Could a change in capital or product strategy uncover returns, reduce risk and deliver value even during volatile periods?
By 2022, the market is expected to recover and renew as workers return to the office and pent-up demand propels retail sales. Alternative sectors such as living, logistics and life sciences will see a surge of activity, and investors will forge ahead with impact investment initiatives. As such, investment and capital strategies suited to the pre-pandemic landscape may no longer prove profitable.
Smart investors will need to raise, invest and restructure capital in creative ways to prioritise these long-term consumer trends over short-term profit.
Reasons to reposition
Low interest rate environment
With the low-rate environment expected to persist in the coming years alongside government stimulus, allocations to commercial real estate will continue to rise. Competitive markets require more creative investment strategies such as joint ventures, re-capitalisations and platform investments.
Renewed focus on sustainability
Historically, environment and corporate responsibility strategies lose momentum during downturns as companies focus more intently on the bottom line. But investors have ramped up their sustainability efforts. Assets and portfolios with a focus on sustainability, health & wellbeing and technology will rise in demand.
Rise of alternative lenders
Real estate investors are increasingly turning to alternative lenders to help meet their financing needs and a deeper pool of non-bank lenders has opened up new financing options, including debt products, particularly in Europe and parts of Asia. Innovative financing and refinancing methods will mitigate economic headwinds and varying valuations as the market continues its recovery.
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JLL acts as lead advisor on sale of UK’s largest residential shared ownership portfolioLoan Advisory and Affordable Housing teams led the substantial transaction
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Canadian investor expands into the UK Living sectorQuadReal Property Group expands investment into the UK Living sector with the acquisition of ‘Project Harmony’ from Realstar. The portfolio consists of six PRS assets and two PBSA schemes for circa £580m.
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Innovative investment deal delivers £90 million UK housing boostUrban Splash wanted to secure investors for its modular housebuilding business. What was needed was an innovative partnership that could bring together the private and public sector to support the construction of thousands of new family homes.
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Restructuring and refinancing a major UK hotel groupShearings Hotels owned and leased 40 hotels to an operating company but they ran into financial difficulty during the pandemic. JLL advised on the restructuring and refinancing of the business, including an enforcement and asset realisation strategy.
Investors need to reposition, diversify and repurpose
Reposition, diversify and repurpose your assets and portfolios.
Traditional investment approaches are being challenged and investors need new strategies to drive returns and reduce risk.
Mitigate risk and generate greater returns.
Investors will deploy capital in new sectors and locations to mitigate risk and drive long-term growth.
Build resilience to withstand future unknowns.
Investors will repurpose existing assets to build resilience across their portfolio and drive performance.