Global Real Estate Investment - Orbvest Specialized Investment

ORBVEST CEO UPDATE - OCTOBER 2021


Global outlook
 
As we conclude the 3rd quarter and enter into the 4th quarter of 2021, it is extremely encouraging to note and acknowledge that the world appears to be finally gaining the upper hand with regards to the Covid pandemic. Optimism in most countries across the globe has been spurred on by accelerating demand for products and services and people can now look forward to once again traveling and planning their futures.
 
This surge in demand has led to supply chain disruptions which in turn has led to upward pressures on pricing globally and possible medium term inflationary concerns.
 
Within the US, the federal reserve has indicated that interest rates will begin rising in 2022, however they have indicated that they believe the supply constraints and inflationary outlook may be temporary in nature.
 
OrbVest continues to closely monitor the various interest rate perspectives, given that rates are a key driver within our existing portfolio and new acquisitions going forward.

Notable events 

We have continued with our aquision plans in Florida, closing on a portfolio of two buildings known as Medical 33 in Orlando. These buildings are superbly located opposite a hospital and a newly constructed cancer center and should deliver solid dividends going forward. In addition OrbVest concluded our first primarily dental portfolio, namely Medical 35, in Atlanta.
 
During the month of November we plan to close Medical 34 in Cincinnati and launch Medical 36 on the platform. 
 
In the last quarter we also introduced our Triple Net lease (NNN) product and we are excited to bring you this portfolio of triple net lease buildings, which provides diversification among established buildings and tenants, combined with long leases.

US real estate 

Excess liquidity in the US and a potentially over-priced equities market is driving an increase of new entrants into the real estate sector. This is a trend across all niches and is leading to increased pricing and competition of assets. In turn, increased prices will impact returns on acquisitions going forward.
 
OrbVest is therefore focusing our efforts on expanding our brand and our network across the US which will assist us, in sourcing additional off-market deals and provide a sustainable pipeline of great deals to our investors globally.

Part of what I do is to ensure our investment mandate is on point, and I have just attended the annual Medical BOMA conference which ended late Tuesday night. Machiel Lucas, Andrew Fotos and I had a full day of networking, cementing relationships and listening to powerful panel discussions.
 
The output from the conference is that Healthcare Real Estate is now mainstream and enormous liquidity and demand continues to flow into the sector, given its proven resilience and stability. This in turn is compressing cap rates and almost all industry thought-leaders believe that cap rates will continue to compress over the coming 2 to 3 years due to the cap rate differential between medical real estate (around 5% - 5,5%) and solid industrial and multi-family at around 4%. The message from all role-players was unanimous yesterday – they are aggressively growing their portfolios in the coming year ahead, given their bullish stance and upside going forward. I am really pleased to say that we were well received and are building a really solid name in the half a trillion MOB industry.

Conclusion 

We are committed to making the process of investing in medical real estate as easy as possible for you to invest and manage your medical commercial real estate portfolio. Our website continues to evolve and expect to see some exciting changes in the months ahead.

Like with any other business or real estate investments at this time, challenges can and sometimes do arise. When problems do arise, such as recent delays in leasing up on some of our older investments, we have the resource and teams available on the ground in the US (headed up by Machiel Lucas and Andrew Fotos) to address and resolve these challenges.
 
Finally, as the US enters its winter season, OrbVest looks forward to closing off the 2021 year, with further growth and success.

 


 
Martin Freeman
OrbVest CEO



 

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