*This content is brought to you by OrbVest
By Justin Clarke*
Despite a global health crisis now in its third or fourth wave, and a wave of civil unrest and looting in KwaZulu-Natal and Gauteng in mid-July, from a financial perspective 2021 has delivered very pleasing returns for investors in South African equities.
But the clouds are beginning to gather. September was negative for most key JSE indices, as concerns around Chinese regulation of online gaming hit heavyweights Naspers and Prosus, and commodity prices softened. Platinum miners, in particular, have yielded some of their recent gains, which reflected a 17% month-on-month decline in the platinum index.
The rand weakened 3.7% against the dollar in September compared with August, as global money continues to flow back into the US on the prospect of the tapering of stimulus measures later this year or early next year.
At 5 October, the FTSE/JSE All-Share Index (ALSI) closed at 64,542, reflecting a gain of 18.4% for the 12 months compared with the same 12-month period in 2020. However, the S&P 500, at 4,345, was up 27.5% in the same period, underscoring the resilience of the world’s biggest economy.
The stock market is a great way to build wealth over time, but it is not the only way. Diversification is essential to help investors to withstand a prolonged economic downturn or even flat stock market returns over the coming years. Certain specialised areas of real estate, such as logistics and medical office buildings, have demonstrated their stability over time, even through the upheavals of Covid-19.
OrbVest, a global real estate company that invests in US income-producing medical office buildings, has seen increasing interest from South Africans and other foreign investors looking to hedge against stock market volatility and rising inflation. Its speciality is sourcing and acquiring premier commercial real estate investments in the healthcare sector in some of the fastest-growing metropolitan areas of the US.
Healthcare real estate has historically been a source of steady growth and investor returns. The sector’s resilience before and during the pandemic is testimony to the centrality of health care in all our lives, and it remains well-positioned for long-term capital appreciation. As the American population ages, it will inevitably create rising demand for healthcare (and healthcare real estate).
OrbVest has amassed an impressive portfolio of over 1.4 million square feet, having acquired over $360m in real estate over the last few years, making it simple for investors to own a portion of a prime asset only normally accessible to large US REITS and institutional investors.
OrbVest is actively pursuing additional medical office building investments across the US to provide enhanced diversification for its investors and reduce concentration risk. Its most recent…
Read MoreUSA commercial real estate