Diversified Opportunistic Real Estate Investing
Since inception, Westport has developed its specialized discipline of opportunistic real estate investing by focusing and consistently executing on core values that we believe generate long term success for our clients, our firm and our people. It is a dynamic, engaged and principled process centered around seven key business principles:
- Flexible & Conservative
- Westport does not limit or define our investment process around select sectors or categories of real estate investing. We do not rely on a macroeconomic thesis or view to deploy capital. While we do take macro factors into consideration in terms of how, when and where to optimally make investments, our team maintains a highly flexible approach to sourcing, negotiating, pricing and managing real estate assets. We cast as wide a net as possible in order to identify and create value across all cycles, markets and sectors.
At the same time we strictly adhere to a fundamental investment approach with three core criteria:
1. Preservation of capital
2. Current cash flow
3. Potential for significant capital appreciation
We look to invest as high in the capital stack as possible to generate desired returns while generally using low or no leverage. Rather than relying primarily on leverage to achieve return targets, Westport focuses on other components of value creation first. At the individual asset level and at the appropriate point in the life cycle of each asset, modest levels of leverage may be employed to facilitate value realization.
We strongly believe — and our experience confirms — that the ability to remain flexible as situations and markets evolve, while simultaneously executing with a consistent and conservative approach, is a critical component of the inherently long term nature of success in real estate investing.
- Innovative & Fundamental
- Westport’s approach to Real Estate investing is unconstrained in terms of conventional classifications. Deal type, size, location, structure, or market cycle are not limiting factors. Our team maintains and continually expands a wide universe of sourcing channels, methods and relationships — with the goal of staying “one step ahead” in spotting evolving opportunities and unusual situations. Many of our investments have been in sectors, markets or assets/instruments which other investors have subsequently gravitated to over longer time periods. Identifying value potential early and taking a proactive approach to executing unique solutions are central to Westport’s innovative culture.
At the same time, potential opportunities we consider are systematically subjected to fundamental, bottom-up analysis and an intensive investment screening/review process. Our analysts do the “on the ground” work themselves; we do not rely solely on outside analytic resources, although we will partner with others as a supplement to our own analysis when appropriate. Our teams meet together weekly to thoroughly assess each potential investment from the wide range of perspectives represented across our firm. Our investment committee further analyzes, tests risk assesses and constructively questions each opportunity. Once an investment is made, we aggressively asset manage and actively monitor each investment against the original rationale and target outcome/timeline.
- Creative & Disciplined
- Our team strongly believes in the adage of “freedom within discipline.” Our senior team’s experience working closely together for a significant period of time has demonstrated the value of consistently following a rigorous set of professional investment disciplines – This facilitates downside protection, risk management and process efficiency — while also unlocking the true creative element that often drives value realization in opportunistic real estate investing.
The following disciplines are integrated into our investment process in order to both mitigate risk and maximize value across all of our portfolios/strategies:
- Fundamental bottom-up analysis
- Rigorous underwriting
- Thorough and “up close” due diligence
- Meticulous investment review
- Proactive and partnership-oriented asset management
Reliably executing these disciplines, allows our team to invest time on innovative approaches to developing a highly diverse range of real estate related opportunities.
- Focused & Diversified
- By specializing exclusively in real estate investing, our team focuses on those situations, structures, securities and operating opportunities that best meet the investment criteria of the firm’s different funds and strategies. At the same time we create diversification in our portfolios around four key dimensions:
Westport invests throughout the capital structure. Depending on the fund and strategy, Westport develops and owns properties directly while also investing in a wide range of mortgage instruments, bank debt (syndicated and bilateral), secured and unsecured corporate debt, mezzanine loans, structured finance instruments and both equity and debt securities issued by companies with significant real estate investments or exposure.
The range of our team’s experience enables Westport to generate profits anywhere in the life cycle of the markets, an investment sector, or a particular asset – whether new development, redevelopment or change-of-use.
Our extensive experience and sourcing networks cover the full spectrum of asset classes – office, retail, single and multi-family, industrial, healthcare, hospitality and gaming — including the ownership of both real property and operating company investments in all of these sectors.
Our team has successfully invested across different regions and markets in the United States, as well as Canada, Mexico, Europe and Asia. International investments are generally made with local country partners. Both domestically and internationally we perform direct “on the ground” due diligence ourselves – while incorporating local partnerships/sources as needed.
- Entrepreneurial & Institutional
- Westport is run as a business, not just an investment boutique. Nine principals have collective responsibility for managing the firm, maintaining its entrepreneurial culture, excelling as professionals and leaders in real estate investing and ensuring the institutional quality of our organization and operations. We believe in being both “small enough” and “big enough.”With 38 employees across four offices, we foster an environment of individual initiative combined with fully engaged team collaboration. Our organization is flat and managed as a partnership to promote maximum communication, participation and contribution. The strong working relationships we have created over time within the firm, as well as with clients and external partners, are the foundation for our success both as investors and as a business.
Based on our extensive experience working with investors and larger organizations, we have built our firm around institutional-standard operations and infrastructure, strong legal and compliance orientation, up-to-date technology capabilities and highly responsive administrative services.
- Independent & Aligned
- Our team is focused both on creating value for investors and achieving success for the firm over the long term. These dual priorities are mutually reinforcing and motivating. Our management team and all our professionals operate as a partnership — with “skin in the game” and strong stakeholder incentives to find, act on and actively manage the most compelling investment opportunities for our investors and for our business.
To further enhance our dedicated resources and capabilities, we have developed external relationships with domestic and international real estate owners, operators and managers who have intimate knowledge of local markets and provide additional in-depth operational expertise. Collaborating uniquely with investors and with external operating partners is a hallmark of Westport’s approach. As a highly specialized investment business, we are committed to alignment between our team and all our key constituents, relationships and channels of execution.
- Accountable & Collaborative
- Rather than maintaining separate acquisition, analytic and asset management teams, the Westport professional/s who source/s a transaction also manages that same investment from underwriting and due diligence during the acquisition process, to the leasing and repositioning of the asset during its holding period and ultimately to the financing and sale of the asset when it is stabilized. This “asset life cycle” approach ensures team member accountability for every investment across our portfolios and maximizes value within the Westport business model.
At the same time, each Westport professional is fully incentivized to access the in-depth expertise and diverse experience of the entire Westport team as investments progress through each stage of the value creation process. Team members also are recognized and rewarded for their ability to build strong relationships with external operating partners and specialty service providers as required for specific investments/opportunities. Our collaborative culture combined with individual, team and business-wide performance participation metrics create a dynamic environment where all of our professionals work closely together on behalf of our investors.
The description of Westport’s investment process contained herein is intended to be representative, but the investment process may be changed from time to time by Westport and Westport may not perform certain steps, or may perform additional steps, in its discretion.