Active Value Capital: Company Profile

Background

Active Value Capital (AVC) is an independent asset management firm specializing in the acquisition and active management of secondary real estate properties. Established in 2019 by industry veterans Philip Bach and David Wise, AVC focuses on identifying and enhancing the value of under-researched properties within the £3-£20 million lot size range. The firm's mission is to deliver superior investment returns through strategic property selection and proactive asset management, leveraging nearly 60 years of combined experience in the property investment sector.

Key Strategic Focus

AVC's strategic approach centers on:

Investment: Sourcing attractive, often off-market, properties or portfolios with significant income potential.

Value Addition: Utilizing an extensive network of contacts to secure favorable deals and conducting thorough due diligence to mitigate investment risks.

Asset Management: Implementing value-enhancing strategies from acquisition to sale, ensuring optimal performance of the property portfolio.

Financials and Funding

As a privately held firm, AVC does not publicly disclose its financials or funding details. The company operates independently, free from conflicts of interest, allowing for a focused investment strategy.

Pipeline Development

AVC has demonstrated a strong track record in managing diverse property portfolios. Notable examples include:

Realm Portfolio: Acquired in February 2013 for £29.2 million, comprising eight properties leased to UK Government/Public sector entities with an 8.1-year weighted average unexpired lease term (WAULT) and a net initial yield (NIY) of 10.1%.

Earth Portfolio: Acquired in August 2014 for £22.8 million, consisting of six properties leased to Mecca with a seven-year WAULT and Retail Price Index (RPI) linked rent increases.

Redefine Portfolio: Sold in February 2016 for £489 million, encompassing 20 high-quality, diversified properties.

Technological Platform and Innovation

AVC's competitive edge lies in its deep industry expertise and extensive network rather than proprietary technologies. The firm employs rigorous due diligence processes and collaborates with top-tier local experts to source and manage properties effectively.

Leadership Team

Philip Bach, Managing Director: Co-founder of AVC, previously Head of Active Value Property at Kames Capital, and a Director at ING Real Estate Investment Management. Philip is a member of the Royal Institution of Chartered Surveyors with 25 years of experience in property markets.

David Wise, Managing Director: Co-founder of AVC, formerly Head of the Direct Property Team at Kames Capital, and Investment Director at AVIVA Investors. David is a Chartered Surveyor, a member of the Investment Property Forum (IPF), and serves on the board of the Association of Real Estate Funds, bringing over 31 years of property investment experience.

Leadership Changes

Since its inception in 2019, AVC has maintained a stable leadership team with no significant changes reported.

Competitor Profile

Market Insights and Dynamics

The UK real estate investment market, particularly the secondary property sector, offers substantial opportunities for firms like AVC. The focus on properties within the £3-£20 million range allows for higher yields compared to larger properties, with yields typically 70 to 140 basis points higher.

Competitor Analysis

While specific competitors are not detailed, AVC's specialization in good secondary and value-add real estate positions it uniquely in the market. The firm's emphasis on income-oriented investments and active asset management differentiates it from competitors focusing solely on prime or defensive stock.

Strategic Collaborations and Partnerships

AVC collaborates with a network of "best in breed" local experts, including brokers, lawyers, and other professionals, to source and manage properties. These partnerships are integral to the firm's strategy of reducing investment risk and enhancing property value through active management.

Operational Insights

AVC's strategic focus on under-researched properties in the £3-£20 million lot size range provides a competitive advantage by targeting assets with higher yields and potential for value addition. The firm's hands-on approach and extensive industry network enable it to identify and capitalize on opportunities that may be overlooked by larger, more traditional investment firms.

Strategic Opportunities and Future Directions

Looking ahead, AVC aims to continue leveraging its expertise in the secondary property market to identify and acquire assets with strong income potential and opportunities for value enhancement. The firm's commitment to active asset management and strategic partnerships positions it well to navigate market dynamics and deliver sustained investment returns.