Mallard Capital LLC

International institutional investors deployed over $80 billion into global real estate in 2024. A significant share of that capital targeted U.S. markets - multifamily, logistics, data centers, and select office repositioning plays. But the way international LPs evaluate these opportunities differs meaningfully from how domestic investors approach the same deals.

The first difference is currency. International investors think in terms of currency-hedged returns. A deal that looks attractive in dollar terms may lose its edge once hedging costs are factored in. Sponsors who present returns without addressing currency risk signal a lack of sophistication in dealing with international capital.

The second difference is structure. Many international investors - particularly sovereign wealth funds and Gulf family offices - prefer co-investment structures over blind pool fund commitments. They want to see the specific asset, the specific business plan, and the specific return profile before committing capital. This means sponsors need to be prepared to offer deal-level transparency that goes beyond a typical fund marketing deck.

The third difference is timeline. International investors often operate on longer decision-making timelines than domestic LPs. This is not inefficiency - it reflects the reality of multi-layered internal approval processes, particularly at sovereign wealth funds. Sponsors who push for fast closes without understanding these dynamics risk alienating potential investors.

The fourth difference is relationship weight. Domestic LPs will often evaluate a deal primarily on its financial merits. International LPs place significant weight on the relationship with the sponsor and the intermediary who made the introduction. Trust, repeated interaction, and cultural fluency matter as much as the numbers.

For sponsors seeking international capital for U.S. real estate deals, the implication is clear: you need an advisor who understands both sides of the table. Someone who can translate your deal into terms that resonate with an Abu Dhabi family office or a Singapore sovereign fund. Someone who has the relationships to get you in the room and the credibility to keep you there.