Great thread on all of the simple, yet painful things, that can go wrong with a luxury real estate project.
Continued…
Continued…
https://twitter.com/stillwell/status/1440666877752070153?s=20
I’ve tweeted this many times, but it doesn’t hurt repeating. When executing our luxury projects:
• we hardly ever use debt and if we do it would be well below 50% LTC
• we don’t use outside investors but our own permanent capital which has long term patience & staying power
• we hardly ever use debt and if we do it would be well below 50% LTC
• we don’t use outside investors but our own permanent capital which has long term patience & staying power
• we demand a margin of safety (e.g. meaningful discount at entry) and we’d rather have a missed opportunity than to “pay up for quality” because paying up will hurt you in the luxury game
*unlike GPs that buy at any valuations chasing fees & promote our only upside is profit*
*unlike GPs that buy at any valuations chasing fees & promote our only upside is profit*
Many things can and will go wrong, from designs to planning and from construction to cost & time overruns.
And yet over the last couple of decades, we never had a permanent loss of capital on any luxury project due to those 3 simple things (which are so hard to follow for many).
And yet over the last couple of decades, we never had a permanent loss of capital on any luxury project due to those 3 simple things (which are so hard to follow for many).
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