Many investors and investor groups only invest locally. Perhaps most importantly, many investors only invest with directors who are local. At the same time, there are many very successful companies operating at the national level. While that’s true, the practical reasons for investing locally are strong and should be carefully considered.
Investing locally provides an opportunity to understand the subtle nuances of your community or city. In fact, I heard one investor tell another about investing in a major East Coast city that looked at properties street by street because sometimes a good street could be only a block or two away from a bad one. For the investor, knowing how to choose the property in the right location had everything to know if he could be successful in his market or not. While these points may not be true in your market and may be exaggerated or construed as exaggerated, the fact is that local investors who know their markets very well often perform much better than the foreigner who approaches with capital. and resources only to find your investment stuck later.
Markets are created or broken by a variety of very subtle influences. Investing locally allows you to understand where the boundaries of the school district are breaking. You know which schools have good test scores and which ones don’t. Learn where the best access to employment is. After a while, you know almost innately how development plans are laid out and how they will evolve over time in relation to the locations of the properties you may be considering for acquisition or the areas you are focusing on for the objectives of the project. draft.
As an operator, years of working in a market gives you insider knowledge on the least expensive way to complete new construction, fix plumbing, repair electrical system, repaint a unit, install new carpet, install new windows, hang doors. and so many other items. For the foreigner using the city administration, the manager often feels that he can pass some elements over to the owners and investors. The opportunity for abuse can be great.
For smaller investors who do not have the time, resources, or capital to institutionalize processes, gain scale for operations or supplies and services, and other needs, local investment overcomes many of these shortcomings and provides them with the investment opportunity that only much more significant capital. otherwise it could achieve.