Pathfinder Report – September 2016


All Fun and Games until Someone Loses an Eye

By Mitch Siegler, Senior Managing Director

In this season of political nuttiness, it’s odd that we’re just now hearing the term “kakistocracy”. We looked it up so you won’t have to. It’s from the Greek “kakistos” meaning “worst” and it means “government by the least qualified or most unprincipled citizens.” Seems fitting for the state of our American politics, huh?

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The Darwinian Theory of Real Estate Investing

By Lorne Polger, Senior Managing Director

I just spent a week in the Galapagos Islands with my kids. It was a beautiful trip and a photographer’s paradise. The uniqueness of the many species that populate the islands, along with the lack of predators result in an amazing, close up experience with the animals. As you may know, the Galapagos Islands were where, in the early 1800s, Charles Darwin began to develop his theories on evolution.

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Scot EisendrathGUEST FEATURE

Where We Are in the Multifamily Development Cycle

By Scot Eisendrath, Managing Director

Most apartment developers are keeping very busy. There are cranes in the sky and it’s hard to find a general contractor, architect or other service provider without a backlog of business. There is chatter about too much supply, overbuilding and potentially reaching the peak of the current cycle. The fact that the second quarter of 2016 marked the fifth consecutive quarter where new multifamily supply exceeded net absorption of new units (per research firm Reis, Inc.) supports that fact.

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Development Costs Soar across the U.S. Stifling New Home Construction

House ConstructionA recent study conducted by leading real estate gurus John Burns Real Estate Consulting (“JBREC”) reveals that increased environmental regulations and rising development costs are making it increasingly difficult for developers to build affordable homes. The study surveyed more than 100 U.S. home building executives who gave specific examples of new home construction costs and delays that didn’t exist a decade ago. A few:

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Reviving a Well-Maintained 1980s-Vintage Apartment Community

Cedardale ExteriorAhhh…breathe in the fresh, rain-kissed air and rustic charm of the Pacific Northwest.

That’s what we did last spring when we first visited Cedardale Apartments in Federal Way – a suburb just outside of downtown Seattle. We were enamored with the serene and secluded setting, mature landscaping, open space and beige siding.

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Life Lessons from Will Rogers, American Cowboy (1879-1935)

“Never squat with your spurs on.”

“Buy land. They ain’t making any more of the stuff.”

“When a dog gets a bone, he doesn’t go out and make a down payment on a bigger bone. He buries the one he’s got.”

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