STRATEGIES
Buy in Secondary and Tertiary Markets
By focusing on properties in markets that are not subject to extreme demand from investors, Westridge can achieve higher cash flow yields than similarly situated properties in gateway and primary metro markets. Because these secondary and tertiary markets are also experiencing higher employment and population growth than their gateway and primary metro counterparts, investments in these markets also provide Westridge and its investors with additional upside.
Value Add Improvements
By focusing on properties in markets that Westridge increases property values through rebranding and strategic, targeted upgrades to unit interiors, the exterior of a property and common areas. Westridge works closely with professional local property management companies to evaluate every aspect of a potential value add strategy. Typically, an asset with a value-add component has also been historically mismanaged, which provides additional levers to reposition the asset and an additional value margin on acquisition.
Impact Investing
Westridge examines each potential acquisition to determine if an impact investing component can be incorporated. The goal of Westridge’s impact program is to create thriving, healthy apartment communities. For example, an impact program can include repurposing physical spaces to promote community interaction among residents, establishing a community garden, creating recycling programs, installing energy and water efficient appliances and systems, or implementing other site-specific programs. These renovations and programs can improve tenant experiences, generate more tenant referrals, lower operating expenses, reduce turnover and increase net operating income.
Buy Below Replacement Cost
Purchasing an asset at a discount to its replacement cost (i.e., the cost to construct the building) hedges the asset’s risk profile by protecting against downward pressures from additional supply in a market. Westridge examines replacement cost on a cyclically adjusted basis to take into consideration deviations in labor, material and land costs from their long-term trends to provide a better estimate of value.
