Market Focus

The real estate and insurance industries are attractive areas for investment and business development.

• Both industries are large. There is approximately $3 Trillion of corporate and commercial real estate assets in the US. The insurance industry represents over $4 Trillion of admitted assets, with over $550 Billion in annual premiums written.
• Both industries are core elements of the free enterprise system. All businesses require real estate in some fashion, either owned or leased, to "manufacture" their product or service and carry out their value proposition. As well, all businesses and individuals require certain forms of insurance to protect their assets and livelihoods. (Source: A.M. Best. Property and Casualty industry reported over $1 Trillion in assets and $300 Billion in written premiums in 1999. Life and Health industry reported over $3 Trillion in admitted assets and $250 Billion in written premiums in 2002.)
• Both industries require a multitude of services to operate efficiently. Successful players in real estate and insurance are voracious consumers of financial services, IT services, data services, brokerage services, and consulting services. Finding strategic or tactical advantages in any of these areas can make the difference between winners and losers.
• Both industries are traditionally resistant to change and slow to act. Most players in these industries see change as disruptive to stable operations, and therefore look upon it skeptically. This results in opportunities for those who are able to embrace change and act quickly.
• Both industries are undergoing paradigm-shifting transitions. Primary among these is the deregulation of the financial, banking, and insurance industries. The Gramm-Leach-Bliley Act, signed in November 1999, loosened the regulatory ties that kept the financial, banking, and insurance industries separate, and is now enabling providers in these markets to cross boundaries in innovative ways. By definition, real estate is the process of managing capital (finance/banking) over time against risks (risk management and insurance) through use of land and brick and mortar assets. Therefore, changes within the capital and insurance markets will inherently impact real estate in profound ways, yet most companies are not actively preparing for how these changes will emerge. This uncertainty is causing many smart organizations in these industries to look for new innovators that will help redefine the future.