We do not focus our property acquisitions in any one particular geographic location within the United States. We may also purchase properties located in Canada, although we have not done so to date. We generally endeavor to acquire multiple properties within the same major metropolitan market so that we can efficiently manage each property. However, we also seek properties with existing “net” leases. “Net” leases require tenants to pay a share, either prorated or fixed, of all, or a majority, of a particular property’s operating expenses, including real estate taxes, special assessments, utilities, insurance, common area maintenance and building repairs, as well as base rent payments. We also may enter into sale and leaseback transactions in which we purchase a property and lease the property back to the seller.
Acquisitions
We have entered into an agreement with Inland Real Estate Acquisitions, Inc. under which Inland Real Estate Acquisitions will assist us in acquiring properties, REITs, real estate operating companies or other real estate assets.
We will consider a number of factors in evaluating whether to acquire any particular asset, including:
- geographic location and property type;
- condition and use of the assets;
- historical performance;
- current and projected cash flow;
- potential for capital appreciation;
- potential for economic growth in the area where the assets are located;
- presence of existing and potential competition;
- prospects for liquidity through sale, financing or refinancing of the assets; and
- tax considerations.
In some instances we borrow money to acquire real estate assets either at closing or at sometime thereafter. These borrowings may take the form of temporary, interim or permanent financing from banks, institutional investors and other lenders including lenders affiliated with Inland Investments or us.
As a matter of policy, the aggregate borrowings secured by all of our assets will not exceed fifty-five percent (55.0%) of their combined fair market value. |
