How Can Indian Investors Benefit from Asset Management?
Asset management is intended to cultivate market value for ownership to improve its returns, whether it is real estate or any other asset.
Share on facebook
Share on twitter
Share on linkedin
An asset manager looks over assets on behalf of others, making critical investment decisions that help the client’s portfolio development. An asset manager also guarantees that the client’s investment does not devalue and that risk exposure is minimized. This entails keeping an eye on the market, remaining current on studies and trends, and keeping up with political, financial, and economic news.
Real estate can also be managed by asset managers. These specialists follow the same rules as asset managers in the financial sector. They specialize in optimizing a property’s value for investment purposes, as opposed to real estate property managers, who handle the day-to-day operations and physical structure of a property.
Read Also: All Your Burning Real Estate Asset Management Questions, Answered!
What is Asset Management in Real Estate?
In the real estate market, asset managers typically specialize in specific types of property, locations, or operations. The asset manager’s primary responsibilities include market research, data analysis, and revenue forecasting.
Leases and rental agreements must be written in a way that attracts tenants while also providing flexibility, reducing vacancies, and limiting liability exposure. Resources must be allocated strategically—poorly managed resources have a detrimental influence on portfolio value.
A property manager is often chosen by the asset manager. The asset manager focuses on financial concerns, whereas the property manager focuses on property operations. This relationship is critical in real estate investing, much as a corporation’s board of directors must work closely with its CEO or COO.
The overarching goal of asset management is to maximize property value and investment returns. This involves lowering expenditures whenever feasible, finding the most stable and substantial sources of revenue, and avoiding responsibility and risk.
Asset managers are, in some ways, entrepreneurs. Many choices in real estate asset management, such as negotiations, approvals, and lease analyses, necessitate the assumption of risks and the creation of predictions. Managers who use their financial resources in the most inventive ways are more likely to be rewarded with better earnings and larger portfolios.
What Is the Importance of Asset Management?
Asset management is important for businesses for several reasons, including:
- Allows a corporation to keep track of all of its assets
At its most fundamental, asset management entails understanding and keeping track of the assets owned by a certain firm. It enables businesses to track their operating and maintenance expenditures with the aim of identifying inefficiencies that may be improved. As a result, effectively recording this information will not only save the organization money but will also result in higher returns. The procedure makes it easy for businesses to keep track of their assets, whether they are liquid or fixed. Firm owners will be aware of the location of their assets, how they are being used, and whether or not they have been modified. As a result, asset recovery can be completed more efficiently, resulting in increased profits.
- Assists in ensuring amortization rates are accurate
The asset management process ensures that assets are accurately recorded in financial accounts because they are verified on a regular basis.
- Aids in risk identification and management
The process of identifying and managing risks associated with the use and ownership of specific assets is known as asset management. It means that a company will always be prepared to deal with any risk that may arise.
- Eliminates phantom assets from the inventory of the company
Assets that have been lost, destroyed, or stolen have been incorrectly recorded on the books in some cases. A strategic asset management strategy notifies the firm’s owners of any lost assets and removes them from the books.
- Maximizing Potential
Asset management assists businesses in realizing their full potential. Companies may maximize their company activities through appropriate management. They can also develop a better design for resource usage and implementation, which will go a long way toward ensuring long-term development and success.
Assets that have been lost, destroyed, or stolen have been incorrectly recorded on the books in some cases. A strategic asset management strategy notifies the firm’s owners of any lost assets and removes them from the books.
Also Read: Understand the Differences between – Investment Management Vs. Asset Management
Tips to develop an efficient Asset Management strategy
Asset ownership is an essential component of any public or private organization. A firm owner must design a strategic plan to properly manage the assets.
- Perform an asset inventory
Before doing anything else, an owner should make a list of all the assets he owns. He will not be able to manage his assets properly if he is unaware of the exact number of assets in his inventory. The following items should be included in a company asset inventory:
- Total number of assets
- Where are the assets located?
- The worth of each asset
- When the assets were purchased
- The assets’ anticipated life periods
