The photogenic Dubai property boom is already in full swing. But, says Alexander Garrett, the emirate’s wealth of bars, shops and entertainment, and its ambitious plans for growth, mean that buying into the epic high-rise fantasy could still be a good idea

If you have never been to Dubai it is tempting to believe that it does not really exist. The more you find out about the place, the less and less likely it seems that it could possibly be rooted in reality.

Three giant artificial palm islands adding hundreds of miles to the country’s coastline? An archipelago the size of Greater London, designed to look like the world itself (where you can buy an island and turn it into whatever your fantasy suggests)? A theme park the size of Singapore, containing the Pyramids, the Taj Mahal, The Great Wall of China and a snowdome? The world’s biggest marina, tallest tower, biggest shopping mall… the list goes on.

Among the most eye-popping facts about Dubai is the sheer volume of property being developed there. According to one estimate, there are some 215 skyscrapers currently under construction in a city of 1.3 million people, with a similar number due to start building in the next two years. The big daddy of them all, the Burj Tower, will have 188 storeys - and rumour has it that if someone announces a taller building in the meantime, they will simply go higher.

Dubai has, without doubt, one of the most booming property markets in the world, illustrated by the plethora of websites selling flats and villas there. But four years after the hype began, is it a sensible place to invest in property? Or will it all end in tears, as so many property bubbles have in the past?

According to Mark Stott, managing director of developer Dubai Select, around 60 to 70 per cent of British people buying in the second-largest of the seven United Arab Emirates are of Asian origin, typically from India, Pakistan or Middle Eastern countries. ‘A lot say that it is a short- to medium-term investment for them, with a view to eventually moving there,’ says Stott.

One of Dubai’s attractions is that it is a crossroads between East and West, with some 1.2 billion people within a two-hour flight. The vision for Dubai is of a place where people come for holidays, shopping, business, sport and fun.

The general consensus is that for short-term speculative investors looking to quickly resell their off-plan property for a hefty profit, the party is over. But Victoria Finch of estate agent Cluttons, which has an office in Dubai, says: ‘People who used to buy in the Mediterranean are now buying in Dubai, and there are also people planning their retirement who want to spend six months in the sun.’

Nevertheless, she says that many potential buyers are put off by the fact that there is a lack of completed properties. Much of what is being offered today won’t be ready for three or four years.

The arguments for buying in Dubai range from the lifestyle - endless sunshine, excellent service, restaurants, shops, hotels, spas - to the investment rationale. Stott argues that with Dubai’s government aiming to boost the population from 1.3 million to 4 million by 2015, and an equally ambitious target to bring in 10 million tourists a year, the demand for apartments to rent will be unquenchable, even with the vast amount in development. He adds: ‘I genuinely believe that property in Dubai is underpriced too. Salaries of professionals there are comparable to those in the UK, with the bonus of being tax-free. But an apartment at Salford Quays in Manchester would cost you twice as much as a comparable property at Dubai Marina, and if you were in your twenties, starting out, I know where I’d rather be.’

Faced with the vast array of off-plan property available in Dubai, the question is how to choose. Stott believes Dubai Marina, where his company has been involved in developing two buildings, The Torch and The Point, is a sound choice, because it is next door to Media City, where Microsoft, Cisco, Reuters and CNN are all installed, and there’s a choice of letting to businesses or tourists. ‘Our investors want to know their property is tied up for the next 12 months,’ he says. ‘The holiday lettings market can be a nightmare to manage.’

Neil MacKenzie of property investment company Oyster International is promoting properties at a striking German-engineered building called The Cube in Sports City. ‘Some buyers think it is a good investment because of the management structure; others think it will be a good investment because Dubai is set to host major sporting events in 10 years or so,’ he says. His clients include Asian doctors, dentists and other professionals with an eye on moving to Dubai. ‘In 10 years’ time, there simply won’t be another opportunity to buy a property like that, right next to the stadia,’ he says.

The zones where non-residents can buy freehold property have been clearly laid out; MacKenzie says it’s also advisable to buy from one of the big four developers: Nakheel, Emaar, Dubai Properties and Damac.

The big money in Dubai has so far gravitated towards the Burj Tower and the Palm Islands, and the World is now ready to compete. The first of the islands to release residential property is called Perseus, and notionally makes up part of ‘Russia’ on the map. Cluttons is selling villas there starting at $2.9m, with one-bedroom flats starting at $557,000.

