Stonebridge International invests in the commercial and light industrial property sectors in the UK, Europe, the US and Australia.
Residential property investments are considered, but usually offer a significantly different investment life cycle to commercial properties, i.e.:
- rentals are often cash flow neutral with returns driven mostly by long term capital growth;
- developments are usually short term with high returns, but carry high risk.
Stonebridge International follows a conservative investment strategy by placing significant focus on understanding the risks related to an investment and the possibility to mitigate those related risks, first ensuring the preservation of capital and second maximising returns thereon.
Stonebridge International aims to achieve medium to long term investment returns by growing the portfolio using (non-recourse) leverage initially and de-leveraging aggressively.
Stonebridge International applies a disciplined investment strategy but remains opportunistic as markets change to enhance the investment returns.
The key factors considered when assessing a property are:
- net initial yield;
- strength of the tenant and lease covenant;
- remaining lease term;
- ‘bankability’ (the willingness of traditional banks to provide senior debt); and
- alternate use, considering property sector, zoning and location.
Stonebridge International invests on a property-by-property basis allowing the risks associated with any given investment to be isolated to that investment.
Important to note is that Stonebridge International acquires controlling stakes in the property investments.