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Investment Approach

Asset Focus - Commercial Real Estate

The Value of Commercial Real Estate in a Diverse Portfolio

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  • Diversification: Real estate often displays low-to-negative correlation with traditional asset classes like stocks and bonds, offering a stabilizing effect in varied market conditions.

  • Compelling Performance: Historically, commercial real estate has delivered competitive returns, often outpacing traditional investments in certain market conditions.

  • Inflation Hedge: As tangible assets, properties often appreciate over time, acting as a safeguard against the eroding effects of inflation.

  • Tax advantages: Real estate investments offer tax advantages such as deferral, loss flow-through, and non-taxable capital gains.

  • Substantial Market Share: Commercial real estate constitutes a significant slice of the global investment pie, with estimates ranging from 15% to 25%, depending on the source.

  • Robust Cash Flow: Real estate investments consistently provide a reliable stream of income, enhancing portfolio liquidity.

  • Tangible Assurance: There's a tangible, familiar comfort in "bricks and mortar" investments—a physical asset one can see and touch

Real estate consistently plays a pivotal role in the portfolios of affluent investors. A survey of individuals with over $1mm in investable assets—55% of whom invest upwards of $30mm—revealed an average allocation of approximately 15% to real estate. This figure is on par with many institutional investors, including pension funds, endowment funds, and insurance companies. Furthermore, Family Offices—with a family's assets exceeding $50mm—real estate's prominence is even more pronounced, accounting for almost 25% of their portfolios

 

The data underscores the significance of real estate as a cornerstone asset for building and retaining wealth.

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For a deeper dive and sources of the surveys, please refer to the "Resources" page.

HNWI Asset Allocations

* 3,171 High Net Worth Investors surveyed.

Net Worth Bands:

11% - $1mm to $5mm

34% - $5mm to $30mm

55% - $30mm+

Source: World Wealth Report 2023 - Capgemini Research Institute

Investment Style - Value-Add

We have successfully navigated the full spectrum of commercial real estate investment styles, from the steady yields of Core (simply put: buy wisely, manage effectively, distribute income, then sell) to the ambitious endeavors of Opportunistic ventures (like speculative ground-up developments). Through this journey, we've recognized our niche: Value-Add investments. It's here, at this sweet spot, where our distinct expertise, hands-on management approach, and passion converge, consistently driving superior risk-adjusted returns for our investors.

Private Equity Real Estate Strategy Types

Capital Market Focus - Private Equity

Private Equity is organized capital that is not traded on a public stock exchange. These are unlisted enterprises that are often funded by institutions and high-net-worth investors. Investments can range from operating companies (e.g. PetSmart) to real estate (e.g. Amazon Warehouses) to infrastructure (e.g. hospitals, roads, etc). They can take the form of singular ownership up to massive, pooled funds.

 

Private equity offers access to exclusive investment offerings and removes the “rollercoaster” temperament accompanying equities traded on major stock exchanges.

 

TREC deals exclusively in Private Equity for Real Estate (PERE).

 

In simple terms, we source real estate investments and manage them on behalf of a group of investors. By apportioning investments to multiple investors this gives the investor the following benefits:

  • participate in assets not otherwise affordable;

  • increased diversification;

  • removes the need to be actively involved; and

  • gives investors access to professionally skilled resources

 

Private Equity is the dominant capital source for Canadian Real Estate​

Canadian Real Estate Capital Sources

Our Role

At TREC, we stand as the pivotal coordinators in the investment process, aiming to maximize returns for a select group of investors. We lead the entire investment lifecycle, leveraging our unique strengths, extensive network, and expertise to assure optimal outcomes.

 

Our comprehensive suite of services includes:

 

  • Strategic Planning

  • Sourcing Premier Real Estate Investments

  • Feasibility Analysis and Financial Modelling

  • Deal Negotiation and Structuring

  • Debt and Equity Financing Arrangements

  • Meticulous Due Diligence

  • Asset Management and Business Strategy Formulation

  • Renovation Oversight and Repositioning

  • Leasing Decision-making and Occupancy Maintenance

  • Physical Maintenance and Property Manager Direction

  • Construction Project Management

  • Ensuring Market Awareness and Financial Management

  • Budgeting, Cash Flow Management, and Investor Distributions

  • Comprehensive Accounting and Reporting

  • Corporate Administration, Stakeholder Relations, and Management

  • Property Disposition and Corporate Wind-Up

 

We are dedicated to each stage of the investment journey to consistently deliver beyond expectations. At TREC, expertise meets execution.

Tempus Real Estate Capital's Role
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