Anyone browsing for property in Dubai will find that the computer-generated images of islands, skyscrapers and attractions on an epic scale leave you feeling like you are in one of those massive multi-player online computer games in which there is no limit to the imagination.

It certainly requires an act of faith to believe that everything will happen just as Dubai’s effective ruler, Sheikh Mohammed bin Rashid al-Maktoum, says it will. But then a lot of people have come to believe that anything is possible in Dubai. As Victoria Finch puts it: ‘The government will simply make it work.’

Source: The Observer

Related Links:

• SkyscraperCity Forums - New UAE Developments
• Is Dubai building to much (AME Info)
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Dubai Property Agents: Dubai Select, Property Frontiers, Cluttons Dubai, Oyster International

Major Dubai Property Developers: Nakheel, Emaar, Dubai Properties, Damac

Beachside villas in Brazil, high-rise apartments in Kuala Lumpur, log cabins in Lapland … growing numbers of British property investors are looking far beyond the traditional second-home and holiday-letting haunts such as France and Spain.Armed with profits, courtesy of the UK house price boom, thousands are hoping to strike gold again by successfully picking the next property hot spot.

Many will be making a beeline for the Property Investor Show at the ExCel exhibition centre in east London this weekend. Organisers claim it is the largest dedicated property investment event held in the UK, with almost 300 exhibitors. The fact that around 60% of this year’s show will be dedicated to property outside the UK, provides proof, if any were needed, that millions of us seem to have become obsessed with owning our own place in the sun - somewhere we can escape to, or which is going to effectively be our pension when we are older.

Anyone attending will be monstered by agents and developers pushing apartments on Bulgaria’s Black Sea coast. Specialist firm Assetz recently looked at prices and rental returns in various locations and found that over the previous 12 months, Bulgaria had been the star performer, boasting a typical gross rental yield of 12% and a “total return on cash invested” of 116%.

But that was the early investors; future returns are likely to be far less sparkling. Below, we’ve highlighted some of the more exotic locations now coming on to our radar - including Lapland and Cape Verde off the African coast. Property firm, Alexander Richards, says Brazil is the place we will be hearing a lot about over the next year or two. Already prices are rising at 20%-plus a year, and the (relative) proximity of the country’s north east coast for European holidaymakers, new international airports - plus villas starting at around £75,000 - are bringing in swarms of investors. Many of the buyers are British retirees, living the good life on under £1,000 a month.

Whether any of this is environmentally sustainable is, of course, a different, but very worrying issue.

Brazil

Why there? Most holiday properties are on sale in the north east beach areas closest to Europe, from established areas such as Fortaleza and Salvador through to less developed coastal areas around Natal. Prices start at £40,000, while £150,000 buys you a luxury villa. Beachfront building plots of 500 sq metres sell for around £60,000. Prime beachfront apartments in big cities such as Rio and Recife start at £250,000-plus.

What’s on offer The three-bed villa is £75,000, 70 miles from Fortaleza. It is part of a beachfront development of 12 properties and a boutique hotel. Contact alexanderrichards.co.uk or call 020 8123 4029

How you get there Flights via Lisbon to Fortaleza. No direct flights from UK. Other Brazil locations (such as Salvador) have direct and charter flights.

Advantages More than 300 sunshine days a year. Prices in Fortaleza rising at around 20% a year (in dollars). European developers much in evidence, in the belief that there’s the same potential as Spain and Portugal 30 years ago.

Disadvantages Flights take 11 hours, cost around £850. Very underdeveloped mortgage market (repayments run over five years!) and rental market limited. Carbon emissions may make such jaunts out of the question.

Finland

Why there? If the beach isn’t your thing, how about a holiday home inside the Arctic circle? The regions of Yllas and Levi lie in the midst of the unspoilt arctic wilderness of Lapland in northern Finland. This is the land of the midnight sun and home of Santa Claus. The average house price in Finland is £105,000 and promoters say prices are set to go into orbit.

What’s on offer A one-bedroom log cabin in Yllas could be yours for £90,000, according to specialist firm Above the Arctic (abovethearctic.com). Meanwhile, £315,000 will get you a four-bed cabin with a sauna, heated parking spaces, open plan loft, two lounges, and storeroom for your skis.

How you get there Yllas is an hour’s drive from Kittila Airport and flights from the UK cost about £570. Alternatively, Scandinavian budget airline Blue1flies from Stansted to Rovaniemi (about 90 minutes from Yllas) from £81 each way - but you have to change in Helsinki and either Copenhagen, Stockholm or Oslo.

