Managing your Multifaceted Real Estate portfolio is an important part of building a long-term asset allocation strategy that is both profitable and tax efficient. Your Multifaceted Real Estate Portfolio (MRP) includes properties, land, buildings, and accessories that you have purchased or leased for investment purposes. Some of your assets may also be owned outright but not in part through a real estate investment partnership (REO). Whatever your definition of ‘Real Estate’ may be, managing it successfully will require the skills of a Multifaceted Real Estate Manager (MAR).
Multifaceted real estate investment managers need to manage any number of different real estate investment properties. These include properties purchased from banks, brokers, investors, or homeowners. Some of these properties may have multiple investment uses. The goal of most multi-family investors is to obtain multiple income streams by utilizing different real estate investment strategies such as’structuring partnerships, ‘ real estate joint ventures, and capital structures.
Some of the most popular real estate portfolio management strategies involve managing commercial real estate investments that are either owned by a company or by an individual. One of the most popular mortgage brokerage firms, Wells Fargo, has a number of dedicated mortgage brokerage departments that are responsible for managing the funds of many mortgage notes. For example, a Wells Fargo vice president might oversee Commercial Real Estate, Residential Real Estate, or any mix of both.
Other examples of companies that have mortgage brokerage departments include Prudential Financial, State Street, Fleet Mortgage, American Home Mortgage, Nationwide Mortgage, and Bear Sterns. Each of these companies have distinct responsibilities, including managing residential, commercial, and even retirement real estate investments. Some of these companies will work with individuals, developing agreements with other companies, and managing portfolios that contain a variety of real estate types. Many of the commercial real estate investment managers that work at these firms will also be responsible for marketing and developing real estate related programs, as well as developing new real estate related technology.
A large part of managing a long-term multifaceted real estate portfolio will involve working with large and small partnerships. In some cases, partnerships will develop their own capital structures. In other cases, larger partnerships will utilize capital structures provided by the managing agent, who will keep an overall eye on how funds are being invested. This manager will be involved in making sure the partnership’s capital structures support the long-term growth of the real estate portfolio.
While the partnership that develops capital structures for the multifaceted real estate strategies will probably be formed with other businesses or organizations, it is common for the managing agent to maintain his or her own shares of the partnership. One common way this is accomplished is through what is called an ‘alliance’. An all-iances structure means that the managing agent and the other partners in the partnership each own a specific share of the partnership’s capital structures. When one partner dies, the other partner will take over the remainder of the shares, depending on how the agreement was originally written.
Each partner will also have some managerial duties. These duties include providing information regarding properties that are being marketed and by whom they are being sold, among other things. The managing directors will also decide when to sell a particular property and will control the sale of any other properties involved in the partnership’s real estate investment strategies. The duties of the managing directors generally include the hiring of staff, handling the day-to-day operations of the partnership, and performing any other duties that are required under the agreement. The principal reason for forming these partnership structures is to ensure that all partners involved in the real estate investment have some responsibility when it comes to managing their assets.
A vice president, or a general partner, is often not considered to be a ‘partner’ in a partnership agreement, but is often a much more senior employee within the company. In some real estate investment companies, such as the Equity Office, the vice president or the general partner will also be responsible for overseeing the use of the Multifaceted Real Estate Portfolio Strategies, or the funds invested in these strategies. This particular duty does not present the same financial pressures and difficulties as those encountered during the partnership arrangement. It only requires that a minimum number of funds to be allocated, which can be done through a simple written agreement between the company and the individual.