Why Real Estate May Remain Hot

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Erik Tracy Rice
6 years ago
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1 Why Real Estate May Remain Hot MODERATOR Jay Rollins, President & CEO JCR Capital PANELISTS Burl East American Assets Capital Advisers CEO & PM of Altegris/AACA Terrell Gates,J.D., Founder & CEO Virtus Real Estate Michael Schwaab, Senior Director, Global Real Estate TIAA Global Asset Management

2 Why Real Estate May Remain Hot MODERATOR Jay Rollins, President & CEO JCR Capital PANELISTS Michael Schwaab, Senior Director, Global Real Estate TIAA Global Asset Management

3 Ever wanted to go back to college?

4 Significant obsolescence remains in student housing stock

5 Sector and characteristics comparison

6 Average Cap Rate (Yield) Rolling Four-Quarter Income Returns

Master s degree Bachelor s degree Associate s degree High school diploma Less than high

7 in higher wages and lower jobless rates Unemployment rates and median weekly earnings across educational attainment levels (2013) Unemployment Rate (%) Professional degree Master s degree Bachelor s degree Associate s degree High school diploma Less than high school Sources: Bureau of Labor Statistics, Current Population Survey, as of March 2014; TIAA

8 General increasing propensity to immediately enroll in college High school completers immediately enrolling in college (%) Millennials 66% of high school completers immediately enrolled in college Boomers Source: US Department of Commerce, Census Bureau, Current Population Survey. College enrollment as of Oct. of each year for individuals age who completed high school in the preceding 12 mos. As of October 2013; table prepared July 2014.

9 Postsecondary degree-granting institution enrollments (millions) $9,410* (public in-state avg. annual tuition; ~30% of private non-profits) $32,405* (private non-profit avg. annual tuition) Private Public Total Recession *Average undergraduate tuition & required fees, four-year universities Sources: Enrollment data: U.S. Department of Education, National Center for Education Statistics, Integrated Postsecondary Education Data System (IPEDS), Fall Enrollment Survey (IPEDS-EF:86 99); IPEDS Spring 2001 through Spring 2013, Enrollment component, as of October 2013; and Enrollment in Degree-Granting Institutions Projections Model, 1980 through 2023, as of January Tuition data: The College Board, Annual Survey of Colleges; Table 1A. Average Published Charges (Enrollment- Weighted) for Full-Time Undergraduates by Sector,

10 Portfolios can benefit from owning assets with cash flows that behave differently during economic cycles. During the most recent U.S. economic recovery, select schools outperformed the total U.S. enrollment trend with positive growth of 1.8% between 2010 and 2014

11 This material is for informational purposes only and should not be regarded as a recommendation or an offer to buy or sell any product or service to which this information may relate. Certain products and services may not be available to all entities or persons. Investments in alternative strategies are subject to certain risks, are not suitable for all investors, and are not intended as a complete investment program. Investors should be aware that alternative investments often engage in leveraging and other speculative investment practices that may increase the risk of investment loss. Alternative investments may be highly illiquid, there may be no liquid secondary market or ready purchasers for such securities, they may not be required to provide periodic pricing or valuation information to investors, they may involve complex tax structures and delays in distributing important tax information, they are not subject to the same regulatory requirements as other types of pooled investment vehicles, and they may be subject to high fees and expenses which will reduce profit. Investors may lose all or substantially all of the capital invested. Please consider all risks carefully prior to investing in any particular strategy. TIAA Global Asset Management provides investment advice and portfolio management services through TIAA and over a dozen affiliated registered investment advisers. Nuveen is an operating division of TIAA Global Asset Management. For more information about alternative investments, please contact us at:

12 Why Real Estate May Remain Hot MODERATOR Jay Rollins, President & CEO JCR Capital PANELISTS Terrell Gates,J.D., Founder & CEO Virtus Real Estate

26 Why Real Estate May Remain Hot MODERATOR Jay Rollins, President & CEO JCR Capital PANELISTS Burl East American Assets Capital Advisers CEO & PM of Altegris/AACA

Like much of the country, Detroit suffered significant job losses during the Great Recession.

Like much of the country, Detroit suffered significant job losses during the Great Recession. 36 37 POPULATION TRENDS Economy ECONOMY Like much of the country, suffered significant job losses during the Great Recession. Since bottoming out in the first quarter of 2010, however, the city has seen