Hidalgo
Strategies
Core/Core+
Core and Core + Investments are considered the least risky because they often target stabilized, fully leased, secure investments in major core markets. Hidalgo Companies' Core Business invests in properties with long term leases in place to high credit tenants and Class A apartments in highly desirable locations. We invest in apartments that are well kept and require little to no improvements. Therefore, this type of real estate investment provides stable, predictable cash flow with relatively low risk for our clients. This type of asset is suited for investors who seek capital preservation and long hold periods and often warrants low leverage acquisitions.
Value-Add
Our Value-add commercial real estate investment business typically targets properties that have in-place cash flow. Still, we seek to increase that cash flow over time by improving or repositioning the property. This could include making physical improvements to the asset that will allow it to command higher rents, increasing efforts to lease vacant space at the property to quality tenants, or improving the property management and thereby increasing customer satisfaction or lowering operating expenses where possible. Once we have successfully increased the property's net operating income, we sell the asset to capture the resulting appreciation in value. We employ medium to high leverage to finance our projects and increase returns for our investors and us. For many investors, value-add projects provide the perfect balance of risk vs. return - offering in-place cash flow at the time of acquisition with significant upside potential in the form of value appreciation.
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Opportunistic
Hidalgo Companies' Opportunistic real estate investment strategy follows our value-add approach, but we take it a step further on the risk spectrum. The opportunistic properties we invest in tend to need significant rehabilitation to realize their potential. Frequently these assets will be entirely vacant at the time of the acquisition, or we would seek to partner with developers to develop raw land from the ground up. These types of projects offer the highest level of return for our investors. Our sponsors for these projects typically employ the use of high leverage finance. Due to our ability to mitigate risk in our opportunistic business, we achieve higher returns to investors than our core and value-add strategies through substantial appreciation in value.