Market Selection: Securing the Right Start

Selecting the right market for real estate investment does not guarantee outperformance in itself. But entering the wrong market would mean a world of hurt for investors, especially during the current erratic market conditions.

Watch our webinar where we discuss the key factors to consider in identifying and choosing the right markets for your real estate investment.

About The Speakers

Keith Ong | Co-Founder
Keith is an industry veteran with over 20 years of experience, he has transacted in excess of USD 3 billion across geographies, sectors and the entire real estate investment spectrum. He was the Assistant Director of Investment in ARA Asset Management, Director of Investment in Rockworth Capital Partners, and the Director of Investment Management and Capital Transactions for Firmus Capital.

Mark Ho | Managing Director - Investment & Asset Management
Mark has over 16 years of experience spanning cross-border investment, research and strategy, he has advised on and executed transactions in excess of USD 800 million across multiple asset classes and investment strategies. He was involved in the investment, research and strategy while under Pacific Star Group, capital market transactions and investment research in JLL, and real estate private equity in Deutsche Bank.

Transcript

0:00
Keith
I'm one of the co-founders of RealVantage. So we've been running these webinars for a while now, with the objective of engaging investors in exchanging views and ideas relating to real estate investments, right? So given our backgrounds coming from institutional real estate, private equity space, sometimes some of our views come across as being counter-intuitive, or some of our audience or their approaches, read different. Whichever the case, we hope that you will find these sessions thought-provoking, and if not informative, right.

So on logistics, please share your views and fire questions in the chat column on your right side of the screen. Now we're thick-skinned people not hardened by hard questions thrown our way over the years. So please do not be shy about asking them or sharing. I'll share your comments. Right.

Okay, the topic tonight pertains to market selection, an exceedingly important first step to maximise the chances of a real estate investment successor for that my colleague, Mark will take us through namely two areas. Number one is how sophisticated institutional investors will approach this topic.

Second, how RealVantage as your online co-investment platform approaches it to secure the most attractive investment opportunities for you, right, next we will round off by sharing our selected markets for focus and the rationale behind it. Well, Mark comes from a strong background in research, strategy, and investments, drawing upon years of experience with institutional fund managers, such as Pacific Star and Deutsche Bank and international advisory firm such as JLL right.

I notice there are a number of folks joining us today for the first time. So, before we hand over hand over to Mark, please bear with me for a brief introduction to our platform.

Okay. At RealVantage, essentially, we act as your real estate fund manager. So we play three key roles. First, we analyse, and we underwrite real estate investment on investment opportunities. So for each deal you see, we set out the funding required, the projected returns and the investment throughout the period, right? We typically only look at offshore deals, right? We haven't really looked at dues here in Singapore at the moment, right? Next, we actively manage these assets and we ensure that history projected returns right.

And at the end of the investment period, you will seek the best exit for you, right? So we interface to investors through an online platform, so the investment process, the asset management, performance tracking, the deposits and distribution of funds are all done online. So it's a very seamless process. Next is, just want to highlight the key value proposition that we bring forth.

Right. First, in the era of risk diversification, you know, real estate, as you know, as an asset class is very capital intensive, but we do it differently. We allow you to come in with smaller quantum sums, and our investments are as small as 25,000. So this gives you a lot of diversification. Besides smaller content sums, you also invest across 40 sectors and across different countries as well. Right. Second, we will actively manage the assets of the investment life cycle. As you know, real estate is very Asset Management intensive, and it needs a lot of hand-holding on the asset, right?

So we do all that for you. So you need not do any of the heavy lifting. Finally, we pride ourselves in providing what we call institutional investment ratings, which you normally wouldn't, wouldn't have access to the right? Apart from investing in different jurisdictions and types, you get to decide on the risk profile that you want to go into, right? So we write you an opportunity to invest for example, in a building, for example, in an office building London, or you like to take federates - we also provide development opportunities, right. So RealVantage is really all about providing investors with a smarter way to invest in overseas real estate, more choices, lower risk and better returns for your capital.

Next up, I think the concept, I would like to emphasise concepts only as good as the team behind it. So let me do a quick introduction about the team so everyone can tell we have a combined experience of close to 100 years in too many years in real estate fund management and in data science and technology. So in real estate, my colleagues and I have transacted over 10 billion in real estate globally and across sectors from residential to commercial assets right. Throughout our careers, we have taken roles above our investments; we have political roles such as asset management and portfolio management.

