John Oliver used to say “put eyes on the objective” in a wartime context. Now, he uses the motto as a business principle.
“It’s probably the most important thing you can do in a military operation,” said Oliver, a 1989 graduate of the United States Military Academy and veteran of Operation Desert Storm. “And it’s the same thing when we buy a property. We take it pretty seriously.”
The “we” Oliver refers to are West Point classmates Tim Abbott and Mike Brumagin, who along with Oliver are managing partners of Richmond private equity firm Battle Monument Partners. They founded the firm in 2014 to invest in single-tenant commercial properties in the Southeast and Mid-Atlantic.
Now, the company is raising up to $5 million through it first securities offering, according to an SEC document filed last month. The money will be raised through debt securities in a fund named STRAC Fund I, and will be used as leverage to add to its portfolio of 10 properties.
A former operating executive in venture capital and private equity-backed companies, Oliver had long hoped to start his own investment fund. Teaming up with Brumagin, a West End resident and restaurant franchisee, and Abbott, who retired from the U.S. Army five years ago and lives in Arlington, seemed like the perfect partnership. The firm also employs two interns from VCU at its 1805 Monument Ave. office.
“We did a lot of work the past two years to get it set up,” Oliver said. “It seems to be the right decision at the right stage of life, and I couldn’t be happier.”
Battle Monument Partners has 36 investors lined up, most of whom are military academy graduates. While Oliver said he doesn’t want his fund to be exclusive, the self-described “Gray Hog” used the partners’ military contacts to build the firm.
Named after a West Point landmark, the firm is situated on Monument Avenue across from the statue of West Point graduate Robert E. Lee.
“The design is to have veterans and industry-leading professionals,” Oliver said.
The partners are focused on attaining above-market return for clients, but they also added a social mission to their firm. Battle Monument Partners committed to donate up to 10 percent of the carried interest from its portfolio sales to charities focused on assisting veterans.
“Our priority is consistent income, along with steady growth in the portfolio,” Brumagin said in a statement to BizSense. “But we are anchored with a sense of duty to provide a social return to the community of our veteran partners.”
Battle Monument Partners has purchased 10 of the 150 properties its partners have analyzed, and has two other properties under contract.
“Our R&D is a killed deal expense,” Oliver said. “If we kill a deal it will usually cost a few thousand bucks, but it’s a lot better than making a mistake.”
Oliver said about 70 percent of the financing for the firm’s real estate deals comes from local banks such as Union Bank, while 30 percent comes from investors.
Most of the properties house national, single-tenant retailers, including Dollar General, CVS and Walgreens. They invested in properties located less than eight hours from Richmond in order to give clients in-person due diligence, although Battle Monument Partners has not yet purchased a property in the commonwealth.
The May 26 filing for STRAC Fund I stated a minimum investment of $25,000.
Oliver said he expects to complete the funding for STRAC Fund I in 18 months.
“If we do our job well, we’ll start another fund and expand the (geographic) footprint a little bit,” he said.