Walton Street invests and manages with the philosophy that real estate is a commodity subject to cycles, both in terms of its underlying supply and demand fundamentals and its pricing relative to other financial assets. Through the Principals’ relationships, experience and discipline, Walton Street strives to identify opportunities that create and maximize value, while minimizing risk, through: opportunistic investing, which seeks to identify capital voids, market and operating inefficiencies and anticipated cyclical recoveries; value-added asset management, which aggressively seeks to redevelop or reposition under-managed and under-capitalized assets to appeal to a broader, institutional marketplace; and a disciplined disposition strategy, which seeks to identify an exit strategy before an investment is made and is continuously evaluated to seek an optimal and efficient result.
Walton Street believes it is critical that those making the investment and management decisions invest significant personal capital in these investments. Underscoring this philosophy, of the $12 billion of total equity and loan commitments, the Principals of Walton Street have personally invested $450 million.
The importance of a disciplined disposition strategy dictates Walton Street’s investment focus on well-located institutional quality assets within desirable markets, which Walton Street believes have greater liquidity by appealing to a wider range of potential buyers. On a portfolio basis, Walton Street utilizes leverage through the use of predominantly first mortgage, non-recourse debt, which is structured to give Walton Street flexibility so as not to impede an asset’s timely exit. Typically, Walton Street makes investments over an expected average holding period of three to five years.