Management believes that while these are terrible times to sell real estate, it is an unbelievably great time to purchase it. The economic downturn has generated ample opportunities to obtain excellent returns by buying distressed real estate assets at low price levels.
We believe that the correlation between real estate properties and prices will eventually return to its historic trend line of long-term appreciation.
Land cannot be moved, manufactured or outsourced. It is an essential building block for a growing society and there is no substitute for it. Investing in land is investing in a tangible asset that is a necessary aspect of life and progress.
Risk will be minimized through acquiring and owning diversified (type and location) real estate.
Cash is King: as credit markets have tightened, highly capitalized investors can maximize returns by acquiring high quality assets at low price levels.
Current state of capital markets: as credit is tight, it is difficult for many homebuilders and lenders to hold excess lots, land and under or non-performing real estate assets. Many companies that hold real estate are disposing of it or considering entering into sale-and-leaseback agreements.
Government regulation and policies: favorable government policies aim to curb the downward trend in the financial and real estate sectors via stimulus packages (with key objectives to kick-start the economy and increase and stabilize home ownership).
Social trends: home ownership is a fundamental part of the American dream and land is essential for this.