Creating shareholder wealth in commercial real estate (CRE) requires an exceptional understanding of both micro and macro determinants of real estate values. At the micro level successful CRE investing is primarily dependent on the heterogeneous characteristics of a particular asset in a single location. Yet, the macro, including events and trends in the global capital markets, also has significant ramifications on asset values. Thus, to truly understand the quality and pricing of an asset, a thorough comprehension of real estate and global capital markets is required.
We are real estate veterans with significant “dirt” experience – meaning we have personally managed CRE properties in numerous asset classes including office, multifamily, retail and mixed-use. Only by physically working properties, implementing leasing and tenant retention programs, identifying value-add opportunities, and creating property repositioning / redevelopment programs does one gain the requisite experience to be a savvy real estate investor.
We couple this hands-on knowledge with Wall Street finance expertise developed over numerous years employed at leading bulge-bracket investment banks. Our competitive advantage is, then, that we couple our understanding of the gritty details of the buying, operating and selling assets with advanced finance theories and practices.
We are conservative investors, making risk adjusted purchasing decisions by focusing intently on the risks associated with each asset. Fundamental valuation begins with an understanding of the required return on equity of a particular asset, commensurate with its innate risk. Risk adjusted yield is heavily influenced by Treasury rates, illiquidity, mortgage interest rates, leverage, capital markets trends, and returns in alternative investments such as bonds or equities. Although quantitative analysis is at the forefront of all our investments, we are emphatic that profitable CRE investing is not about financial engineering.
Our passion for real estate is in the craftsmen’s work of properly buying, valuing and enhancing commercial properties. We believe the largest single determinant in CRE value creation is combining an outstanding management team with an asset in a quintessential location that was purchased at a sensible price. To successfully identify, value, and create shareholder wealth in CRE acquires a practitioner’s acumen, one borne from numerous accomplishments in directly buying and managing real estate assets.
We greatly treasure our relationships with business partners and investors and zealously guard our reputation for integrity. The financials controls we establish internally and at properties are exceedingly stringent. We promote financial transparency and real time reporting on behalf of our investment partners.