Investment Approach

CorVal develops investment vehicles in partnership with investors that are designed to meet their specific requirements. The overriding objective is to provide investors with vehicles that pursue a strategy aimed at meeting investors' risk-return profile within a simple structure that offers transparency and a strong alignment of interest.

As both investment manager and co-investor, CorVal employs a disciplined approach to real estate investing that is focused on understanding and evaluating investment risk. A detailed knowledge of the markets, and an understanding of the property fundamentals that drive long term value, enable risks to be quantified. Based on this assessment, CorVal is well positioned to make investments that deliver an appropriate risk-adjusted return. Each investment is assessed from a macro perspective with a focus on economic fundamentals including interest rates, inflation and capital flows as well as the micro factors including local market supply and demand and the property specifications.

In assessing each investment opportunity and determining the appropriate strategy, CorVal addresses the following key areas:

• entry price and timing;
• strategy, including opportunities to add value through active management;
• growth potential, driven by real estate fundamentals;
• risks and mitigating factors;
• hold period/exit strategy;
• funding; and
• sustainability and responsible investing.

CorVal's specific investment strategy is to target institutional-grade commercial real estate in Australia's major markets that offer value-creation opportunities. In the current environment CorVal expects to source attractive investment opportunities through:

• the acquisition of assets that are mispriced as a result of the ongoing tight credit market conditions, or due to the distressed position of over-leveraged owners or sales forced by banks;
• the refurbishment, re-leasing or re-positioning of existing tenancy areas;
• the focus of a boutique, specialised manager on asset and property management to drive operational efficiencies and increase net property income; or
• the strategic acquisition of assets that are beyond the reach of private investors and either too small or out of favour with either A-REIT investors and/or large offshore investors.