By Jonathan Basofin, Principal

The start of fall has always evoked contemplation and renewal for me. Maybe it’s the combination of kids returning to school, the Jewish new year, or the fact that I was born in October, but fall marks the beginning of my year. And as I consider where we’ve been and are headed, I’m particularly excited about the path that Cloverleaf is on.

This past year, I spent significant time – on my own and with trusted partners and advisors – exploring what we and our investors value most, and how those considerations should inform Cloverleaf’s acquisitions strategy. I thought about how we got from my father, Michael Basofin, founding the company in 1982, to my entry in 2009, to today. Two things struck me as I reflected on those 43 years: the extent to which we’ve always slowly and intentionally evolved, and how ever more swiftly the world around us changes.

So then, what kind of real estate do we believe presents an optimal risk/reward profile in the second half of the 2020s?

Our response is to curate a portfolio that offers durable cash flow and multiple profitable exits. Therefore, we’re buying what we believe to be forward-looking properties that are relatively shielded from instability. More specifically, we’re seeking well-located real estate leased to inherently stable businesses, which would be expensive and challenging to relocate – or, to use an industry term, “sticky” real estate.

An example of this “sticky” strategy is our veterinary real estate acquisition program, in partnership with AMO Partners. AMO, which stands for “animal medical office,” is a leader in veterinary real estate and members of its management team are longtime, respected friends of Cloverleaf. We believe the right veterinary-occupied properties exemplify the above traits, while offering multiple profitable exits – e.g., sales after negotiating value-enhancing lease extensions, sales to 1031 buyers, portfolio sales to larger/institutional buyers, or just good old-fashioned market timing.

Additionally, we think it’s best to pursue a select diversity of these tenant types, prioritizing under-tapped niches that we believe are poised for continued growth. So, we’re reviewing other “sticky” real estate sectors, like certain medical facilities (aka veterinary for humans), and funeral homes. And we’re considering the best way to offer our investors participation in a diversity of these assets.

At the same time, we’re continuing Cloverleaf’s longstanding program of buying multitenant projects that benefit from our active management style. We’re positioned to capitalize on rarer, opportunistic investments. And as we evolve, we’ll continue the fundamentals (e.g., low debt, timely and clear reporting, etc.) that have made Cloverleaf thrive and be trusted by our many valued stakeholders for over four decades. We’re proud of that history and will never change our core, only look for ways to get better.

In all, I am renewed and excited about Cloverleaf’s continued growth and what’s to come. I’ll look forward to reviewing our progress next fall!

If you would like to discuss our strategies, currently available opportunities, or have any questions, please contact me at jeb@cleafgroup.com or 847-272-3300.