Investment Origination

S|T|O|R|E Capital was formed to fill a need for efficient long-term real estate capital for middle market and large customers. We do this largely by creating lease contracts that address our customers' needs and create strong alignments of interest that benefit our shareholders. By creating demand for our services, and not simply taking market share, we have maintained large pipelines of investment opportunities ever since we opened our doors. The result is that we can be both selective and achieve higher rates of return than could our shareholders if they were to seek profit-center real estate investment on their own.

Investment Underwriting

What makes profit-center real estate an attractive asset class is that it has three sources of payment: The cash flows produced by the business that operates in the property we own (our primary payment source); the credit support offered by the tenant's overall business (our secondary payment source); and the value underlying the real estate in which we invest (our third payment source). Our methods of evaluating investment risk, looking at each of these three variables, have been developed over many years and over 10,000 property investments. The upshot is that we have sophisticated risk evaluation tools and insights that are designed to offer greater risk-adjusted investment results than those available to most real estate investors.

Investment Documentation

We have learned that lease contracts, and not tenant credit metrics, are the principal governors of investment risk. Part of contract creation is embodied in the investment underwriting process: The prices we pay for the real estate; the ability of the tenants to pay our rents from the operations housed within our real estate; the rents and escalations we receive; and the support offered to the investment by tenant credit quality. These factors are ultimately incorporated into our contracts and supported by third party diligence, including appraisals, property condition reports, environmental reports and other diligence. Finally, the contracts we create incorporate alignments of interest, such as the common use of master leases and bankruptcy-remote investment structures. Altogether, our documentation process, like our approach to underwriting, has evolved over decades and offers investors in S|T|O|R|E a value that most could not create for themselves.

It is a common fallacy that net lease real estate investment portfolios require little management. They must be actively managed, but with a greater focus on the minority of investments that have a higher risk potential to experience future problems. Over the years, we have learned how to monitor unit-level profit and loss statements, tenant corporate financial statements and the timely payment of property taxes and insurance in order to gauge portfolio quality. S|T|O|R|E represents our third, and most highly developed servicing platform. We are virtually paperless, can access granular or highly detailed information from virtually anywhere and are highly scalable. Having such systems helps us effectively monitor and reduce tenant credit risk at the property level. And when combined with our high degree of financial and operating flexibility, we are able to realize better shareholder risk-adjusted rates of return on our invested capital.

Financial Reporting and Treasury

We spend as much time at S|T|O|R|E thinking about our corporate financing strategies as we do our real estate investment strategies: Borrowings must prudently improve shareholder returns; they must be structured to provide portfolio flexibility and minimize company exposure to changes in long-term interest rates; they must be structured to optimize our cost of financing that will enhance investor rates of return; and finally, a liability strategy should contribute to corporate governance by enhancing corporate flexibility. Our leadership team has unparalleled experience with diverse liability strategies. Today, we are amongst a handful of companies to employ a AAA and A+ rated master funding borrowing source. Our leadership team developed the conduit strategy in 2005 and it is ideally suited to finance diverse portfolios of profit center real estate, such as ours. The strategies we implement have always been designed to add value to our investors by offering a more efficient means to finance real estate than they could otherwise do on their own.

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Overview

Who we are
STORE Solutions
Corporate Responsibility
- STORE Capital 2023 Corporate Responsibility Report
- Document Library
Store News
Join Our Team
Get In Touch

Who we are
STORE Solutions
Corporate Responsibility
- STORE Capital 2022 Corporate Responsibility Report
- Document Library
Store Resources
Join Our Team
- Career Opportunities
- Employee Diversity, Equity and Inclusion
Get In Touch

Our Five Core Competencies

Our Five Core Competencies
Our Asset Class
Margins Of Safety

480.256.1100
info@storecapital.com
8377 E. HARTFORD DR. SUITE 100
SCOTTSDALE, ARIZONA 85255

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