The Davis Investment Discipline Applied to Real Estate
Uncover Companies Skilled at Managing the Entire Real Estate Cycle
Our unique approach focuses on uncovering real estate companies with a proven record of managing investments for cash flow growth over entire real estate cycles. Such companies typically possess strong balance sheets and healthy rental income.
Analyze Owner Earnings to Identify Durable, Well-Managed Businesses Selling at Value Prices
We do not rely solely on reported earnings or press releases to determine the value of a company. Instead, we conduct intensive rigorous research, analyze numbers and read financial reports to get the most accurate view possible of a company's true value. We also consider how a company’s value compares with its replacement cost.
Evaluate the Company's Properties at the Submarket Level
As an example, we believe it is not sufficient to know a property is located in Manhattan. Instead, we dig deeper to analyze the submarkets of Midtown, Downtown, the West Side, and the East Side to more accurately determine which real estate investment trusts (REITs) are operating in markets that seem to be improving.
Meet with Management—Invest with Doers Not Bluffers
Before we invest, we conduct a thorough review of management's philosophy, its history of decision making and its plans for future earnings growth.