INVESTMENT APPROACH

Alpine Grove is a top-down investor, which focuses on macroeconomic dislocations and forms platforms to pursue investment strategies against these dislocations.

Alpine Grove conducts extensive macroeconomic research to identify market dislocations and opportunities. Examples of such dislocations are Japan in the 2000s, Germany after its 2004 labor reform, US after the 2008/2009 recession, and Spain after its bank and labor restructuring in 2012.

Alpine Grove selects partners to pursue real estate strategies against these dislocations. Examples include: Japan hospitality, German industrial, US creative offices, and Spanish residential.

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  • Cover our downside. As stewards, our highest priority is to preserve our investors’ money that has been entrusted to us.

  • Price in-place metrics. We primarily price assets on in-place existing metrics including location, floor-plate, in-place yield, and relation to replacement cost rather than relying on long-term levered cash flow projections which can be unreliable

  • Invest for the long-term. Rather than chase return by buying more risk, we buy and price assets that we would like to own for the long-term which have a temporary pricing dislocation, either from the economic cycle or from complexity in the asset or its capitalization.

  • Price unleveraged. A property’s intrinsic value cannot change depending on financing availability, and we should therefore not pay more for an asset because of leverage. We price all assets on an unlevered basis.

Alpine Grove uses extensive on-the-ground management to guide decision making and business plan execution.

  • Sell against a re-buy price, not against a cost-basis. One’s cost basis or expected profit are based on past and not future risk. We set our minimum sales prices based on our willingness to own an asset’s remaining risk at a price. The maximum price at which we are willing to re-buy or hold an asset is the minimum price which we are willing to sell it for.

  • Sell after value has been created. The opportunities we acquire generally require value creation to achieve attractive risk-adjusted return. We generally sell only after that value has been created.

  • Divest for the long-term. When proactively exiting, we sell our riskiest assets first. Doing so minimizes the probability that we are left holding our riskiest assets in a downturn. Stronger assets should have a higher ability to weather a downturn.