Real Assets Adviser

July 1, 2019: Vol. 6, Number 7

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From the Current Issue

Airbnb vs. the hotel industry

More than 2 million people stay in an Airbnb every night, making it a disruptive force in the travel industry that cannot be ignored. What started as two roommates trying to earn some extra cash to pay their high San Francisco rent has turned into a travel tech behemoth valued at $38 billion.

Do not wait too long: The importance of succession planning

Given many firms in the real estate space recently have taken on the task of succession planning, it seems like an opportune time to encourage those who have put it on the backburner to change their priorities. We talk with senior executives of fund managers and operating companies, and one thing is clear — they are focused on growth, their investors, their P&L, their employees, and not what happens if they aren’t there anymore. They see succession planning like writing a will, a task for the day after tomorrow. A day that never comes. We tell our clients implementing a succession plan is critical to a firm’s long-term success, value and longevity. It is particularly vital for companies where the current successes and value are critically tied to one or a handful of individuals.

Ten good years: Attractiveness of infrastructure has increased over the past decade

Infrastructure investing has taken a transformative turn over the past decade. While the design, building and maintenance of projects was primarily in the hands of all levels of government (depending on the needs of the project), those projects have moved more into the hands of private investors. According to a report by PwC and the Global Infrastructure Investor Association, more than $200 billion has been raised by specialist funds since 2006, with at least the same amount allocated by pension funds and other direct investors.

Using the tech effect to supercharge AUM

It should be no surprise that leading wealth advisers, including Charles Schwab, Vanguard and others, have taken their advisory platforms online. Betterment, an online robo-adviser, has only been in existence since 2008 but now manages $16.4 billion in assets. How can an online advisory provider such as Betterment attain considerably more AUM than many brick-and-mortar advisory firms that have been around for 50 years or more? The answer: Effective technology and a strong online presence.

Technology is finally feeling its age at senior living centers

The Jewish Senior Life campus in Rochester, N.Y., is not small latkes. With 1,000 employees, it is one of the largest employers in the city as it offers such services for the elderly as independent living, assisted living, memory care, skilled nursing, adult daycare and outpatient programming. The community even has its own IT (information technology) department, which developed a mobile app called JSL Connect. It is downloadable from iTunes and Android stores. Recently, the senior community formally connected with the Rochester Institute of Technology to innovate tech programs throughout the campus.

Driving conditions: What is fueling the global outlook for real estate in 2019 and beyond?

What is the best route for investors in real estate in 2019? Steady as you go or all change? The outlook for real estate fundamentals globally in 2019 remains generally positive, although the pace of improvement appears to be moderating amidst a slowing global-economic-growth backdrop. A slowing in the pace of monetary-policy normalization appears set to provide an extended window of opportunity for execution of existing strategies in the capital markets. Taken together, this suggests promising conditions for investors to keep moving forward steadily on their existing route.

Warehouse demand wearing thin: Data finds industrial real estate’s golden run is ending

Industrial real estate — widely considered the “property type of the year” for years running — might be seeing its reign come to an end. According to a new forecast published by the Deloitte Center for Financial Services, it may not be easy for the industrial sector (encompassing warehouses, distribution centers, flex spaces and other industrial buildings with storage facilities) to sustain its momentum over the next few years.

The space economy: Yes, infinite investment opportunities — but also some outsized ambitions

Space is more important to modern business than most investors realize. It plays a role in making food, pricing insurance, and steering self-driving cars. While moonshot projects from SpaceX to Blue Origin drive headlines, the Earth-facing space economy is booming thanks to plummeting costs of entry. As tech companies large and small compete to launch thousands of satellites, it is easy to forget that space used to be the domain of national governments. Today, it is fast becoming the arena of private enterprise.

5 Questions: Here comes digital securities and assets

Digital technologies are changing virtually everything, and investment is no exception. Digital assets and securities are in the offing and, if they live up to their billing, will bring many new opportunities to investors. One of the avid observers of this tech wave is Scotte Carter, co-CEO of Monolith Global Partners. (along with co-CEO Chad White).

Not your average Joe: Blackstone is aiming to play a major role in private wealth, and one of the firm’s point men is Joseph Zidle

One of the most striking things about Joseph Zidle is that he personally replies to emails sent to his address — and swiftly. There is no executive assistant with a yoga instructor’s velvety voice, no phalanx of communications professionals running interference, and no cadre of compliance officers ensuring that anything said adds up to one big equivocation. It’s just Joe.

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