Acquisition Overview

Investment Criteria

Preferred property types include:
Industrial and Retail real property and sub-performing loans, secured by real estate.

Investment levels are:
Single assets valued between $3,000,000 and $20,000,000.  Portfolios with a maximum of 12 assets up to $50,000,000 on aggregate value.

Financing:
We close escrow for cash and do not have financing contingencies.

Returns and holding periods:
Depending on the type of asset and risk factor, we expect internal rates of return between 8% to 10% on an un-leveraged basis.  We focus on as long-term investments.

Selective works quickly to close transactions. Our responsiveness comes from our focus on efficient underwriting and due-diligence combined with immediate access to funding.

Underwriting:
The principals visit every proposed acquisition and review all due-diligence information. This is the most important step in this process and is one we never delegate.  Selective has developed its own financial models that are flexible for the asset being acquired.  As a result, our pricing is very accurate and is based on realistic assumptions.

Bidding & Negotiation:
We negotiate purchases with broker representatives or directly with sellers.  In cases where a seller may not pay a fee, Selective will pay the broker that represents Selective.  Selective negotiates purchase contracts reasonably, quickly and professionally, usually in 10 days or less.

Escrow Period:
It is important to close transactions promptly. If the purchase price and underwriting are accurate, little is gained by delaying the closing. Due-diligence periods are often 30 days or less.  Closings can occur as early as 5 days after the due-diligence period expires.