Given the fast-moving nature of the real estate market, it is vital to work with professionals who fully understand your imperatives and are in complete alignment with your financial goals. Incorporating real estate into a broad financial portfolio can and should be an integral part of a savvy financial strategy, but it entails much more than simply buying investment properties at random.
Balco employs detailed demographic, macroeconomic and financial analyses of the most dynamic markets in the country such as Austin, Miami and Denver, among others. As a result, we can say with confidence that no other asset comes even close to yielding as significant a return on investment.
Yet, most financial advisors neglect real estate as an asset class, especially for individual investors. Their neglect may constitute a serious misalignment with what we believe should be an appropriate, growth-oriented financial portfolio that maximizes returns as well as optimally hedges inflation and mitigates risk.
If you have sold a property recently, you know how extraordinary the performance of real estate can be. By the end of 2021, the average home price in America had increased by 17.1% over the prior year. In the markets where we focus our efforts, the gains are even greater. In Denver, prices increased 23%. In Miami-Dade, an amazing 25.6%. And in Austin, where Ballard Built is based, home prices rose by a staggering 39.4%. These figures are unprecedented. But, given population growth and economic trends, they are completely rational and destined to continue for some time.
This is not a new phenomenon. A look at the past 30 years reveals steady growth patterns of 7% to 10% a year on average in those three dynamic metro markets. Nationally, the annual average price appreciation in the U.S. since 1992 has been 5.3%, which includes rural and rustbelt markets that saw little or no appreciation. Beyond home prices, every category of real estate, including commercial offices, continue to appreciate well beyond the gains of most other financial vehicles.
The reality is, most financial advisors avoid any discussion of real estate. Wealth managers focus on equities, fixed income products, exchange traded funds (ETFs) and market funds instead of real estate. Of course, you can and must have a stake in these kinds of investments to ensure a fully diversified portfolio. But a quick look at investment opportunities provided by Ballard Built reveals how a carefully curated and data-driven real estate portfolio may align more fully with your objectives, especially if you are seeking greater returns over a shorter timeframe.
This is especially true as Balco investors enter a true partnership in which you participate alongside us in our ventures. We ensure our financial objectives are in alignment with yours, and you are part of our ownership structure across all our real estate ventures, from existing properties to new developments to land investments.
How does it work? As a fellow owner of the fund, over the course of 36-48 months the program will yield a 12-14% targeted internal rate of return, 15% of all company profits after expenses, and payouts as each phase of any given project is completed (which may be in as little as 18 months, although on average 36 months is more common) in addition to bonuses on exits of assets and additional one-off profit opportunities. In today’s high inflation environment, no other vehicle can protect and increase your hard-earned wealth and offer this kind of tangible asset value.
Investors seeking even shorter time horizons may also join us in specific projects. Ballard offers a deal platform program where you partner with us in a specific deal over a two-year period. The project is designed for a targeted 6% annual return with a projected total return of 12-16%, plus an additional 5% of all remaining profits on the project. This program offers the protection of being collateralized by an active construction project already underway.
Balco’s approach to deal selection brings a level of security and confidence that rivals and often surpasses traditional market investment strategies. In the same way the best brokers and financial advisors will get to know a company, its products, its leadership, and its long-term performance before making a recommendation, Balco’s real estate investment professionals have a deep knowledge of market macroeconomics, demographics, historical and future market growth trends, economic risk, migratory trends, local business growth and employment, and many other factors such as local authorities current and future development and zoning plans. As with financial investments, a great many elements must be considered when determining the quality of a real estate investment.
High-quality, high-return real estate investing in today’s volatile and dynamic environment requires great expertise. Partnering with advisors such as Ballard Built who ensure close alignment with your objectives will maximize both profitability and peace of mind.