First up is some feedback I got in response to something in last week's OTR. This comes from a highly-regarded institutional investor:
On your comments about how to get LPs over the line and get that close, I would add: Get some deals done (with GP capital that will get transferred into the funds) so that people have something tangible to buy into, make the penalty for late entry meaningful (I only know of one fund that forces late entrants to pay more than the 6-8% penalty); provide meaningful incentives to first close participants; close off catch up (Blackstone does this), at some point in the future, new LPs do not get to participate in the old deals, they only participate in the deals done after their entry (this assumes that early deals in a funds' life tend to capture the early trends and get best returns which regularly is the case).
I'm happy to publish any additional comments on this subject.
September 30, 2012. For some, it's a time to look to see if they've "made their numbers." To others it's the end of the third quarter of a year that has, for me anyway, simply flown by. Retailers are not only displaying Halloween stuff but Christmas as well! Give me a break. What's the hurry?
In the real estate business, deal-makers start turning up the heat around this time as well: owners who have listed properties for sale want to see action before year-end. Investors, for tax and other reasons, may want or need to invest money before the Swarovski crystal ball drops over Times Square in New York, to be witnessed by goodness knows how many revelers. In the New York City market, the investment sales brokerage business has been going through a very interesting time. New firms entering the market, "poaching" as it were, top producers and teams from other firms. The competition has never been fiercer and, from what I hear, it's not over yet.
But, moreso, perhaps turning the page of your diary and seeing that Monday is October 1, gives you pause, perhaps reflection. Have I at least made progress towards the goals that I had set for myself or my business at the beginning of this year? How about personal development-have I learned new things that will help me be a better me? A better consultant? A better friend? Have I used my time wisely? Have I taken time out for myself, to have fun, to enjoy life? Some of these may seem like daunting questions but it's not a matter of how much of anything you did, it's that you either did it at all, or started to do it. And we need to pat ourselves on the back every once in a while; we can't expect that others will do it but when they do, it sure feels good. This hold especially true for parents with their children: don't take their accomplishments for granted. Make sure you congratulate them for a job well done. Building self-esteem in a human being starts very, very early.
Real Capital Analytics released their August 2012 US Capital Trends Reports this week. They also made this announcement: In October, RCA will launch a suite of over 160 property price indices based on the same data and methodology used in Moody’s/RCA CPPI (Commercial Property Price Index).
With RCA's kind permission I offer you some of their insight:
Office: Sales of significant office properties totaled $5.3b in August, slightly below June and July levels but 6% higher than a year ago.
Industrial: Sales of significant industrial properties totaled $2.3b in August, marking a rise from July but a small decline from a year ago.
Retail: Sales of significant retail properties totaled $2.7b in August, marking a rise from July and a small gain from a year ago.
Apartments: Sales of significant apartment properties totaled $6.4b in August, rivaling May and June as the most active month this year.
Hotels: Sales of significant hotel properties totaled $1.1b in August, marking one of the lightest months this year and the largest yoy decline in sales – down 63%. Similar trends were evident in both the full and limited-service sectors.
JOB POSTING: The San Francisco Employees Retirement System (SFERS) has both private equity and real estate analyst positions available and this single posting is designed to 'attract' both types of candidates.
- Scott Arden who recently joined Triton Pacific as their man in New York.
On my iPod I have a wide range of songs. I have two "Walk" playlists for the walks to and from the train station. But yesterday I listened to a few tracks for the first time in a while. They are from an album by Jimmy Durante, a name not known to many of you. It's a compilation of some of the greatest "standards" ever written and I encourage you to check them out and expose others to them. These are songs that have already stood the test of time of several generations. You don't hear them played too much but...well, see for yourself:
Big News: The Felix Consulting Group proudly announces our "Mentorship Interview Series." Starting soon, I'll be posting interviews with people who have made a difference, a significant contribution to the commercial real estate industry. Each person will be asked the same questions, the answers to which will be helpful to younger people, on their way up. It's all about "Learning, Growing & Connecting." This is something I've been working on for a long time and I'm very excited about it. Stay tuned.
Just so you get an idea, here is a sample of some of the questions that I may be asking each interviewee:
- How did you learn what you needed to know to be successful in the CRE industry?
- Who have been your mentors and how did they most help you?
- What advice were you given along the way that was most meaningful?
- How has the industry changed and if you were starting your commercial real estate career now, given what you know, what might you do differently?
- What advice can you offer to people interested in a commercial real estate career or in advancing in the industry?
On the road...
Oct. 3: Kirkland & Ellis Real Estate Symposium in New York
Oct. 9: The Bitter End in New York to see Shannon Corey perform
Oct. 14-16: Chicago to attend and moderate a panel at the NAREIM Fall Executive Meetings
Oct. 17: Depaul University, Chicago for my "Careers in Real Estate: Connecting the Dots keynote.
Oct. 18: University of Chicago for the same thing.
Oct. 22-24: Los Angeles for the 20th Annual PREA Investor Real Estate Conference
Oct. 25:26: Amsterdam to attend and moderate a panel at the PERE Global Investor Forum
Nov. 7: Washington, DC for my "Careers..." discussion with students at Johns Hopkins University
Nov. 8 & 9: Attending, moderating a panel and serving as "Chair" for Day Two of the PERE Forum
Thanks to the DaVinci Hotel in New York for allowing me to use their computer to post this column.