UST’s Spring 2012 Real Estate Executive Insight Series kicked off last night with a presentation by Ian Harrison, Vice President of Acquisitions with St. Paul based, AEI Capital (AEI).
As VP of Acquisitions with AEI, Harrison works to identify investment properties and strategies daily. With a team of 2 analysts, and a corporate attorney, Harrison team is “lean and mean” actively searching for investment deals in primarily the single tenant net lease market.
Through AEI’s triple and double net lease structuring, the company transfers the risk of property-related expenses to the tenants for as many costs as possible. Tenants are responsible for the property’s taxes, insurance, operating expenses and in most instances the maintenance of the real estate. Their leases are backed by corporate tenants such as Best Buy, Chipotle, Pet Smart and Dicks Sporting Goods offering fairly low yields (8.25% annual, pay out distribution close to 6%) but safe yields nonetheless. Harrison explains such investment structuring is ideal for investors attracted to opportunities which offer stable income, low volatility, reduced risk, and capital appreciation.