REAL ESTATE INVESTMENT
Our overall strategy is to acquire, transform and sell real estate assets that have significant value creation potential over a 3 to 5 year individual project life-cycle. We employ moderate amounts of leverage to increase yields to investors while mitigating the downside risks inherent in any real estate investment. Typical projects will include office, multi-family, “flex” industrial and mixed-use, including portions of retail, which are under performing the market. Through disciplined underwriting and superior execution of each project’s operational plan we realize above market growth in net operating income. A schematic representation of our strategy is shown below.
CORE ELEMENTS OF INVESTMENT STRATEGY
Superior Operational Execution
Off Market and
Attractive Deal Flow
Increased Rental Sales
Higher Yield to
Conservative Asset Evaluation
Brass evaluates over 1,400 potential acquisitions annually. The Brass Evaluation Process yields approximately 25% of the assets as Brass Quality. Offers are based on conservative investment criteria that result in an acquisition to offer rate of approximately 1%. Historically, our conservative approach has enabled Brass Funds to capitalize on the performance of our operations, not just market conditions.
Brass's’ platform is designed to maximize operational efficiencies throughout the hold period of the asset. Brass (formally Magi Real Estate Services) and Complete Construction Management provide marketing and leasing, property management, and construction / renovation services to the acquisitions of Brass. These service companies afford Brass the ability to respond in real time to the needs of tenants. The Brass Approach as an owner and operator translates into above market absorption and retention that facilitates true value creation.
Brass employs a “managed risk” approach to investing. This means that projects are evaluated and capital is stacked in such a way as to provide a balance between expected return and staying power in the event economic conditions deteriorate. Leverage is used prudently to enhance returns to equity, while keeping loan to value and debt service ratios at moderate levels.
An important component of our risk management strategy is diversification – by property type and geography. It also involves sourcing projects in “non-traditional” market segments, avoiding the wild swings associated with “faddish” markets including, Phoenix, Las Vegas, and much of the two coasts. Brass has had considerable success in markets such as Central Texas and suburban Denver where population and job growth is strong, but steady and the political climate is consistently “pro-growth.”
Cautious Opportunistic Approach
Investing ahead of market cycles using up to date market information to stay ahead of market cycles.
Texas, Colorado, Florida, Louisiana, Arizona, and New Mexico.
Assets that are located in recovering markets from real estate down cycles.
In-house construction, leasing, and management, facilitates efficiencies that maximize value creation over the asset hold period.
Value Added Execution
Intensive management to strive to maximize value creation through local market knowledge in select markets and assets.
Single properties and portfolios requiring restructuring, repositioning and/or redevelopment opportunities.