Mission-Driven Development with Robin Zeigler

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This is the Insider's Edge to Real Estate Investing with James Nelson, the principal and head of Avis and Young's Tri State Investment Sales Group. In this program you'll learn game changing strategies to outperform the market. James will teach you how to source, execute and capitalize on the best real estate opportunities in New York and around the world. Now here's your host.

This podcast is for educational purposes only and should not be relied upon for investment decisions. The opinions expressed are those of the guests and not their companies. Listeners should not act upon the information without first seeking appropriate advice from an accountant, lawyer or other professional.

Welcome everyone to episode number 198 of the Insider's Edge to Real Estate Investing. Thank you as always for joining. I'm James Nelson. I'm your host. I'm principal and head of Tri State Investment Sales for Avis and Young. If you haven't been listening lately, we are doing a miniseries on the Capital stack. That's where you get a chance. I'm interviewing Scott Singer, he's the head of Debt Equity here at Avis and Young and you're going to learn all about what it takes to size up a deal Talking about Debt Equity JV Partners so that's a four part series. We've already released two of those episodes. We'll intersperse those with the episodes that we have. So you're going to want to go and take a look for those first two that we posted. But for today, thrilled to have with us Robin Ziegler who is Founder and CEO of Murrell Real Estate Partners. Murrell is a privately owned full service real estate company that aims to spur economic development through mixed use developments in emerging and underserved markets. Robin's got a great background. She was COO for Cedar Realty Trust. She also served as that role for Federal Realty Investment Trust there in the Mid Atlantic Realty region she oversaw a portfolio of 40 shopping centers, five mixed use development projects representing 7.3 million square feet. She's also had experience on the board of Directors for three public companies, JLL Income Property Trusts, R L J Lodging Trust and Nets reit. So a lot of great experience here to bring to the table. But I really appreciate Robin's approach. Starting off as an accountant from Florida A and M, she really has attention to the numbers but I love how she has really built career over time and now focused on mixed use development and doing this. We get into this episode, she talks about her why, the purpose, the reason, the types of communities that she's looking to serve not just providing affordable housing in some cases, but really creating this mixed use environment talks about why retail and services is so important for the people they build for. So you're going to get a lot out of this episode. We're going to have a brief word from our sponsor and we'll get right back to that interview with Robin Ziegler. But before we do, if you have not already, go to jamesnelson.com that's where you you can find the show notes a lot of helpful information and we look forward to being in touch with you soon.

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Welcome everyone. Excited to have with us today Robin Ziegler who is founder and CEO of Murrell Real Estate Partners. Robin has an incredible background. I had the privilege of hearing her speak last week at a Green Pearl conference and so really excited that Robin originally we were going to do this virtually, but Robin came in here to the city. I said look, trust me, live in person. It's going to be a really great experience. So Robin, thank you for coming in and joining us today.

Thank you so much for having me James. I much appreciate it.

Wonderful. So let's talk about Mural and what you are doing and I want to know how did you come up with the name? And I heard a little bit about really the why behind it. So would love for you to just share with the audience. I think it's a great place to start.

Sure. So when we were thinking about starting the company and thinking of a name we were, you know, I remember my husband and I were sitting around like at dinner and trying, you know, we had came up with all these different names around my name and I had decided somewhere in the process that I really didn't want the company to be named about me personally, but rather what we do and something that had meaning. But that was an acronym or something that kind of symbolized the work we do. And so we were playing around with all these different acronyms that had absolutely zero meaning. And someone on the team threw out what about mural? And I'm like, that's pretty cool. And so then we actually took the name because of, you know, the connotations that it has to art and urban and culture. And then we created an acronym around it which is mixed use revitalization approached locally. So we actually did it backwards, but it worked out quite well.

And I know when I heard you speak, and there was a nice article also in the Commercial observer on your story, you said that you're not just about building affordable housing. I mean, that could be a component of it, but really mixed use development and really thinking about what best serves the community. So can you maybe share with the audience about how you approach a project?

