Middleburg Communities from Vienna, Va., and some individual investors joined a $850,000 seed round for Connexus Living. The company runs a platform that allows real estate companies to request proposals and procure goods and services. Individual investors included startup founders and executives such as Demetrios B. Barnes and Todd Butler from Sentral and Migo, and Demetrios B. Barnes .
Middleburg Communities CEO Chris Finlay said: “Connexus has done something unique in the industry, driving NOI [net-operating income] through its service contracts. This saves us money and gives our site teams more time in their days.”
Focus on Profitability
The NOI is an important metric in the real estate sector. It is used to determine the revenue and profitability for investment properties, after accounting for necessary operating costs.
Connexus, founded in 2023, helps commercial real estate managers and owners centralize the RFP processes, creating operational and economic efficiencies. Connexus, which already has 200,000 units on its platform plans to use the money to expand its market reach and bolster its capabilities.
“We are thrilled to be backed up by thought leaders in multifamily.” Their leadership and expertise are going to accelerate our scale-to-market,” said Devin Wit. Melissa Wirt is the vice president of success and co-founder of Wirt.
Connexus, according to Devin Wirt, helps owners and operators “save north of 15% on their existing contracts.”
The ‘Build-to Rent’ market is booming
Middleburg Communities is one of a number of companies that are targeting the “build-to rent” market. Build-to-rent, which is a single-family house leased to one tenant, has emerged as a new growth area, attracting billions of dollars in new investment.
“One of our biggest concerns was that people were not able to save enough money for a downpayment, regardless of interest rate,” Aaron Tishkoff told CoStar News in early this year.
Tishkoff called these homes the “next-best alternative” for people who cannot afford to purchase a single family home. Middleburg, according to CoStar, has invested over $500 million in its portfolio of built-to-rent properties across Charlotte, N.C. Charleston, S.C. Jacksonville, Fla. and Wilmington, N.C. In February, Middleburg broke ground on a Midlothan, Va. 260-unit project outside Richmond.