Real estate investment trusts are popular vehicles to generate capital. You could go to the local bank and be happy with one or two percent, sure, but why not invest in real estate and gain up to 20% on your investment?
Where would you invest, to get that kind of return? If you're Iain Finnegan, you put your money in Chicago.
Mr. Finnegan is guiding Wilton US Commercial, an investment firm that has plans to obtain $50 million worth of property in Chicago and give back 20%. Forget New York City, too overpriced. Los Angeles? Outrageous prices, no value for the money. In the middle of the country, anchoring fly-over country, that's where Wilton US Commercial will stake its claim to an investment portfolio.
Isn't the mayor a descendant of Irish immigrants? Aren't 90% of the judges of Irish extraction? Look at the name of the airport, and you have to believe that the Irish belong in Chicago, that they're wanted. Forget that old "No Irish Need Apply".
Wilton will join forces with US Equities to manage the properties it will buy. Mr. Finnegan is impressed with US Equities' track record in turning around the John Hancock Center and they've done great things with Sears Tower. He's interested in picking up office space that is already rented, and then making money by tarting up the space as needed before going all out to fill every vacancy. The plan is to actively manage the properties, which sounds like secret code for "we're going to raise your rent."
There's money in Ireland, but the Irish property market is oversold and the values have nowhere to go but down. But Chicago, now, that's a different story. Reasonable rates, and values are expected to rise over time.
Plans are drawn up to purchase the American Medical Association headquarters, located near Chicago's toney Michigan Avenue. If the AMA decamps, no problem. Wilton will remodel, refurbish, and rent out the space for more than the AMA was paying. And that's how to make money in real estate.
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