About Pacolet Milliken

Investment Program 2016

7 Bryant Park Groundbreaking
Photo credit: Tim Dominick, The State

7 Bryant Park Groundbreaking, NYC

In 2015, we were more active on the transaction front than we have been at any time in the Company’s history, harvesting opportunistic investments that generated significant gains and investing in new assets and operating companies that will help to define our core operating and growth pillars for the future.

In the current investment environment, we are particularly optimistic about the prospects within the water/wastewater industry and the Class A multi-family real estate sector – two areas where we have a strong foundation today and the opportunity to significantly grow in the near future.

Our focus on water/wastewater assets results from our belief that there is an attractive blend of dependable, long-term income combined with upside growth potential. We not only believe that wastewater is a unique ‘steady income plus growth’ vehicle, but also that it is at the forefront of an emerging new industrial opportunity that could replicate the growth trajectory witnessed in Europe over the last two decades. We also believe that Class A, urban infill multi-family assets that represent modestly leveraged, well-located, high quality residential rental properties are ideal for long-term ownership and consistently produce dependable cash flow.

We continued to strengthen our Real Estate partnership platforms with Hines Interests and The Hanover Company and initiated a new partnership with Waterman Interests. Likewise, in Energy/Infrastructure, we began substantial construction on a landfill gas-to-energy project, in partnership with Detroit Edison, north of San Francisco. We also continued to build out our solar portfolio with our partners at Syncarpha Capital. By partnering with these best-in-class enterprises, we are able to reduce risk, exploit local market knowledge and connections and maintain access to a robust pipeline of attractive investment opportunities. Our balance sheet remains strong. As of December 31, 2015, our debt-to-total capitalization was 23%.

What has not changed is our core investment strategy - the steady deployment of capital within our energy/infrastructure and real estate platforms in order to generate stable, growing dividends and to expand shareholder value.

OUR PARTNERS

Our relationships are more than capital partnerships. In many cases, we have become part of the general partnership of development entities – a very privileged seat given who our partners are. We believe that, because we have operating backgrounds, we can create a meaningful dialogue with them - and help them fill a capital void where in some cases, it is too early in the value creation process to interest institutional investors. This dialogue has led to some ‘first time’ relationships for our partners.