Three questions for James Stolpestad - CEO of Allianz Real Estate of America
Roland Deger currently supporting Allianz Real Estate of America in New York took advantage of the time to collect some information about the real estate business of ARE of America to inform his colleagues in other entities by asking James Stolpestad three questions.
Allianz Real Estate of America | New York, 05/03/2011
James Stolpestad, CEO of Allianz Real Estate of America
Roland Deger: ARE of America was founded one year ago, expanding into the American markets. How satisfied are you with the development of the company today?
James Stolpestad: I am very pleased with our progress and the contribution from our team. We grew from one person to 15 full-time employees and approximately 7.3 billion US-dollars of assets under management. We integrated the legacy lending platform into Allianz Real Estate and created a synergistic lending and equity investment business.
We have sourced and closed or committed to a dozen debt transactions of approximately 575 million US-dollars. We closed two equity commitments totaling 125 million US-dollars and are working on another 200 million US-dollars fund/JV transaction in the multi-family sector. Our existing equity assets have performed relatively well though this challenging market period and we feel they are on a positive trend. We developed new reporting and risk management processes. Based on the feedback from our now five internal affiliates, I think they are very happy with our progress and they remain very supportive of our continued efforts.
Deger: How would you describe your current investment strategy?
Stolpestad: The equity investment strategy remains the same - making 'core' or 'core plus' conservative investments with joint venture partners in the larger markets. We had a good start in the office sector and are focusing most of our efforts now in the multi-family rental apartment sector, retail and evaluating industrial/logistics. New York and Washington D.C. are the favorite markets of so many equity investors so we are expanding our focus to other markets that offer compelling risk-adjusted returns.
On the lending side, we continue to make only conservative fixed-rate first mortgage loans secured by institutional quality office, retail, multi-family, industrial and medical office buildings.We try to favor the most experienced and creditworthy borrowers. We have moved into larger markets and larger loans which we feel offer lower risk-adjusted returns and create efficiencies as we expand our portfolio.
Deger: What are the most important challenges in the next 12 months?
Stolpestad: The development of our team remains our biggest challenge. It has been a tough year for our team, people have worked very long and hard, and we continue to ask a lot of people. We started to develop the skills of our existing people, expand our team, and add the appropriate resources to meet the needs of the business as it grows.
We face increasing competition in both the lending and equity investment worlds so we cannot be complacent. We remain confident we remain on the right path to create a best-in-class real estate investment and asset management platform for the American market.
