Targeted Alternatives seeks commercial real estate investment opportunities in the southwestern United States. We target capital preservation oriented investments or joint ventures with either long-term credit tenants or value-added development/redevelopment opportunities primarily in the $2,000,000 to $15,000,000 range.
Location and site are primary considerations in our real estate investments. For office properties, we seek "B" class buildings in "A" locations. Retail property selection is driven by area demographics, and neighboring and competing uses. Industrial properties vary widely in uses and therefore must have an optimal balance of a healthy industrial service area as well as excellent transportation infrastructure and facilities.
Our management style is rooted in the boom-bust cycles of the southwest. Rental rates are largely a product of the marketplace, but competitive advantage in tough markets comes from superior expense management. Lighting retrofits, energy management systems, xeriscaping and other technological solutions deliver true value to tenants by minimizing per person occupancy costs. We target technologies that have an 18-month payback period and reduce overall stress on the property and its systems.
We employ a disciplined approach to real estate investing. In the most recent downturn, this discipline led us to sell all but one of our investment properties by the end of 2005. It also kept us from making new acquisitions at the height of the market frenzy. Our standards:
- Properly well-located considering use.
- Bought below replacement cost.
- No irreversible functional obsolescence.
- Immediate cash flow or highly likely long-term appreciation.
- Value add opportunities through rehab, redesign, repositioning, or employing state of the art expense technology.