Alvia Asset Partners

The office sector is at a crossroads. While remote work has reshaped how we collaborate, many organisations are now reconsidering its long-term impact on productivity and culture. This reassessment, combined with liquidity pressures facing some institutional property fund managers, is creating opportunities for investors to step in and acquire high-quality assets. In December last year, we acquired a 37% stake in Brisbane’s 55 Elizabeth Street, an A grade office tower anchored by the Australian Federal Government. This was a step into what we saw as a counter-cyclical opportunity in a sector many are quick to overlook. Brisbane’s office market has shown resilience, with cap rates holding firm, while Melbourne’s have softened significantly – highlighting the divergence across cities. We’re actively seeking opportunities like this, where value and quality intersect. While the headlines may focus on the challenges facing the office sector, we believe offices will remain an essential part of how people work, connect, and innovate – making this a compelling time for thoughtful, long-term investment. Josh Derrington, Eddie Barrett, Nathan Robertson, James Duffy

As the holiday season approaches, we see strong potential for companies like Endeavour Group and Diageo to benefit from a seasonal boost in Australian consumption trends. In today’s high cost-of-living environment, Diageo stands out with stable earnings and consistent cash flow. Its diversified product portfolio supports steady consumption patterns, despite broader macroeconomic uncertainty. Speaking with ausbiz’s Nadine Blayney, Alvia Senior Investment Analyst Daniel Martin, CFA emphasised that for true active managers, the opportunities are clear - those willing to dig into bottom-up analysis can uncover value in an equity market that may appear expensive at a headline level. Our focus remains sharp: finding companies with sustainable cash flow and consistent performance. While US companies dominate the headlines, we see significant parts of that market as extremely overstretched. Instead, we’re uncovering overlooked opportunities in the UK and Europe - global businesses with resilient models that have been left behind. Josh Derrington, Nathan Robertson, Eddie Barrett https://lnkd.in/gDfc5cwd

The "Magnificent 7" are undoubtedly among the most extraordinary companies in the world today, boasting impressive earnings and global dominance. Yet, despite this, we aren't buying into the hype. Why? Because investors are paying more for a unit of tech sales now than at any other time in history - even surpassing the dotcom bubble. We admired Apple at 10x earnings, but at 38x? We just can't justify it, regardless of product quality. These seven giants now represent roughly 30% of the S&P500’s market cap but make up just 11% of its revenue. Take Nvidia for example, the undisputed leader of the advanced chip market, commanding a staggering 90% market share driven by its first mover advantage. The market has priced Nvidia as though it has already won the race. But cracks are forming - more competitors are entering the fray - even OpenAI is exploring in-house chip development. These are world-class businesses, no doubt. But can they grow fast enough to justify their stratospheric valuations? That’s a bet we’re unwilling to make. As investors continue to champion these names, we’ll keep highlighting the risks. When prices soar on hype rather than fundamentals, the prudent path is clear: proceed with caution. Josh Derrington, Nathan Robertson, Eddie Barrett, Chris Scarpato, CFA

Providing financial literacy and purposefully guiding the next generation is key to preventing the classic 'shirtsleeves to shirtsleeves in three generations' scenario. Many of Alvia’s clients grapple with balancing discipline and indulgence in raising their children, aiming to instil an appreciation for the effort involved in wealth creation. Some Alvia families include their children in the family’s wealth management process early on, fostering a sense of responsibility through education and observation, while others operate a “family bank”, lending money to their kids on commercial terms to encourage financial accountability. At Alvia, we place great importance on trusted, long-term partnerships, thoughtfully selecting clients whose family culture supports the preservation and growth of wealth across generations. As CIO Josh Derrington shares, 'We want to be able to manage the capital through multi-generations. I know if the parents haven’t put the right value set in place, then we are going to be looking for a new client come the second generation.'" Read the full article by Michelle Bowes in The Australian Financial Review. Nathan Robertson, Eddie Barrett https://lnkd.in/gVbyhN4d

With the U.S. election outcome stirring markets, Alvia is on the hunt for pockets of value. Last night, the US market rallied hard, leaving many international markets trailing. This divergence presents distinct opportunities in often-overlooked areas, particularly China, where US tariff fears have suppressed the market. Rather than focusing on export-driven plays, we’re prioritising China’s internal consumption story. Take ANTA Sports (HKG:2020) for example - a company with industry-leading margins and steady 10% annual growth, without relying on export revenues. Currently trading at a material discount to its Western peers, ANTA reflects an undervaluation driven by broader market sentiment, as our Portfolio Manager, Chris Scarpato, CFA, shared with Juliette Saly on ausbiz. Opportunities like these, where short-term sentiment deters others, are where we uncover real long-term value. At Alvia, our focus remains on high-quality companies, even when that means taking a contrarian stance. Josh Derrington, Nathan Robertson, Eddie Barrett https://lnkd.in/gnAdyKhr