- Determine the life-cycle expenses
If a business owner wants to be accurate with his asset management plan, he should determine the total life-cycle expenses of each asset. Many business owners make the mistake of merely calculating the initial purchase costs.
Additional costs, such as maintenance expenses, condition and performance modeling, and disposal costs, are expected to arise during the asset’s life cycle.
- Establish service levels
After calculating the life-cycle costs, the next step is to establish service levels. Simply said, it implies detailing the overall quality, capacity, and function of the various services provided by the assets. As a consequence, a company’s owner can determine the operating, maintenance, and renewal activities necessary to keep assets in excellent shape.
- Make long-term financial plans
A corporate owner’s asset management method should ideally transfer readily into long-term financial planning. With a solid financial strategy in place, the owner may determine which goals are achievable and which must be prioritized.
What do Asset Managers Bring to the Table for Private Equity Investors?
Third-party asset managers offer solutions to help private equity investors fulfill their goals of maximizing returns. They attempt to address the challenges that investors face in managing the operational, strategic, and financial aspects of their investee companies, as the latter are unable to obtain the necessary management information promptly and are concerned about fraud, misappropriation, or misconduct in their investee companies.
These asset managers serve as the eyes and ears on the ground for knowledgeable investors who understand that it is prudent to follow up on investments with regular monitoring of major business risks. They assist Private Equities in managing different risk factors and the issues outlined above. Because they are independent, these asset managers ensure that an unbiased, external perspective is incorporated into asset management protocol and that investors’ interests are protected and optimized without jeopardizing relationships between investors and investors.
So because the asset manager is independent and unbiased, he or she acts without regard for the history of the investments and brings to light the facts of the investments by acting as a bridge between the stakeholders. As service providers, they recognize the significance of each investment to the investors and recognize that every piece of information about the investment is significant. These managers serve as a watchdog, communicating crucial information and observations while also suggesting remedies to potential dangers.
Investors are generally in agreement that India is not a short-term play. Institutional investors are increasingly establishing long-term, strategic positions in the market to maximize profits on existing investments in India while also having a long-term, greater exposure.
Also Read: Understand the differences between asset management and wealth management
Engaging a local third-party asset manager with the necessary experience managing transactions and investments, as well as post-investment monitoring, is intended to ensure that the expectations of the various stakeholders in the investment cycle are effectively managed. When it comes to some vintage funds achieving their goal returns, the majority of FDI funds have yet to return even their capital to their investors.
When it comes to underperforming assets, asset managers may play a vital role in safeguarding or recovering value for the client. In many cases, the use of third-party asset managers has resulted in the simplification of information flow from investee firms to investors, as well as the improvement of investee firms’ finance vertical and risk management capabilities. The fact that these asset managers are unrelated to the investment, the investor, or the investee increases the credibility and independence of the monitoring process and fosters a constructive environment for information and ideas to flow among stakeholders.
Asset management is a procedure that assists businesses in keeping track of all of their assets, including cars, equipment, and investments. Keeping track of assets helps to streamline processes, especially when it comes to selling or disposing of them. Because all accessible assets are adequately accounted for, the procedure also reduces the possibility of registering ghost assets. Assetmonk is a WealthTech Platform that provides asset management facilities in Hyderabad, Chennai, and Bangalore with IRRs ranging from 14 to 21%. Our commercial real estate investment products are divided into three categories: Growth, Growth Plus, and Yield. Visit our website to learn more about real estate investment and our services!
Asset Management FAQ’S:
What is asset investment management?
In finance, asset management refers to the management of investment portfolios. The assets in this portfolio will be managed by investment banks or individual asset managers, who will limit risk while increasing value.
Is asset management the same as investment management?
Investment management describes the use of instruments and procedures to achieve good returns, depending on whether the individual is risk-averse or risk-tolerant. Asset management, tax planning, estate planning, insurance, retirement planning, education, and philanthropy are all examples of this.
Related Articles

