Acquisition Strategy
How properties are onboarded to the Subunit Protocol
Subunit’s approach to acquiring properties is guided by core principles that prioritize ease of governance, reliable income, community consent, and adaptability. This section outlines how we choose and approve new real estate assets, ensuring each addition to the portfolio aligns with both our investment goals and our community values.
TLDR: US based, "Easy-to-Govern" properties with cash flow.
Focus on Easy-to-Govern Properties
We target properties that a decentralized community can easily govern. In practice, this means favouring assets that require minimal ongoing intervention or emergency decisions.
For example, newer or recently renovated units are preferred because they come with modern systems and infrastructure – investors can often go years without major maintenance headaches. Fewer unexpected repairs translate to fewer urgent votes or crises, making it simpler for the Subvault DAO to manage collectively.
We also seek properties in desirable, growing areas that naturally support stable performance. Homes in up-and-coming neighborhoods tend to attract reliable tenants and have strong occupancy, all while benefiting from local economic growth. Such areas often feature lower crime and better amenities, contributing to higher property value appreciation and sustained rental demand.
Cash-Generating Assets with Long-Term Upside
Another pillar of our philosophy is acquiring cash-generating assets that provide sustainable yield and long-term upside. In simple terms, we prioritize properties that produce steady rental income from day one, ensuring the Subvault earns a dependable yield for members.
Regular cash flow means the investment can cover its expenses and potentially distribute surplus to participants, instilling confidence that our holdings “pay for themselves” through operations. Just as important, we look for long-term growth potential in each asset – whether through natural price appreciation, improving neighborhoods, or value-add opportunities down the line.
Community-Driven Acquisition Process
All property acquisitions go through a transparent, community-driven process to ensure that Subunit’s portfolio reflects the will of its members. We believe that combining expert due diligence with decentralized decision-making leads to the best outcomes. Our acquisition pipeline involves two key stages:
Core Team Due Diligence: First, the core team identifies and vets potential properties. This team consists of real estate and finance experts from the Subunit community who analyze each opportunity’s fundamentals. They perform market research, inspect the property’s condition, evaluate financial projections (rental income, expenses, expected yield), and check for any legal or compliance issues. Only assets that meet Subunit’s strict criteria (e.g. easy governance and solid returns) make it past this stage. The goal is to present the Subvault DAO with high-quality, viable opportunities rather than burden members with raw, unfiltered deals.
Subvault DAO Approval Vote: Once the core team greenlights a property, the proposal is brought to the entire community for a vote. Every member of the Subvault DAO has the right to evaluate the proposed asset and cast a vote on whether to accept it into our portfolio. This on-chain voting process is open and transparent, reflecting Subunit’s commitment to decentralized governance. If the community reaches consensus (per our governance rules), the property is approved for acquisition. In practical terms, approval means Subvault funds will be deployed to purchase the asset, and corresponding UNIT tokens for that property will be issued to vault stakers. If the vote fails, the property is declined and we continue the search for better opportunities.
This two-step process ensures no property is acquired without broad community buy-in. It mirrors the approach used by other decentralized real estate platforms, where a core team screens deals and members collectively vote on acquisitions. By following this proven model, we leverage professional due diligence while giving our community the final say – every investment is of the community, by the community. The result is a portfolio that members truly co-own and support, and a pipeline that is both efficient and democratically legitimated. Subunit’s investment club ethos is upheld at every step: experts guide the way, but the ultimate power rests with our Subvault DAO members.
Adaptive Strategy Based on Vault Size
Subunit’s acquisition strategy is dynamic and responsive to the size of our communal capital pool (the Subvault). We recognize that a one-size-fits-all approach won’t work when our available capital can vary over time. Instead, we adjust the scale and scope of target properties to match what the community has staked:
Smaller Subvault (Early or Lower Capital): When the vault’s staked funds are modest, we focus on smaller, lower-cost assets that fit within our budget. This might include single-family homes, condos, or duplexes in our target markets. These properties are easier to acquire with limited funds and help us avoid over-concentration risk. Targeting smaller deals ensures we can put the community’s capital to work quickly and start generating returns, rather than leaving funds idle waiting for a huge purchase. It also allows the Subvault DAO to gain experience with governance on a manageable scale. As an example, if our available pool is only enough for a $300K property, we won’t overstretch for a $1M apartment complex; we’ll acquire an asset that fits the vault size and still meets our quality criteria.
Larger Subvault (Growing Capital Reserves): As more members stake USDC and the SubVault grows, higher-value or multi-unit opportunities unlock. With a larger pool of capital, Subunit can pursue acquisitions like apartment buildings, multi-family complexes, or premium properties in prime locations that would have been out of reach before. Bigger deals often come with benefits like better economies of scale, diversified tenant streams, and higher absolute income – advantages we can tap into once the Subvault DAO has sufficient resources. A robust vault might also allow multiple acquisitions in parallel, improving diversification. We remain diligent that even these larger targets adhere to our philosophy (easy to govern and cash-flow positive). The key is that our portfolio scales up responsibly: we grow into more ambitious investments only when the community’s participation makes it feasible and prudent to do so.
This adaptive strategy means Subunit is always “right-sizing” its investments. We won’t force the Subvault DAO into a giant purchase if the capital isn’t there, nor will we stick to only tiny properties once our treasury can handle more. Instead, the focus is on progressive growth – starting with attainable wins and expanding our reach as the community and its treasury expand. This dynamic approach sets Subunit apart and keeps our acquisition plans flexible. Whether we have $100,000 or $10 million ready to deploy, our philosophy guides us to invest in the best possible properties for that scale, maintaining quality and community oversight at every level.
Community Alignment and Continuous Evolution
All of these principles reflect Subunit’s overarching mission: to build a community-governed real estate portfolio that is sustainable, profitable, and driven by its members. Our acquisition philosophy is not a static rulebook, but a living strategy that can evolve with input from the Subvault DAO.
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