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Rose Smart Growth
Investment Fund I, L.P.
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Location
The Fund’s investment strategy seeks to maximize economic,
environmental and social returns, while reducing economic risk. The key
to the risk/reward balance is found in the watchword of all smart real
estate investing— “location.”
The Fund purchases existing, cash flowing buildings in downtown
locations: on main streets, in walkable communities and in locations
most likely to reduce vehicle miles traveled (VMT). These are not only
the most environmentally responsible locations, but also the most
likely to prosper over the coming years because they are supply
constrained, increasingly in demand, and less vulnerable to competition
from new product since they are “built-out.”
Traffic and congestion presently result in longer commute times,
reduced quality of life, and increased financial burden for commuters
and families. Nationally, there are clear trends toward a return to
cities not only as places to work, but also to live, shop and enjoy
culture.
With gas price volatility, smart growth locations have become even more
attractive areas to rent vs. “sprawl” real estate. Although we do not
know exactly how markets and regulations will respond to the issue of
climate change, we are certain that under any scenario, transit-based
and walkable locations will do better economically than those only
served by auto.
More than 20 published studies of markets nationally have documented
increased value of transitoriented real estate. For example, in
Washington D.C.:
- A survey of 2,800 commercial properties
revealed a decrease in value of $2.30/SF for every 1,000 feet from a
Metro stop. ¹
- Analysis of 250 residential rental
observations demonstrated a 2.4-2.6% decrease in rental rates for every
tenth of a mile from a Metro stop. ²
Smart growth locations are smart investment locations.
¹ Federal
Transit Administration. 2000. Transit benefits 2000 Working
Papers: A Public Choice Policy Analysis. Washington, D.C.:
Federal Transit Administration, Office of Policy Department.
² Benjamin, John D. and G. Stacy Sirmans. 1996. “Mass
Transportation, Apartment Rent and Property Values.” The
Journal of Real Estate Research, Vol.12, No.1.
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