How One Builder Unlocked $1.57M in Hidden Savings — Without Cutting Corners

CASE STUDY: 150-UNIT BUILD-TO-RENT PROJECT IN NORTH TEXAS

CONSTRUCTION BUDGET: $30M DEBT

TOTAL SAVINGS: $1.57M

CONSTRUCTION BUDGET AFTER STRELLA: $28.5M DEBT


1. OVERVIEW

A real estate developer was preparing to build a 150-home residential community, each budgeted at $200,000 — totaling a $30 million construction budget. The project’s original proforma projected a Net Operating Income (NOI) of $1.5 million, yielding a 5.0% capitalization (CAP) rate.

The developer partnered with Strella Companies to explore opportunities to reduce material costs without compromising on quality or project timelines.

2. KEY FINDINGS

Our team analyzed the builder’s material list and uncovered substantial savings opportunities across multiple finish product categories under review:

  • Cabinets
  • Countertops
  • Flooring
  • Doors & Windows (interior & exterior)
  • Light Fixtures
  • Plumbing Fixtures (sinks, faucets, toilets, bath)
  • Trim, Shelving, and Hardware
  • Mirrors and Window Treatments

The review revealed potential savings exceeding $10,000 per home, simply by optimizing procurement in these key categories.

3. SOLUTIONS

Strella Companies implemented a strategic sourcing solution, leveraging our global network of vetted manufacturing partners. We provided:

  • Factory-direct pricing — eliminating distributor markups
  • End-to-end supply chain management — including production, shipping, warehousing, and final delivery
  • Tariff mitigation strategies
  • Guaranteed pricing and product availability
  • Top-tier quality with industry-leading warranties
  • Optional turnkey installation for select categories

We integrated our pricing directly into the builder’s budget spreadsheet, providing full transparency and confidence in our cost projections.


4. IMPACT

The $1.57M in construction savings reduced the budget from $30M to $28.5M — without changing the NOI of $1.5M, while pushing the project’s CAP rate from 5.00% to 5.26%, a significant financial gain for any developer or investor.  Why It Matters:

  • Higher CAP Rate = Higher Asset Value and Return on Investment
  • Same Rent Roll but Better Margins 
  • Improved Financing Terms — Lenders favor projects with stronger proformas
  • More Flexibility — Developers can choose to reinvest in higher specs or expand the project scope

BY THE NUMBERS

By working with Strella Companies, the developer not only saved $1.57M but also improved the financial profile of the entire development. These are savings that drop straight to the bottom line — or translate into greater long-term value and scalability.

Strella Companies helps builders and developers unlock hidden savings while protecting quality, timelines, and returns. Better sourcing isn't just about lower prices — it's about building smarter.