Own Property In A Neighborhood That Isn’t Great?

Own a property in a neighborhood that isn’t great?  You could keep ignoring it OR you could create a master plan.  

Family offices often hold properties for 10 years or more.  This is referred to as a long-term hold.  

This may be intentional due to solid returns.  It may also be unintentional because it was inherited, came with a business deal, or a portfolio of properties was assembled without a plan. 

To optimize your portfolio, take a strategic approach:

• First: Analyze all your holdings to identify the best assets. 

• Second: Select an area that you believe in long term. 

• Third: Create a master plan or vision for that neighborhood. 

A master plan approach may require the family to purchase additional parcels in the neighborhood. The family will need to coordinate with the city + neighborhood, hire an architect and land use attorney.  

When assembling parcels, a property should “carry itself” or break-even.    Lower returns or losses may be taken to set up larger development plays.  

Look to maximize value, not just for an individual property but across the master plan.  Re-zoning properties can make sense, while other times building as-of-right is better. 

This thoughtful approach requires leadership by the family, relationship building, and legal, financial and technical knowledge.