The Phocas REIT strategy invests in U.S. equity REIT securities and utilizes the FTSE NAREIT All Equity REITs Index® as a benchmark.


REITs are both real estate and equity securities. Successful REIT investing requires extensive knowledge of REIT management teams, real estate markets and equities.

Phocas believes that active managers investing in REITs need to have extensive knowledge in REIT management teams, real estate and equity markets to generate consistent long-term alpha for investors.


Portfolios typically include between 25 – 35 REIT positions using a core/satellite approach that combines larger cap often times core REIT holdings with smaller cap specialized REIT holdings. The portfolio is diversified across sectors and geographic regions.


Investment process utilizes the Phocas Fair Market Value research methodology which is a three-pronged approach that utilizes (1) discounted cash flow model (2) Net Asset Value (NAV) model and (3) Adjusted Funds from Operations (AFFO) model. Within each company model, the analysis assesses numerous qualitative and quantitative factors, including but not limited to (1) the quality of management, (2) the quality of company financials and balance sheet and, (3) asset quality and location.


The strategy can be characterized as bottom-up and does not utilize macroeconomic forecasting. The Phocas team strives to add performance through security selection and to keep portfolio turnover low as the team understands that commercial real estate is not a short-term investment.


Annualized Returns (%) As of 9/30/17 YTD 1 Yr 3 Yrs. 5 Yrs. 10 Yrs. Inception
Phocas Small Cap Value Fund (net) 6.01% 19.37% 10.80% 15.28% 8.85% 8.93%
Russell 2000 Value TR 5.68% 20.55% 12.12% 13.27% 7.14% 6.73%
Calendar Year Returns (%) 2017 2016 2015 2014 2013 2012 2011 2010 2009
Phocas Small Cap Value (net) 0% 24.07% -3.84% 7.82% 46.96% 10.12% -5.53% 30.17% 24.87%
Russell 2000 Value TR 0% 31.74% -7.47% 4.22% 34.52% 18.05% -5.50% 24.50% 20.58%

Performance %

Time Period: 5/1/2006 to 9/30/2017

Data presented reflects past performance, which is no guarantee of future results. Net performance shown reflects the deduction of annual investment management fees of 1.00% of assets under management. Performance returns may reflect the effect of material economic and market factors not anticipated by Phocas. Clients’ returns will be reduced by advisory fees and other expenses incurred in the management of the client’s account.