7 Retirement Planning Investment Strategies for Freelancers
Freelancing has the potential to be extremely rewarding, but you should also plan your retirement planning investments property. Here is some money advice to make sure you’re on the proper route to financial independence.

How PIO, OCI, and NRIs Can Safely Invest In Indian Real Estate In 2022
Let us look at some of the key aspects that have aided NRI, OCI, PIO real estate investments in India. Non-Resident Indians (NRIs) who want to participate in the Indian real estate market should be aware of the rules that govern the purchase, sale, and rental income generated by a property.

Indian Real Estate Industry 2022: Will Omicron Stop The Growth?
Indian Real Estate Industry 2022 | Will Omicron Stop The Growth? – India’s real estate industry, which was heavily damaged by Covid-19, is now picking up speed and heading towards a robust recovery.

Own A Property? Get All Your Rental Income Questions Answered Here!
Buying a rental property and then renting it out to tenants will usually give you enough money to pay down the mortgage. Don’t know where to begin? We’ve got you covered, don’t worry. Let’s go over everything you should know before purchasing a rental property.

Retirement Planning Investment Strategies With Real Estate In India
Real estate is a solid retirement investment option. It helps you generate rental income

The Ultimate Guide To Retirement Planning Investment In India 2022 & Beyond
Retirement planning investment options help you to make informed decisions. Retirement planning refers to strategically investing a part of your earnings into wealth-generating assets to create a retirement corpus fund that will help you maintain your lifestyle and meet expenses.

5 Bad Asset Management Strategies To Avoid For Real Estate Investments
When it comes to real estate investments, asset management is tricky. We examine the most common strategic mistakes by real estate asset management organizations. As a result, when considering businesses to invest with, individual investors must keep an eye out for these blunders and be careful to ask the correct questions to screen potential real estate asset management firms.

DIFFERENCE BETWEEN RETIREMENT PLANNING INVESTMENT & SAVINGS ACCOUNT
The majority of investors, confuse saving and retirement planning investments. However, they are two completely separate things with distinct objectives and duties in your financial plan and balance sheet. Make sure you understand this key notion before you start your road to prosperity and financial independence.

What Is The Minimum Amount For NRI Real Estate Investments In India?
Did you know that an NRI like you could invest in real estate in India and earn rental income? NRIs have a myriad of investing possibilities and must select the one that best meets their needs ranging from stocks to mutual funds. However, real estate stands out amid the vast investment alternatives in India for an NRI.

TDS on Rental Income: What is the Limit & How Much Is Refundable?
What is the limit to deduct TDS on Rental income and how much amount is refundable? TDS gets imposed on various revenues, including a landlord’s rent, commission, professional fees, salary, interest, and so on. Varied forms of income are subject to different TDS rates under the income tax legislation.

How to pick the best investment for Rental Income and Capital Appreciation: Residential or Commercial Real Estate?
The difference between commercial and residential real estate property is something that all investors must know. Which type of property should you select if you want to invest in real estate to make better rental income & capital appreciation? Residential or commercial? We examine the benefits and drawbacks of each choice.

The Scope Of NRI Real Estate Investments In India In 2022
NRI real estate investments in India have been increasing over the years. Investment managers, institutions, and private equity investors are expected to be the main cross-border capital deployers in 2022 in the United States, Canada, the United Kingdom, and Germany. More than half of all major cross-border transactions are expected to be in the office sector in 2022, while residential is expected to be the second most invested sector.

Capital Appreciation Or Cash Flow: What Is More Important For Investors?
What is more essential in real estate investing: cash flow or capital appreciation? Real estate investors frequently dispute whether it is better to focus on capital appreciation or cash flow when putting out an investing strategy. The obvious goal of investing is to make money, but how that money is made is crucial.

How To Create A Retirement Planning Investment Strategy In 10 Minutes
Retirement is a significant milestone in our lives that must be carefully prepared. Many factors must be examined, including your retirement age, monthly savings, investments, debts (if any), and so on. It would also rely on your post-retirement pension, provident fund, and a variety of other things. To have a comfortable retirement, one must plan thoroughly and ahead of time. Let’s look at some ways to make your retirement planning a success.

5 GOOD AND BAD PRACTICES THAT AFFECT THE RENTAL INCOME OF YOUR PROPERTY
Investing in a property for rental income might pay you financially. Be aware of the hazards and obligations if you’re considering this type of real estate as an investment.

Become A Pro Investor By Maximizing The Capital Appreciation Of Your Property
There is no need to be concerned about exiting if you invest in a built-up property to generate regular income. When it comes to capital appreciation, however, timing the sale is crucial. Here are some things to consider if you want to get the most out of your real estate investments.

How To Save Long-Term Capital Gains Tax On Your Property? Here’s How
If you sell your home, you must pay capital gains tax on the profit gained after considering factors such as inflation and indexed cost of purchase, among others. However, you can implement strategies to save on capital gains tax on property sales.

Golden Rules For NRI Investments In India During Market Dip
If you’re an NRI looking to invest in a home in India you must consider these golden rules for NRI Investments in India.

Essential Services To Look For In Asset Management Companies In India
Asset management encompasses more than simply the purchase and sale of assets; it also involves the management of financial assets and other investments.

The Updated Rental Income Tax Calculator For India In 2021-2022
While filing the income tax return (ITR), one must use the income tax calculator correctly since one’s gross rental income equals the total yearly rent minus municipal taxes paid in that fiscal year.