While many real estate investment firms buy properties to hold briefly and liquidate, often resulting in a hefty capital gains tax, our core investment strategy is to hang onto properties over the long term – in both our property-specific limited partnerships, and our commingled open fund. For investors, this means that appreciation in the value of the property is captured by a series of periodic refinancing which allows tax-deferred cash distributions from appreciated value. Also, since the original property remains in the hands of the partnership, they can continue to count on receiving regular cash distributions over a period of many years, even generations.
When we partner with investors who are interested in a shorter investment horizon and the IRR that can be realized from a value-add strategy, we identify and purchase the appropriate properties in our target markets. Shortly after closing we implement the property upgrade plans; and then stay alert to market conditions and investor interest to execute a sale at an attractive internal rate of return and multiple on our investment. These investments typically also deliver an attractive blend of current cash flow and appreciation.