the Global Financial Crisis, the single most challenging stress test in generations.
SFM's fragmented ownership & inacurate reputation limit valuations.
One reason institutions have overlooked SFM, despite its intrinsic resiliency, is its undeserved reputation as difficult to own and manage. That reputation stems not from the SFM asset itself or its tenants, but rather from how SFM has generally been run. While wealthy families have successfully owned SFM properties for generations, the almost complete lack of institutional sponsorship has relegated the sector to fragmented ownership. Worse yet, many of the smaller individual owners lack the capital and scale to provide comprehensive maintenance and institutional-quality management. The result is substandard housing that diminishes quality-of-life for already financially stressed moderate-income families and, not surprisingly, strains tenant-landlord relationships. Subsequent anecdotes regarding occasional landlord-tenant conflict have been used to characterize the entire SFM property class as well as its MI tenants. The combination of its inaccurate reputation and poor maintenance and property management have served to limit the SFM sector's price appreciation and deplete the supply of quality affordable homes.
undervaluation and institutionalization drive social impact and investor returns.
As a result of being chronically under-managed and institutionally overlooked, SFM has been severely undervalued for years, especially in secondary markets where even capital from individual investors can be scarce. Allagash recognizes this as a significant opportunity. Allagash seeks to identify and accumulate highly underpriced SFM properties in stable markets and submarkets with highly inelastic demand. Then Allagash works to intelligently renovate these properties and institutionalize their management and maintenance. Additionally, Allagash commits to maintaining properties at rent levels affordable to tenants making 80%-100% of AMI. Following this process allows Allagash to have the opportunity to stabilize affordable housing stock and improve quality-of-life for MI households - all while positioning investors to pursue superior returns with controlled risk.
The TWO-PRONGED missing Middle CRISIS
increasing demand and decreasing supply
The U.S. is experiencing a severe two-pronged housing crisis that has been named the “Missing Middle.” Over the last 50 years, as the highest incomes have pulled away from the rest, the median household’s income has fallen further and further behind the average. The situation is often described as the disappearance of the Middle Class.With housing prices escalating more quickly than wages, the Middle Class no longer lives at the halfway point between opulence and subsistence. The situation is often described as the disappearance of the Middle Class. In fact, previously Middle Class families now have a reduced share of income and so are more appropriately described as moderate-income. The MI Forever Renters, whose growing. Simultaneously, luxury redevelopment is consistently reduced the stock of naturally occurring affordable housing ("NOAH") while construction cost inflation means that building new rental properties that can affordably serve moderate-income households is no longer financially viable. The result is the real estate Missing Middle: not enough multifamily rental housing to provide MI households with an acceptable standard of living at a reasonable cost.
For Allagash, the Missing Middle is where these two crises intersect. Just as the moderate-income population is expanding and needs more affordable housing, less is available. Allagash cannot solve these deeply rooted problems on its own, but we believe that investment capital to preserve existing housing affordable to moderate-income households is needed now. The largest source of capital, institutional investors, has largely stayed on the sidelines, mainly because few investment vehicles have been built for this sector. That is the gap Allagash was created to fill.
We believe that the expanding shortage of rental housing affordable to moderate-income households is both a pressing social need and a significant investment opportunity. For that reason, Founding CEO/Co-CIO Tony Barkan conceived Allagash PERE Investment Management with dual objectives: providing safe, comfortable, affordable housing for MI families and pursuing superior returns while controlling risk for investors.
These two objectives are designed to reinforce each other in a virtuous cycle. As return-seeking capital enables Allagash to acquire SFM properties and institutionalize their management, quality of life can improve for moderate-income families. As these families choose to make Allagash properties their long-term homes, improving tenant stability should cause tenant turnover and operating costs to decrease, thereby increasing property values and investment returns. Those returns can then attract further investment, and the cycle begins again.
As an emerging manager pursuing these objectives, Allagash seeks to achieve significant scale and create a new paradigm for mission-driven real estate investing. Allagash now offers investment in affordable SFM serving MI households through its commingled Fund or, for larger investors, separately managed accounts.
the team
Allagash is led by five partners with over 150 years of experience. The firm’s three Founding Co-Managing Principals, who have full responsibility for managing Allagash and its real estate investments, consult with the other two partners, the Heads of Construction Management and of Property Management, in directing the renovation and operation of the properties owned by the Fund and any separately managed accounts. Allagash's management and operations also benefit from consulting with a highly senior and expert Advisory Board.
The Founding Co-Managing Principals
Tony barkan
CEO/Co-CIO
38 years OF experience
After becoming a Founding Principal and Head of Real Estate at Seer Capital Management in 2008, designed and ran two programs from 2010-2015 leading directly to Allagash’s SFM strategy: the first purchased, renovated, and managed over 1,000 1-4-unit affordable rental homes across the southeast U.S. and the second became the second largest global investor into Commercial Mortgage-Backed Securities B-Pieces, effectively sponsoring over $20 billion in commercial property mortgages allowing Mr. Barkan to review and analyze hundreds of SFM properties.
As Founder/CIO at Sailfish Investment Management ("S4") from 2005-2007, became an early identifier of the “Big Short” trade and migrated position to 100% short by EOY 2006.
