TENET’S FUND OPTIMIZATION METHODOLOGY
TENET’s team of highly skilled and seasoned financial and industry experts bring extensive knowledge in originating and assessing investment opportunities, bond structuring, portfolio construction, and managing projects from concept to exit. Our fund portfolios are designed to offer targeted broad sector direct deal investment opportunities while seeking to avoid correlations to the limits of traditional lending benchmarks and idiosyncratic industry risk exposures.
Proprietary Funding Platform
TENET is redefining Private Equity style direct deal investment with our internally developed bond funding model. While we utilize debt instruments to fund up to 100% of sponsor capital needs in a similar fashion as traditional Private Equity, we do not simply exploit target company balance sheet capacities for massive amounts of leverage, nor do we use portfolio assets to securitize debt for future targets. Rather, we work with our project sponsors to identify and mitigate financial and economic risk factors, employing credit enhancement strategies, and accessing the capital markets through private placement investment grade rated shorter duration bonds. By deploying capital into the underwriting and closing stages of our bond funding process, short-term cash-on-cash returns are generated from fee participation while mid-term capital growth is achieved through accretion of equity earned in funded projects. Additionally, as a result of TENET’s financial engineering, capital deployments are returned to the fund once the bonds are issued allowing capital under our management to be re-deployed to additional projects.
Risk Management Model/Project Selection
Each investment opportunity submitted to TENET is thoroughly reviewed for feasibility and risk exposure by our internal analysts during our pre-underwriting process. Only those opportunities identified as showing the right characteristics are accepted into underwriting where extensive validation and feasibility analysis is conducted by our third-party strategic partners. This, together with our financial engineering, qualifies TENET’s multi-layered underwriting to partner with experienced world-class insurance companies to insure and protect our investors’ economic and financial interests.
Internal Hedge
TENET’s focus on systematic risk mitigation goes beyond simply substituting market risk and, through the development of a proven bond offering investment vehicle, replaces capital committed to launch bond offerings with the capital raised from the bond offerings themselves. This singularity removes the original equity capital from any further risk in the investment as the investor is no longer financially tied to the project. Additionally, equity holdings are managed by our dedicated RIA TENET Financial Services.
Our Funds
Whether you are looking for additional exposures to breakthrough technologies or more traditional positions in commercial real estate, our funds provide access to private market opportunities while delivering best-in-class risk/reward profiles by deploying capital into our proprietary bond funding model.
TENET Innovation Fund
The TENET Innovation Fund targets projects and companies enabling, leading, and benefitting from disruptive or emerging technologies. Sector and industry exposure can vary based on project pipeline and macro trends, however, portfolio companies, generally, show a propensity to design, embrace, and capitalize on new or developing technologies or processes. Innovation fund investments tend to be smaller, on a relative basis, and rely heavily on the project sponsor’s ability to execute, and on the expert guidance and connections of the TENET team.
TENET Resort Fund 1
The TENET Resort Fund 1 targets hospitality investments through the development of large-scale mixed-use luxury resort projects. Projects included in this fund are originated, designed, developed, and operated by TENET and its wholly owned subsidiaries TENET Development Corporation and TENET Resort Management. TENET’s commercial real estate development and management team boast over 200 years of collective experience with project portfolios that include some of the most iconic resort destinations around the world, including The Cosmopolitan in Las Vegas and the Ritz Carleton on Lake Las Vegas.
TENET Acquisition Fund
The TENET Acquisition Fund is positioned to capitalize on recent dislocations in the commercial real estate development market arising from the debacles created by the confluence of conventional lending limitations, over-leveraged foreign developers, and COVID-19 era hospitality fluctuations. The fund is designed to acquire distressed development projects, at various stages of completion, in prime markets with the goal of completing and operating the projects under the TENET Resort Management flag.