The capital cycle and the role of actors in the real estate sector
Seen from another angle and even if you don’t quite believe it, real estate users are the main players in the real estate industry.
Seen from another angle and even if you don’t quite believe it, real estate users are the main players in the real estate industry. That’s right: people like you or me, we are the ones who start the project cycle. We allocate part of our savings, whether large or small, to investment funds, pensions or Afores.
Without this input, the managers of these instruments would not be able to fully exercise their function, since, with the intention of diversifying their portfolios and achieving large profits, they invest a significant percentage in real estate projects, either directly in the projects or indirectly through other institutions.
With these investments, developers, project managers, architects, engineers and brokers enter the real estate cycle to contribute their knowledge and vision to these important projects, which they place among the users. These last ones appear again, because they are the ones who occupy the spaces and reinvest in them.
This value chain ensures that capital flows, changes hands, and faces economic cycles through time.
In addition to considering the role of each actor, it is important to know the four stages of real estate; which, if understood and studied, are also a key to real estate success.
As Winston Churchill said, “However beautiful the strategy, you should occasionally look at the results.”
Or to put it in another way: What is not measured is not controlled, and what is not controlled is not improved.
So, don’t forget to take into account the actors in order to know the role they play in the real estate scenario; as well as to consider and understand what stage the project and the market are in.