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Over my 50 years of doing deals and observing the flows of capital, one thing is never changing, and that is that the sources of capital for US CRE are always changing. It just depends on which nation is in a capital growth mode, and which has seen its day go past. We saw the Arabs as the main source when they really controlled oil and wealth was flowing in to them so fast they had no place to put it other than London and the US. There were the Japanese when they were in their huge value run up for real estate and as their economy was booming, before it crashed twenty years ago. The Russian oligarchs (thugs) become instant billionaires after the fall of the Soviet Union and this group was able to gather up all of the prime assets of the Soviet Union and to then need a safe place to hide their wealth and to flee to. That was again London and the US real estate markets. Then came the Chinese as their economy opened up and capital was allowed to leave for foreign investment. Again, the ones who were intimately involved with the regime were able to gather up huge pools of assets and they also needed a place to hide all of the wealth and a place to flee. Singapore, Vancouver and the US become the top places for Chinese money to go. Then as the Chinese economy skyrocketed into a hugely successful export engine and as the peasants became urbanized earners, they all wanted a place besides Chinese apartments to put money so they would have safety and a place for them to flee. It is always the same.  Wealth is created for a period of time in a specific nation, and the wealth gatherers want a place to keep it safe, and a place to send the kids to university, and for themselves to flee when the balloon bursts. The US and London have always been the place to hide. Switzerland is no longer the place to stash money as it once was. London and the US are much nicer places to live and far better places to send the kids to university. Singapore is safe and open to Chinese, but it is a tiny island. EB5 became a great vehicle for the scammers and syndicators in China to take advantage of the huge wealth creation for ordinary Chinese. US developers were the beneficiaries of this latest flow of capital. Israel has now slipped in as a new source of capital as that country has prospered and created real wealth for some. Europe is no longer a source of major capital investment and has not been for quite a while.

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Joel Ross

Joel Ross began his career in Wall St as an investment banker in 1965, handling corporate advisory matters for a variety of clients. During the seventies he was CEO of North American operations for a UK based conglomerate, and sat on the parent company board. In 1981, he began his own firm handling leveraged buyouts, investment banking and real estate financing. In 1984 Ross began providing investment banking services and arranging financing for real estate transactions with his own firm, Ross Properties, Inc. In 1993 Ross and a partner, Lexington Mortgage, created the first Wall St hotel CMBS program in conjunction with Nomura. They went on to develop a similar CMBS program for another major Wall St investment bank and for five leading hotel companies. Lexington, in partnership with Mr. Ross established a hotel mortgage bank table funded by an investment bank, and making all CMBS hotel loans on their behalf. In 1999 he formed Citadel Realty Advisors as a successor to Ross Properties Corp., focusing on real estate investment banking in the US, UK and Paris. He has closed over $3.0 billion of financings for office, hotel, retail, land and multifamily projects. Ross is also a founder of Market Street Investors, a brownfield land development company, and has been involved in the acquisition of notes on defaulted loans and various REO assets in conjunction with several major investors. Ross was an adjunct professor in the graduate program at the NYU Hotel School. He is a member of Urban Land Institute and was a member of the leadership of his ULI council. In 1999, he conceived and co-authored with PricewaterhouseCoopers, the Hotel Mortgage Performance Report, a major study of hotel mortgage default rates.

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