Attractive locations produce attractive cash flows
The criteria for an optimal location are both the site itself and its future prospects. How will the infrastructure, the job market, incomes and educational offerings develop? In short: What will the quality of life look like over the next few years? Another crucial factor is whether the real estate in the Archer Daniels Asset Management’s current locations can be managed without substantial additional cost.
Beyond that, Archer Daniels Asset Management always strives to optimise its portfolio, selling off less complimentary and buying strategically important new properties so that once value creation is complete – or even beforehand, in the event of a favourable opportunity – we can realise profits for our investors.
For this strategy to work, many years of know-how, as well as intensive market knowledge, both on the part of management as well as the employees, are required.
Focus on Residential Real Estate
Multi-family residential real estate is highly stable throughout the economic cycle and is expected to benefit from continued economic expansion and strong rental demand worldwide. Our focus is on the acquisition, development and management of residential real estate, particularly in southern parts of Spain and other western European opportunities. Archer Daniels Asset Management main locations can be found in the metropolitan area of Malaga as well as along the whole southern coast.
Archer Daniels Asset Management not only invests in and around large cities but also deliberately invests in medium-sized and smaller towns and cities in order to harness growth potential and opportunities for returns there.
The rental portfolio comprises affordable residential space that appeals to broad sections of the population.
Deploying capital where it makes the most economic sense
Safeguard value, take advantage of opportunities!
ARCHER DANIELS ASSET MANAGEMENT sees itself primarily as a long-term holder of real estate. The buying and selling off of smaller residential portfolios are also very much a part of our strategy, be it for the optimization of the entire portfolio or because we see favorable market opportunities. To be able to do this – especially in the current market – a high degree of capital discipline is becoming ever more important.
Some background: In some segments and regions, purchase prices have already reached levels that no longer make long-term oriented management attractive in relation to equity capital costs. Therefore, at locations where the purchase prices for residential real estate are growing substantially faster than rents, we are taking advantage of sales and buying opportunities – naturally, under a precise and competent review of each individual project.
The equity capital that is released again through sales makes it possible for us to reinvest in properties in ARCHER DANIELS ASSET MANAGEMENT ‘s core regions with a higher initial rate of return. That is the principle of capital recycling.
Net cash for future investments in higher yielding properties