Yeah. So coming from my background, which was in retail and operating as COO to grocery anchored shopping center REITs and operating a lot of grocery anchored shopping centers in that capacity, as well as the development, operations and construction of several mixed use, large transformative mixed use developments. And one of the things you really see is that if that real estate is done right, if the ground floor plan activation is really something that is interesting for the community and it's where people gather and it's a strong amenity for the residential, it creates a lot of value that whatever is up top, whether that's residential, office, hotels, what the real driver is relative to the amenity is the ground floor plane. In my background as a former chief operating officer for two grocery anchored REITs, grocery anchored shopping center REITs, focusing our attention on the retail and the ground floor plane activation because that's really how community gets made. That's where people go out to dinner, they take their kids out out to eat after a baseball game, they take their kid to get a haircut, they go on their first date. Like all of those things happen at the ground floor plan. And that's really where you make community. And what I saw is that in our large mixed use developments, that community, when done right, is really what elevates the values for the residential and for the office and the hotel and whatever is at the top of those mixed use developments. So kind of applying that same math to what's happening in underserved markets. There certainly is a need for affordably priced housing, there's no question about that. But it's not just housing. There's also a need for the places that build communities because that's another thing that's sorely lacking in our underinvested and emerging markets throughout the country. And so when you look at most major cities, there is a barrier to where capital has been deployed. There is a railroad track, a highway, a bridge, a street where there's capital deployment on one side and then you cross that barrier and it falls off a cliff. And so what we typically look for are markets that are emerging and growing, where if you pull that capital investment across that barrier, there is a lot.

Of untapped demand, where there's a lot of demand and a low amount of supply. And so we look for those market opportunities to create a mixed use, mixed income environment that's focused on the ground floor plan that creates that community, that creates that vibrancy at the ground floor plane. So people want to be there, linger there, live there, but you also have above it a mix of income and housing. And so we typically look at affordable housing, workforce housing and market rate housing really focused on the missing middle working class, middle income Americans who can't afford to live in the luxury high rise in the CBD or other places because they've been priced out and they don't qualify for affordable housing. There's a large gap in the middle. And so we really focus on housing.

That creates community in that middle part of the country, middle part of our market, and supplementing that with the needs that and the demands that are there in those markets from a retail and services standpoint and provide that on the ground floor plane.

I love that. And it's certainly that commentary on having really place making exist. You know, we've heard that on the show before and certainly when Rick Clark was here, former CEO of Brookfield, talked a lot about the process of, and the importance rather of placemaking and certainly in the major CBDs now BROOKFIELD Also, certainly they've done tremendous things in the affordable space. I don't want to say, but I think your point that place making isn't just something that's only works or is needed in the major markets, but there's really a need for it regardless of where you are. So, so I want to, we'll, we'll now kind of go back to the beginning and then we'll, we'll see how you've gone about building some of these communities. So you graduated with a BS in accounting, so you started as an accountant and here you're developer. I mean that's, you know, usually the accountants, you know, they're great at the numbers, maybe they're on that CFO role. So you also got your MBA from Georgia State. So at what point did you start kind of making this shift where you said, okay, well, real estate. This is really interesting to me and kind of taking a more active role on the investment side.

So I wish it were that strategic. I would say I really fell into it. So I was an accounting major. I moved to Atlanta after undergrad, and I was working at Ernst and Young, and I was assigned to their signature client, which was Coca Cola. And when you're on the Coca Cola audit, it's typically your only client. And so I absolutely hated it. I was working 80 hours. I was. I a. The people that were around me were not very friendly and studying for the CPA exam, et cetera, et cetera. So I was not enjoying life. But there was a female partner at Ernst and Young, and she was starting the Kenneth Leventhal Real Estate Group. And she asked me if I had any interest, and I was like, sure, if you can get me off of this Coca Cola audit, I'll do anything else. It's very political. Like, once you're on Coca Cola, you don't. Everybody wants to be on. No one wants to get off. So I was kind of, you know, the. The idea of getting off of the Coca Cola account was, like, unheard of. And so she was like, yeah, I don't know if I'm going to be able to do anything about it, but I'll see. Long story short, she came back a couple weeks later and said that she was able to pull some strings and I could join the group. And I was like, that's great. So that's actually how I got into real estate. I say all the time that if she were starting the Kenneth Leventhal Group in basket weaving, I would have become the COO of a basket weaving company. But it just happened to be real estate. And then one of our clients was Lyn Lease, who had a US Arm called the Yarmouth Group, which was focused on retail, and they own King of Prussia Mall. And so because of.