Advantages Finland is ranked among the safest and least corrupt countries in the world, and property has enjoyed decent capital growth in recent years.

Disadvantages Can be expensive and tricky to get to.

Cape Verde

Why there? Cape Verde is a group of islands 300 miles off the west coast of Africa, touted as the new Canaries.

What’s on offer Cape Verde Property (capeverdeproperty.co.uk) is selling four-bed villas in Vila Verde on the island of Sal for £250,000. However, the Delfini Resort on Boa Vista has new one-beds at £57,000.

How you get there There are no direct flights to Sal and Sao Tiago, bumping up the journey time. It’s not cheap either. Flights from Gatwick to Sal cost between £500 and £900. Direct flights from the UK to Sal start in November, bringing prices down.

Advantages Good capital appreciation over the past year. Warm and dry all year round.

Disadvantages High levels of poverty. Low rainfall leads to regular and severe droughts.

Lake Balaton

Why there? This is Hungary’s substitute for a coastline. One and two-bed apartments start at about £48,000 in the resort of Balatonalmadi.

What’s on offer BL Yacht Club is an exclusive gated development being built on the south side of Lake Balaton. Studios cost £69,950 and three-bed penthouse apartments £217,500 through property broker Big Real Estate (bigrealestate.co.uk).

How you get there FlyBalaton Airport opened in April and Ryanair flies there direct from Stansted.

Advantages Millions of yacht enthusiasts as well as Germans, Austrians and Italians go each summer. All hotels and apartments were fully booked at times this year. It’s fairly cheap and easy to get to.

Disadvantages It is something of an unknown commodity.

Montenegro

Why there? The town of Herceg Novi in Montenegro’s Kotor Bay gives you some idea of the place’s appeal.

What’s on offer Property Frontiers (propertyfrontiers.com) is selling studios for £28,000, one-bed apartments for £40,000 and two-bed apartments for £77,000, all in Kotor Bay.

How you get there Flights to Tivat Airport, 8km from Kotor Bay, start at around £666 and involve changing at Vienna. But it’s only a half-hour drive from Dubrovnik in Croatia where flights from Gatwick cost £156 return.

Advantages Montenegro is undergoing reforms designed to bring economic growth and foreign investment.

Disadvantages Unstable past, poor infrastructure and lack of budget airline access means it compares unfavourably with some other destinations.

Source: Guardian Unlimited Money - Cash Clinic - Buying Property Abroad

Related:

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Britons are travelling farther to work, on job assignments to Moscow or Budapest. Lucia Adams looks at their housing needs
EASTERN Europeans are here in a big way, we all know, but what is less apparent is that they are part of a two-way traffic: Britons are heading east for holidays and to find holiday homes — and also to work. We hop on a cheap flight to Tallinn, Warsaw or Budapest and scour the emerging property markets, buying homes just about anywhere we can place on a map. But is there money to be made? Are holiday lets in Poland ever going to be all the rage? Or might letting to expats on overseas assignments in Russia be a good bet? Britons are becoming more itinerant and there is growing demand for rentals in areas where blue-chip companies have set up shop. For buy-to-let investors who want to invest in Central and Eastern Europe, but who do not want to get involved in holiday lets, focusing on the corporate market can be a good proposition. According to a PriceWaterhouseCoopers study of trends in 2004-05, 42 per cent of 203 companies surveyed forecast growth in short-term assignments in Central and Eastern Europe. In a separate report by Pricoa Relocation in 2005, more than 40 per cent of companies questioned expected to send their staff on short-term assignments to the Czech Republic, Hungary, Poland, and Russia (see the above chart). For those on assignment, finding good-quality rentals in cities often still full of soulless, Soviet-style workers’ housing blocks can be a challenge.

Darren Dyer, who moved to Moscow as a merchandising manager with the Kingfisher DIY retail chain Castorama, says: “There are a lot of big companies coming to Moscow who want to look after the welfare of their people. But there just aren’t the places available; there is more demand than supply of properties that Westerners would be prepared to live in.”

Having relocated with his wife, Michelle, and son Cameron, 8, the family were keen to live in a gated expat community near the Anglo-American school. They were told that there was a year-long waiting list, and the minimum $7,000 (£3,750) monthly rent was higher than Darren’s accommodation allowance.

