Bank of America has published its 2025 Specialty Asset Management Outlook shedding light on market dynamics affecting commercial real estate, farmland, timberland, and energy assets. The report emphasizes real assets as a growing component in portfolio diversification for investors aiming for long-term wealth creation amidst a fluctuating market.
Ken Shepard, SAM Executive at Bank of America Private Bank, highlighted the importance of real assets in the current climate. "Characteristics of real assets, such as generally being uncorrelated with traditional investments and serving as a hedge against inflation, are increasingly relevant in the current environment," Shepard stated. "For well-informed, long-term investors, 2025 will be a good year to selectively build positions in certain real asset sectors."
The 2025 SAM Outlook explores several key themes:
- **Commercial Real Estate (CRE)** shows positive momentum with renewed investor confidence due to rebalancing supply and demand, stabilizing valuations, and increasing liquidity.
- **Farmland** presents opportunities for stability and diversification. The 2025 crop year may benefit informed investors, as competitive pressures ease and farmland values remain stable or slightly lower.
- **Timberland** is seen as a bridge for market uncertainties. It offers a viable investment for long-term investors with lower risk profiles, as it is mostly insulated from market cycles and geopolitical risks.
- **Energy Use** is projected to increase globally due to factors like population growth and rising standards of living. The preference is expected to lean towards natural gas, renewables, and other carbon-friendly sources.
Bank of America’s SAM team boasts significant experience in managing complex assets like timber, farm and ranch land, oil, gas, mineral interests, real estate, and private businesses. They provide comprehensive services for ultra-high-net-worth clients within Bank of America Private Bank and Merrill, as well as those looking to acquire real assets.
Bank of America positions itself as a leading financial institution, offering extensive banking, investing, and asset management services globally. Its wide array of products and services caters to consumers, small businesses, and large corporations. The corporation's stock is publicly traded on the New York Stock Exchange under the ticker BAC.
The report advises investors to consider the complexity and risks associated with nonfinancial assets such as closely-held businesses, real estate, and mineral properties, underscoring the importance of consulting with professional advisers.
Bank of America’s insight into the future of specialty asset management underscores the potential for growth and diversification through real assets in a diverse market landscape.
For inquiries, contact Julia Ehrenfeld at Bank of America by phone at 1.646.855.3267 or via email at julia.ehrenfeld@bofa.com.