And then in the midst of.

While working there, they acquired Equitable.

There was a lot of kind of.

Upheaval and people moving around and shifting around.

And so in the midst of all of that, I got assigned to asset manage King of Prussia Mall on behalf of Yarmouth Group on behalf of Lindle. That's how I got into retail. So it was all kind of happenstance. I then went into the former Retail Investment Management Group while at Lend Lease, and then ultimately went to work for Federal Realty, which is obviously a retail reit. So I did not do it on purpose, but I just kind of fell into it based on, you know, the kind of career opportunities that were. That were open to me and taking advantage of those and kind of walking through that. I will say, though, having an undergrad in accounting is. Is very beneficial when you are running a real estate company as a COO.

Of a REIT and when you're doing.

Development, because obviously all of this is very numbers driven. And so having that kind of accounting and finances, like, you know, in my background, I think it drives my staff crazy because if you show me a spreadsheet, I can just look at it.

And be like that.

That number right there. I don't think that's right. Look into that. And people like, how do you do that? But it's from having that accounting and even audit background, like, my brain just automatically goes to what's wrong, and I can usually find it pretty quickly.

Well, there should. Was there a huge leap when you went from kind of the numbers side of the equation to asset management of the King of Prussia Mall? I mean, that is a major asset. So when you say asset management, what was actually happening here? Were you really getting under the hood there?

And yeah, so initially it was really getting. My first assignment related to King of Prussia was to model it in what we would call Argus today, but at the time it was project. So I'm dating myself, but so I had never heard of project before. I had never seen it before. So I'm literally taking this asset with like almost 1,000 tenants, and I'm trying to model it in project on my own, on the fly, trying to figure it out as I go. I mean, it was quite crazy, but I just immersed myself into it for like a week and just figured out how to. So my first assignment was to model this project to try to value it. And so I would say, like, the transition was really like accounting into that finance and asset management aspect where you're looking at, you know, how much is this asset worth? How much could we sell it for? What's the value creation? And so it was really a good transition in some ways from accounting into the finance and investment management of real estate and retail more specifically. And then that grew into more oversight of the overall operations and asset management of the projects or of the shopping centers holistically. You know, everything from food court renovations, because these were all enclosed shopping centers.

When I was at Lyn Lease.

So it was everything from like renovating the food court to, you Know, renovations of the shopping centers themselves, how CAM should be structured, all of these things.

That are very finance driven at their core.

And then when I went to work.

For Federal Realty, they were creating a position of asset management over the development projects. And so it was taking all of these assets they had across the country, grocery anchored shopping centers mostly that were going through renovations and putting an asset, that management function on top of it because they were still operating shopping centers. Federal is obviously a reach and quarter over quarter. NOI is very important. So how do we make sure we're maintaining NOI while we're doing these renovations that we're not having to get give rent relief, that sales are still being able to be maintained and grow? And so that was how I started at Federal, was overseeing the asset management of these development projects. And then over time I became the regional co had responsible for the whole P and L. So kind of everything related to the P and L, which is everything from accounting to financial analysis, asset management, how the leasing is involved, development, construction, all of those things as well as basic operations and property management and how all of that comes together to create the P and L and the P and L growth for the region. And so that was kind of my responsibility.

So your portfolio, so you're responsible for 40 shopping centers, five mixed use developments, over 7 million square feet. Right. So, and there's someone listening to this show right now says, okay, this is, I can't even fathom, you know, overseeing, you know, that many projects. But just thinking about even just one specific project, you know, that decision of you've got a cash flowing asset that's, you know, clearly past its prime, but it's still in. Maybe you're starting to lose some tenants because you're just not keeping up. But that decision to actually take some of the income offline to reinvest capital.

Yes.

I mean, how do you go about making that decision? When is the right time to do something? Is it better to just, you know, if it's cash flowing, kind of leave it alone? How do you make that decision?

