Strategies

IRA Capital invests capital based on a comprehensive assessment of risks and rewards. The level of risk varies in each asset depending on factors including product type, geographic region, market conditions, occupancy levels, etc. Accordingly, IRA categorizes each opportunity and makes investments across the risk spectrum (Core, Core-Plus, Value-Add, and Opportunistic) and ultimately ensures that the expected return is commensurate with the various risks associated with each transaction.

IRA’s Core strategy aims to invest capital in best-in-class real estate with the least risk and a focus on capital preservation and stability of current income. Such assets are often Class-A buildings in primary markets, and often have net-leases ultimately providing the highest predictability of cash flow. The targeted yields for IRA’s Core strategy are a 5-7% Cash on Cash, and a 7-9% IRR.

IRA’s Core Plus strategy targets stable real estate in primary and secondary markets, with a higher current income and IRR than demonstrated by the Core strategy. In order to accomplish higher yields, IRA’s Core Plus strategy seeks assets that are generally core but contain value-creation potential through either moderate leasing, and/or the extension of shorter lease terms on single/multi-tenant properties. The targeted yields for IRA’s Core-Plus strategy are a 7-9% cash-on-cash and a 10-14+% IRR.

IRA’s Value-Add strategy focuses on buying income-generating assets at a steep discount to replacement cost. These assets typically have 50-70% occupancy, and require major capital improvements and repositioning of operational and physical issues in order to enhance the asset prior to achieving higher occupancy levels. IRA’s Value-Add strategy generally targets minimal cash-on-cash returns in 0-5% range, with an expected IRR of 18%+.

IRA’s Opportunistic strategy is the highest on the risk spectrum and generally includes investment in ground-up development projects or acquisition of distressed assets that have occupancy levels lower than 50%. Opportunistic acquisitions are the most difficult to finance and most capital intensive. IRA does not expect any cash flow when executing investments in this strategy, but also expects the highest upside upon execution of the business plan. The targeted IRR for IRA’s Opportunistic strategy is 20%+.