They settled instead for a three-bedroom apartment in a secure block that they rented for $5,000 a month. It was a far cry from the rural Dorset home that they left behind. Darren says: “We had never lived in an apartment — for the first six months there were no children for Cameron to play with.” Noisy building work in the block and a rent increase to $6,500 after a year prompted the family to start hunting again. This time they found a three-bedroom townhouse in the much-desired location of Pokrovsky Hills. But it wasn’t cheap. Darren says: “Rent is $8,500 month. We had to put up a $10,000 deposit and pay six months in advance.”

Liam Bailey, of Knight Frank, says that Moscow’s popularity among big European and American companies has created competition for topnotch homes, although many investors are frightened of buying there.

Other hot spots in Central and Eastern Europe include Slovakia, Bulgaria and Romania, which are on course to join the European Union next year, and the Baltic states, according to Savills. Agents in those countries say that house prices are rising by 30 per cent or more a year. In larger and more developed residential markets such as the Czech Republic, Poland and Hungary, price rises, though substantial, have been more moderate. But the demand for top-quality homes can be just as keen.

Campbell and Kirsteen Macfarlane moved from Scotland to Budapest in January for a two-year assignment with BT Global Services — Kirsteen as a bid manager, and Campbell as a sales director for Eastern Europe and Russia. Although they enlisted the help of the relocation company Inter Relocation (00361 2785680, www.interrelo.com) they had to view 35 properties before finding the right home.

They now rent a three-bedroom detached house with a swimming pool in District 2, a 20-minute drive from their office, for €2,400 (£1,630) a month (negotiated down from €3,200). Kirsteen says: “There is a massive variety in quality. Expats tend to live in certain districts — people tend to clump together either near the centre or near English-speaking schools. Americans and the French have reinvigorated this area and made it more popular.”

For the intrepid investor hoping to let to corporate employees, Charles Weston-Baker, of Savills, points to the expanding business communities in Sofia, Prague and Cracow. He says, however, that returns vary considerably, and that the quality of property must be exemplary in specification and location. “Gross yields are 5 to 10 per cent and occasionally more. With capital appreciation, we always say: be realistic. Say 5 per cent but often it can be 10 or 15 per cent. Prices can go up as well as down in value.”

Source: Timesonline

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ATHENS, Greece An international group of developers urged Greece Thursday to ease foreign investments by slashing red tape and revamping laws on property development.

Eleven mid-sized companies from Europe, Africa and Australia announced the formation of an association to lobby the government for reform.

“Greece is the ideal place for large-scale investments,” association president Clemente Pinedo said. “Our role is to be a conduit between foreign investors and the Greek government to help solve the problems faced by foreign investors.”

Despite drawing more than 14 million tourists a year, Greece has failed to attract investment in vacation homes, golf courses and resorts, because of hidebound bureaucracy and dated laws, Pinedo said.

Greece is the only country in the 25-member European Union with no national land registry, and has just 5 18-hole golf courses nationwide — in contrast to Spain, which boasts over 300 and adds 20 new ones a year.

According to Pinedo, foreigners last year purchased 400,000 vacation homes in Spain, whereas only 50,000 vacation homes in Greece are owned by foreigners.

The group complains of fragmented Greek regulations on planning permission, which involve up to a dozen different ministries and government bodies and lead to long delays.

There is also no legal framework for multipurpose developments encompassing vacation homes, hotels and golf courses together.

These are not separate pieces,” said Pinedo. “They must be all together. You must have clear rules of the game.”

Source: IHT

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Global investment in real estate may increase 26 percent to US$600 billion this year as investors chase stable returns, according to a report published Wednesday by Jones Lang LaSalle Inc.

Investment in the first half amounted to US$290 billion, with spending in Germany and Japan almost doubling, said Jones Lang LaSalle, the world’s second-largest publicly traded real estate brokerage. Investment in the Americas rose to US$129 billion, followed by US$117 billion in Europe and US$43 billion in Asia.

“Across the world, fund managers are receiving record fund inflows as populations in developed countries approach retirement age,” Tony Horrell, head of Jones Lang’s international capital group in London, said in the statement. “Many of these funds are attracted by real estate’s strong stable returns.”

Investors are buying more shops, offices, hotels and industrial properties to broaden their range of assets. Banks such as Goldman Sachs Group Inc. and other buyers are targeting countries such as Germany and Japan, where property returns have lagged behind markets such as the U.K. and Ireland.

