It's the goal of many multifamily owners and investors: Buy an apartment community in need of upgrading, perform the needed renovations, boost rents accordingly and drive impressive returns.

But just because apartment companies frequently undertake value-add projects, it doesn't mean success in these endeavors is easy. On the contrary, a value-add community that attracts residents and produces the targeted returns is the end product of an almost never-ending amount of diligent research and careful strategic planning. 

Below are some of my general tips for success in the value-add arena.

• Dig into submarket data. This may seem obvious, but it's such a critical step that it merits placement here. A successful value-add project depends on a submarket that can support the rents and the investment returns you're seeking. Once you know what metro you're looking to invest in, thoroughly research the area's submarkets to pinpoint where your best investment opportunity may be. What are the submarkets where the population is increasing, employment opportunities are growing and rents are rising? Be prepared to go through all the data sources you need to make this vital, fundamental determination.
• Visit a property you're considering buying. Statistics, spreadsheets and databases are of course indispensable when evaluating a value-add opportunity. But don't ever underestimate the value of setting foot on a property and seeing it in person. As the great and wise Yogi Berra once said, "You can observe a lot by just watching."
  
  On a personal note, I was recently tempted – because of an extremely hectic schedule – to pass up an opportunity to visit several properties my company was evaluating for value-add acquisitions. However, my tour enabled me to see that the properties would be much stronger investments than the data or the offering memorandum from the broker indicated they would be. Had I had not seen them in person, I would have concluded otherwise and missed an invaluable opportunity.
  
  Additionally, when determining the size and scope of your property renovations, it's imperative to visit the competition. Take a tour and talk to the comp's leasing staff and residents. Ask the residents what they like and what they don't like about the property. Find out why they moved there and if they plan to renew their lease. That kind of information is gold.
  
  
• Realize there is no "one-size-fits-all" renovation for creating value. The specific shape and scope of your renovations will depend on the renters at your community and in your submarket. Dive into that data to develop a clear understanding of the renters' wants and needs.
  
  If the area is full of young, single professionals, it may make sense to focus on improving the pool area and the fitness center. If the submarket caters more to couples with young families who will be cooking at home most nights, then renovating the kitchens could deliver the best return on investment. 
  
  The objectives of your investors are also critical when planning renovations. Some investors may care most about cash flow and return, while others may be more focused on the overall return of the investment upon disposition instead of a current yield.
  
  
• Don't lose sight of the end game. In their laudable effort to not overspend on renovations, owners and investors can forget they're creating a product that is real, that is hopefully something renters will like and want to live in. 
  
  Without question, apartment companies have to make sure their expenditures have a strong chance of boosting rents and delivering the targeted returns. But sometimes this can lead to an overcautiousness that results in a community that does not address the wants and needs of renters in the submarket.