Foreign Property Investors Hedge Bets Declining as U.S. Interest Rates Dip

CBRE | July 16, 2019

Foreign Property Investors Hedge Bets Declining as U.S. Interest Rates Dip
According to CBRE, with the sharp drop in U.S. interest rates in 2019, the differential between U.S. rates and those in countries with lower-yielding foreign currencies has narrowed, contributing to lower hedging costs for foreign investors acquiring U.S. dollar-denominated assets. Across eight major global currencies, the annual cost of hedging against U.S. dollar (US$) depreciation has decreased year-to-date for all but the Australian dollar (AU$). Except for Chinese (CNY) investors, who are the only ones in this group to achieve a boost in IRR when purchasing an asset in US$ and hedging back to local currency at current forward exchange rates, Canadian (C$) investors currently have the lowest hedging costs. The largest decreases year-to-date have been for Japanese (JPY) and Singaporean (SG$) investors.

Spotlight

If you're a new investor looking to land your first investment property, let Brandon Turner help you start your path with this video, where Brandon shares 4 steps every new real estate investor needs to take in order to land their first rental property with confidence and success.

Related News

REAL ESTATE INVESTMENT

Bascom Group Wraps Up the Year, Acquiring a 320-Unit Multifamily Acquisition in Florida

Bascom Group | December 28, 2021

The Bascom Group, LLC ("Bascom") has acquired a 320-unit apartment community within the Orlando MSA in Florida. The property, Enclave at Lake Ellenor ("Enclave"), was acquired for $68,500,000 or $214,063 per unit through a partnership with East Hill Capital's Duff Bedrosian and Leste Group, a Miami based investment manager. Enclave is the second property acquired by Bascom in partnership with East Hill Capital and Leste Group. Starwood Property Trust provided the debt financing for the acquisition and was arranged by Charles Foschini, Christopher Apone, Shannon Wilson, and Scott Wadler of Berkadia. SD Cap will provide renovation management and Cushman and Wakefield will provide the property management. Enclave at Lake Ellenor was a unique opportunity to acquire a centrally located, ultra-low-density property with significant unrealized renovation potential in the rapidly growing Orlando market. Enclave is perfectly positioned within reach of business hubs, world-class attractions, and educational centers. Orlando benefits from a diverse and well-educated workforce, business-friendly government, and competitive tax climate, making the city an ideal location for businesses." Bascom's Senior Vice President & Principal, Jim Singleton. Enclave at Lake Ellenor is located in Orlando, an area experiencing substantial growth due to Florida's rapidly growing economy. The property's proximity to major roads, such as Interstate 4 and the Florida Turnpike, allows convenient access to retail, entertainment, dining, and major employment centers throughout the Orlando metro. Bascom plans to renovate the units while presenting a significant discount to the price point of new construction. Aside from unit renovations, Bascom will enhance property exteriors and implement amenity additions, while improving operational efficiencies and strengthening their presence in the Florida market. Orlando's affordable, low-density housing, pro-business environment, no state taxes, and tourist rebound since the pandemic have established the MSA as one of the most resilient apartment markets in the country. Enclave at Lake Ellenor is extremely well-positioned for the team to implement institutional management and execute a strategic renovation plan. Bascom will renovate unit interiors with new appliances, countertops, backsplash, cabinetry work, as well as plumbing and light fixtures. In addition, Bascom will modernize the clubhouse, fitness center, and pool areas. As the Orlando economy continues to rebound from the effects of the pandemic, in-migration trends are projected to persist, making this a great opportunity for us." Bascom's Senior Vice President of Operations, Tony Ferrell. About Bascom Bascom is a private equity firm specializing in value-added multifamily, commercial, and non-performing loans and real estate related investments and operating companies. Bascom sources value-added and distressed properties including many through foreclosure, bankruptcy, or short sales and repositions them by adding extensive capital improvements, improving revenue, and reducing expenses by realizing operational efficiencies through implementation of institutional-quality property management. Bascom, founded by principals Jerry Fink, David Kim, and Derek Chen, is one of the most active and seasoned buyers and operators of apartment communities in the U.S. Since 1996, Bascom has completed over $20.4 billion in multifamily value-added transactions encompassing 347 multifamily properties and over 89,600 units. Bascom has ranked among the top 50 multifamily owners in the U.S. Bascom's subsidiaries and joint ventures include the Bascom Value Added Apartment Investors, Shubin Nadal Associates, Spirit Bascom Ventures, REDA Bascom Ventures, Bascom Northwest Ventures, Bascom Arizona Ventures, Harbor Associates, Village Partners Ventures, and the Realm Group. About Leste Group Founded in 2014, Leste Group is a global independent alternative investment manager guided by core values of respect, creativity, and teamwork. The firm offers investors a diverse range of strategies across real estate, credit, venture, liquid markets and other alternative asset classes. Leste Group's investment teams leverage institutional-grade processes, a nimble, entrepreneurial approach, capital markets expertise, and exclusive networks to source unique opportunities and drive consistent risk-adjusted returns.

Read More

Real estate shows the slowest rate of transparency improvement despite increasing sustainability commitment and proptech adoption

JLL | July 08, 2020

Although there is greater emphasis on corporate social responsibility and a widespread use of new technologies in the commercial real estate industry, the biennial proprietary Global Real Estate Transparency Index published by JLL and LaSalle (NYSE: JLL) shows the slowest rate of transparency improvement since the period directly following the Global Financial Crisis.

Read More

REAL ESTATE INVESTMENT

Swift Real Estate Partners Announces 1111 Broadway Acquisition

Swift Real Estate Partners | August 17, 2021

Swift Real Estate Partners ("Swift"), a San Francisco based real estate investment manager and operating company, announced today, the successful purchase of 1111 Broadway in Oakland, CA. 1111 Broadway is a "best-in-class" office building located in the heart of Oakland's dynamic CBD and situated directly atop the 12th Street BART station. The 24 story Class-A office building totaling 565,877 square feet features 24,000 square foot floor plates. Tenants also benefit from panoramic views, destination dispatch elevators, onsite parking, and a recently renovated lobby. The asset is 91% leased to a premier roster of diverse tenants. Swift was represented by Jack Machalow with Orrick. "We celebrated our eleventh anniversary in July and are continuing to grow and expand in our target West Coast markets. 1111 Broadway has been one of the best performing assets in Oakland since it was built and we're excited to add this marquee building to our expanding East Bay portfolio," said Christopher Peatross, President of Swift Real Estate Partners. Swift is currently investing on behalf of its third institutional value-add fund focused on West Coast office and industrial assets. About Swift Real Estate Partners Founded in 2010, Swift Real Estate Partners is headquartered in San Francisco, and has regional offices in Orange County, Portland, the San Francisco East Bay and the Silicon Valley. Swift is a vertically-integrated real estate investment firm which seeks to generate superior risk-adjusted returns for its partners. Swift acquires and repositions office and industrial assets in select West Coast markets, identifying unique opportunities and executing well-defined business plans while providing real-time, day-to-day oversight for each investment. Since inception, Swift has owned and operated real estate valued in excess of $4 billion across more than 10 million square feet. Swift is currently investing on behalf of its third institutional investment vehicle, Swift Fund III. Swift's professionals bring experience encompassing all aspects of real estate investment and management, including acquisition, financing, leasing, disposition, construction management, property management and marketing services.

Read More

Spotlight

If you're a new investor looking to land your first investment property, let Brandon Turner help you start your path with this video, where Brandon shares 4 steps every new real estate investor needs to take in order to land their first rental property with confidence and success.