Real estate investment is becoming increasingly global with US$128 billion, or 44 percent of all investment, spent on cross- border transactions in the first half, said Jones Lang. That was 69 percent higher than in the same period a year ago, it said.

Inter-regional spending, involving investors from outside the region where the asset is located, rose 68 percent to US$90 billion, or 31 percent of total spending, from a year earlier, Jones Lang Lasalle said.

“In relative terms, the globalization of real estate investment has had the greatest impact on developing markets, said Horrell. “In Central Europe and some Asian and Latin American markets, inter-regional investors are purchasing the majority of available prime quality stock.”

The U.S. accounted for 43 percent of all investment in the first half compared with 45 percent a year earlier. The U.K., home to the world’s most expensive offices, slid to a 14 percent share from 20 percent in 2005.

Inter-regional investment in the Americas more than doubled to US$33.5 billion, with Middle Eastern investors, buoyed by surging oil prices, accounting for 14 percent of international spending. The U.S. accounted for 96 percent of all investment in the region, with New York, San Francisco, Chicago and Boston the most popular cities for non-U.S. purchasers.

Global investors spent more than US$9.5 billion on U.S. hotels in the first half, in addition to “sizable” office and industrial property purchases, said Jones Lang.

The share of investment going to Germany doubled to 8 percent, with global investors buying more than 40 percent of all the German commercial real estate that was traded in the first half. Transactions in Germany in the first half almost equaled the total for the whole of 2005 as German investors sold a net US$24 billion of assets.

Japan accounted for 8 percent of all real estate investment, up from 5 percent a year earlier. Investment in Japan accounted for half of all spending in Asia compared with 35 percent in the same period in 2005. Investment in Asia as a whole rose 40 percent from a year earlier.

Jones Lang’s total excluded the US$30 billion spent privatizing publicly traded real estate investment trusts such as Trizec Properties Inc., as well US$16 billion on developments funded in advance and more than US$60 billion on residential apartments.

Source: China Post

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SINGAPORE (Kyodo) CapitaLand Ltd., Southeast Asia’s largest listed property developer, is poised to sharply expand its business in Japan as the economy has effectively overcome deflation, a symbol of its decade-long slump.The Singapore-based real estate giant plans to up the number of shopping malls it operates in Japan to 15 or 20 from four in two years, said Pua Seck Guan, the chief executive officer of CapitaLand Retail Ltd., the retail property business unit of CapitaLand.

In value terms, the size of these commercial investments would quadruple to 147.0 billion yen from 39.1 billion yen.

“Japan’s economy has bounced back, which gives investors confidence,” Pua said. “We believe the long-term potential of Japan is there.”

Pua cited increased consumption propelled by Japan’s sustained economic recovery, which looks certain in November to become the longest continuous expansion since World War II.

“Since Japan is one of the largest investment markets in the world, we cannot ignore it,” he said in an interview, adding that CapitaLand operates in 80 major cities in 20 countries. “Besides, it gives us sufficient return.”

CapitaLand said it has acquired 13 rental apartment properties in Japan this year, bringing to 18 the total number it holds in the nation.

With the increase, CapitaLand has committed 75 percent of 30 billion yen worth of investment in the rental apartment field, a target it set when launching its rental apartment business in Japan in May 2005 with Bahrain-based Arcapita Bank, with an eye to drawing oil money from the Middle East.

CapitaLand said it will further raise its target portfolio size to 42 billion yen within a year, with the number of properties rising accordingly, as it sees greater profits from rent when land prices in Japan show signs of bottoming out in not only big cities but some regional areas.

According to Japanese government data, residential and commercial land prices in Tokyo rose last year for the first time in 15 years, a sign the country’s asset deflation may finally have come to an end. In July, the Cabinet Office dropped the word “deflation” from its monthly economic report for the first time in five years.

To facilitate CapitaLand’s business expansion in Japan — both through acquiring existing assets and developing new ones — Pua said the company is exploring local partnership opportunities, especially with retailers.

For the rental apartment business, CapitaLand already has a Japanese partner, Samty Co., an Osaka-based real estate company, making it easier for CapitaLand to boost business in the field, especially in the Kansai region.

In China, CapitaLand has partnerships with Beijing Hualian Group Investment Holding Co., the country’s sixth-largest retailer, and Shenzhen International Trust & Investment Co. to build malls anchored by Wal-Mart Stores Inc. of the U.S. in provincial cities across China.