Yeah, so it really is taking the portfolio and culling through it asset by asset and making those determinations. Right. How, how stable is the cash flow of said asset? You know, what are the inherent lease rent growth based on the existing leases? Where is the, where are the risks related to credit risk of the tenants of that shopping center? And so you look at the shopping centers and you really determine these are good long term cash flowing plays, we shouldn't touch them. These need a little bit More kind of love and attention, if you will, a potential facade renovation or merchandising upgrade to really pop the income and really get all the value out of it. And some of them need to be are in a great location and a great situation to reposition into large scale mixed use development. And sometimes it could be from, as you mentioned, tenants that are filing bankruptcy or tenants that their lease is coming up. And so it provides the opportunity for value creation like I look at a portfolio and where you have credit risk and anchor tenants whose leases are coming up for expiration, that's your value creation opportunity right there. And so if you can really look at how you're doing your leases and where those spaces are bundled, so to speak, the most accretive way to attack it is to phase it and to have while a portion of it is under construction, the other portion of it is still operating. And if you remember when I started at Federal, that was my job, right.

Was to figure out how do you.

Maintain income while you're doing facade renovations. Well, it's the same methodology, just on a much bigger scale when you're talking about creating large mixed use development. But the notion is to, to a, it's all an asset management play up front, right? So you're really managing those leases to expire together in the right places at the rate right times, getting the right rights within those leases for relocation, for.

Termination, for all of those things to.

Effectuate a future mixed use development.

And so some of it takes strategizing 10 years in advance, five years in advance, and doing things in those leases to make sure it allows for a large opportunity in the future. But then once you've kind of positioned everything to be able to transition, then it's figuring out, okay, we're going to.

Start with this part of the project.

And keep in mind most shopping centers have large parking fields. And so you're looking at the assets, you're looking at the parking fields, you're looking at, you know, all of the, who has parking rights, who has approval rights, the co tenancies. I mean it's a, there's a whole lot of things that go into kind of figuring all the math, figuring out how to do all of this. But overall what you're looking at is how do you do this in phases, maintain as much income as possible and, and then you're creating the development while that operating shopping center is still operating in some capacity. And then you eventually get to all of it. And so you've taken to your point a middling shopping center that might have had anchors that have filed bankruptcy or tenants that have gone out, or tenants that are leases are expiring. And you've now turned that into a whole different. I mean, you've, you know, increased the value 10, 20 fold and you have changed the community. Right. And so when you add that volume.

Of density to an area, you're changing the tax base, you're changing how much money goes to schools, you're changing how much money goes to infrastructure, police, et cetera. And so again, if you take that same mindset and think about it in an underinvested market and how much more impactful that same exercise could be, that's essentially what we're doing at Mural.

That was incredibly helpful. And I think again, even for our newer investors, if they're thinking about do I reposition this asset? Is now the right time? Do you get that correct return? Now, I'm sure I don't know how much disposition work along the way that you did, but I would imagine also at that kind of critical juncture on, okay, well we think that there's upside here and we need to decide are we going to do it? Are we going to sell the dream to someone else? I mean, I would imagine sometimes you think, okay, well we know there's value here, but we'd rather kind of get that premium on the sell side. Did that ever Calculus?

I would say in my REIT days we were not as big on dispositions as a private company may be. That being said, as part of our certainly annual process and sometimes even quarterly process, we would always do wholesale analysis. And so you're always looking at is it better based on the trajectory of this asset for us to hold it or to sell it. And so even though at Federal and at Cedar we we didn't sell a lot of assets, it was a, a constant way of thinking about kind of, you know, a portfolio and its value and thinking about when there are kind of value creation opportunities, are we best served to do it right? Is the real opportunity here, for example, to add a hotel and hotel is not in our property type. Just thinking back, you know, in my REIT days, and so we might sell the land to a hotel operator just as an example. So you are constantly thinking about, you know, what is. Even if you're the owner, you have to kind of step back for a moment, take the emotions out and just really look at it again. What do the numbers say? You'll look at the actual financial analysis and really determine what the long term impact of this asset should Be. And are we the best to extract that or is it best to get. Take the. Take our cash up front and let.

Someone else do it?

Perfect. No, that makes a ton of sense. So maybe now talk a little bit about moving from Federal to Cedar Realty Trust. And we were just speaking before we had Leo Ullman, the former founder of Cedar Realty Trust on the show. So what prompted your move? What was the opportunity?

