The importance of investing and building wealth has tremendously increased with the growth of income in economies all over the world. This is particularly true as we recover from the COVID-19 pandemic and investors look for safer havens to park their money in a world where yields and interest rates are ultra-low. Dhanani Private Equity Group, which has been in real estate development and private equity since 2011 has experienced firsthand the changes in the markets in Houston, Texas. On the flip side, DPEG has also seen many developments pop up in the last few years which shows the investor demand is continuing to grow. "This is good news for our firm and the real estate industry. We will keep forging our path ahead to push our growth along with our investors' by continuing to diversify our portfolio and build legacy assets." states Nadyrshah "Nick" Dhanani, CEO, Chairman and co-founder of Dhanani Private Equity group.
From the beginning, DPEG's approach has been the same, developing and acquiring various properties in high-traffic locations that not only provide small and large businesses to thrive but also contribute to stellar returns for their investors. Along with a strong management team, DPEG has been able to bring it's investors and partners an average IRR between 20-35% on over 100 projects - it's lowest return being 7.70% and it's highest being 137% annually.
A Visionary's Approach
Nick Dhanani is the powerhouse, vision and face behind Dhanani Private Equity Group and has built the business brick by brick from day one. Nick's career started from humble beginnings as he immigrated to Houston in the mid-80s and started working at a convenience store as a night cashier. After a couple years of experience, he started to buy and operate his own stores. With the proceeds of his early businesses, Nick decided to start investing in real estate and developing properties and with that, DPEG was born. Nick started this company by developing convenience stores which was his expertise at that time. After developing 50+ stores, he quickly pivoted to building, leasing and holding another 50+ shopping centers as the deals grew larger. In the middle of that journey, he also had experience building fast food and hotels.
Most recently, multifamily development is Nick's number one priority. DPEG has experienced tremendous growth as a company in the past few years as it started with deals worth a couple of million dollars to now launching projects over $75 million dollars. Just a few months ago, the DPEG team exited their very first multifamily project, The Territory at Greenhouse in Katy, TX that started development in 2018. This exit not only highlighted an IRR of 30% for investors, but it also set a record for highest price per door in the history of the Katy submarket. Nick's philosophy is that as long as the bottom-line numbers make sense for everyone involved, the deal is worth doing. Along the way, Nick's vision and perseverance led him to grow his team and company to $700mm in assets under management. In 2020, the Mayor of Houston, Sylvester Turner recognized Nick for his contributions to the business development of Houston and beyond. Today and going forward April 4th is known as "Nick Dhanani" day in Houston, Texas.
DPEG was established based on Nick's desire to help his friends and family build long-term wealth, preserve their capital and educate them on how to use money as a tool to bring in more returns. "Time is our most valuable commodity and there is a big difference between working for your dollar and having your hard-earned dollars work for you." Nick has always said.
Sailing Through the Challenges
Sharing experiences from DPEG's early days, Nick says, "By far the most challenging time for us was when we started and tried to raise money for investments. Without an established track record, you can imagine the difficulty of trying to convince investors to invest with you!" Initially, it was the trust that Nick's family and close friends had in him that truly helped overcome hurdles. Word quickly spreads around the city of DPEG's success and growth as every single project they've done so far has turned a profit.
Another challenging time for DPEG was during the early days of the COVID-19 pandemic which completely turned the world and business practices upside down. Millions of companies and their investors were either taking losses or completely shut down for good. DPEG and their team was agile in implementing new strategies in an effort to offset the pandemic's impact. They also worked with investors to ensure their projects were safe as the team believed in practicing patience with a long-term vision. Ultimately, DPEG believed that real estate investments and income-producing assets would always come out as a winner.
Learnings, Team Building and Leadership
The DPEG team and their investors are a family that look out for one another while enjoying the journey together through all the ups and downs. When asked what he'd wish he knew before starting this business, Nick says, "I wish I was able to convey my vision to investors in the early days of the company before laying the groundwork. It was challenging to build new relationships without a track record but we've come such a long way since. I am grateful for those who put their trust in us early on and those who continue to do the same since our first days in business."
As a leader, Nick believes that mindset plays a huge role in the success of a company. Leadership comes from top-down and success is a byproduct of the entire team sharing the same vision. He also believes that operating a lean team where everyone wears multiple hats helps the company grow quicker. Dhanani Private Equity Group is on track to close over $200mm in sales in 2021 alone and is hoping to continue its growth trajectory while doing what they love most - putting the investor first.