In addition to investing in development and re-development deals, a significant portion of our portfolio consists of cash flowing assets. These assets can be a force of stability against unfriendly capital markets, as well as play an important part in helping us when possible to achieve above market risk-adjusted returns with our partners. Having stabilized properties in our portfolio helps our overall strategy of a diversified portfolio by allowing us to have the flexibility to invest in other transactions with more risk and reward.
Wafra seeks out opportunities that provide significant operating flexibility. As part of our due diligence, we closely evaluate factors that can potentially limit flexibility or reduce the value of an asset. We focus on making investments in high quality, well-located assets that we expect will consistently appeal to a wide group of subsequent buyers.
Our focus is not limited to any one geographic area or property type. We like to diversify asset classes, as well as location. We know that a complex transaction does not have to equate to high risk. Along with our partners, we are not only able to uncover value, but we work hard to realize it throughout a variety of transactions.
Through a variety of alternatively structured investment vehicles, Wafra’s real estate division makes equity investments on a direct or joint venture basis, as well as provides mezzanine loans. Both of these opportunities typically range from $10 million to $30 million across a variety of asset classes. Transactions are structured using reasonable market standards of leverage. However, where there are opportunities that may require more untraditional levels of debt, Wafra will evaluate the fundamental economics in an effort to enhance the investment’s return.
Wafra begins each transaction with a vision that is executed throughout the investment hold period. Investments are usually held within our portfolio for three to seven years. However, we are able to structure each transaction on a deal-by-deal basis, in an effort to ensure that we realize the full potential of an asset’s strategy.