Today we're going to talk about real estate investing in 2023.
And it's simple as follow the money.
Now, I know many of you are very focused on your real estate investing,
but what you need to understand about real estate at all time,
some real estate is going up and some real estate is going down.
Most people think of real estate as their primary house or flipping,
and if that's all you do, then you're probably going down.
But for the rest of us, professional investors
were looking at the whole picture because real estate
has a lot of different asset classes, which we're going to go into next.
So when you're looking at where the money's going, it's
typically going out where are the trends and where are the needs?
Because that money will fulfill those needs and solve the problem.
There are six major property types that big money invested.
And when I say big money, I'm talking about Wall Street.
I'm talking about institutions,
family offices, any kind of manage money or big funds.
Typically, they focus on industry.
Will multifamily hotel single family, which a lot of you're in retail
and office.
There is a lot of reasons why the big money is moving away from these right now.
Specifically interest rates work from home pandemic, those kinds of things.
So it's my belief that the big money is going to invest in these niche properties.
So you might be wondering
why would big money be investing in these small niche type properties?
Well, it's because migration patterns and buying habits
and technology have all emerged as we've all seen it.
And now these are becoming more and more opportunistic for those real estate.
Invest in 2023.
Real estate investing will be a niche property, specifically workforce,
housing, data center fulfillment, medical office and life sciences.
So why am I so sure about this?
Because the big money is headed in this direction right now
because of the migration patterns around the United States,
the advances in technology, and of course the work from home.
So as you guys know, I love Buckminster Fuller.
Why fight the forces when you can use them?
The workforce housing is a big deal.
Affordability is probably the biggest issue right now.
In fact, it's the lowest it's been in over 30 years.
Second, we all know that housing costs are growing significantly faster
than people's wages.
And third, interest rates have gone up eight times since March and are expected
to go up even more in 2023 as the Federal Reserve
continues to fight inflation and higher interest rates
make it much harder for anyone to build affordable housing data centers.
Now most of
you are on your phones and computers and you want connectivity wherever you go.
But right now it's centered in ten primary markets around the United States.
There's a massive undersupply as technology rolls out
and these big data cloud servers are all over the place
and they're very rarely in the middle of the country.
Currently, the vacancy rate is about 3%.
And all these data centers across the United States fulfillment centers.
Now, all of you have gotten pretty damn picky where you want
the same day delivery, but I end up buying my groceries
that they get delivered to my front door.
This is not going away and this is just not Amazon.
It's all kinds of places.
You expect something to be at your house the next day.
As a result,
most retail like bricks and mortar and malls and those kinds of things
are not doing very well.
So think of fulfillment as last mile distribution for you.
That's what we're talking about here.
And there's a massive demand now and in the future medical offer.
So there is about 300 million people in the health care system right now
representing almost 20% of the US GDP.
Primarily.
These are two things hospitals or inpatient
and medical office building, which are outpatient.
There's a big push because of cost of the hospital,
the move to outpatient, which is putting a huge demand on medical office buildings.
And let's face it, these baby boomers aren't getting any younger.
And this is an area that has low vacancy and is very undersupplied.
So the last they are in his life sciences are bioscience.
And of course, these are just labs or crazy scientists.
They go in and try to figure out
how to combat the latest disease or create the new drugs.
So this is kind of a recent scenario brought to light by COVID 19
as we realize that we have a huge need for more research and development.
There's major federal funding
here, guys, for breakthrough science to keep us all healthy in the future
so we don't have to deal with another pandemic.
Currently, vacancy in life science and bioscience is above 5%.
This asset class is severely undersupplied
and will continue to have federal funds thrown at it in the future.
So many of you might be frustrated with some of the lack of opportunities
you're facing right now if you were stuck in the single family markets.
What I'm asking you to do is go up to 30,000 feet, follow the money,
solve the problem and don't fight the forces, Use them
and invest in the future where everybody else seems to be doing
it right under your nose.