Adding value through expertise:
ViaWest focuses on commercial investment opportunities where we can add value to property through our unique combination of underwriting expertise, nimble yet institutional-quality asset management skills, and in-house, tenant relationship-focused property management.
Our primary areas of focus are existing office, industrial and retail properties, as well as commercial land investments in which industrial, office, or retail buildings comprise a portion or the entirety of the mix of highest-and-best uses for the land.
Office property investments can be very profitable, but they do require a high level of capex over the long-run and are at the whim of the cycle of tenant demand. Therefore, they require a sophisticated combination of leasing, space-planning and underwriting skills to create a successful investment.
Why office investing?
- The significant capital required to fill vacant spaces forces unskilled or undercapitalized owners to sell office at attractive prices, providing a reasonably consistent supply of attractive opportunities;
- There is a relatively small pool of buyers who have the ability to reposition and re-tenant such offices buildings in comparison to other property types, such as multifamily;
- People really matter in office, and we have talented human resources internally to effectively invest in office assets, execute a value-add business plan, and manage the properties on a day-to-day basis to maximize the performance of an office investment.
Industrial is an excellent asset class for development and ownership. The real estate serves as a mission-critical element of the tenants’ core business. Responsiveness of an owner and manager is key to the tenants’ success and is a ViaWest Group strength and core value.
Why industrial property investing?
- It is an attractive long-term hold asset because the ongoing capex is relatively low;
- Demand is very closely correlated to population and economic growth, and we are in markets with positive long-term outlooks for both of those;
- Due to the smaller investment sizes of industrial properties, institutional investors are perpetually under-invested in industrial properties, creating an insatiable institutional investor appetite and strong liquidity when we want to sell;
- There are attractive economies of scale and benefits to owning multiple properties, including the ability of an owner to provide space alternatives to growing tenants. This benefits owners who are committed to the business full-time, such as ViaWest Group, rather than passive owners of real estate merely looking for income.
Retail is increasingly focused on daily needs, service-oriented and experiential tenancy which are not threatened by e-commerce. Retailers will continue to place a premium and pay a premium for the best locations but require a focus on creating opportunities that provide the access, visibility and brand identity they need to thrive.
Why retail investing?
- The amount of time people spend out of the house consuming goods is steady, if not growing.
- With an evolving consumer and American innovation and entrepreneurism, there are always expanding and new retailer/food tenants/concepts with demand for new locations.
- The best and biggest internet/social media concepts will have real stores in order to have a physical relationship with their customers.
- The renewed post-Recession focus on redevelopment creates transitional real estate opportunities in improving and gentrifying areas.
In growth markets such as Phoenix, many of the most appealing investment opportunities in real estate are in acquiring attractively-located commercial land, be they smaller or larger sites, with the strategy of adding value through entitlements, zoning, vertical development, or selling off smaller portions of the land.
We like land investing because, if done right, it can provide extremely attractive returns due to the fact that improved market fundamentals flow directly to the value of land. In a very simplistic example for illustrative purposes, let’s assume 20% of the value of a property is in the land and 80% in the construction of the building. Barring a change in construction costs and tenant demand, if market rents go up 20%, the value of the land essentially doubles.