Arixa Capital’s mission is to provide investors with attractive current income and total returns while remaining focused on capital preservation. We strive to maintain a healthy margin of safety on every investment we make. Arixa specializes in private lending secured by real estate, and we have built a full-service lending and loan servicing platform to ensure a steady flow of investments for our funds. In our lending business, we provide outstanding customer service to our borrowers — primarily, private real estate developers focused on single-family and commercial real estate projects in California.
Arixa Capital’s core investor base consists of individual investors rather than pension funds, endowments or other institutional investors. We believe that large funds cannot effectively deploy money in the overlooked niches that offer some of today’s most attractive returns. To operate efficiently, these funds typically must deploy $10–$50 million per investment, and sometimes much more. Arixa is built from the ground up to make smaller investments directly, without relying on multiple layers of managers, each of whom must be compensated. Arixa's vertical integration and simplified expense management enable us to deliver real value to investors and outperform the returns of our larger rivals who may pursue similar strategies.
When we choose to make an investment or launch and manage an investment fund, we aim to keep the following considerations:
- LIMITED RISK - Frequently, we would rather give up some of the “upside” of an investment in order to limit our risk. We are fundamentally risk-averse, long-term focused investors.
- INVESTMENT STRATEGY - We like strategies that are more difficult to execute for larger investment management companies, which allow us to earn above average returns for our investors. Excessive amounts of capital ruin good investment opportunities so we avoid highly competitive markets whenever possible.
- UNDERVALUED ASSETS - We seek to invest where we see undervalued assets (such as buying homes from banks in the wake of the financial crisis); however, we do not pursue investments whose returns are based on the timing of a recovery in asset values, which we consider too hard to predict and too volatile.
- EXPERTISE IN NICHE - We seek to make investments in products, people and markets that we know well. This allows us to have a strong point of view about value, risks and the potential rewards of each investment.
- ECONOMIC TRENDS - We actively pursue a deep understanding of long term demographic and housing trends and to take advantage of these trends when we invest. One such trend is the increased demand among Millennials to live in more urban areas areas with shorter commutes rather than having a larger home and yard with a longer commute. We also see a limited supply of high-quality properties in very desirable urban neighborhoods where demand is strongest. Our point of view on these trends drives many of our real estate investment decisions.
- CUSTOMER NEEDS - When necessary to serve our customers, we are willing to build out infrastructure and to develop vertically-integrated platforms. This goes hand-in-hand with serving harder to reach niche markets and making a large number of smaller investments.
- NIMBLE APPROACH - At the same time, we aim to remain nimble enough to change our investment strategy as the market changes. This may mean returning capital to our investors in one fund and launching new funds as market opportunities disappear in one area and emerge in other niches.
How It Shaped Arixa’s Investment Philosophy
Both principals of Arixa Capital had similar professional experiences which shaped the company’s investment philosophy and attracted them to real estate investment. Their shared experience includes leaving secure and attractive careers to co-found or build start-up technology-related businesses. These businesses became very valuable during the dot-com bubble and then lost most of their value when that bubble burst in 2000.
In 2002, Jan Brzeski dedicated himself to learning the real estate investment and asset management business by working for a Los Angeles family office with a value-oriented approach to buying and operating income property. While at that company, he also gained experience making private loans secured by real estate as an income-oriented investment strategy with a margin of safety. In early 2010, in the wake of the financial crisis, he started Arixa’s first fund, which was dedicated to making small-balance, short-maturity real estate loans to developers who purchased homes from banks and at foreclosure sales. This fund continues today and played a significant role in shaping Arixa’s investment philosophy—namely, to focus on capital preservation and mitigating risk in every investment.
Greg Hebner's background includes purchasing, renovating, and reselling a large number of homes in California. He began as a borrower from Arixa's original lending fund in 2011, and became a partner in Arixa's fund management business beginning in 2012.
Our Company Name
The first word of the company name, "Arixa", is named for a town in Namibia. The name was chosen by Arixa's founder Jan Brzeski, when his wife was working in Namibia on a public health initiative. The First Ladies Community Initiative helped build birthing shelters so that women who make a journey from the countryside to regional health clinics in order to give birth would not have to live in a tent while waiting to go into labor. Arixa Capital proudly supports the First Ladies Community Initiative which supports education and training of first ladies and their staffs, often to promote initiatives such as maternal health.