Our investment model identifies high potential real estate with unrealized value

Identify

Core focuses on a select group of asset classes and seasoned operating partners in its search for a well-balanced risk/reward investment opportunity. Properties with the right combination of partner and asset class that survive an intense due diligence process are considered as acquisition candidates.

Currently, Core considers apartments, student housing, hotels, senior housing and manufactured housing as favorable asset classes for investment.

Core’s acquisition strategy allows for well-timed, advantageous investment as individual asset classes cycle through natural highs and lows.

Structure

The structure of every potential deal is balanced to create an investment that supports returns and minimizes risk. Our two-fold strategy is focused on developing the most appropriate capital stack and establishing incentives for operating partners—a structure that maximizes annualized cash flow and back-end capital value.

THE CAPITAL STACK

In most cases, the capital stack consists of a first mortgage, coupled with equity provided by our operating partner, Core principals and Core’s investors. Core typically refrains from using high leverage situations with a goal to maintain greater debt-service coverage ratios than minimums required by most lenders. This structure can provide downside protection if actual operating performance is below projection.

THE INCENTIVE STRUCTURE

Most Core investments are “value-add” opportunities that are facilitated by our operating partner. Structured incentives are used to provide additional ownership opportunities for our operating partners upon achieving previously defined financial results.

Acquire

Property acquisition occurs only after two separate and independent levels of satisfactory due diligence. The due diligence process includes, but is not limited to: reviewing market comparatives, shopping the competition, pricing reviews, detailed facility examination, confirming proposed revenue and expense structures, environmental analysis and capital expenditure budget review.

LEVEL ONE:

Performed by our operating partners, the first level of due diligence is done externally. Our experienced operating partners vet and present investments believed to meet or exceed the Core negotiated incentive structure.

LEVEL TWO:

The second level of due diligence is performed internally by Core, in order to independently confirm all assumptions provided by our operating partner.

Improve

Across all asset classes, Core seeks to acquire property that allows for financial growth through strategic and tactical implementation of improvements.

Improvements include one or more of the following:

1. Investing capital to repair, replace or improve the facility
2. Reducing operating expenses through more effective management
3. Reducing vacancies and concessions through improved marketing and sales
4. Increasing rents—reflecting capital improvement or repositioning of the property in the market

Monetize

Core believes a successful real estate investment should provide some level of cash flow throughout the life of the investment—in addition to capital preservation and appreciation at the time of sale. To maximize this opportunity, our primary focus is on the acquisition of existing real estate with in-place cash flow that can be further improved throughout the ownership lifecycle of the asset.

Investment monetization goals are achieved through a combination of:

• Increased annualized cash flow created by property improvements
• Potential early return of part (or all) of investor capital through property refinance during the hold period
• Capture of the expected increased value of the asset at sale.