From 1997-2015, built and managed numerous traditional and alternative investment platforms with almost $20 billion peak portfolio size and $2 billion peak investor equity.
From 1988-1997, served as a trader and trading desk manager of currencies, commodities, and mortgage-backed securities at Man Group, Goldman Sachs, and Salomon Brothers.
simon russell
COO/CO-CIO
27 years OF experience
From 2019-2025, developed the Fund’s investment strategy with Tony Barkan, a friend and colleague for over 20 years, and then invested personally until contributing the portfolio to the Fund at Initial Closing.
Developed strong operational, community, and tenant relationships illustrating that the virtuous cycle paradigm can work for all stakeholders.
Began investing into commercial and residential real estate almost 30 years ago.
From 1993-2019, served in both client-facing and proprietary roles as an equity and equity derivatives trader, manager, and business builder for numerous banks and investment banks including Deutsche Bank, Rabobank, and Pali Capital.
david puchi
CBDO
35 years OF experience
From 2003-2022, co-founded and co-managed Baceline Investments LLC, which purchases and manages unanchored neighborhood shopping centers in secondary markets throughout the U.S. Baceline recognized an undervalued and institutionally underinvested real estate sector performing a necessary function for local communities and worked to institutionalize its portfolio, which is currently valued at $800 million.
Created and co-managed multiple private equity real estate partnerships and investment funds and has participated as a principal in over $1 billion of real estate transactions.
Primarily responsible for procuring over $500 million in capital for Baceline's investment vehicles.
From 1994-2003, founded a commercial real estate property management business as well as the predecessor investment entities to Baceline.
From 1987-1994, was a practicing commercial real estate attorney both at a law firm and within a regional bank.
the advisory board
Small-format multifamily is an operating business wrapped in a credit market wrapped in a community. Allagash’s Advisory Board members have held senior leadership roles across each of those layers:
- Billy Jacobs, distressed and complex real estate investing: former Head of Commercial Real Estate Investing at Perella Weinberg Partners and CEO of Lionheart Strategic Management
- Ron Freydberg, public-REIT leadership: founding member of MFA Financial, Inc.
- Michael Commaroto, institutional mortgage markets: former President & CEO of Apollo Residential Mortgage, Inc. and U.S. Head of Home Equity Whole Loan Trading at Deutsche Bank
- Paul Curcio, impact investing at institutional scale: former COO and Senior Portfolio Manager, Impact and Responsible Investing at Prudential Financial, and Head of Capital Markets at PGIM Real Estate
- Lucas Clarke, brand strategy: Founder & Managing Partner of Gnosis Group and founding Marketing Director at Mad Greens and Ninja Nation
Advisory Board members provide guidance and perspective to Allagash’s Founding Co-Managing Principals but do not manage the firm or make investment decisions.
A repeatable investment process specifically designed for SFM
Rigorous Research and
proactive sourcing
Allagash selects markets based on economic and social conditions, tenant performance and stability, and the available opportunity set, among other factors. Within each market, we then evaluate submarkets primarily, but not exclusively, for relative positioning and safety. Before sourcing any properties, we make multiple visits to each market, its submarkets, and specific property locations within them. We source properties through our partners’ wide network of local property owners, property managers, contractors, lenders, government agencies, and nonprofits, often identifying opportunities before they reach the broader market.
Thoughtful Renovations
At purchase and regularly thereafter, Allagash’s construction management team, led by the Head of Construction Management, professionally assesses each property. Renovations, when necessary, address safety first, then comfort and, where feasible, energy-efficient upgrades and additional amenities, all to provide families with safe, comfortable, and stable long-term homes. To ensure renovations meet our specifications, we select and directly manage local contractors and subcontractors, many of whom we have worked with before. The entire renovation process is guided by our detailed Construction Management Manual.
Respectful, Reliable, and Responsive Property Management
Allagash selects regional and national third-party property management companies that we believe will best support the operations and maintenance of our portfolio in each market. Property managers follow our detailed and demanding Property Management Operation Manual. Allagash’s management team, led by the Head of Property Management, oversees all of each property manager’s work, including, in particular, how rents are set and how tenants are treated. Property managers are held accountable using property-level performance indicators, so that every tenant receives the respectful, reliable, and responsive service they should expect, regardless of the rent they pay. Our team also visits tenants periodically to make sure their actual experience reflects the reports we receive.
The first mover advantage
When a pre-institutional asset class gains acceptance among institutional investors, its pricing can rise significantly as a deeper pool of buyers competes for assets. "First Movers", investors who recognize these sectors and invest before prices rise, are positioned to benefit most. Single-family rental (“SFR”) housing followed this path in the early 2010s when institutional capital entered the sector, and while at Seer Capital Management, Allagash CEO/Co-CIO Tony Barkan was among the first institutional investors to commit capital to SFR. Allagash believes small-format multifamily now offers a significant First Mover opportunity for both high net worth and institutional investors.
Targeted Market Focus
Institutional-Grade Management
Social Impact with Strong Returns
Contact Allagash
Please contact us regarding any SFM properties that may be for sale
or for further information on investing into Allagash's Affordable SFM strategy.
David Puchi
Chief Business Development Officer
Message Allagash
Contact Us
Please try again later.