We have two esteemed industry veterans sitting on the Investment Committee, Mr Anthony Ang, who is currently the CEO of Sasseur REIT, and Mr Richard Tan, the former CFO of Suntec REIT. These guys will vet and approve the dues we put up for funding right. Many of us who serve company esteem organisations such as GIC, Barclays Bank so far. All right. That's quick. Good. Now, let me just hand over to Mark with the cue to the topic for today. Mark.

6:12
Mark
Yeah, let me just put a screen up on my site.

Okay, I hope everyone can see this. Thank you, Keith, and a very warm welcome to everybody here. First up, the reason I'm wearing a cap is that I have not cut my hair for a long time-wise. I think this is better than presenting a very messy self to you guys, right? So, the approach towards this topic of market selection can differ, right? So for some individual investors based in Singapore, for example, it could be a question of whether to purchase an apartment in River Valley or Newton or perhaps in some other location on the city's outskirts.

Right. But it is a very different consideration for global institutional investors that are not constrained by access to markets or opportunities. So for clarity, what I mean by institutional investors would mean we refer to entities like - the likes of pensions, insurance companies, large corporates, and family offices, sometimes sovereign wealth funds, etc. all right.

So as you can also appreciate that, you know, how you approach this question is really a function of what one perceives as the investable universe. And because RealVantage (RV) exists for the purpose of expanding this investment horizon for non-institutional investors, including individuals, we will take a global approach to this topic.

Now, at the very highest level, institutional investors begin by defining their own investment universe right. So, to such investors, there are certain threshold levels that determine if a market is investable or not. So, this table is actually extracted from a study published in the International Journal of strategic property management, that reveals the factors ranked in terms of importance when selecting markets for such investors.

So, as you can see, the security or property rights and title, expected returns liquidity and market size are amongst the top considerations for such investors. Right. So markets that do not meet a certain minimum threshold will automatically be dropped. So I think it's no surprise then that we hardly ever see any institutional investors going to markets like, I don't know, Turkmenistan, Mongolia, Cambodia, you know, stuff like that.

Now, while we are on this slide, it is also worthwhile to note that amongst all these factors, some are actually relatively static and they change only slowly. And there are others that are more fluid and dynamic, such as those highlighted in red, right? And in between, there are also factors that could change over the medium term as highlighted in orange. So, this has implications on the market selection as we will come back again later.

Now, for institutional investors, a very purist tip would be the weirdest left on the market as a very first cut. We rely very much on mathematical or statistical financial approach, if you like, driven very much by data and not emotions, and first and foremost, before even getting down to the real estate market selection, they would usually carry out a very robust portfolio optimisation exercise across all the asset classes that invest in. So this will include things like equities, fixed income and other alternatives, such as hedge funds, private equity, commodities and of course, direct real estate.

So, this is selecting the best asset allocation according to some defined objectives. Now, for example, a defined aim could be like for certain, given a risk tolerance level, which is the best allocation that maximises the returns for this investor. All right, the next step after they have determined the target allocation to real estate, say X number of billion dollars, right?

The next round of optimisation is then applied to just purely to real estate allocation. And depending on the specific motivations and needs of the individual institutional investors, the optimisation is then run on a more constrained model such that the end results are further fine-tuned to arrive at a final market allocation. So, in a nutshell, this is a very high-level approach to how markets are being selected by the institutional investors So, just for illustrative purposes, on the right-hand side, you will see a pie chart showing a very high-level allocation across various regions for GIC, our Singapore, sovereign wealth fund.

So according to their allocation, roughly half of the capital targets Asia. And the balance of that goes towards other regions like the Americas and Europe. And I mean, you can expect that within each continent there will be more granular and detailed allocations to the specific markets. So, as you can appreciate, where the investors are coming from the motivations and the objectives can really affect the results from this exercise.

So, for institutional investors in a very recent survey, just last year of global investors by CBRE, it showed that when it comes to investing in real estate, the global players on average would say will point towards that diversification benefits, stable you and income and superior risk-adjusted returns afforded by this asset class as the guiding main primary motivations.

Now, as individual investors, perhaps we rarely think of our real estate investment in terms of what is strategic versus what is tactical. But believe me, from the investor institutional point standpoint, it is almost a given. Right? So, following an investment strategy means that you have a plan, right? It's guided by very defined objectives. And this does not really change much over time, right? When a virus comes or not, it will be adjusted, but it does not show the entire strategy out of the way.