Yeah, so it was interesting. Based on where Cedar was in their life cycle, they were looking to do more mixed use development. And some of their shopping centers inherently were in what I would call underinvestment markets. Not all of them, but some of them were. And so they had some preliminary ideas and designs around doing some mixed use development for some of their assets. And so the CFO of cder, he and I used to work together at Federal. He was formerly the chief accounting officer at Federal. And so that was the tie in to cder. And so they called and told me about this opportunity and mentioned that it was an Port Washington, New York. And I was like, where is that? I had never heard of it. I had never been to Long island before. And so admittedly it took some tall talking, but. But I did end up moving here to New York and became the COO there. And part of what we obviously same thing there as far as operating the entire grocery anchored shopping center portfolio. But it was also about looking at the entire portfolio and figuring out where there, where there were mixed use opportunities. They had already circled some before I arrived.

Some of those I agreed with, some of them I did not. But we really looked at, you know, how do you take a handful of these assets and really turn them into large transformative mixed use developments. And so while there we did about six or seven overall redevelopments. Some of them were kind of your basic grocery anchored facade, grocery anchored shopping center facade renovations. But there were three that were actually four that were large transformative mixed use developments that we did all the master planning for and created some of them. We even did all the anchor leasing. We created the incentives worked in public private partnerships because you can't do any of this work, particularly in underinvested markets, without having some type of subsidies, whether it's it's tiffs or rack Ps or pilots or infrastructure dollars, just any and all types of incentives. And doing it in partnership with the municipality is an important part of how to make these things work.

So, Robin, one of the number one questions I always get is for career advice, not just for people who are new to the business. But maybe they've been working for an established company. Maybe they're thinking of going off on their own. Maybe they're thinking, think that. Move to another firm. So, again, it seems like to me that this was definitely a situation where. And I'm sure you had a great role at Federal, and it seemed like, you know, things were moving along well. This was a little bit more of. You had to uproot yourself, move to a new area and really a new challenge. So for someone who's sitting, let's say, in a comfortable job right now, they're happy. They've got, you know, they figured it all out.

Yes.

You know, what would you say to kind of finding that next challenge? I mean, I gotta imagine there was something kind of within you saying, okay, I'm ready to do something else. When's the right time for that?

It's interesting because throughout my career, I don't know that I was consciously of the mindset of I am ready for the next thing, but rather, the next thing came to me as an opportunity. And I think one of the things, you know, people ask me, like, how did you become a COO of areit? And really it was taking advantage of opportunities that came my way and not being afraid to walk through the door and take that challenge. Right. There were so many times in my career where I was asked to do something that I had not done before that I could have said, I don't know how to do this. No, this isn't for me. But rather, I said, okay, I'm going to figure it out. And so, for example, when I was. I went into the Ernst and Young Kenneth Leventhal group, and she was like, okay, you're going to work on REITs. I had never heard of a REIT. I didn't know what it was. We didn't have Google back then. So I went to the lot, to Barnes and Noble. I went to the information desk. I don't even know if they still have those anymore, but they had an information desk. And I was like, I need a book on. I need every book you have on Reets. They had four of them. I bought all four. I read them over the weekend. I got ready for work on Monday. So it's like taking advantage of the opportunities that come your way. I also think it's like part of having a North Star, so to speak, of. We all do this work and we, you know, we do the daily grind. And I would, you know, to your earlier point, every position I was in was comfortable. When I Was there.

Right. Like I didn't have like this dying.

Need to go do the next thing. But it's also about what are the.

Things that matter to you, what are the things that are important to you even outside of your kind of the day to day grind of doing your job. And if there are, if there's ways to marry any aspect of those two things together, I think it just makes the journey better. And so for me, being able to do work in real estate and I just love creating places. I love the notion of this was dirt before and now it is a place, as I said, where people are creating memories, like that matters to me. And then to take that a step further and do it in areas that have historically been under invested, that matters to me even more. And so if there are opportunities for.

People who are thinking about kind of, you know, what is the next thing for me, if there's any way to marry any portions of those pieces together, I just think it makes the journey a bit better.

