Mid-Year 2019 Market Update from Regulation D Resources
“We are mid-year 2019 and, with the summer season upon us, comes Regulation D Resources Mid-Year Private Placement Capital Markets Update!
2019 has been a record year with regards to Regulation D Private Placement Offerings and comparable to mid-2000 in terms of transaction volume and capital investment. Slight volume volatility in March was the only outlier with the balance of the year at or above expected execution volume. Execution volume is approximately on par with 2006 and 2016 which should lead to another year in the $1.5 trillion range insofar as total capital raised under the Regulation D programs. Following is a summarized market update:
Real Estate: The Fed signaling an end near term to rate hikes allowed for some stability to return to the real estate sector. Still the top sector by volume with apartment and multi-family class real estate transactions being the leading sector. We are also seeing some assisted care development gaining traction and also focus on memory specialized care facilities.
Approximately 87% of the real estate offerings executed this year were equity based offerings and approximately 34% intended on using leverage or external financing as part of the capital stack. Other notable sectors in real estate were self storage facilities (acquisitions and new construction), sports complexes, and triple net properties.
Energy: Oil and gas has been stable in 2019 and, as typical, is the number two sector by volume. Relatively stable energy prices have contributed to continued interest in development and also re-entry and re-work type transactions.
Green energy is slightly lower this year as compared to 2018. We have seen a slight decrease in solar and wind based opportunities compared to 2018 and 2017.
Technology: Technology related offerings are our third highest volume sector with customer tracking and management applications being the leading sub-sector in the tech sector. Execution volume and capital raised appears to be ahead of 2018 in terms of volume.
86% of our transactional volume is 506(c) based offerings. We are also continuing to see a significant number of clients using the RDR Investor Web Portal Application to promote the offering and manage the compliance and subscription processes.
Our highly awaited V3 update to the investor web portal software will be available by the end of this summer and has some upgrades in terms of data management, admin features, and user interfaces.”