Our primary business objective is to increase shareholder value by acquiring, owning and operating properties. The key elements of our strategy include:
Strategically Acquiring Properties
We seek to expand our geographic diversification by strategically acquiring commercial properties in high-growth markets. Our acquisition targets are located in densely populated, culturally diverse neighborhoods, primarily in and around Phoenix, Chicago, Dallas, San Antonio and Houston, five of the top 15 markets in the USA in terms of population growth. We may also pursue opportunities in other Southwestern and Western regions that are consistent with our strategy.We believe that during the next several years there will be excellent opportunities in our target markets to acquire quality properties directly from owners, at historically attractive prices. Many of these assets may benefit from our management team's experience in turning around financially distressed properties, portfolios and companies.
Redeveloping and Re-tenanting Existing Properties
We “turn around” properties and seek to add value through renovating and re-tenanting our properties to create Properties. We seek to accomplish this by (1) stabilizing occupancy, with per property occupancy goals of 90% or higher; (2) adding leasable square footage to existing structures; (3) developing and building on excess land; (4) upgrading and renovating existing structures; and (5) investing significant effort in recruiting tenants whose goods and services meet the needs of the surrounding neighborhood.
Recycling Capital for Greater Returns
We seek to continually upgrade our portfolio by opportunistically selling properties that do not have the potential to meet our strategy and redeploying the sale proceeds into properties that better fit our strategy. Some of our properties which were acquired prior to the tenure of our current management team may not fit our strategy, and we may look for opportunities to dispose of these properties as we continue to execute our strategy.
Prudent Management of Capital Structure
We currently have 15 properties that are not mortgaged. We may seek to add mortgage indebtedness to existing and newly acquired unencumbered properties to provide additional capital for acquisitions. As a general policy, we intend to maintain a ratio of total indebtedness to undepreciated book value of real estate assets that is less than 60%. As of March 31, 2010, our ratio of total indebtedness to undepreciated book value of real estate assets was 53%.
Investing in People
We believe that our people are the heart of our culture, philosophy and strategy. We continually focus on developing associates who are self-disciplined and motivated and display at all times a high degree of character and competence. We provide them with equity incentives to align their interests with those of our shareholders.
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