REAL ESTATE

Buying real estate can be more than just finding a place to call home to Cline Investment Firm. Most people have to do a real estate transaction at some point in their lives, and some find it an intriguing opportunity for capturing and creating value. Real estate has become a common investment vehicle to Cline Investment Firm, and it continues to be popular despite a very rocky market correction in 2007-09.

Using our scale and market presence to maximize opportunity from direct and indirect real estate

Real estate has a robust track record of enhancing portfolio diversification and can deliver strong risk-adjusted returns for investors.

At Cline Investment Firm, we offer expertise across all principal real estate sectors – enabling us to target opportunities in their home market and globally.

Our success in real estate is built on deep local research, global insight and an active approach to investing and development of our real estate assets. In this way, we seek to enable our clients to benefit from global real estate themes such as demographic change, urbanization, technology plus environmental, social and governance (ESG) factors.

For a full understanding of Cline Investment Firm' Real estate expertise and global reach.

Key Benefits

Global presence – local access

Managing $51billion in real estate assets, we are one of the largest real estate managers globally committed to sustainable investing and innovative solutions for clients.

With over 270* real estate professionals in 15* locations worldwide, our scale drives credibility and deal flow. In turn, we can offer clients a comprehensive end-to-end service throughout the market cycle, spanning the real estate risk spectrum and value chain.

Direct and indirect expertise

As well as managing direct real estate assets, we invest indirectly using listed and non-listed funds, multi-manager strategies and real estate debt. By also providing related services for tax, finance and development, we’re committed to giving clients a one-stop solution for their real estate needs.

We have a deep understanding of real estate’s ability to provide a wide variety of investment opportunities. We believe the asset class is unrivaled in its ability to deliver enhanced portfolio diversification and strong, risk-adjusted returns over the long term.”

Real Estate Trading (Better Known as Flipping)

We have experts that has significant experience in real estate valuation and marketing with the right capital and the ability to do or oversee repairs as needed

Real estate trading has a shorter time period during which capital and effort are tied up in a property. Depending on market conditions, Cline Investment Firm generates significant returns even on this shorter time frame for clients.

Real estate trading requires a deeper market knowledge and a bit of luck. Hot markets can cool unexpectedly, leaving short-term traders with a loss or a long-term headache.

We have extensive experience in delivering strong, risk-adjusted returns from direct and indirect real estate, real estate multi-manager, listed real estate and real estate debt solutions for our real estate investors over the long term. With a significant presence in the market, we are ranked as one of the largest real estate managers globally. We have real estate professionals across the world covering investments, transactions and developments. They have a strong regional network of contacts and an ‘on-the-ground’ understanding of local market conditions. Our approach is global but implemented locally.The size of our real estate business combined with our presence in local markets makes us a key player globally. Agents approach us directly with investment opportunities that are often unavailable to smaller investors.We believe that our global reach allows us to uncover more investment opportunities that have the potential to enhance investors’ returns.

Key facts

• $51 billion ($68 billion) real estate assets under management
• Top 20 global real estate manager
• 1,600+ properties in 20 countries globally managed by local real estate teams in 15 offices

Local expertise and experience

With over 270 real estate investment, development, transaction and portfolio management professionals, we have a depth and breadth of experience across the globe. Our specialist teams have the necessary language skills, local contacts and expertise to really add value.

We have a well-established and long-term track record of investing in real estate markets. Over that time, we have demonstrated an ability to adapt to ever-changing market conditions, while producing competitive returns and innovative solutions for our clients.

Our large and experienced team offers clients a one-stop solution for their real estate needs. We can provide a complete, end-to-end service covering all aspects of real estate investing from research and risk analysis to tax, finance and development. Transaction teams in local markets use their knowledge and ex2022ise to ensure we achieve the best deals possible.

Building a deeper understanding of real estate markets by fully understanding the risks and drivers of return across real estate markets, we are able to position our portfolios appropriately and, in turn, unlock greater return potential.

Research and process

Research is the engine driving our success. We believe that focusing on producing global, industry-leading insights gives us a competitive edge and ultimately helps us to deliver strong performance for our clients across market cycles. The real estate industry is heavily influenced by global themes, such as demographic changes, urbanization, technology and ESG. We believe that informing our clients and colleagues promotes better decision making.

Anticipating pricing trends

Our investment process is about understanding risks and the fundamental drivers of return, while always assessing what is changing. This helps us to anticipate real estate pricing, to position portfolios appropriately and ultimately to unlock enhanced performance. Our analysis of the relationship between real estate market pricing and subsequent returns suggests that we can use our tools for asset allocation, and establishing risk tolerance for the mandates we manage.

Key elements our process include:

A global house view that informs our decisions at both a market and asset level

Proprietary, global, risk-based tools which are used to screen all investments

Bringing together the considerable insight of our real estate colleagues across the globe and across different types of real estate from direct to unlisted and to debt. Guided by this research, our investment managers look to make astute investment decisions, selecting individual assets, products and securities that offer our clients the best risk-adjusted return potential.

Balancing risk against reward

As a global player, we can tailor our investment approach to the risk tolerance of our clients. Built on the foundation of a global, consistent and repeatable approach, we aim to deliver strong, risk-adjusted returns for our diverse client base. We believe that risk strategies should be dynamic.

An ability to be flexible and to adapt our risk positions according to changing circumstances is key.

