Why Are Alternative Investments Gaining Popularity?
Alternative investments are gaining popularity with more investors adding them to their portfolio or increasing their existing allotment. There are several reasons why alternative investments are enjoying high levels of popularity right now: diversification; avoiding market volatility and the current high cost of equities; not wanting to be limited to publicly traded stocks; frustration with low returns on ‘safe’ investments; needing a hedge against inflation; increased accessibility; and personal interest or passion, as in the case of collectibles.
Investment Demand is Driving Increased Interest in Alternative Assets
For some time now, alternative assets have been increasing their share of the investment market, gaining nine percent of market share between 2017 and 2019, driven then, as now, partly by investors seeking better yields. Hedge funds have remained buoyant and look poised to play an integral part in the economic recovery. Additionally, many sectors of commercial real estate are seeing increased activity, despite an uncertain and often turbulent year for commercial real estate in general; issues resulting from the pandemic are playing a significant part in this increase.
4 Ways Global Change Will Create Opportunity for Real Estate Investment
The pandemic has been a catalyst for global change, rapidly accelerating some underlying trends that were already in evidence – even before 2020. It is reasonable to assume that we may never return to the way things were in 2019, but how will the ‘new normal’ affect real estate investment and what opportunities can investors expect to see?
2021 Commercial Real Estate Trends & Future of Remote Work
The COVID-19 pandemic has been the catalyst that could completely change people’s work/life balance and the way we use, or even if we use, our office spaces.
Family Office Investments: Why Debt Funds Are a Desirable Option for Family Offices
Family offices – wealth management firms catering to ultra-high-net-worth individuals and families – should find real estate debt funds to be an attractive way to increase diversity in their clients’ portfolios. Despite catering initially to niche markets, such as commercial real estate, private real estate lending has blossomed rapidly as an alternative investment in recent years, and looks poised to be a very desirable investment vehicle for high-net-worth investors.
New Home Construction Shows Greatest Increase Since Recession
Remember back in the spring, when the pandemic was just making its presence felt? Many of us thought that this would put the housing market on hold, or – at the very least – depress prices. We couldn’t imagine marketing homes in the middle of a pandemic, much less entering into a contract to build new. Yet, in fact, seven months on, that has not turned out to be the case.
Add Real Estate Debt Funds To Your Private Investment Portfolio
Why Real Estate Debt Funds Should Be Part of Your Investment Portfolio Real estate debt funds are relatively new players in the investment field, having blossomed in the wake of the 2008 financial crisis. Traditionally, investors have been recommended to look at a blend of investments, including equities, with a view to realizing capital growth over the medium to long term. Yet, real estate debt funds now form the core of many portfolios; in his blog post, Private Real Estate Debt: The Pandemic’s Impact and the Industry’s Future, Craig Solomon, CEO of Square Mile Capital writes: “Private lending has been one of the standout growth stories in private real estate over the past decade… the industry stands at $190 billion in aggregate assets under management…”
Real Estate Debt Funds: An Investor’s Guide to Higher Returns with Less Risk
An Investor’s Guide to Real Estate Debt Funds Real estate debt funds first emerged in the wake of the 2008 financial crisis, providing an efficient way to connect lenders with developers needing short-term capital for a range of commercial real estate projects. Following the crisis, traditional lenders tightened regulations and liquidity requirements for borrowers. Banks were resistant to offering loans for commercial real estate and, if they did offer loans, they placed greater focus on income and cash flow than on equity and assets. Real estate debt funds were able to service a small but potentially very profitable niche market.
SEC Amendments Widen Access to Lucrative Private Markets for Investors
New amendments from the Securities and Exchange Commission (SEC) will expand the pool of eligible investors available for private offerings, benefiting both would-be investors and companies looking to raise capital. Towards the end of last year, the SEC proposed amendments to its definition of “accredited investor” in Securities Act Rules 215 and 501(a), and to the definition of “qualified institutional buyer” (QIB) in Rule 144A.3 T. The amendments, confirmed on August 26, make more investors eligible, as “accredited investors,” to participate in private capital markets. The original definition of “accredited investor” limited investment in private offerings to those people with specific income or net worth. Previously, would-be investors were assessed on their financial profile, usually requiring a minimum income of $200,000 (or $300,000 for spouses), or a minimum net worth or asset ownership of $1 million, either individually or jointly. With the new amendments, both individual and institutional investors who don’t pass the existing tests for income or net worth but meet defined measures of professional knowledge, or expertise, may now qualify to be “accredited investors.”
Commercial Real Estate Tax Breaks Under CARES Act
Tax Breaks Offer Relief for Commercial Real Estate Owners Needing to Repurpose or Reconfigure Existing Space to Accommodate Social Distancing The current crisis is forcing many rapid changes to be made in the use of commercial real estate space – at considerable expense. Now, there is at least some good news for those struggling with the cost of making major interior changes to their commercial space, thanks to generous tax incentives for qualified improvement property (QIP) under the umbrella of the Coronavirus Aid, Relief, and Economic Security (CARES) Act. These tax breaks can help alleviate the financial costs of redesigning and repurposing commercial space. The key to benefiting from these incentives is the interpretation of QIP, which now includes any non-structural improvement to the interior of an existing building, necessitated by the need for social distancing.
