Diversity Group International Expands Business Focus
As the Diversity Group International (PINKSHEETS: DGIN) Interest Rate Optimization Strategy (IROS) program continues to gain momentum and awareness in the premium finance insurance industry, the firm has begun to diversify the strategy's application to the Commercial Real Estate industry.
"Our research indicates that the commercial real estate industry in the U.S. alone exceeds 6.5 trillion dollars in assets and is expected to grow another $4.8 trillion by 2020," says CEO Kevin Bobryk. "The commercial real estate mortgage market in the U.S. accounts for $2.4 trillion in loans. A large number of these loans will reset over the next few years, which may expose them to potentially higher interest rates. Our IROS program will provide a direct means to potentially offset those higher interest rates."
According to many sources, including Moody's Analytics (Federal Reserve) - May 2011,long-term Commercial Real Estate loan interest rates are expected to rise over the next few years, from the current record lows to as high as 8%. DGIN believes this will drive even greater interest in cost reducing strategies like the IROS program.
"We see a major competitive advantage with the IROS product over the current products available to the commercial real estate market. The IROS product provides a simple, transparent, highly liquid, flexible and low entry cost structure that functions independently of the loan versus the typical complex, locked-in and potentially costly derivatives-based products that are offered today," says Bobryk.
With the application of the IROS product to the commercial real estate market, the firm has adjusted its pro-forma revenue expectations across the next 5 years with an additional 10 million dollars in gross revenue. "The potential for further market expansion and revenue estimations exists with the firm looking toward Asia, specifically the rebuilding in Japan and China's exponential growth, as these commercial real estate loans will continue to come under inflationary pressures similar to those in the domestic U.S. market that are causing interest rates to rise."
Posted: 05/19/2013 12:24:00
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