Five principles guide Hearthstone in structuring its homebuilding investments.


Hearthstone is engaged in one business only: managing institutional capital in residential development. Hearthstone employs professionals who have dedicated their careers to this industry, many of whom have had experience as homebuilders.


Hearthstone cements strong, long-term relationships with the top builders and developers in each market. By focusing on relationships and repeat transactions with a loyal group of builders, Hearthstone reduces risk for its investors, increases the quality of it's investment opportunities, and provides better service for its builder and developer partners.


Hearthstone invests in as many as fifty projects each year. As a result, no one investment dominates Hearthstone's portfolio. Investments are diversified by geographic region, builder, and product type. Most projects require less than $5 million of equity capital although Hearthstone will consider transactions requiring as much as $30 million.


Hearthstone requires every member of its investment committee to invest alongside Hearthstone's institutional investors in each of the company's investments. As a result, each member of the investment committee has a significant portion of his or her personal net worth at risk in the company's projects.


Hearthstone's strategy is research-driven, and is based on a thorough knowledge of the dynamics influencing the supply and demand for housing in Hearthstone's target markets.