“We want that we can secure certain relationships or tieups in Japan like what we’ve been dealing with in China, so we can increase the speed of expanding our portfolio size” in Japan, said Pua, who doubles as CEO of CapitaMall Trust Management Ltd., which manages Singapore’s largest real estate investment trust by asset size.

Source: Japan Times Online

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Abu Dhabi: Damac Holding, the Dubai-based real estate developer, is planning a major investment in the Egyptian real estate market, a top company official said.

“We have been negotiating the issue with the Egyptian side for almost six months now, and the site will be finalised soon,” Hussain Sajwani, the group’s chairman, told Gulf News yesterday.

The value of Damac’s international expansion and projects has been on the rise recently, reaching almost Dh25 billion so far, including a Dh10 billion in China, and a $400 million in Qatar, in addition to Lebanon and Jordan.

“We also find the Abu Dhabi market very promising, given the huge projects that have been announced or are in the pipeline,” Sajwani explained.

“However, Abu Dhabi needs to open up to foreign investors in the real estate sector, as the government cannot carry out all the required development,” he added.

Rents in Abu Dhabi are expected to increase by 100 per cent in the next five years, as the city’s demography is expected to change dramatically, due to the need to upgrade existing properties.

Accordingly, a different tenant mix is expected to enter the market, with much higher income than that of the average middle class in the capital today, according to Sajwani.

He said rents in Dubai and Abu Dhabi would keep going up, but at a slower pace than hitherto as the market is maturing. “However, Dubai is still relatively cheap compared to similar places elsewhere in the world and prices will keep going up about 40 per cent in the next five years,” Sajwani said.

Abu Dhabi rents would also rise because the real estate sector had been neglected for a very long time and would be pushed higher by the wealth of the emirate and new developments in the sector.

Sajwani attributed the rising rents to rising investment costs as well as strong demand. Building materials, administration costs and land prices were all rising, he said.

“Foreign competition has been good to Dubai’s local developers, as it opened up more markets and introduced the emirate to the outside world. Abu Dhabi needs a similar kind of foreign exposure and its market need to mature as well,” he said.

With its project Ocean Scape in Abu Dhabi, Damac is the only Dubai-based developer carrying out projects in the capital city, and the company is planning to further expand in that promising market with a new sales office there to cater for its ambitious plans.

Source: gulfnews.com

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NEW YORK, Sept 12 (Reuters) - Morgan Stanley Real Estate, a division of investment bank Morgan Stanley on Tuesday said its Special Situations Fund III has raised $2.24 billion of equity to invest primarily in real estate debt and equity securities around the world.

The buying power of the fund could double depending upon the level of debt the fund will use along with its equity, said John Carrafiell, managing director and global co-head of Morgan Stanley Real Estate.

The fund will invest predominately in public or private debt and equity securities that are based on the performance of real estate assets. However the fund is not precluded from acquiring minority interests in physical real estate assets, Carrafiell said.

The fund also could invest in real estate derivatives as a hedging device.

“In that sense, we will look at derivatives to protect our return,” he said.

Investors include institutional and Morgan Stanley Global Wealth Management investors from North America, Europe, the Middle East and Asia as well as Morgan Stanley, which invested 25 percent of the total initial equity raised.

“Special Situations targets investments in market-leading real estate companies in growth and developed markets with high barriers to entry where investors often find it difficult to access deal flow, including China, India, Russia and Central/Eastern Europe where we have already deployed significant capital,” Carrafiell said.

The fund will also invest in developed markets such as Japan, the United Kingdom, Western Europe, the United States, Hong Kong and Korea where corporate and financial restructuring opportunities exist and where the private markets value real estate higher than the public markets.

“We’re looking for above-average risk adjusted returns, based on the market, the transaction and the asset we’re investing in,” he said. “The interesting thing about this fund versus a pure opportunistic fund is that it does not have a single point-return target.”

In that way, the fund will offer investors more of a portfolio-like exposure to risk, as it includes various investments that not only carry differing degrees of risk, but also react differently and sometimes opposite to different market and economic conditions. This helps mitigate risk while boosting or protecting returns.

The fund is the third in a series of successful real estate funds. Special Situations I, which is fully liquidated, launched in 1997 and invested primarily in the United States and Asia. Special Situations II launched in 2000 and invested solely in Europe

.Source: Reuters

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