Which asset class or, in the case of real estate, A, B or C location? These are the questions we are asked in interviews and which are most frequently reported in the media. However, LHI knows that there is one point that is at least as important for investors:
Who do I invest with
For family offices, asset preservation and growth are generally important, while institutional investors value income-generating distributions. Here you can see how difficult it becomes when these two investor groups are invested together.
This was also evident during the financial crisis. Regulated investors had to push for an exit for liquidity reasons, whereas family offices, for example, did not understand why they had to sell at rock-bottom prices.
Today, on the other hand, due to the current high sales prices and pessimistic NAV expectations, family offices are happy to exit real estate funds and realize the profits. However, the current market environment makes it difficult for insurance companies to find a new investment opportunity, which is why they prefer to remain invested as a cash flow-oriented investor group.
For both groups of investors, decisions have to be made quickly. I therefore have to reach a joint decision with my co-investors quickly. It is therefore not surprising that the trend is towards single-investor vehicles. This eliminates the need for coordination processes that delay decisions, which can mean that attractive assets cannot be secured in the short term, for example.
That’s why we take great care to ensure that we unite homogeneous investor groups in our investments, says Dieter Seitz, Managing Director of LHI Capital Management GmbH. As a result, our investors reach agreement more quickly and the due diligence process is shortened. This makes it possible to reach important decisions quickly and to the satisfaction of the investors.
If you would like to find out more about our investments, we look forward to hearing from you.
Your contact person