Now, however, a technical approach is a lot more dynamic, right? So where market selection is concerned, for example, an institutional investor might have decided he wants to deploy x million into China's tier one and tier two cities over the next five years. So They may gain exposure like urbanisation, for example. Now, this is the strategy, but technically this investor still has to carefully time his entry into each of the constituent markets, right.

So, for example, do we go into charging first, then followed by tension, or should we just target Schengen first? Now, it depends a lot on which point of the real estate cycle the individual markets are in, and a whole myriad of other considerations. So, for real estate, this is important because when we target a certain market or region, it takes a considerable amount of time and resources to build the connections and to understand the markets, right. So because of COVID-19, for example, an investor might technically pivot from one to another city for 2020 within China, right?

But the larger strategy for China would probably remain very much in place. Okay. Now, beyond the threshold factors beyond the optimisation exercises right, there are quite several other considerations that are very practical that institutional investors take into account when they do their market selection. And I trusted individual investors you probably also know do the same thing.

But before going to that, it is important that we appreciate that as an asset class real estate is unique in several ways right compared to other types of asset classes. Real Estate is a very localised business and is very heterogeneous, right like, you know, two buildings near to each other. They are very similar in age and have very similar specifications. They can be both are unique values simply because maybe one has a double street frontage. receives good natural light. It's along the major road while the other one nearby signs off. Facing sites and for example, right?

So you can appreciate that that can be very significant information asymmetry, right, where the locals know a lot more about the market than a foreign investor, for example. And hence things like industry connections become a very important factor. All right.

So when I select a market, right, it doesn't mean that I just go for the market with the highest returns, right? If in the highest returns market, I don't think I'm able to execute, or I don't have the connections there, then I'm not positioned to take advantage of those kinds of returns. And I should then target another market where I'm better able to manage my risk, right? So, for these reasons, the important considerations are very important when I mean selecting the markets.

So some of these will include the size of the investors own domestic market, right? If the investor has a very huge domestic market that he understands very well, obviously because it's the only domestic market that is relatively cheap for them to execute in, then there is less need for him to venture across the border. Right. So I think by now you can appreciate that the answer to this seemingly very simple question like, which is the best market, it's hardly a trivial one because, you know, simply because the best market for one investor may not be the best for another one.

Now that you have a little bit of understanding how the institutional investors approach this whole question, I just want to show you some of the interesting results arising from their decisions, right. So we are looking right now at a very simple graphic that shows that the proportion of investors who consider their home markets as the most attractive market out there, and how these results came in is true again, a global survey of global investors done by CBRE, just last year.

So I think unsurprisingly, if you look at the first top few like us, Australia, and even China has a very high proportion of their own institutional investors finding it. The best and most effective market is actually their own domestic market. All right.

Conversely, for small markets that do not have diverse submarkets, you know, the likes of Hong Kong and Singapore, the picture is vastly different. So only 11% of our institutional investors in Singapore say Singapore is the most attractive and the rest not so much because they don't like Singapore as a country, I am sure, right? Because they're almost forced to go overseas to achieve the objectives of having a more robust, diversified portfolio in order to achieve better risk-adjusted returns.

So now coming back to individual investors' standpoint, with RealVantage around, there's really also no reason they should be constrained to a tiny market that offers very limited diversification value. Now, this is another very interesting chart. It's also a selfie, but this time it's conducted by a hotel and Cornell University. Also very recent, and it shows a unique aspect.

What this chart shows is how institutional investors domiciled in different regions select their market focus. So the way to understand this chart is, for example, if you look at the first data point on the very left, you know, it means that for North American institutional investors 98% of those surveyed have a geographical focus on North America, which is their own market. All right, so this is a way to understand the graph. And I will just point out four key points to note here.

First and foremost, across the regions, you will find it American and Europe. North America is one of the most sought aftermarkets. It is a soft, most sought after marketing for Americans. And the same goes for pet investors. And although it's not a top market in Europe, it's a second most focused market. All right.

As mentioned earlier, the second point I will make - now, again, is a reinforcement that these survey results are very consistent no matter who conducts it. So American and European investors are very heavily invested within their own respective regions. Right, the only one that stands out is APEC, where the relatively more active as cross region investors,

There is a moral reason for this, maybe just quickly it is very simple. APAC (Asia Pacific) as a region is known to be a diverse region, right? It comprises many other small countries. And so if as a Singapore investor, if I'm going to step out of Singapore device, do you want to go to look at a smaller market or you know, it takes a lot of time to understand the market, I might as well just target and market that there's this larger and richer opportunity. So this is just a line of thought. That goes into the guiding intuition behind this.

