What are the trends in real estate investing?

December 14, 2016

Panelists share leading trends in the industry, including the reallocation from stocks and bonds to real estate as well as the evolution of foreign investment.

Transcript

Brandon Weber: One of the reasons that Hightower is where we're at is there's a mega-trend that we're seeing which is just as like great reallocation of assets out of stocks and bonds into property and we're now a global company, so we're seeing it in a lot of different markets. And so when you see like the institutional investor's portfolio now contains about 9 to 10 percent of real estate, 20 years ago is about two to three percent. PWC just put out a report, they're expecting that to go up to 15 to 16 percent of a typical institutional investor's portfolio being allocated to real estate. We're talking about trillions of dollars of capital flow being pushed into our asset class, which will be fascinating. It's resulted in much larger portfolios, bigger funds, more complexity, pan geography, pan kind of strategy owners. And then you stick on top of it the United States being kind of the last bastion of security in that global flow.

David Schwarz: There's been a real evolution in education of a lot of these foreign investors where four or five years ago when they started coming to this market, it was all about yield. They want core, they wanted the best assets and they said they wanted to buy it, New York or gateway cities at a six cap - was never going to happen. So [what] we're seeing now I think is a lot of institutional investors from internationally coming and looking for development. So a lot of these investors who say we’ll take development risk if we can be in the New York, San Francisco, DC, the big gateway cities, and actually take risk and look for more all-in return versus purely just yield as they may have been looking for a few years ago.

About Kenneth Weissenberg

Kenneth Weissenberg CPA, Tax Partner in Real Estate Services, is experienced in tax saving strategies and negotiating sales and acquisitions. He represents owners of some of the most well-known real estate properties in New York City.

About Lisa Knee

Lisa Knee is a Tax Partner and Co-Leader of the national Real Estate practice and leader for the national Real Estate Private Equity Group with expertise in the hotel, real estate, financial services, aviation and restaurant sectors and is a member of AICPA, New York State Society of Certified Public Accountants and the New York State Bar Association.

Have Questions or Comments?

If you have any questions, we'd like to hear from you.

More in This Series

Fourth Annual Real Estate Private Equity Summit

Recently EisnerAmper’s Real Estate group hosted the Fourth Annual Real Estate Private Equity Summit. The event brought developers, investors, owners and operators together to discuss what’s happening on the real estate front.

What opportunities are in debt structure products across the capital stack?

With the economy in an active investment phase in debt and restructured products across the capital stack, panelists discuss opportunities they see, including transitional assets, different geographies, and non-traditional banking resources.

What is your outlook on New York City?

Panelists describe their outlook on New York and other gateway cities, looking across geographies, asset classes, and property types, as well as slowing job growth or just continued modest growth in general and retail and residential vacancies.

What do your future investments look like?

EisnerAmper Partner Lisa Knee asks the panel what their investors are looking for, the tools their investors are using to evaluate the market, the balance of supply and demand in real estate, and how they are planning the real estate cycle.

Bringing foreign capital to the US

Panelists discuss the process of bringing in foreign capital, the criteria that foreign investors look to in U.S. properties, and what kind of investments they are looking to make.

Are we in a correction? How long is it going to last?

EisnerAmper Real Estate Private Equity Summit panelists Kenneth Weissenberg, Jonathan Kaufman Iger, Leslie Himmel and Phil Watkins discuss whether the market is in a period of correction, and what’s ahead for vacancies and pricing.

What are the key buying and selling trends?

With a slight decrease in sales volume and a slowdown in the land market, Real Estate Services Partner Lisa Knee asks panelists to share the key buying and selling trends on the horizon, including insights on residential product.

How are Brexit 421A & EB-5 going to impact foreign investment in the US real estate market?

Panelists discuss the impact of Brexit, 421A and EB-5 on foreign investment in the United States, and the effects of that capital on development in gateway cities - there's a strong trend of non-US capital continuing to come and invest in the US.

Where are you getting your capital from? Is it more difficult today?

Real Estate Services Chair Ken Weissenberg speaks with panelists on the topic of where capital is coming from in today’s market, how accessible it is for new projects, and the reality of debt and equity chasing real estate.