So. And then ultimately to where you are today, that decision to start off on your own, I mean that's quite possibly the largest leap of your career.

Right.

Talk about the benefits of working for a publicly traded company. Access to capital.

Yes.

Infrastructure. So to hear to now do this all on your own. I mean.

Yes.

What was it that you know, after a lot of time in the business.

Yes.

Prompted you to go out and start mural?

So it's funny, people ask me all the time like, you know, what made you or how have you always wanted to be an entrepreneur? Entrepreneur. And the answer is no. I don't know that I ever even gave it a lot of conscience thought. I mean to your point, I was the COO of a publicly traded reit. I believe I was the only black and only female coo, a retail REIT in the country. And I was good. Like there was not anything driving me to do anything different. Except that during the pandemic, I'm running a portfolio of grocery anchored shopping centers. All of them are open. At least 98% of maybe all were open. And so, you know, it was a lot of like 20 hour days. Right. You're dealing with getting property managers to all the different places, working with the grocery stores, working with the police departments. Like there was just a lot going on, making sure you had PPE for the customers, for your staff, that everybody was safe. You're still trying to get leases signed and do accounting. And everyone's working virtually. I mean it was a COO's nightmare. Right. And so and we were renegotiating all of these leases, you know, rent relief and the PP packages. And there's. There was a lot going on. And in the midst of that, there was also, we had assets and D.C. and in Philadelphia, for example, so there's riots going on. So we're dealing with the riots and trying to keep my staff safe. And so there's just a lot of things happening all at once. And I think just because of the overall fervor of that much activity for work and what was going on in the country, and I was turning 50, and it was just a moment of me really thinking about the fact that.

I have had a very successful career and what do I want my next 50 to look like and where do I want to spend my time, attention and energy? And one of the things that I have always seen is just how much.

Need there is to reinvigorate certain parts of our country.

It's been, even when I was an accountant at Ernst and Young, is something that was always top of mind for me, even when I had no idea that I was even going to go into real estate. And. And so it was in those moments when I was doing kind of that.

Self reflection and really thinking about where do I want the next parts of my journey to be and where best can I utilize my skill sets. And I do think that myself and my team have a unique set of skills that not everyone has. And it is exactly what is needed to reinvigorate our underinvested communities. And so it was the. The think all of that kind of thinking and reflection, I think that led me to, if not now, when? And if not who? If not me, then who? And so I decided to. I talked to the board and the CEO of Cedar was very collaborative. They knew that I was thinking about this. They were very supportive of me doing it. And so I did both for a little bit. And then I left in May of 22.

So just to make an observation. So although in these transitions in your career, you said, well, I wasn't really looking for the next thing. And it kind of just happened. But. But then I'm also hearing you're working at times 20 hours a day, you're reading four books over a weekend. So I'm sure that when you really dedicate yourself and put in that hard work, that others kind of see what you're doing and that leads to other opportunities. Right? That's how the opportunities find you. It's not like you were just sitting back and just waiting for things to happen.

Exactly. I mean, the old adage goes, luck is the combination of an opportunity and preparedness. Right. Like you have to always be prepared so that when those opportunities come your way, you're ready. And I think the point that I was making before, even where there are gaps, get ready. Like don't. You don't use that as your reason to not move forward. But that's. Now that's a gap I have. I need to fill that gap. I need to figure out how to fill the gap. I need to fill it quickly. And so I think that was always my mindset. But to your point, no matter what job I was doing, I always gave it 120%. And so, you know, it was always having that dedication to make sure that we're doing it right, we're doing it well, we're doing it smartly, that we're thinking about kind of all of the challenges and nuances to whether it's operating a portfolio for REIT or whether it's operating and managing Mural as a private company, it's, you know, thinking about all of the aspects holistically and how to best move them forward.

So when you embarked on this mission driven development platform, you still have to get capital.

Yes.

Behind this. So let's talk a little bit about that because. And Don Peebles has been on this show as well. In fact, he raised the fund because he really felt not only for minority women owned businesses, accessing capital has been very challenging. There's not only that, but also in areas that that seems are really not as established. Right. As doing something in the cbd. So how did you kind of going into this, did you know that you had the capital backing and if not, how did you go out and find capital providers who really shared in your mission and saw this as a viable opportunity?

