EisnerAmper’s Trends Watch is a weekly entry in our Alternative Investments Intelligence blog, featuring the views and insights of executives from alternative investment firms. If you would like to be featured, please contact Elana Margulies-Snyderman.
This week, Elana speaks with Yuen Yung, CEO, Casoro Onyx Impact Fund and Chairman, Casoro Group Education Foundation.
What is your outlook for minority and women-owned property developers and operators?
The prospects are exceptional. According to a McKinsey report, diversified companies are 35% more likely to have superior financial performance than undiversified companies. However, even if the prospects are excellent, getting there requires effort and attention. The statistics say it all: less than 15% of commercial real estate professionals (CRE) are women; less than 5% are black; 3% of senior executives are Latino; and 2% of senior executives are Asian. The number of senior African-American professionals in CRE was 3% in 2010; it barely budged from there.
We believe the answer, and the key to superior returns as well, is to support leading minority RE companies among the 50% who say they struggle to find capital and the 34% who say they are unable to grow their business or expand their operations. for lack of capital.
Where do you see the biggest opportunities and why?
There are huge opportunities in the development and supply of multi-family housing, as well as mixed-use real estate, especially in growth areas that serve knowledge workers. Working with female and minority-owned developers and operators only makes things better. It is a classic of “doing well by doing good”. The track record and experience of companies in this space, combined with the local insight, connections and talents of people long deprived of equal access to capital markets, is a powerful mix. We also give back by sharing a substantial portion of our General Partner (GP) revenue with our foundation which supports real estate education for students in underserved communities. By funding post-secondary school classes in real estate, we not only provide an educational resource, but also create a forum where valuable personal relationships can be made. Supporting this type of investment improves the game for everyone while closing the gaps in opportunity and prosperity. The result is a healthier overall real estate industry.
What are the biggest challenges you face and why?
It’s simple: overcome existing impressions about impact investing. We don’t believe in sacrificing returns for good. On the contrary, we believe that in our industry, an impact approach increases economic returns for both investors and society. This is one of the reasons why we don’t understand greenwashing, i.e. the use of ESG/impact investing more as a marketing strategy than an actual fund strategy. There is no need for that! The other challenge worth mentioning is reporting. We want to develop a new reporting framework to accurately track the social progress made by our fund strategy and our foundation. We believe that such transparency will encourage others to follow our example.
What keeps you up at night?
Two things: raise funds quickly enough to allocate them to the opportunities we have in our pipeline; and making sure we leave nothing to chance. There are many talents that deserve our attention.
The views and opinions expressed above are those of the interviewee only and do not/are not intended to reflect the views of EisnerAmper.