The purpose of the updated investment criteria is to enable Persis Corporation ("Persis") to direct and guide investment opportunities and allow for increased diversification while continuing to focus on capital preservation, stable income, maintaining a relatively low risk portfolio, and successful completion of transactions in compliance with the constraints of 1031 exchange regulations.
Persis wishes to diversify its real estate holdings geographically and by tenant base.
Persis is interested in properties in stable markets with steady growth prospects. Persis prefers to own properties in primary market areas. Assets shall be located in areas that offer rent growth potential and favorable demographics. Consideration shall also be given to any proposed developments and projects under development and the potential positive or negative impact on the property under consideration. The following attributes are applicable to various prope1ty types:
Persis wishes to own high quality properties that will retain value and require limited capital improvements. Assets shall be of high quality construction and offer modern design attributes consistent with tenant demands. The magnitude of a tenant's investment in the Property shall be given consideration. All properties shall be free of environmental issues and risks that would be identified in a standard Phase I environmental site assessment which complies with all ASTM requirements or has been issued a "No Further Action" letter by the appropriate regulatory agency, if any such issues have been identified in the past.
The size of acquisition transactions will depend upon the capital available for tax-deferred reinvestment as well as the existing investments of the Portfolio. Typically assets of more than $15 million will not be targeted for acquisition. Average targeted deal size is $5 million to $15 million and subject to adjustment if needed.
New investments should use the minimum amount of debt necessary to successfully complete any given transaction. Persis is averse to high leverage, which is consistent with Persis's low risk tolerance.
Persis is a Sub S Corporation. Tax considerations play an important role in the investment process. Persis would prefer to utilize 1031 Exchange transactions to invest on a tax deferred basis due to low basis assets. Successful implementation of tax deferred transactions is key to the development of the Portfolio.