Whilst unconstrained in terms of its asset selection, Somerston seeks to concentrate its intellectual and financial capital on a manageable number (typically 5-10) of strategic initiatives at any one time, each having the potential to make a meaningful contribution to the Group’s overall performance.
Strong local knowledge is crucial to accurately assess the risk profile and financial feasibility of any project. Through careful analysis, Somerston targets assets offering the potential for above average income growth and/or capital appreciation over the medium term. Such potential may arise systemically within a given market due to the forces of supply and demand and/or at the project level where the application of the Group's expertise offers scope for additional value creation.
Where the risks of doing so can be properly managed, Somerston may seek to further enhance returns through financial gearing.
To augment its own capital base, Somerston may admit external investors at the asset/project level. Somerston's decentralised operating model maximises flexibility in the structuring of investments through single or multi-level partnerships and joint ventures, allowing Somerston to recognise differing jurisdictional and tax issues applicable to individual co-investors in order to maximise their returns.