Our goal is to produce consistent, high, risk-adjusted returns in real estate securities. At a very high level, our past or future performance is as much a factor of what we don’t do, as what we do. We don’t adhere to an index chasing philosophy, so we don’t start our day asking ourselves “what’s in the index” and then adjusting that to our desired weightings.

We start with a clean sheet of paper. On that paper is written “search for a frustrated tenant.” Frustrated tenants can’t or won’t move, so landlords have leverage and raise rents.  Frustrated tenants can complain endlessly to their spouses, but at the end of the day they stay put – and pay higher rent. Tenants with choice, however, can bargain and gain leverage over landlords.  We work to aviod companies in this situation.

This focus on finding the frustrated tenant takes us into all sorts of interesting real estate businesses, including manufactured housing, cell towers, medical offices and gaming. In these areas, tenants are denied choice and as a result occupancies remain high, rents and asset values increase and this creates value for shareholders.