Investing in North America – Robust Economic Fundamentals and Vigorous Demand for Land Investments
View Full Release, 2020/02/07
HONG KONG, Feb. 7, 2020 /PRNewswire/ -- Walton International Group, a North America based real estate investment and land asset management company, offers global investors a distinct opportunity to diversify their investment portfolios with land investments, specifically pre-development land and builder option land developments ("BOLD").
North America has long been a popular destination for investment. Global investor confidence in the region remains high due to the robust economic fundamentals supporting stable and strong investment returns, with the US economy expanding by 2.3% in 2019.
Real estate investments have attracted investors seeking long-term investment opportunities, and those searching for alternative means to diversify their investment portfolios.
Land investments share similar attributes with traditional real estate investments, are often considered a good inflation hedge and can provide investors with an innovative and risk averse option to appreciate capital in the long run.
Land Demand Driven by Strong US Economy
Despite global geopolitical and trade uncertainties, the US economy maintains a stable outlook. Economic stability, low mortgage rates, projected overall population growth and millennials reaching the peak years for family formation are driving demand for land absorption and development in the US, particularly in the southern states.
New home construction continues to hit post-recession highs, with US builders beginning construction on 1.37 million new homes in November 2019. New single-family home sales reached 719,000 units for the same month, surging 16.9% from a year ago and the Median New Home Price has climbed at a steady and healthy pace since 2009 to reach USD 330,800.
The National Association of Home Builders/Wells Fargo Housing Market Index hit 76 in December 2019, with US homebuilders being the most confident they've been since June 1999. In fact, homebuilders and developers with tight inventories are constantly on the hunt for ready-to-use and strategically located parcels of land to address demand for new homes.
Innovative Land Investment Opportunities to Capture US growth
The Walton Group currently owns, manages, and administers more than 106,000 acres of strategically located land in key growth markets in North America, 80% in US and 20% in Canada, on behalf of more than 92,000 investors worldwide.
Prior to acquiring these land assets, Walton's team of professionals conduct a strict due diligence process in collaboration with independent third parties. Concurrent with the new land acquisition, Walton will engage a major US homebuilder ("Builder") to assess the new property, review the financials of the project, enter into an exit focused agreement ("EFA") that would allow the Builder to ultimately purchase the property from the land owners at a future price and date. This strategy creates a pre-determined planned exit of the land acquisition and allows Walton to provide transparent estimates of future returns and cash flow on the new project based on the EFA.
Proven Track Record in Real Estate Asset Management
This comprehensive process to identify the right land is cultivated from the Walton Group's over 40 years experience in researching, planning, and structuring pre-development land investments. It has been critical to the success of the Walton Group's land investment strategy, which has already seen 110 pre-development land projects exited in North America (as of June 30, 2019), and delivered returns of more than USD 1.5 billion to investors and partners in business since inception.
This tested and proven approach to land investment is bolstered by the Walton Group's wide-ranging and strategic partnerships with top national and regional homebuilders and developers, with over 38,000 acres of land in U.S. already under negotiation with prospective purchasers as of December 31, 2019, bolstering the pipeline of exit activity for the company and its investors for 2020.
The Walton Group's recent acquisition of Lee Farms, a 245-acre property in Loveland, Colorado showcases this revitalized and fluid approach. The pre-developed land is slated for a single-family residential master planned community of approximately 900 units, offering a variety of sizes and types of homesites. The expected phased procurement of the property by a top publicly-trade homebuilder accelerates the investment process for investors, by locking in the exit strategy and anticipated returns at an early stage.
Strategic Investment Choice for Global Investors
Investments in North America, especially the US are wide-ranging and diverse, and are all supported and driven by the US economy's strong fundamentals. The Walton Group's unique land investment products offer investors a timely opportunity to ride the tide of economic growth in the US, while still offering protection in the event that volatility returns to the market.
Land investments in the form of pre-development are valuable additions to investors seeking to expand their investment toolkit for capital appreciation and portfolio diversification purposes.