Strong opportunities remain for real estate investment.Last year proved tremendously successful for RiverOak Investment Corp., a unique real estate investment fund sponsor that occupies a vital niche in the universe of equity players by providing its investors--high net worth individuals--with an unprecedented opportunity to invest in real estate outside the conventional debt and equity markets. Six years ago, the concept of individual investment in real estate had not even appeared on financial advisors' radar screens. As a rule, high net worth individuals were expected to plow plow or plough, agricultural implement used to cut furrows in and turn up the soil, preparing it for planting. The plow is generally considered the most important tillage tool. all of their investment dollars into a portfolio of diversified diversified (di·verˑ·s stocks and bonds. My firm, which specializes in offering opportunistic opportunistic /op·por·tu·nis·tic/ (op?er-tldbomacn-is´tik) 1. denoting a microorganism which does not ordinarily cause disease but becomes pathogenic under certain circumstances. 2. real estate investments to individuals, was in its start-up stage at the time and we struggled to capture the attention of financial advisors. Most wouldn't even talk to us about investment in private real estate funds as a valuable diversification Diversification A risk management technique that mixes a wide variety of investments within a portfolio. It is designed to minimize the impact of any one security on overall portfolio performance. Notes: Diversification is possibly the greatest way to reduce the risk. itself from stocks and bonds. Today, all that has changed. RiverOak Investment Corp. has almost fully invested its third investment fund, which was over-subscribed, and is laying the groundwork for our fourth fund, which will start raising capital in March. RiverOak Realty realty n. a short form of "real estate." (See: real estate) REALTY. An abstract of real, as distinguished from personalty. Realty relates to lands and tenements, rents or other hereditaments. Vide Real Property. Fund IV will be larger than previous funds, raising up to $50 million for investment, and will focus on a broader geographic scope than previous funds, concentrating on markets between Boston, MA and Raleigh, NC. It will also target slightly larger investments up to $6 million each with an average around $3 million Our funds track the changing opportunities in the broader real estate market. Our first fund did a lot of office and industrial investment, while the second did more apartments and office. Fund III focused primarily on the residential sector, including single-family properties and condos, and is about to make a hotel investment. We anticipate that our next fund will do more apartment and hotel investment, including some high-end housing in the New York metro For the region, see . Metro New York is a free daily newspaper in New York City started in 2004. Its main competition is AM New York, with which it practices many of the same distribution and marketing strategies. area. The multi family residential market will continue to be good because so many units have been converted to condos and there is not a lot of new construction, and we believe the hotel sector will be attractive, especially in major cities. RiverOak's investors own real estate--not stock--but do not hassle Hassle () is a location in Närke, Sweden, where a Celtic treasure was found in 1936. It comprises a large bronze cauldron which contained two Bronze Age swords of the Hallstatt type, a pommel of bronze, two bronze buckets with with day-to-day direct property ownership issues. And unlike funds or syndication deals which invest in single assets, RiverOak's current investors own multiple properties throughout the Boston-to-Washington, DC corridor. RiverOak's funds offer "diversity within diversity": diversification away from the equities market; and the diversity of multiple investments in multiple locations and in multiple product types within each fund, which further spreads the risk. Our partners are real estate developers or operators who pay slightly higher returns for equity financing Equity Financing The act of raising money for company activities by selling common or preferred stock to individual or institutional investors. In return for the money paid, shareholders receive ownership interests in the corporation. that fills the last "gap" to complete their transactions. RiverOak's "gap equity" is usually a small fraction of a transaction's total capitalization Total capitalization The total long-term debt and all types of equity of a company that constitutes its capital structure. total capitalization See capitalization. , but it saves developers' time, and frees up their capital for other projects and opportunities. RiverOak is the only real estate fund that does not charge fees of any kind. The only costs are the actual costs to cover operating costs operating costs npl → gastos mpl operacionales of the fund (less than 3% of the fund's capital). In this way, the principals of RiverOak--who do invest in the fund themselves--only profit if the investments themselves profit. Unlike all other funds, RiverOak does not profit from the management of the fund itself, only from its performance. RiverOak is lean, streamlined, nimble nim·ble adj. nim·bler, nim·blest 1. Quick, light, or agile in movement or action; deft: nimble fingers. See Synonyms at dexterous. 2. and non-bureaucratic. Each of the operating principals has more than 20 years of experience in all phases of real estate investment and management--essentially having proven their business model while working within other corporations. RiverOak performs its own due diligence Research; analysis; your homework. This term has caught on in all industries, because it sounds so "wired." Who would want to do analysis or research when they can do due diligence. See wired. and investment modeling. We believe that 2006 holds tremendous promise for strategic real estate investment. The principals of RiverOak look forward to continuing to provide a unique opportunity for high net worth investors without the hassles of day-to-day issues associated with real estate ownership. Our diversity of investment and market experience provide a successful formula that has produced an 85 percent retention rate from fund to fund, and we look forward to broadening our reach this year. |
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