Why Commercial Assets are a Strong Investment Option
Does world conflict have any impact on commercial real estate?
Everest discusses some key points for investors’ consideration.
After Hamas’ brutal attack last month, the Israeli government quickly declared war on the Palestinian terror group. While the world watched in horror, some commercial real estate circles were also buzzing. But why?
What connection could there be between Hamas’ attack and what’s happening here in the housing market?
As always, Everest has the scoop.?
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An unexpected impact
In the aftermath of Hamas’ attack, Wall Street showed great worry. Almost immediately, stocks took a tumble alongside the Israeli shekel. We also saw oil prices rise, although the global crude supply doesn’t seem to be at risk since the initial shakeup.
Pundits insist that once the shock wore off, so did market panic. In fact, most economists are now focusing their sights on the current earnings season and the Federal Reserve’s campaign to further raise interest rates.
Still, recent headlines taught us something important.
Beyond the broader market reactions, Everest noticed a key trend among investors.
The threat of global conflict had many people flocking to defensive stocks in an attempt to protect their portfolios. In addition to government bonds, utilities, and energy, real estate stocks saw a 1% gain the week of the attack. Clearly, these defensive sectors represent stability in an otherwise tumultuous economy.?
That said, many investors chose to do nothing at all.
Everest Commercial Loan Officer Zishe Jacob explains, “Although the war in Israel is a terrible tragedy, it doesn’t directly affect commercial real estate investment. But for many people in CRE, the attack on Israel hit very close to home.”?
Communities in America and across the globe continue to mourn the needless loss of life. For now, many investors are forging ahead in their pursuit of stability and prosperity, all while praying for a swift and permanent resolution to the conflict.
Some CRE takeaways
If we learned anything from recent events, it’s that commercial real estate will always be a solid asset that strengthens your portfolio in times of market turmoil.?
Stocks aside, investors looking to dip their toes in the multifamily pond have a wonderful team of experienced loan officers ready to assist at Everest Equity. Our people are not only incredible at what they do. They are also kind, compassionate, and always available to lend an ear. It’s no secret that the majority of our clients are like family.
Mr. Jacob notes, “A big part of today’s commercial real estate players have friends and family in Israel. We are thinking of them during this trying time.”
To take your mind off the many problems in this world, check out Everest’s definitive list of commercial real estate benefits. Why is this sector so tried and true? We’ll tell you!
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Why CRE is the Ultimate Defensive Investment Strategy
This reliable asset class has so much to offer! Here are the top advantages.?
Cash flow
Just like stock distributions, commercial real estate delivers consistent monthly, quarterly, and/or annual dividends to investors. Did you know that CRE regularly outperforms the S&P 500?
Diversification
If your portfolio is mostly made up of traditional stocks and bonds, commercial real estate offers something unique. Its low correlation with the stock market means volatility is low in rough economic times.?
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Tangibility
As a hard asset, real estate always maintains its value, even if property values rise and fall over time. Even if a particular project fails, the property can always be restructured into something new. In other words, endless opportunities for financial success.?
Tax Breaks
No capital gains taxes here! When it comes to commercial real estate, capital gains can be easily reduced (or avoided altogether). Ask an expert for advice when building your CRE portfolio.?
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Inflation Hedge
From multifamily apartments to commercial retail spaces, landlords can always raise their rents! You won’t have to worry about inflation’s impact on your portfolio, as real estate investors regularly increase rent as the economy grows.?
Everest says: Triumph through the toughest markets
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Everest Equity Stands with Israel
Our loan officers are here for moral support, mortgage advice, and compassion for all.
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The Everest Equity Company, Inc. Registered Mortgage Broker New York State Department of Financial Services. Mortgage Broker Licensed by the New Jersey Department of Banking and Insurance.?Licensed Mortgage Broker CT, PA, FL,?NC and TX Banking Department. Loans arranged through third party providers. Company NMLS ID 12484
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