The following Q&A was completed as part of our conversational Commercial Real Estate FAQ Interview Series, we hope you find it helpful.
While a budding real estate investment company can grow quickly simply by acquiring more in assets, this isn’t always the sustainable way to go. A young company doesn’t just what growth, they want sustainable growth, and this is more of a marathon than it is a sprint. Grow your assets, grow them well, and ensure that all of your investors are kept satisfied with their choice to do business with you.
Richard Wilson: If someone else that’s listening is focused on their own niche area and wanted to grow to 100 million dollars plus in assets as quickly as possible, what would you suggest to them that would help them greatly?
Leonard Way: Well, always remember that growing a company is, particularly real estate investment company, is more of a marathon than a sprint. You can grow assets, but growing assets for the sake of growing assets is never a very sustainable situation. We like to remember sort of the golden triangle approach made up of knowledge, determination, and capital. And if you have any two of those three, you generally will find someone with the third to help get you there. In our case, the Beach Company has all three, we’re blessed that way but as with any company we’re limited by our amount of capital. So we have very deliberately over the last 15 years sought to bring in third party capital allowing us to grow substantially over that period of time. But you can grow that quickly, but again is it going to be sustainable? What you want is to grow those assets, manage those assets well, and to make sure that you’re keeping that capital source as happy and as satisfied as possible. So, as you grow, make sure you execute well so that the growth will continue instead of going away.
Richard: Right, great. Appreciate that.
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