The last point I want to make is that they focus on the UK and Australia, to me at least, stands out significantly, especially for APEC institutional investors. So, if you look across the data points, I know it may not be the highest focus area from all regions, right?

But the point should sink in when you consider the other data points are representing regions. Whereas for the UK and Australia, they are individual countries that show up prominently in this chart here. So that tells us that, you know, these are very heavily focused geographical markets.

So this is a Lastly, I will share with you for as far as institutional investors like the markets are concerned, right. Again, it's a result of a survey. And it shows how institutional investors rank countries when it comes to investing outside of their home countries, so when it comes to investing, as long as it's outside of your home country, the US has now ranked the number one country in the world, followed by the UK and then followed by Australia.

So, we have a high-level idea now of how institutions go about selecting the markets and I would like to share with you how real Vantage can approach the same topic. Now, given our backgrounds, I think Keith alluded to earlier, you know, on behalf of institutional investors, we have been investing on their behalf for a while.

So, unsurprisingly, our approach on many levels is very aligned on the practice now. However, as an online co-investment platform, there are also some differences that will have some implications on how we select all markets. First and foremost, we are not constrained by any specific organisational requirements. So as an example, we are not a pension fund. We do not have to adhere to anything called asset-liability management considerations, just to elaborate very quickly as a pension fund.

According to the profile of their members, they have a sort of like schedule or payoffs some years down the road, right? So in managing the investments, they need to ensure that the cash flow, the returns from the investments can then match the pension outflows. Okay. We don't have that kind of consideration.

Now, although the way we function is like all these institutional fund managers, we do not have a specific investment mandate that might restrict us to say, Oh, you can only invest in us. No, we don't have that. And importantly, along we invest alongside our investors, right, meaning you say are we interested are very well aligned. When do we feel the pain? Do you feel the pain? No, we are in it together. We are 100% independent.

So why is this important? Because an example of a platform that is not independent is when a platform, for example, is also owned by an actual player. And the platform is then used to be a channel to generate capital into the project that they are invested in. So we are not beholden to invest in anything other than deals which we have which offer the best risk-adjusted returns that we are satisfied with.

Moving on to the segment below the SEC, the market segment below the institution's is the segment that RV serves right and it spends a very wide spectrum. So at one hand or at one end of the spectrum, the investors include family officers. On the other end of the spectrum, we also serve individual accredited investors. So because the investors have varying objectives, requirements, so as a platform serving their needs when we select markets, we select markets that can offer a wide range of strategies that can cater to this demand.

Now at RealVantage, we are Asian, more specifically, we are Singaporean investors and as a result; we adopt a very Southeast Asia centric perspective. No, we are sensitive that we need to minimise a region-specific, idiosyncratic risk, right? Global risk hits everybody. So we cannot really run away from that. But we can do that selection or markets minimise region-specific, specific risks.

So as an example, you know, some of us may recall the Asian financial crisis that rocked this region back during, say, 1997. So, while this region went through a lot of pain, the US and European markets have felt a thing. Alright.

Moving on to the last point on this slide, we also different in the sense that we have used a very data-driven approach. We also use artificial intelligence in our operations. So we find such an approach allows us to monitor many markets in a very timely manner, much more efficiently than if we rely just purely on labour, right? It allows us to test markets, at least at the very onset, with no buyers' emotions.

So while we benefit from using this technology, we also have to be very careful that the data inputs that go into our system are reliable, comparable, timely, and offer certain quality. So as a starting point, the very three primary factors that get our scale market selection, you can see on the slides here. Now, Keith and myself, we have been active in investment markets that spend both the developed and the emerging markets over the course of our careers.

Now, during this time, we have developed a very acute appreciation of the risk that accompanies markets with a very weak regulatory framework. So without naming names now, right in certain jurisdictions, while there may be laws and regulations in place, right, their interpretation may not be consistent across the submarkets, and not consistent over time as well. Right. We as investors can use the best lawyers to drop the titles, legal documents, but whether they cost interpret them according to the original intention or not, that is a separate matter. So, this is very important.

A strong regulatory framework is a very important contribution. Now, market depth is very closely related to things like how rich the opportunities are, of course - the bigger the market, the more likely you are to find on earth pleasant opportunities.

