Investment Strategy

The investment strategy of the Hampshire Real Estate Companies is to acquire value-added opportunities where it can use its 50 year operational experience to materially enhance their value with a focus on the following real estate asset classes: Industrial; Office and Retail.

Hampshire balances the risk in its various fund portfolios by employing a strategy that blends the assets in the portfolio between YIELD-oriented properties and CAPITAL enhancement properties.

Yield-Oriented Strategies:

1. Stable Yield Strategy: This strategy is focused on assets with stable, long term Net Operating Income to counter balance the riskier investment strategies.

2. Yield Enhancement Strategy: This strategy is focused on assets with a fairly stable Net Operating Income; however, there is an opportunity to enhance the yield by modifying the underlying leases.

3. Buy Vacancy/Renewal Strategy: This strategy is focused on assets that have short term Net Operating Income issues caused by existing vacancies or pending tenant lease expirations.

4. Credit Risk Strategy: This strategy is focused on acquiring well-located assets at a discount due to the credit status of the primary tenant. In employing this strategy, Hampshire looks at special risk mitigating factors; such as, the quality of the asset, nature of use to tenant's business, ability to re-tenant/re-use the facility.

Capital-Oriented Strategies

1. Re-positioning Strategy: This strategy is focused on assets that need to be upgraded by an infusion of capital to bring the facility up to today's standard. These projects include deferred maintenance; modernization of the physical plant; exterior facade improvements; and interior renovations. This strategy is typically employed with buildings that are vacant or have a pending renewal.

2. Expansion Strategy: This strategy is focused on assets that have the ability to be expanded.

3. Development/Re-development Strategy: This strategy is for raw development or major re-development of existing facilities.

4. Change of Use Strategy: This strategy is focused on assets that have the ability to be converted to a different use through re-development of the property.

In all investment strategies, the Hampshire Companies uses appropriate debt leverage in order to enhance the overall returns of the investments.