Building Wealth, Brick by Brick
In the world of finance, investment banking is often viewed as an overarching asset management and fiscal management that a bank will do on behalf of a company. Typically, when we think of this topic, most people assume that only the largest companies in the world can afford to use the services offered by banks like JPMorgan and Barclays.
Beyond the generic services offered, though, real estate investment banking is a very useful tool for various investors throughout the world. Generally speaking, investment banking for real estate covers three separate dynamics. These three topics, which will be covered in depth below, are as follows:
- Building your portfolio.
- Managing your existing holdings.
- Planning and facilitating real estate transactions.
Assuming you have or are looking to delve into one of the three topics covered below, consider engaging with real estate investment banks to assist you in your development.
Building Your Portfolio
When it comes to building a real estate portfolio, a lot of people simply don’t know where to start. By hiring a real estate investment bank, they’ll help you weigh out and plan every facet of an investment portfolio in the field. The bank will first weigh risk versus rewards for any investment opportunity that you provide them.
Taking it a step beyond that, though, the investment bank will facilitate all aspects of portfolio building, ranging from outlining an initial investment strategy to coordinating the purchasing and closing process for any assets that you decide to pursue.
Building a portfolio is imperative to establishing yourself in the real estate investment market, largely because this will set you up for the future success you seek. Consulting with an investment bank for asset management and financial services can pay dividends down the road. Remember, these investment bankers have decades of experience and can provide an entire team that will deploy their various expertise and specializations to assist in building the best portfolio to suit your desires or needs.
Whether you are looking to purchase or build a handful of real estate properties or create a real estate conglomerate, hiring a real estate investment banking team could help establish and build your portfolio!
Managing Your Existing Holdings
Managing your existing portfolio and holdings is just as important as building your portfolio initially. When you hire an investment banking real estate team to manage your existing holdings, you can expect the following services:
- Analyze cash flows and returns.
- Maximize value.
- Assess the performance of assets.
- Coordinate leasing activity.
- Much, much more.
These services are imperative to establishing success in a very competitive real estate market. As an investor, you might already have existing investments and holdings; however, they might not be the most optimized to maximize your returns and values.
By hiring a real estate investment bank to help manage your existing holdings, you will be able to maximize the returns on your portfolio and learn various tips and tricks to extract more value than you otherwise would’ve! Activity in managing your existing holdings might not always be an “active” role of managing from the bankers; they will also play pivotal roles in budgeting, forecasting and analysis in the background to provide you with the best components of advice and asset management to improve your portfolio.
Planning and Facilitating Real Estate Transactions
Of the three primary services offered by real estate investment banking, this is arguably the most important or justifiable to hire a bank. While the prior two categories could be carried out and fulfilled on your own, planning and facilitating various types of real estate transactions is much more difficult without the necessary experience.
These bankers will help with virtually any and every aspect of the transaction that you might pursue, including the following:
- Mergers.
- Acquisitions.
- Debt Financing.
- Property Valuation.
- Sales or Exchanges.
Each of the above transactions will require their own attention and assistance from the investment bankers – ultimately, this is arguably the greatest justification for hiring a bank to assist with your real estate investing and development. These bankers have contacts and connections throughout the industry, greatly increasing your odds of facilitating a sale, merger or acquisition (among other transactions).
From Blueprint to Portfolio
At the end of the day, many real estate developers or investors choose to avoid hiring or working with a real estate investment bank. With that being said, various reasons and justifications point to the fact that hiring a team of bankers will have a better upside in the long run for your portfolio and investments.
Consider your portfolio and fiscal position and how you want these circumstances to change – depending on your response, investing in real estate investment banking might be in your best interest!