… and why ownership capital structures matter
Much is written about data in today’s world. Those that have it, and more importantly those that control it, are seen as the new masters of the universe. Some people say it is overcooked, but others clearly see value. Not all industries have managed to properly capitalise on the potential that lies behind gathering ‘good data’. It may come as a surprise to some that the ownership of European commercial real estate is an area where the data business is incomplete.
Many will ask if there is value in knowing who owns a building? In the investment world, knowledge of who owns an asset has become hugely important. Let’s step back and look at the equity markets, where ownership data is more sophisticated and has become a vital component of the investment market.
Being able to decipher precisely who holds the common stock in a company tells a story. It also answers a lot of questions, such as who is buying, or selling? Are the directors buying? Or are they selling? Is the business family-owned, with a controlling stake? Do the life funds hold it, or are they getting out of it? Are hedge funds buying… or perhaps shorting it? Is Buffett selling, or buying? The simple logic is that having all this information to hand is invaluable for those looking to make investment decisions.
At its most basic level, of course, data can also facilitate the investment process. Knowing the shareholder register of a company can greatly enhance liquidity – particularly when it comes to buying and selling smaller, less liquid, real estate stocks.