OAK BROOK, IL— In the right retail market, leveraging surrounding geography can help fuel major portfolio growth. InvenTrust Properties Corp. is utilizing this model (Hub and Spoke) to boost market knowledge and extend its reach to adjacent markets. For example, that means the firm's Raleigh office is a springboard for investment in the Carolinas and the office in Denver allows for investment in the Front Range of Colorado. The model is working. InvenTrust purchased approximately $330 million in retail real estate in April 2016 alone, and the firm has no plans on slowing down in their target markets. To get an inside look at this model and how it has evolved, we sat down with David F. Collins, EVP of portfolio management at InvenTrust, for an exclusive interview.

GlobeSt.com: Tell me about your hub-and-spoke model. How does it work?

David F. Collins: We view the hub-and-spoke model as a differentiator for us in terms of being competitive in the marketplace, driving operational efficiencies and enhancing local market knowledge. It all fits into an overall plan to push decisions to the field, getting the teams closer to the properties and being able to service properties in a concentrated geographic area as well as adjacent markets. We have been buying large, trophy assets in high population and high-income growth markets. Through the hub-and-spoke model, we can expand our regional footprint and put acquisitions, operations and leasing staff on the ground where we are buying properties or interested in buying properties. By using this concept, we are able to take a market like Austin and service San Antonio, which is 80 miles away. We are getting both geographic concentration and we are able to leverage our staff to build our market knowledge in both target markets and provide our tenants best-in-class management. It has evolved and it is dynamic. As we cycle out of smaller markets and focus more on larger high growth markets, the hub-and-spoke model becomes an integral part of our strategy.

GlobeSt.com: How long have you implemented this approach?

We have been on this journey for several years. As we have transitioned our company to its current fully independent structure, we focused on geographic concentrations in high job growth and high income growth markets, primarily in the Sun Belt states.

GlobeSt.com: Which geographic markets are you focused on and why?

Collins: We are very focused on top markets with the aforementioned high job and population growth. Denver, Raleigh, Dallas, and Austin are all examples of markets in which we are looking to expand. Geographic concentration is absolutely ground zero for us. As we continually reevaluate our portfolio, we are recycling out of slower growth markets to markets with these high growth characteristics.

GlobeSt.com: InvenTrust has been aggressively acquiring properties. How does this operations model help support the firm's portfolio growth?

Collins: We want to leverage our geographic concentrations, and this allows us to be in adjacent high growth markets (the Spokes) that we wouldn't be in unless we had a strong presence in nearby core markets (the Hub) We are recycling our capital to reduce our presence in slow growth secondary and tertiary markets. That includes a number of good assets in smaller markets where there is really no room for us to grow.

GlobeSt.com Why is the operations side of your business so important to portfolio growth and development?

Collins: We are building a culture here that is very focused on a value-proposition based on innovation, collaboration, accountability and transparency. Those are the metrics that we use to evaluate our teams' performance and compensation. We have made a major commitment to hiring great operational staff, including leasing, asset management and property management. We have really invested in people to support all of the elements of our business plan. It is not always the part of the business that gets a lot of play, but you have to build a back-of-the-house that supports the front of the house. A lot of our focus in the last 12 to 18 months has been on the operational side. This has really empowered our regional offices to be more effective and to make better and faster decisions. It is all part of the overall strategy to position InvenTrust Properties for high growth in the future.

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When Leveraging Geography Fuels Portfolio Growth

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