Strategies for Acquisition
Triad prepares and implements strategies for the acquisition and disposition of real estate assets that can be purchased on an opportunistic basis or repositioned to enhance yield, and managed to preserve and increase value with the goal to implement a timely disposition strategy that generates exceptional returns for its owners. Triad’s approach is structured to meet and exceed the owner’s objectives by performing the following services:
- Identification of opportunistic, value-added opportunities with the potential for exceptional yields
- Development of alternative capitalization, financial engineering and repositioning strategies
- Negotiating acquisition terms from the initial letter of intent through execution of the purchase agreement
- Securing appropriate capital structure through loan offerings and equity procurement
- Comprehensive underwriting, including detailed financial analysis and thorough market evaluation
- Obtaining a property conditions assessment, including structural and environmental reports and systems evaluation
- Careful coordination with the legal team, lender, and seller to ensure professional execution at closing
- Coordinating and leading the disposition process to develop a strategy to ensure highest price
- Creative approaches, such as a master planned disposition focus, are studied for challenging properties
- Analysis and preparation of offering materials designed to target the most aggressive investment group sector
- Hands-on, carefully managed and coordinated marketing effort, including ongoing communication with the owner
- Property is broadly marketed to prequalified buyers
- Management of the closing process
Triad formulates creative financing plans to optimally balance the client’s near term cash requirements with the capital source’s long-term yield requirements. Triad has the capability and experience to handle virtually any type of financing transaction for any commercial real estate asset.
Triad provides comprehensive underwriting, in-depth financial engineering, and a recommended investment structure for each assignment.
Client companies gain access to debt and equity capital by taking advantage of Triad’s relationships and track record with institutional investors, such as pension funds, life companies and REITs, as well as its relationships with private, entrepreneurial investors, including European syndication firms.
Prevailing and applicable financing vehicles in the market place are identified, evaluated and presented to the client. They include: fixed and variable rate debt, sale and leaseback proposals, participating and convertible mortgages, credit enhancement, traditional and nontraditional debt, forward commitments and institutional and entrepreneurial equity joint ventures. Upon approval of the capitalization plan by the client, Triad is prepared to originate, negotiate and orchestrate the closing of the required financing.
Real Estate Analysis
Triad conducts “market sensitive” valuations on individual properties and, if appropriate, presents alternative capitalization and repositioning strategies to maximize the real estate assets’ cash flow and appreciation potential. Each service assignment is initiated with a thorough analysis that consists of an in-depth and iterative process of asking strategic questions that direct the team to the optimal approach to exceeding the owner’s expectations.
Services, with certain representative questions and considerations, include:
- Analysis of market repositioning: How does the property compare, from an aesthetic, physical, economic, occupancy and access standpoint to its competitive set?
- Lease options: Will the option terms and conditions adversely impact the marketability of the property?
- Expansion opportunities: Will this point of differentiation make the property more attractive than the competitive set?
- Contraction alternatives: If this flexibility is important to the tenant, how can this be offered without cash flow uncertainty?
- Acquisitions: How is the property positioned in its submarket and what changes can be implemented to enhance exit value?
- Dispositions: How can we intentionally present the asset as an attractive acquisition opportunity to the investor class that will pay the highest price?
- Refinancing: How can we reduce the potential negative consequences of refinancing by negotiating to have any prepayment penalties reduced?
- Sale and leaseback: How can we unlock company capital without adversely impacting its cost of capital?
- Credit enhancements: Does it make sense to restrict capital or incur liability to reduce the company’s cost of capital?
- Equity joint ventures: How do we secure capital with the proper balance of debt and equity, which requires a higher yield?
Through this iterative process, Triad develops the optimal strategy to maximize the value of its services to the owner.
Upon agreement, Triad will implement its recommendations.