Author: Geoffrey Dohrmann
Geoffrey Dohrmann is the publisher and editor-in-chief of The Institutional Real Estate Letter and the founder and CEO of Institutional Real Estate, Inc., its publisher.
Articles by Geoffrey Dohrmann
- Value-Add and Opportunistic Investment
Published on May 01, 2010 in Capital Markets
The primary conversation in the commercial real estate market today revolves around the substantial amount of equity capital chasing high-quality core investments as prospective buyers exhibit a high level of interest in the stability of income and an overall lower risk level. For reasons that have yet to be fully explored, there is comparatively little discussion of value-add and opportunistic space.
Value-add and opportunistic investments traditionally have been considered higher-risk strategies that use significant degrees of leverage to maximize the total return of an investment. Value-add opportunities generally involve Class B or C assets in high-quality locations that can be significantly improved operationally or rehabilitated to increase cash flow. Leverage approaching 65 percent can be used both to enhance returns and to finance part of the renovation capital.
- Insitutional Investors Commit New Capital
Published on March 01, 2010 in Market Trends
Institutional investors will not be abandoning real estate as an asset class in 2010. Instead, they will be retrenching, rethinking, and carefully dipping their toes back into the water.