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Strategies for high-net-worth and family office investors

On Behalf of | Dec 4, 2017 | Uncategorized

Kansas City is one of the commercial real estate markets in Missouri that is currently recommended to family offices and high-net-worth investors who wish to avoid competing with institutional and foreign investors. Increasingly, these types of investors are looking beyond so-called “gateway” cities to other markets. The multifamily property market has become particularly competitive. However, there are a number of deals available under $10 million that require some work, and these could still be lucrative.

Geopolitical instability and a strong dollar are two factors that have resulted in $61 billion in foreign real estate investments in the industrial sector since 2010. San Francisco and Los Angeles are among the most popular markets for this type of activity. One survey found that foreign investors may also start moving more into non-gateway markets within the next year, but those types of investors are still reluctant to go far outside their usual markets.

While properties in non-gateway markets may have lower liquidity, they are also lower in price. However, they may still be out of reach for local investors, which makes them both attractive and available to high-net-worth investors and family offices. Other sectors that might see somewhat less competition from foreign investors include data centers, retail, industrial, office and student housing, although none are entirely out of reach of a foreign investor bidding war. Experts recommend value-add assets.

Developing these properties may introduce an entirely new set of challenges, even for experienced investors. Investors and developers might want to work with an attorney on a number of issues. For example, an investor might run into a zoning issue regarding the use of the property. Before construction begins, the investor might want an attorney to draft and review any contracts. Finally, an attorney may be able to help with any legal disputes that arise.