And it's also closely related to how liquid the market is. Liquidity is extremely important because for our views, our views, our specific time, their specific timelines to them, alright. It's very sweet now if you are sitting on a huge paper profit, but it is very set if you're not able to exit a market where we need to exit the market because there's no liquidity in the market that moves on and we end up missing the best exit window. All right, so market capital is a very important consideration for us. And the third one would be transparency.

Now, when we operate in someone else's market, we never forget that we are foreigners, which is why we prefer markets where, as foreigners, we are as close to a level playing field as possible with the local players, their transparency is a very important factor in the levels displaying for you. Right. So transparent markets, as I mentioned earlier, we use AI, it also allows us to get the quality data inputs that we require.

So just looking across the board, I think you probably wouldn't be surprised that we have chosen the US, UK and Australia as our primary target market country's right. Now, the bottom line is that there are reasons we identify these markets. The bottom line is we are still seeing attractive opportunities coming from these markets. And there are very little compelling reasons for us to want to migrate up a spectrum.

So at this juncture, I would just like to share with you on this slide results from Gao global transparency index. Joe is an international top tier real estate professional services firm. And they have been running this index for 20 years now. And it is in the industry widely recognised and watched by all cross border investors. The index - yeah, it's called transparency index, but it is a comprehensive index, tracking over hundred 86 individual elements covering a hundred countries.

All right. So these are broken down into six sub-indices that cover very important areas, as I mentioned earlier, regulatory and legal framework. Things like market fundamentals, transaction processes, for example.

Now, I'll tell you the rankings change with every additional of this bi-annual index, but with whatever the changes are, the UK, Australia and the US have consistently maintained pole positions. They might play some of your musical chairs now from addition, but they have always been anchored right up there in the pole position.

Now, undoubtedly and sadly, you know COVID-19 has dominated the headlines and concerns globally in recent weeks or even months now. Its unprecedented nature has generated uncertainties of such a scale that it is difficult for anyone to have any reasonable amount of confidence when it comes to forecasting, alright forecasting is actually quite an important market selection. So, any GDP forecast you see now that is the World Bank, IMF, Asia Development Bank, whatever they are, they all now come very heavily caveated even for specific markets, Take, for example, Hong Kong residential sector.

The forecasts coming from even a seasoned analyst are all over the place now. JP Morgan says the prices will drop 10% this year. SMP says it will drop 10 to 20%. Morgan Stanley is forecasting a 5% raise, and Citibank is saying prices will rise five to 10% from this month onwards to the end of the year. So, I mean, we track these views closely, but at the same time, we take a very pragmatic approach with market selection. So at this point in time, all I will say is, the dislocations in markets and opportunities generated is something that's happening globally, right?

But we are relatively more optimistic for markets where we see stimulus measures playing a big part in those markets. All right. As you can see from this chart, this chart, this pie chart shows off the total direct fiscal stimulus measures in the whole world. How much does each region or each country contribute to this total?

Alright, so you ask this actually, you know, it can't account for 15% of the global GDP that you carry, but when it comes to the direct fiscal stimulus measures, we are punching way above its weight coming in at 44% of the total physical measures around the world. Australia - I know it's a small slice here actually in orange is 3% here, but Australia is actually only accounting for 1.7% of the global GDP, right? So to account for 3% of the total fiscal measures is very big for them.

For the UK, it's about the global GDP share of about 2.2%. And so, reasonably, is quite in proportion to the size of its fiscal response. So, together with the three markers that the key countries that we have a sort of at a first level single, US, UK, Australia, the total direct fiscal stimulus already accounted for half of the world saw response alright.

And this is important that where they are dislocating is happening globally, we will be targeting the dislocations that will likely be more short-lived, which is a very big function of how much governments are doing for their respective countries. Now with knowledge just singling other countries is not good enough, right? I mean, the US and the UK is a huge country.

So to take us to the next level, RV does this right. The first level I've really been through in-depth. The next one sectors and strategies is a topic that we covered in a webinar, I believe, probably four weeks ago. So back then, in response to the COVID-19 virus outbreak, we have identified certain sectors that we are optimistic on and offer attractive risk-adjusted returns and we narrow down the market.

