Corporate Office

(619) 255-5860

Email Us

info@monrocapital.com

Investment Criteria

OUR MISSION

Guiding Principles

Monro Capital seeks to enhance the long-term value of well-located real estate. Value creation may come in many forms, but for us it entails improving underutilized assets through capital improvements, entitling, financing, marketing, and/or building conversions.

Core Competencies

Our Investment Approach

We serve our investors by going through the following 5
strategies. We call it THE MONRO WAY…

Buy with a MARGIN OF SAFETY

Use APPROPRIATE levels of debt

Invest in UNIQUE and DIVERSE assets

Pursue LONG-TERM investing

Emphasize TENANT RETENTION

“The individual investor should act consistently as an investor and not as a speculator”

— Ben Graham

OUR DIFFERENCE

We hold our investments for long-term growth.

Our prerequisite underwriting criteria answers the following question: “Is the asset as renovated, repositioned or in its current state worthy of being a long term hold?” If the answer is “no,” the property will probably not be an acquisition candidate. Although Monro Capital may dispose of assets, our objective is not to flip marginal properties. The objective is to acquire assets that become better over time.

What we don't do:

WHY?
EXPLANATION

Forecast Rents

WHY?
With rents reaching alltime highs, coupled with the recent pandemic, forecasting rents 10 years forward is very hard to predict.
EXPLANATION
Instead of forecasting rents far into the future, we use year-of rent rolls to determine today’s income. By doing this, we project rents conservatively to avoid over-projection of rental rates years into the future.

Project IRRs/ Terminal Values

WHY?

Low debt costs combined with high exit value assumptions inflate IRR performance.

EXPLANATION

Just like trying to forecast rental rates, we don’t think it is prudent to project terminal values like IRRs. Values can change due to factors out of our control, so we focus less on these metrics and more on stabilized cash flow.

Buy-to-Flip

WHY?

Buying to flip requires reliance on market timing, which is unpredictable and risky.

EXPLANATION

Instead of relying on getting lucky with market timing, we steward our assets indefinitely. We don’t focus on trying to cash out upon disposition, hoping that the market has moved favorably in our direction. We prefer to focus on minimizing vacancy and lease downtime through tenant retention, regardless of the state of the economy

Maximize Leverage

WHY?

Interest rates are incredibly low right now, yet there is no way to tell if/when they will rise.

EXPLANATION

We purchase assets with conservative debt/equity ratios to protect ourselves from economic shocks. We tend to utilize Life Insurance lenders, as they often offer the most flexibility for our needs.

Have a question?

We're happy to answer. Give us a call or send us an email and we will be in touch shortly.