20th June 2018 - Versicherungswirtschaft HEUTE

Bidding Process or Targeted Matchmaking?

Even in a difficult market environment, market participants are dependent on finding lucrative investment opportunities. One option is the real estate market and off-market real estate transactions, explains John Amram, managing director of HPBA GmbH, in an exclusive article for VW heute.

Until recently, empirically reliable data on off-market real estate transactions was scarce. In the meantime, however, a study which we conducted with bulwiengesa has revealed some astounding facts: the deal security with off-market transactions is as much as 14 per cent higher than with regular bidding processes and other conventional brokerage methods. Furthermore, the study revealed that numerous investors are prepared to pay a surcharge of five to six per cent for the benefits to be gained with off-market transactions […]

This article was originally published in German only. A summary in English is available.

Summary
When talk turns to off-market transactions, some investors associate the word with exclusive brokerage to an individual investor by a third party. As John Amram, managing director of HPBA GmbH explains, there are several possible off-market brokerage models. One recommended procedure is a method based on targeted matchmaking. With this method, the off-market expert draws up a short-list of highly qualified investors based on the specifications and preferences of the seller. The expert often also acts as a consultant in this process, jointly compiling important criteria with the seller. John Amram advises real-estate experts to be wary of making wide-ranging judgments in this area and to carefully weigh up the pros and cons of bidding procedures, matchmaking and other brokerage models. That is the only way to find out how to achieve the best results.
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