VALUE-ADDED RETOTD Episode 00246

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VALUE-ADDED

A phrase generally used by advisers and managers to describe investments in underperforming and/or undermanaged assets that possess upside potential. NOI and property value can be positively affected through a change in marketing, operating or leasing strategy; physical improvements; and/or a new capital structure. The objective is to generate 13 percent to 18 percent returns. Leverage could fall in the 60 percent to 70 percent range.

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