Should a residence by investment now be described as an asset class, essential for HNWIs to diversify their portfolio and lives? A clear favorite is a residency permit such as the Portuguese Golden Visa, and obtaining one through a regulated fund is the perfect route.

Reflecting on the past year and the significant increase in interest shown by companies such as EQTY Capital in Portugal, it is safe to say that a suitable residency or citizenship by investment is no longer just a requirement for HNW individuals or families from jurisdictions with social or political unrest or economic instability. In the recent past, there have been a few very important events that have changed the very nature of how such an investment is viewed, and it is safe to say that it is indeed now an asset class in its own right.

As such, it is imperative that such an investment be viewed exactly as such: an investment. This was the starting point for the establishment of EQTY Capital and should be the starting point for any prospect considering such a move.

The question should be asked: "If a visa was not attached, would I be interested?" When answering this question, one should consider the team involved, conflicts of interest, risk profile, fee structure, and exit strategy, among others.

That said, many of the reasons why wealthy families wish to secure a second residence remain the same. Typically, investors from the likes of South Africa, Brazil, Turkey, or India, for example, pursue more freedom in terms of European movement and improved social, education, and health opportunities for their families. These were in most cases and are a large portion of those who typically seek investments such as the regulated fund platform initiated by EQTY Capital.

However, it is becoming much more common that HNW families are now seeing not only the financial and succession planning opportunities in holding a second residency but also the opportunity to stretch retirement plans or budgets or improve lifestyles. It's as much a plan B or C as a plan A, particularly for baby boomers or highly mobile digital nomads. This has opened up investors from Canada, Australia, New Zealand, the UK, and the USA in particular, on top of those previously mentioned, and they represent the fastest growing demographics in this space.

EQTY resonates strongly with these internationally minded individuals who expect to engage with commercial expertise and corporate ethics of the highest standards—this is the key for these individuals. As mentioned, they are looking at investments linked to residency, but it's important that the investment can stand essentially on its own two feet and not need the attachment of potential residency to justify its existence. Track record, team, governance, conflicts of interest, really need to be considered, and should these fundamentals stack up, then the right of residency is merely a bonus, and the decision to invest is an easy one.

Portugal: the protection of a well-regulated country and a perfect place to live, work and play.

Not all countries are created equal when you look at their business and social environments. Gaining access to countries governed by unbiased legal systems and protected by fair police and security forces is a huge draw for HNW families. Portugal scores highly across the board, but most importantly, it is a place where one can enjoy the simple things in life in a cultured, dynamic, affordable environment. It is not surprising that the Portuguese Golden Visa program is considered the benchmark.

Portugal has really benefited from this increase in inward investment. As a country, it is going through somewhat of a controlled property boom, partially helped by the original demand for property at the start of the Portuguese Golden Visa program. Importantly, golden visa investors only account for 1.5% of all property sales, according to last year’s statistics, which shows a robust and mature market with solid fundamentals.

That said, the rules on where Golden Visa investors can buy property have changed, and investors do not have access to the very best areas of Portugal anymore. Funds, however, are Golden Visa eligible and allow investors to invest in efficient property developments in some of the best areas of Portugal.

In addition to qualifying as an investment for a family’s residency application, a fund represents a real opportunity to make an investment in a rising economy and one that is well regulated by the Portuguese Financial Services Regulator, CMVM.

Golden Visa eligible funds are professionally managed, of course, by highly skilled and regulated fund managers such as STAG Fund Management, who always have the ultimate decision-making ability. It is very important to note that firms such as EQTY are merely the advisors to the fund. We identify investment opportunities and present those from our investment committee to that of the fund manager, who would then check—do the investments comply with the fund regulations? Are they commercially sound? And are they in the best interests of the fund? And if they are in the best interests of the fund, they are in the best interests of the investors.

It's fair to say that prime residential real estate is at EQTY’s core, and what we've done is something quite different. EQTY has established a platform of leading developers in Portugal, from which we preselect non-development stage acquisitions, usually ahead of the market and with a pre-build as well as bulk purchase discount. This means that any investment made has inherent upside as well as downside protection. Currently, there are close to 20 developers on the platform, which is up from the 5 we started with last year on the 1st of April '21, which leads to portfolios with exceptional diversification.

This contrasts with the common single developer focused fund that you so often see in Portugal, where a developer acts as an advisor, feeding the fund a diet of their own product. This diverse approach mitigates risk, particularly the construction and sales risk associated with property development. Risk management, a primary concern of Golden Visa or other RBI investors and a prerequisite for a profitable investment,

The apprehension of investing in a foreign country is mitigated with the right partner. We’re glad to share our expertise with those looking to invest in this beautiful country, so they too can receive the same privileged welcome we’ve enjoyed. We are passionate about Portugal. It would be our pleasure to talk through and understand how EQTY Capital can be of help to you.