Our Key Philosophy is To Win By Not Losing And Ensure Cash Flows Do Not Fall
WE MINIMIZE INVESTMENT RISK
When it comes to investing, minimizing risk is just as important as picking winners. At RockStep we focus on protecting our investors wealth while providing a consistent, respectable return.
- Investing in assets with a high probability of maintaining cash flows even if the economy and interest rates rise.
- Underwriting conservatively—we do not inflate the returns. Our exit cap rate is often the same or higher than our acquisition cap rate even as we improve the credit quality of the cash flow.
- Seeking local investors to help ensure the success of the shopping center and reduce community related risk.
- We put more equity in each of our investments compared to our competitors.
- For value-add properties, we often have major national retailers lined up before closing a deal.
OUR INVESTORS WIN BEFORE WE DO
Our investors receive returns before we receive ours. We receive a return only after our investors have received their preferred quarterly payments and their entire investment back. Only then do we receive a portion of the profits.
WE DELIVER SOLID, RELIABLE RETURNS
At RockStep we pride ourselves on delivering attractive and consistent returns to our investors.
- RockStep investors typically enjoy a preferred quarterly return from the property’s cash flow.
- We target a internal rate of return over a 5- to 7-year hold using conservative operating and exit assumptions.
- RockStep typically uses less leverage and puts in more equity compared to most other commercial real estate investment companies. We target 40-50% equity in our investments. This creates more cushion for problems and reduces the probability of a cash call (we have never had a cash call).
WE HAVE SKIN IN THE GAME
We put our own cash into every deal alongside our investors. We typically use lower leverage than our competitors which reduces deal and refinance risk. We often sign and guarantee the bank note, while our investors carry no bank liability. Therefore, our investors can’t lose more than their investment.
WE ARE DRIVEN BY INTEGRITY
We believe in small-town values in operating with honor. We are open and direct, and believe in building relationships and improving the communities in which we have an investment. Our mission is to make small-town America better. We do this by actively managing and investing in our assets. We align the success of the asset with the community.