Our due diligence process is at the core of everything we do for you as an investor. Each and every deal that comes through gets thrown in the gauntlet against our rigorous financial models for fit, and then it requires unanimous approval from our investment committee.
Sponsor / Borrower
We need to understand who are the brains, the muscle, and the passion behind a project. The right sponsor, or borrower, can make the difference between success and failure. A high level of what we’re looking for:
- Experienced track record (yes, we review their prior projects)
- Any abnormalities in their background, public criminal record checks & credit checks
- How well capitalized they are
- Positive references
When & Where
Econ 101 location, location, location is literally where it’s at. We need to understand what’s happening in our global economy and how it’s impacting the market we’re considering for the time horizon of the investment. A high level of what we’ll be looking at:
- Where the investment is and key drivers to a growing economy
- The timing of everything and how it’s relation to our economy
- Comparables and the competition
What & How
What we’re investing into deserves our full attention as the devil is in the details. Here’s a high level of how we assess the asset:
- Go down the rabbit hole and analyze the full array of property metrics and data points
- We throw the numbers to the test with our pro forma modeling that is discounted and stress tested
- Is this place for real? We make sure to visit every property on a direct deal.
Every investment has a beginning and an end. We need to have conviction that the timing of entry combined with the exit strategy has a probability of success and the timing fits what we need. We like to:
- Run the thesis of exit through different economic models
- Validate key assumptions in the investment strategy
The Big Decision
After we’ve completed our internal due diligence, our Investment Advisory Committee (the IAC) steps in to critique the deal. The members of the IAC independently inspect & analyze our due diligence with a fine toothed comb to approve or reject the investment. The IAC has been hand-selected from the real estate industry spanning the disciplines of commercial real estate credit and lending, development, property management and fund management.
Investment Advisory Committee
Brad actively manages over $1.2B in AUM for Columbia Pacific Advisors through the firm’s direct lending strategy. Brad brings more than 30 years of experience evaluating various private commercial credit opportunities both personally and professionally. Previously, he was Co-founder, President and CEO of Maxit Financial from the company’s inception in 1993 until its acquisition by Cash America (NYSE: CSH) in October 2010. He received a B.S. in applied physics with a minor in math from the University of Utah.
Chris Carsley, CFA, CAIA is Managing Partner of Kirkland Capital Group, and serves as Chief Investment Officer of Arch River Capital LLC and Arch River Navigator Fund I LP. He is responsible for the investment management, finance structuring and capital partnerships for both Kirkland Capital Group & Arch River including its regulatory and reporting compliance practices. Chris brings over 25 years of investment industry expertise specializing in direct lending in commercial real estate, corporate and venture finance, business valuation, business operations efficiency, regulatory compliance practices, securities research, portfolio management, arbitrage trading and hedging. Prior to entering alternative investments, he worked as a trader and senior member of the hedge fund security finance team for Paloma Securities that managed over $9B in AUM.
James Wong is the Co-Founder / CEO of Vibrant Cities responsible for site evaluation, acquisition, development, equity funding and banking relations. Additionally, James is a seasoned entrepreneur, investor and founder of multiple successful companies. As a sought after thought-leader, speaker, and writer on real estate, technology, and entrepreneurship, James has been an active real estate investor and property manager for the past 19+ years, acquiring, developing and managing over $800+ million real estate projects.
Jeff Rakow is President of Snowball Investments and formerly Investment Director for Talon Private Capital. In his current & prior roles, Jeff provides leadership focused on the acquisition and asset management of commercial real estate investments for institutional, corporate and private clients. Jeff has successfully led the acquisition, re-positioning, leasing and disposition of 1.2 million square feet of office projects in the Puget Sound region, valued at $500 million. In addition, Jeff managed a 4 million square foot corporate real estate portfolio on behalf of the leading regional hospital system in the Puget Sound region, saving the client over $2 million in annual operating costs.
Prior to his career in real estate, Jeff worked on the founding team of several successful software startups in San Francisco and Silicon Valley, where he built and managed teams of engineers to deliver consumer, wireless and enterprise software.