High-risk Real-Estate Funds good for who?

by Kerry on August 23, 2012

“While pensions and other large investors can require a lengthy review period before their boards approve any new investment, wealthy individuals are appealing in part because they can act quickly. “They are very fast, flexible and intuitive,” Mr. Sternlicht said, chairman and chief executive of Starwood Capital.

Starwood’s fund is aiming at distressed properties and debt, and new construction, which includes a condo and hotel project near the Brooklyn Bridge in New York City. Carlyle and Blackstone group have also raised a large amount from independent investors.

“Most individual investors didn’t participate in the commercial-property bubble, so they haven’t been as shell-shocked as pension funds have after it burst, noted Vincent Costantini, chief executive of Boston-based property investment and advisory firm Roseview.”

This article by the WSJ is an excellent resource if you are looking to invest in large commercial real estate ventures.

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