Northtree believe that income should form the core component of portfolio return and that acquisition pricing should be underwritten by six key investment principles
1. Mispriced risk.
The imperfect nature of the UK CRE market creates pricing anomalies at asset and sub-sector level
2. Dynamic locations.
A forensic understanding of evolving demographics is a critical component of pricing underwrite. Utilise demographic profile to understand tenant trading patterns and to identify logistics pinch points
3. Sustainable income yield.
Prudently capitalise on significant arbitrage between income return and low cost debt. Strong property fundamentals and diversification underwrite sustainability of income stream
4. Value add potential.
Proactive, not reactive asset management and close tenant relations release embedded value
5. Highly liquid lot sizes.
Decrease portfolio risk through significant asset level diversification, offering entry yield pricing discount and maximum flexibility at exit
6. Pricing underpinned.
Favourable occupational market conditions validate pricing underwrite. Residual asset value is key to downside risk management