Now, based on the sectors and strategies that we have identified, we will then have to look at the cities that offer the richest prospects for such strategies, right. For example, I mean, if you are pursuing a low-risk kind of strategy, you won't be going to Cambodia, right? Because there aren't a lot of investment-grade types of real estate for you to invest in, right? So you narrow down further to the cities now, even amongst all these cities that provide us with a very rich perspective, I think I mentioned earlier as well.

If we do not have enough confidence that we can execute, or we do not have enough strong partners that we can work together with, then we are unfortunately not placed to take advantage of those. So after we review our own internal resources, our connections, this lesson comes down to even a smaller group. Alright. So moving on to one of the last slides I have. Okay.

Before I move on to the results, sorry, just a quick one. Maybe just to give you an idea of how we went through all the various layers in the previous slides. It is very intensive, not just data evolution. Human attention kind of exercise that we do so that we run a layer of filters. Right.

According to the macroeconomic data. For AI wise if a market has no rents dropping for three consecutive quarters and is falling at a faster and faster rate, the system will give us a red flag to say that this market is something to stay away from, right?

The bottom of the market is some distance will be or conversely, you don't market if rents are falling, but they have been falling consecutively for at declining damage is falling slower. Again, a red flag comes up to tell us this market. We could be very well near a turning point. So this is what the AI system will tell us, but it still takes a human with the experience to go to verify if all the factors are in place for a market to know.

So just an example of how we use AI because a lot of people don't understand how it's applied. And this is probably one of the most important slides, but it looks important and it's very hard to go into each and every one of the markets. So it's a big topic in its own right.

But let me summarise our guiding thoughts here. All right. The selection of our cities is heavily guided by, first of all, we are prioritising; we are tweaking our AI algorithm to favour fundamentals over distress. Now, why do we do that? Because if we were to enter a market where the market fundamentals are shaky, to begin with, even if you are getting very distressed prices, 50% of 70% of the price you buy into the market. The question is, will the market have the fundamentals required to turn around Post COVID. And, you know, we plan to exit in three years, four years, by the time that comes around, we don't know if we can have the market have reached account recovery.

Whereas if you were to go to fundamentally sound markets, like the ones I'm showing here, very diverse economic drivers and stuff like that, over time, from experience, we tell we know that the man has a mean reversion to the markets and we would eventually be able to exit markets. We also in selecting the markets, we also pivot very strongly to resilient economies.

By this, you know, we are talking about things like tech hubs. Right, you will realise that the tech sector is one of the relatively less affected sectors in this virus episode. I mean, just as a rule of thumb, you know, just as a guide as a layman's way of looking at it. If we go to the recruitment websites today, you see who are still posting hiring posts, you'll find that these are coming from technology firm's FinTech education right?

So in choosing some of these, like, for example, Austin in Austria or us it is a textbook is a very strong tech call Anita is anchored by a very reputable huge University. And these are one of the reasons why we favour markets like that.

Now on the converse side, for example, before this we actually quite like the Seattle market, but it is very important to know which are the MNC that is anchored within this market, you know, virus or no virus Starbucks being anchored in Seattle, people will still drink coffee, it's okay. I don't think they will be very. It's our view that they won't be very badly affected by bullying is the right and is not the whole industry is going through a lot of pain or pain right now. And the kind of ripple effects that will come through the city, you know, being such a huge play in a city.

Right now. We have taken that off our list. So We are avoiding all the cities with the headquarters of, you know, firms that are very badly affected by the virus situation. And in our strategy webinar to four weeks ago, we associate, we are going for structural factors more than just cyclical.

Alright, so places that require to have a very high demand for data centres, places that have a growing and ageing demographics, you know, that translate to things like assisted housing, or even like offline consumption, translating into opportunities for logistics, for example. So these are the places where we see the opportunities. And so this is like, the broad guiding, thinking behind the selection of all markets.

So this is my last slide - just a very quick conclusion, right. So we need to be very clear about why we want to invest in real estate because we want diversification, we want a state and income. We also want attractive risk-adjusted returns, right? This is our primary motivation. And when it comes to choosing the broad level markets, again, just to recap, regulatory framework, the strength of debt, market depth, and transparency, which is why we chose the three markers that we chose and checked off all the boxes that you want.

Now when it comes to the selection of cities, right, I mentioned earlier fundamentals over distress. No pivoting to the certain resilient economy or market drivers and favouring structural model cyclical. And I think we've debts I've come to the end of. How should we do this? This is a Q&A.

39:46
Keith
All right, feel free to post your questions on to any box.

Transcribed by https://otter.ai

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