The Next Big Thing

Investors and developers are always looking for the next big opportunity, and these days there are plenty of them. What’s more, there are quite a number that so far appear to have strong growth prospects, able to withstand recession and likely offer promise for years to come.

Got a bent toward healthcare? Both the seniors housing and life sciences sectors are in need of more properties. Education? Universities need housing, laboratory and classroom space, and they are increasingly seeking the capital and expertise of the private market. Technology? Corporations are outsourcing their data centers. Energy? A wide variety of property is needed along many of the active shale formations. And those players already well entrenched in these markets are reporting very attractive returns.

Of course, nothing is ever that simple. Some of these opportunities come with a lot of risk, and there is plenty of competition vying for the best locations, partnerships and tenants. Experts in a number of these sectors are already warning about some possible overbuilding. And while financing is in good supply, reports across the board have it moving with caution: conducting extensive underwriting, limiting availability to investors experienced in the specific sector or with experienced partners, favoring those with an operating plan or at least a history with the lender.

Read the full editorial in the September 2014 issue of CPE. Access is free!