Operational Real Estate Investments
Transactions and capital raises involving operational real estate tend to focus on the specialised operations of a property and on its operator. From an investor’s perspective, there must be a healthy balance between minimising operational risks and leveraging the opportunities arising from the lease and the property itself.
Operational properties as special purpose real estateThe sale of an owner-occupied property by its operator to a real estate investor (primary sale) is a transaction requiring not only empathy for the client on the part of the broker but also an in-depth understanding of the sector, the economic situation and the financial implications of the transaction. The investor must be made aware of the opportunities and risks clearly and concisely, so as to enhance liquidity. The primary objective is to maximise deal certainty whilst achieving the best possible price. Ultimately, the sale of the property must optimise the operator’s financial resources. The same elements are key in the financing of acquisitions, developments, or capex projects, whether it be raising additional equity or securing senior / junior / mezzanine debt tranches.
Sale transactions between two professional investors (secondary sales) often determine market volumes and pricing trends. In many of the niche markets, the volumes transacted are small, with operational real estate in total making up less than 10% of overall commercial real estate transaction volumes in Switzerland. However, interest in these ‘alternative investments’, from investors and lenders, is growing rapidly as long-term leases are available and investments usually offer attractive yield profiles.
From hospitality and healthcare to every type of niche propertyAs a leading global investment advisor with worldwide access to both highly specialised and well-capitalised investors, we set ourselves the goal of managing the most efficient processes for our clients, offering total transparency across all asset classes.
Based on our position as market leader for the financing and sale of hotels and related “bed” sector assets, which have long been an established part of our services, we aim to increase the liquidity and marketability of operational real estate from other sectors, such as healthcare (senior living, hospitals, clinics), leisure (casinos, sport / wellness centres, marinas) and other niche markets (data centers, self-storage, petrol stations).
Data-orientated market knowledgeThe quality of our advisory service for the financing, sale and purchase of operational real estate builds on comprehensive market knowledge, based on an in-depth analysis of market data. Our close links with other CBRE teams means that our expertise extends beyond operational real estate, allowing us to provide support and advice on mixed-use properties as well.
Overview of services
- In-depth advice on the sale and purchase of operational properties, as well as capital raises across the entire capital structure (equity, senior / junior / mezzanine debt)
- Reliable data and process management of single-asset and portfolio transactions
- Managing structured transaction as well as capital raise processes
- Operational and commercial analysis of assets and their underlying market
- Defining target groups and developing sale and capital raise strategies
- Assistance with contract negotiations and due diligence reviews
- Close co-operation with CBRE capital market teams across every use class and region