Despite a wide array of headwinds currently facing the multifamily industry—including elevated interest rates, massive new construction deliveries and softening operating fundamentals—we maintain a positive long-term outlook for the sector.

I looked back and noted that in my June 2023 edition of “Board Minutes from the Chairman” we briefly discussed the nonbank lending space, sometimes referred to as shadow banking, with its significant influx of private equity. Upon further reflection, I recalled a previously penned article from 1992 entitled “The Dawn of the Financial Architect”, a piece I wrote about the tail end of the savings and loan crisis (S&L) and the formation of the RTC or the Resolution Trust Corporation.

Over the last 35 years, I have been involved in over $8 billion worth of investments encompassing over 300 separate transactions. I have served in the capacities of borrower, property operator, lender, developer, investor and GP/fund manager. As a result of these experiences, I have had a front row view into many real estate organizations and what happens in good times and in bad. I have also been fortunate to have 2 partners in business for 30 years, operating through multiple cycles, including the Great Financial Crisis (GFC).

I’ve learned over the years as an entrepreneur that not only do you need to keep innovating but be willing to break the status quo and embrace change. While most leaders thrive in flux, they overestimate other people’s ability to process change and today’s instantaneous technological shifts only exacerbate feelings of uncertainty and a loss of control.

Entrenched into the 5th decade of my real estate career, I can’t help but think that I’ve read this chapter before, taken the same meetings and asked the same questions. Mark Twain said it best in that history never repeats itself, but it does often rhyme and so it does today.

Since the start of the pandemic, corporate America rapidly evolved to the work from home model aided by technologies such as Zoom and Microsoft Teams. What started out as a government mandated necessity has now evolved into a bright contrast of different corporate strategies, some embracing work from home models and others recognizing the many pitfalls of working remotely. Furthermore, tight labor markets have provided employees with the power to determine how they want to work, many electing to work from home.

No doubt we have all enjoyed the classic holiday film It’s a Wonderful Life, and in my household more than once. To remind everyone, the plot is built around the Bailey Brothers Building & Loan business and George Bailey’s near-death experience only to be saved by an angel who seeks his wings by showing George what the world might be like without him and his community savings bank. Our Chairman Minutes would be remiss if we did not catch-up on the current day banking mess and its impact to the real estate industry and the potential offing of a new credit crisis.

Being in the real estate investment business I’ve always enjoyed sharing varied tidbits and learned experiences with my own kids. Our family are active hikers and outdoor enthusiasts, so the opportunities are plentiful to educate and lecture (as my wife messages) on the fascinating aspects of finance and investment. How could my family not want to hear more about the importance of multiples vs IRR’s, positive vs negative leverage, cap rate arbitrage, functional obsolescence, or portfolio construction while out on the trail?

Mom’s heritage as a Brit always framed my upbringing, whether through her colloquial expressions, her careful fiscal oversight or her discussions of wartime London and the foundational imprint it cast on her life. As I return from an extended trip to London, I am not only reminded of my own DNA but of the tremendous history of the island nation, its impact on the history of the world and on our own country.

As a kid growing up, like many of my generation, I watched some of the classic sitcoms including Father Knows Best and Leave it to Beaver. Aside from the varied lessons learned from the Andersons and Cleavers, I carried forward a dream of buying my own home and while not necessarily within a community such as Mayfield or Springfield, I did make my first purchase, a condominium in San Francisco, in 1984.