Printed in the Wall Street Journal, page D1

September 27,2007

 

H. Alan Welles, a commercial real-estate broker in West Palm Beach, Fla., acts as a "sponsor" to groups of individual investors who pool their money to buy retail, industrial or office properties, entrusting Mr. Welles with handling the entire transaction, including acquisition, leasing and management. His clients include professionals and retirees in their 50s with a lot of cash.

A few weeks ago, one of Mr. Welles's groups beat out several offers on a $4 million medical-office and retail building in West Palm Beach because they were able to offer all cash and the ability to close with no financial contingencies.

"With us there is no red tape, but the procedures for getting stuff done are so much slower with the larger groups," says Mr. Welles, who deals with commercial properties valued at up to $15 million. "A lot of sellers have gotten burned while trying to hold out for the top dollars, so now they're just looking for fewer headaches."

Leslie Evans, a Palm Beach-based attorney, invests in some of Mr. Welles's groups and will occasionally negotiate their contracts. Because of the opportunities for individual investors right now, he says that more professionals have been calling about investing their money in a group, and the number of these groups has been expanding.

Mr. Evans says the current commercial real-estate market is perfect for the doctors and other professionals in the group who have a high net worth and are taken aback with the stock market's recent volatility. "This is definitely the better opportunity right now for those who are looking to be able to sleep at night a little bit better," he says.

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Small Investors Gain an Edge In Properties