Investment Approach

Investment Strategy

STRATEGY: Single Asset Transactions

Walton Street utilizes the Principals’ substantial real estate experience, expertise and long-term relationships in sourcing and selectively acquiring single asset investments, with an emphasis on well located assets with institutional quality potential. Walton Street will focus on three primary strategies within single asset transactions:

  1. Value Creation: Walton Street seeks real estate assets which have significant cash flow and residual value enhancement potential through creative and aggressive asset management, including targeted capital improvements, tenant lease-up opportunities and operating efficiencies.
  2. Value Investing: Walton Street targets the acquisition of real estate assets at a discount to their replacement cost, or in some cases, below their current market value.
  3. Larger Transactions: The emphasis on overseas markets from most of the major real estate opportunity investors and the capital constraints upon REITs and highly leveraged investors have created a capital void for larger transactions in the U.S., particularly for assets with significant scheduled tenant rollover and/or capital improvement requirements. Thus, larger U.S. transactions ($100 million and up) may be more likely to provide attractive pricing today for credible buyers with identified and discretionary sources of capital.

STRATEGY: Complex Ownership Situations

Walton Street seeks opportunities to acquire real estate assets which are under-valued due to the complexity or illiquidity of the existing ownership or capital structure. In such situations, Walton Street will seek to actively work through the complexities, gain control of the asset and prepare such asset for sale, without the prospective risks of bankruptcy, fragmented ownership or property-level issues.

STRATEGY: Illiquid Assets

Managers such as Walton Street who possess real estate investment and management expertise, in combination with financial and corporate skills, can capitalize upon unwilling owners in illiquid structures. Walton Street will seek: (i) passive opportunities in which the interests of an entity can be acquired at a significant discount to the underlying net asset value with the knowledge that the underlying assets are nearing their disposition; and (ii) owners of assets or holders of interests who seek to sell in an illiquid market.

STRATEGY: International Ventures

While our primary investment focus remains in the U.S., Walton Street has a demonstrated access to opportunities within global markets. Unlike our typical domestic investment strategy, Walton Street seeks to access these global opportunities through experienced, local partners and operators who have established, long-term relationships within their markets and have access to proprietary transaction flow.

STRATEGY: Targeted Development

Walton Street participates in selected land acquisition and development opportunities to capitalize on an imbalance between the supply and demand of space for a particular property type in specific markets which possess proven barriers to entry.

STRATEGY: Entity Recapitalizations

Walton Street seeks to capitalize on pricing arbitrage opportunities within and between the public and private markets. Walton Street will seek to make investments in entities which require additional capital to restructure their ownership, recapitalize their portfolios, fund additional acquisitions, or in some cases, capitalize upon the significant spread between the private net asset value of a public entity’s underlying real estate and the public entity’s share price.

STRATEGY: Private Equity Platform Investments

Walton Street will consider private equity investments in experienced real estate operators or operating companies which require capital to expand or create an enterprise with a significant asset base. Walton Street will seek to build enterprises that it cannot build efficiently on its own, in areas that possess public and/or private exit opportunities through: (i) the consolidation of a fragmented asset ownership base; and (ii) an enterprise’s leading expertise or specific industry profile.