Real Estate has long been considered a source of significant, stable returns for global investors. The popularity of real estate investment is undeniable given its annual worldwide transaction volume of approximately US$660 billion, a figure that is steadily rising.
Conventional methods of investing in real estate are fraught with inefficiency and disadvantages. Additionally, local marketplace knowledge is essential in order to gain access to high-quality deal flow, an obstacle that many investors fail to take into account. Without knowledge of the local conditions and constraints, the potential for return on investment is severely limited while the risk increases.
The REIT model enables access for investors with smaller amounts of capital, but the minimum investment amount is simply too high for the majority of the population. And for those who do invest, these vehicles introduce expensive management fees, prohibitive regulations, and inefficiencies.
The market capitalization of global stock markets is equal to $73 trillion, compared to the estimated value of $217 trillion for developed real estate. Investment opportunities are endless, however, a substantial amount of capital is required to realize above average returns, making this asset class out of reach for most individuals.