Australia's wealthiest investors are evolving their investment preferences, with a clear shift toward growth assets and private markets. This week our CEO Nathan Robertson shared insights with The Australian Financial Review's Michelle Bowes on why private equity is gaining ground, with 21% of HNW investors now active in private markets. However, Nathan cautions that private market investing comes with considerable risks, especially for those with less experience. "Ultra HNWs have a much longer time horizon; they’re thinking about their wealth not just in terms of five, 10, or 15 years, but generationally and therefore having larger exposure in illiquid markets is much more tenable than for retail investors." - Nathan Robertson Josh Derrington, Eddie Barrett https://lnkd.in/gnzuwapP

We thrive on finding opportunities where short-term market pressures create long-term value. Our approach often means taking a contrarian stance against prevailing market sentiment - focusing on high-quality companies that others may overlook due to short-term noise. Take Nasdaq-listed VERISIGN and VEEM Ltd (ASX:VEE) for example. VeriSign, with its monopoly on .com and .net domain names, holds a unique position in the market, offering strong pricing power and consistent revenue. Meanwhile, Perth-based VEEM is making waves with its innovative marine gyro stabilisers, helping vessels reduce fuel consumption and environmental impact. While many focus on immediate earnings or cost pressures, we step back to see the broader opportunity. Our focus remains on the long-term potential. Portfolio Manager Chris Scarpato, CFA joined Juliette Saly on ausbiz to discuss why these companies are catching our eye. Josh Derrington, Nathan Robertson, Eddie Barrett https://lnkd.in/g98Ntm6W

Four years ago, in the thick of the COVID-19 pandemic, we launched the Alvia Family Office Fund. Fast forward to today, and we’re proud to mark this milestone with a fund that’s delivered 14.0% p.a. (inception to Sep 2024), placing it in the top 1% of Morningstar’s multi-asset growth category – ahead of 118 other funds. Launching in 2020 was tough. Markets were volatile, uncertainty was extreme, and the road ahead was anything but clear. Yet through all the ups and downs, our disciplined and unconstrained approach, with a primary focus on managing risk, has paid off. The four year anniversary of the fund coincided with it being named Finalist for Best Multi-Strategy Fund at the Australian Alternative Investment Awards. While we didn’t take home the award, being in the mix is testament to the trust our clients place in us and the hard work of our team every day. As Josh Derrington puts it: "It’s not just about weathering the storm; it’s about positioning for what comes when the storm clouds clear." Thank you to everyone who’s been part of this journey – we’re only just getting started. Nathan Robertson, Eddie Barrett, Chris Scarpato, CFA, James Duffy, Daniel Martin, CFA, Mitchell Simmons, CFA

We’re closely watching the revaluation of the Chinese equity market. Trading at near-record low valuations, weighed down by concerns over property bubbles, political challenges, and trade tensions, the recent sell-off is understandable. But when a market of this scale falls by 50%, it deserves a closer look. Historically, the Chinese equity market has delivered positive returns 100% of the time after a trough in PE multiples, with a median return of 21% one year post-trough. We aren’t backing up the truck, but we are dipping our toes in. Take Alibaba for example... while many investors are put off by negative sentiment and the company’s structural complexities, it’s easy to throw Alibaba into the “too hard” basket. But we see an intriguing valuation. By 2028, projected cash flows are estimated at ~$25 billion, with a balance sheet of $70 to $150 billion (depending on your valuation method), and a $35 billion buyback program by 2027, plus dividends. These are compelling numbers for a business with solid operational performance, despite the market’s continued reluctance. While higher prices often attract higher allocations, we find that doing the opposite has proven rewarding for patient, long-term investors. #ChineseEquities #ValueInvesting #Contrarian #IndependentThought Josh Derrington, Nathan Robertson, Eddie Barrett, Chris Scarpato, CFA

There must be something in the water at Alvia HQ - following our win two weeks ago as Best Boutique Licensee at the IMAP Awards, the Alvia Family Office Fund has been named a Finalist for Best Multi-Strategy Fund in the Australian Alternative Investment Awards! We’re honoured to receive this recognition and proud of the continued hard work from our team. Looking forward to the awards night on the 25th September at the Hedge Funds Rock Gala and sharing the room with some of the industry’s best. Josh Derrington, Nathan Robertson, Eddie Barrett, Chris Scarpato, CFA, James Duffy, Daniel Martin, CFA, Jim Christensen, Matthew Morgan https://lnkd.in/eRi82pQA