Seek, Select, Sit BackˇK
Zeppelin Real Estate Analysis Limited
This is what an ideal real estate investment fund, or for that matter
any investment fund, should do. Nonetheless, due to a variety of
reasons, this is not always the case. Sometimes this is understandable
as actual circumstances may be quite different from what are anticipated
thus requiring constant strategic and tactical changes, yet sometimes
this is not overly excusable due to poor investment insight, planning,
and / or execution. Here what we mean by seek, select, and sit back (and
= this refers to seeking desired / intended / targeted / suitable real
estate properties which in turn implies prior vigorous researches
into potential real estate markets and sectors and honest assessments of
oneˇ¦s return requirements, risk tolerances, and resource capacities.
Sometimes there should be no seeking at all IF oneˇ¦s return, risk, and
resource parameters are unrealistic or not quite matching what are available
= assuming oneˇ¦s investment criteria and parameters make sense, there could
be more than enough potential real estate opportunities from which to
choose. While ones that are subsequently revealed to be not quite matching
oneˇ¦s investment criteria could be discarded with relative ease, others that
satisfy the investment criteria and appear to be on similar par with one
another may present a challenge to the investment executives. A well thought
out investment analysis and evaluation process may help toward making
the best possible investment decisions in an efficient manner.
(and relax) = assuming oneˇ¦s seek and select stages are well carried out,
and that there are no immense and unforeseen circumstances which drastically
alter the investment parameters, this stage will start to bring in the
anticipated investment benefits (rental revenues, sales proceeds etc)
requiring perhaps just the basic property management and portfolio
much effort and hard work are involved in seek and select stages,
while the sit back stage (as its term indicates) is (or should be)
relatively uneventful. Say if an investment fund is based on a 5 year
horizon, then 1 year may be spent on seeking (researching various markets,
building up the required professional teams and logistics etc), another year
on selecting (properties being constantly acquired and transactions
completed etc), and the remaining 3 years in a sit back mode (revenues
starting to roll in and dividends paid out to investors etc).
investment managers may deem the above too simplistic a picture.
Admittedly it is (and it has to be given the limited space allowed for each
article), yet simple plans and operations generally have a higher chance of
success than overly (and sometimes unnecessarily) complicated ones given all
things being equal. Also, investors are not interested in the managersˇ¦
demonstration of high intellect and sophistication, but in the investment
results instead. For starters, your humble author is wary of investment
managers who seem to have to work too hard ALL the time scrambling from one
investment type to another and being all over the place apparently without
any coherent investment plan or even a concept.
proclaimed by an architectural master, ˇ§less is moreˇ¨ perhaps
holds true for investment operations too.
The article and/or content contained herein are for general reference only
and are not meant to substitute for proper professional advice and/or due
diligence. The author(s) and Zeppelin, including its staff, associates,
consultants, executives and the like do not accept any responsibility or
liability for losses, damages, claims and the like arising out of the use or
reference to the content contained herein.
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