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  • Matt Hershey

Notorious B.T.C.

‘B.T.C.’ – whether ‘buy/reposition-to-core’ or ‘build-to-core’ – had a bad rap until now. These separate accounts and specialized funds have become more legit. Definitionally, we’re talking about buying assets with deep value-added business plans or developing assets. Once stabilized, the partners continue to hold and manage these assets for longer term cash flow as opposed to selling.

Some managers have used this term to erroneously describe development funds with the intention to sell on stabilization. While the name’s novelty may turn investors heads initially, it’s soon discovered they’re missing the point. Was anyone ever developing to ‘un-core’, in other words half occupancy? Development is fundamentally an exercise in creating core assets. The point of B.T.C. is to invest at cost basis and then enjoy the benefits of that basis for years to come by not selling.

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