Our demonstrated ability to invest capital across multiple strategies and throughout the market cycle demonstrates our risk capability. We are able to diversify across a wide range of commercial and niche sectors, as well as by geographical locations, and we can offer a variety of solutions across the risk spectrum. This helps our clients to achieve a balance between risk and reward

A universe of opportunity to meet clients’ goals We provide solutions across the full spectrum of direct and indirect real estate – with a strong track record in innovating strategies to maximize the sector’s potential.Solutions for clients

Taking real estate global Real estate investing is becoming increasingly global as investors look beyond their traditional home market for new opportunities. This appetite to diversify and invest globally is one of the factors that motivate us to create innovative real estate solutions.We can provide a wide variety of opportunities for investors including direct property (bricks and mortar), indirect property (shares and bonds), real estate lending and multi-manager. Thanks to this broad expertise, we can offer a range of strategies to meet our clients’ goals and to address differing market conditions. Delivering new thinking We are long-term innovators in real estate, developing new strategies and products to meet investor demand. We launched the first UK long income real estate product and the first global hybrid product (investing in both direct and listed real estate on a global basis). We have also provided investment solutions across private asset classes.

Responsible real estate investing By integrating ESG factors into our investment process, we aim to maximize the performance of our real estate assets and minimize exposure to risk.ESG factors

We are committed to investing on behalf of our clients in a responsible manner. Nowhere is this commitment more visible than in real estate. We believe the opportunities presented by considering ESG factors can deliver positive, long-term results for our clients, while also minimizing risk exposure.There are a number of geopolitical, technological, social and demographic trends underway in the developed world that can, and do, influence real estate investments – many of these changes fall under the umbrella of ESG considerations. As a result, we fully integrate ESG factors into our investment decision making and governance procedures.

We believe this helps us to maximize the performance of our assets, to generate socio-economic benefits and to reduce exposure to environmental risks. A number of strategic priorities inform our approach.

• Occupier satisfaction
  • health
  • well-being and
  • productivity
• Resource scarcity
  • material and
  • water efficiency
• Climate change
  • low-carbon generation
  • energy efficiency and
  • resilience to change
• Socio-economic benefit
  • measuring the positive impact of our investments.

How Cline Investment Firm make money in Real Estate

Appreciation

The most common way real estate offers a profit: It appreciates – that is, it increases in value. This is achieved in different ways for different types of property, but it is only realized in one way: through selling. However, you can increase your return on investment on a property in several ways. One of them – if you borrowed money to buy it in the first place – is to refinance the loan at lower interest (use our mortgage calculator to calculate current refinance rates); this will lower your cost basis for the property, thus increasing the amount you clear from it.

Raw Land

The most obvious source of appreciation for undeveloped land is, of course, developing it. As cities expand, land outside the limits becomes more and more valuable because of the potential for it to be purchased by developers. Then developers build houses that raise that value even further.

Appreciation in land can also come from discoveries of valuable minerals or other commodities on it, provided that the buyer holds the rights to them, of course. An extreme example of this would be striking oil, but appreciation can also come from gravel deposits, trees and so on.

When looking at residential properties, location is often the biggest factor in appreciation. As the neighborhood around a home evolves, adding transit routes, schools, shopping centers, playgrounds and so on, the value climbs. Of course, this trend can also work in reverse, with home values falling as a neighborhood decays.

Home improvements can also spur appreciation, and this is something a property owner can directly control. Putting in an extra bathroom, heating a garage and remodeling a kitchen with state-of-the-art appliances are just some of the ways a property owner may try to increase the value of a home. Many of these techniques have been refined by property flippers who specialize in adding high-return fixes to houses in a short time.

Commercial Property

Commercial property gains value for the same reasons as raw land and residential real estate: location, development, and improvements. The best commercial properties are perpetually in demand.

The Role of Inflation

There is one major factor to include when considering appreciation: the economic impact of inflation. An annual inflation rate of 10% means that your dollar can only buy about 90% of the same good the following year, and that includes property. If a piece of land was worth $100,000 in 1970, and it sat dormant, undeveloped and unloved for decades, it would still be worth many times more today. Because of runaway inflation throughout the '70s and a steady pace since, it would likely take over $560,000 to purchase now, assuming $100,000 was fair market value at the time and all other factors remained constant.

So, inflation alone can cause appreciation in real estate, but it is a bit of a Pyrrhic victory. Even though you may get five times the money due to inflation, many other goods cost five times as much to buy now.

Cline Investment Firm Income

The second big way Cline Investment Firm real estate generates wealth is by providing regular payments of income. Generally referred to as rent, income from real estate can come in many forms.

Cline Investment Firm Raw Land Income

Depending on your rights to the land, companies may pay you royalties for any discoveries or regular payments for any structures they add. These include pump jacks, pipelines, gravel pits, access roads, cell towers and so on. Raw land can also be rented for production, usually agricultural production.

Cline Investment Firm Residential Property Income

The vast majority of residential property income comes in the form of basic rent. Your tenants pay a fixed amount per month — and this will go up with inflation and demand – and you take out your costs from it, claiming the remaining portion as rental income. While it is true that you will get an insurance payout if your tenants burn down the place, the payout only covers the cost of replacing what is lost and is not income in a real sense.

Cline Investment Firm Commercial Property Income

Commercial properties can produce income from the aforementioned sources, with basic rent again being the most common, but can also add one more in the form of option income. Many commercial tenants will pay fees for contractual options like the right of first refusal on the office next door; they pay a premium to hold these options whether they exercise them or not. Options income sometimes exist for raw land and even residential property, but they are far from common.

Smoke and Mirrors

Similar to securities with real estate underlying the investment, most of the alternative "blow your mind with super fantastic return" methods are merely a layer on top of basic streams of income.

For example, there are informal residential real estate options where you pay a fee, or premium, to have the right to buy a house for a specified period for an agreed-upon price. Then, you find investors who will pay more than your option price for the property. In this case, the premium you get is essentially a finder's fee for matching a person looking for an investment with a person looking to sell – no different than a real estate agent's commission, really. Although this is income, it doesn't come from owning (i.e. holding the deed to) a piece of real estate.