NEW YORK--(BUSINESS WIRE)--Commercial real estate and technology firm Real Liquidity is tackling the $5 trillion private commercial real estate investment market, one that has long been plagued by the problem of illiquidity. General and limited partners are unable to efficiently sell a fractional ownership interest in their real estate syndicate — a group of investors that pool funds to purchase assets.
To address this problem, Real Liquidity has assembled an experienced and diverse team of real estate, investment, legal and securities professionals. The team’s primary goal is to change the way real estate is bought and sold by utilizing their proprietary, safe and secure, technology-driven marketplace. Their unique solution connects buyers with sellers that otherwise would not have access to each other.
“Sponsors and limited partners often find themselves with their capital locked up in real estate assets from which they cannot quickly or efficiently get out,” said Real Liquidity CEO Kevin Guy. “To divest their equity in these assets, the sponsors and limited partners traditionally have had to first go to the existing shareholders and/or an inefficient private market where they are forced to take a significant discount in the value of their shares — sometimes at 50 cents on the dollar, or even worse. It’s painful. Now there’s a better solution for sellers to get closer to fair market value.”
In addition, Real Liquidity provides opportunity and a service to an accredited investor class that never before had access to a private market that is estimated at $5 trillion.
“Whether it’s a partner dispute, family reorganization, or different owner investment objectives,” Guy said, “at some point in the future, the goal of general and limited partners is the same — to liquidate some or all of their equity in an asset in which they have ownership.”
The most common reasons a seller desires liquidity include: a partner/family dispute; a significant change-of-life event or a different investment; or, typically, where one partner wants to divest their ownership interest in the asset while the other partner(s) want to remain an owner.
To provide a desirable marketplace to a pool of accredited investors, the Real Liquidity team works with selected sponsors and management teams to onboard quality, seasoned, and cash-flowing assets. Although applicable to assets of nearly all sizes and values, most properties vetted through the process are in the $5 million - $50 million range. The vetting process includes performing in-depth due-diligence on each asset, a highly selective process which, among other layers, includes scrutinizing the property’s financials, property history, tenant mix, market data, and management experience.
Real Liquidity has begun conducting due-diligence for the first wave of properties, while continuing to attract other commercial properties in the Multifamily, Office, Retail, Hospitality, Industrial, and Mixed-use markets.