Ever wonder about the $460 Billion industry of medical office buildings?

Chances are you're going to be spending more time at them as you fight the war against time.

A thread on trends in the asset class, why we're BULLISH, and how well it holds up in recessions: Starting with the top down, there's an undisputable demographic trend that demand for healthcare services will increase.

1) Lot's of people getting older in the USA (graying of America)
2) Usage of healthcare goes up as you age.

Simple. Easy. Effective. Demand 🚀

1) What 2) H

One of the most valuable lessons I've learned as a LL is to humanize interactions with your tenant's.

After all, you're typically entering into a 5-10 year relationship with a tenant and the intermediary disappears after.

A thread on how we saved millions by doing this:

👇 During a time of economic crisis a retailer in one of our centers hired a "workout" group to re-negotiate all of their leases. It's important to understand how these groups win, typically it's a percentage of savings from their leases.

Group opens with a 40% rent reduction.

If there’s anything REtwit has taught us, there’s many different ways to make money as an investor.

People are on here &building in public. What follows is a list of investors, grouped together by how I’d categorize their investment strategy.

What follows is a substantial list: Market Dominance:
@moseskagan – hyper focused on LA apartments
@Bethazor1 – FL retail
@Stealx – focused on Chicago MSA apartments
@joepohlen – Assisted Living throughout PA
@dtmorgan18 – value-add/opportunistic mf/housing in SoCal
@gabebodhi – sub institutional MF throughout Co

Yesterday I posted a thread on how sometimes 💎 in commercial real estate pop up.

In addition to looking at a ton of deals, here's how I find them.

Below is a simplistic framework.

🧵 I believe there are three key components of what could be viewed as an interlocked system whereby if one or multiple are out of whack relative to each other, opportunity make exist.

They are:
-Fundamentals
-Rent Roll / Expenses
-Price

This may be controversial. Every now and then in CRE there is something we buy that is just wildly mispriced.

We look at 1000's of deals a year & sometimes these gems pop up... it's a bit like micro/small cap investing where a cheap opportunity just hits you over the head

🧵 This to me is akin to a relative value or mean reversion trade & we don't underwrite cap rate compression though we're confident we'll achieve it.

Here's a sample of some deals we've done this way.

Ex 1:
Bought assets late last year as a part of a portfolio at a 7.25 cap

A number of people have asked @realEstateTrent or I where to get information. I've mentioned I love reading REIT reports for trends and sometimes micro level information. I mentioned to @moseskagan this is part of our edge (can work smarter, not harder).

A thread on $BRX most recent quarterly investor report.

It can be found by going to their website -> investors -> scrolling down to quick links & clicking "quarterly investor information"

Quick primer on who Brixmor is:
-one of the largest open air retail owners in the US
-grocery/community centric

#cretwit has talked ad nauseum about the beauty of CRE due to it's simplicity (we aren't that smart) relative to other assets. It's true & part of my heart goes out to that, BUT

I'm a structure/finance guy by neurosis, a 🧵 on common mistakes I see that cost owners MILLIONS💰💵 1) Not understanding financing alternatives

Some common mistakes I see here are amongst build to suite developers and groups doing value-add projects

On the BTS side, right now there's plenty of financing alternatives for 95-100% LTC financing. If you're a merchant builder

As someone who sits as both a GP/LP in a number of real estate investments, below are some questions that I ask in lieu of their common counter parts. We'll have fun and do broke (b) versus woke (w) in homage to the internet meme gods.

Time for a short🧵: (B): What's your track record?
(W): Tell me about how often you hit your NOI projections/business plan/operational goals and when you deviate, are there any common themes

^highly applicable to managers that invest across risk/return continuums.

A thread on learning in CRE investment management-

First some context:

We sit in a unique spot spot in the industry where we're bigger than mom n pop operator's, but not quite an institution. Given we're usually around ~$500mm in AUM we're regularly straddling the institutional world and "friend's and family" / "country club" money. We've done deals where JV'd with recognizable wall street or PE names and also passed the hat around the country club. As such I've been fortunate to gain perspective from both "sides of the aisle" and I think there's a lot

Constantly hear how retail is dead. The convo needs to be bifurcated by malls, power centers, grocery anchored centers, and single tenant. I'm in agreement we're largely over malled and that some will continue to suffer.

A data guy at heart some ways that I dig deeper. Let's start by looking at Brixmor, a leader in grocery anchored retail with 70% of their portfolio being grocery anchored.

-3Q20 net effective rent for NEW leases near all time highs
-92% collection (2% being deferrals) and 97% of tenancy open
-91.2% leased compared with 92.4%

What's to follow is absolutely not investment advice, but a look into how I allocate our personal assets today and likely into the future. This is highly unconventional, but works for us.

At a high level we're between 30-40% of our invested assets in an algorthymetically traded portfolio that I manage. The remainder is in commercial real estate. I say invested capital b/c I'm somewhat of a "fiscal prepper" and keep about 1.5+ years worth of living expenses in cash at all times.

The algo portfolio trades primarily futures these days and is built on

In an effort to bring more transparency to CRE, a deal from the trenches:

We bought a half leased medical office building for 55/sf (~1/4th replacement cost) in a prestigious suburb of a declining MSA. Normally we want growth tailwinds but this suburb had been growing and is a frequent “best places to live” with great schools.

Why’d we buy-
-Able to structure long term sale leaseback from seller (hospital system)
-Huge lot, building had excess land and a great exterior
-Priced as if building was 48k sf when we knew it was 54k sf.

Deal execution-

1/n) Below is tweet storm of my journey into public market investing/trading, how I learned, and a thank you to those who have helped (direct & indirect) along the way:

It was 3 years ago just before Easter we were on our way to Amsterdam for 10 days (it was a work trip for my 2/n) wife, I invited myself). During the days while she had work and I was working remote, I began my quest to learn about public market investing. Reason is, majority of net worth at the time had been tied up in Commercial Real Estate (co-investing in our investments for my “day