Yeah, so when we originally launched the company, I had circled a dollar amount of like what we needed to like launch the platform and to invest in our first couple of deals. And so we did our first fundraise around that. We ra the funds relatively quickly, I would say, and it was with just two investors. And so we did that. It was a debt, like a prep equity type of, of structure and launched the company with that initial fund. We then did everything else subsequent to that on a deal by deal basis. But we did like a full dog and pony run with like all of the institutional capital shops. So, you know, Goldman Sachs and Naveen and Starwood and MetLife and PJIM and all of BlackRock and kind of introduced ourselves to all those groups. And what we were doing got very positive reception. And then I would say what happened practically is by the time we were, we got our first deal closed, by the time we were like packaging up the second deal, the interest rates had increased and the institutional capital was like, we love what you're doing. We're just not deploying equity right now. And so we heard that over and over again, or we heard that. So what we are doing obviously is.

Mixed use, mixed income. And part of, from a investment perspective.

Part of the best way to structure.

Those types of deals is to have a portfolio that allows for core plus and value add opportunities along with those opportunistic opportunities so that they hold so they can all balance each other off, particularly in different economic cycles.

Because one of the things I've seen.

Is, you know, as a CEO for the last 20, 30 years, having managed portfolios through the GFC and the pandemic and even what we're doing, whatever you want to call this, it'll have an acronym by Tuesday.

But what you see is the, the, the way to really ensure value creation and value and income stability is by having a lot of different diversity within that portfolio. So diversifying around investment types, type core plus value add opportunistic just based on our life cycle and also doing just value add acquisitions in retail and residential to kind of create those dumbbells and then also just the diversification and property type. Right. So we have retail, we have affordable housing, workforce housing, market rate housing, and those can all be even different condos that we structure differently based on the different economics that go with those different property types. But it's the combination of all of, of that makes for a really strong portfolio in this space. For institutional capital, they want core multifamily in Texas or you know, value add retail with grocery anchor in the Midwest or whatever their kind of their buckets are. And so our portfolio doesn't necessarily fit well within, within those buckets. And we try to do some like carving around the edges to make things fit with this one or that one. But it really goes against what I believe to be the best accretive way to create returns in this space. And so with all of that in mind, so we have been doing deals on a deal by deal basis to answer your question. But we've also launched our second fund most recently where we are doing a fundraise for the portfolio so that we're doing a fundraise for people to invest in the GP of the portfolio with that characteristic. Because over the long term I do Believe that's the best way to really extract the alpha that's available in this opportunity set. And we still use our LP relationships for the LP for the construction ready aspects of those projects as well as.

For the stabilized projects.

That makes a ton of sense. And now that, like you said, to get that diversity of, through a fund structure. But for many, again, for many of our listeners, they're probably starting off or they're doing deal specific as well. So what is in development, you know, is know, opportunistic clearly by, by definition. So walk us through maybe that first deal that you did where located a site, were you able to, to put it under contract, get yourself some time to, to raise capital, get it entitled? How does that kind of walk us through the stages of actually acquiring land, getting it entitled and then ultimately capitalizing it and closing on.

Yeah, so our first example is probably not the best example for our listeners, but I'll walk you through it anyway. And part of the reason was because of what we saw happening in the capital markets, we purposefully did not engage in deals that required market debt. And so that then we were looking at kind of a different class of assets to avoid the capital markets and some of the volatility that we saw happening with interest rates rates. We now are just starting to look at deals that require market rate debt. But back when we started the company, we had opted not to just because I could see the volatility happening with the interest rates. That being said, ironically, there was a land opportunity that came from. The CEO of Federal Realty met a gentleman at a car show and the gentleman asked him if he knew me. He said of course. And so he calls me on a Saturday morning. I'm walking like why in the world is the CEO of Federal calling me on a Saturday morning? But turns out it was because the guy asked if he knew me. Long story short, we ended up buying that guy's land in Jamaica, Queens here on Hillside Avenue. He owned several car dealerships and some small retail. And so it was part of a family that owned. There was several family members that owned this land, tenants in common. I would say it was not an easy negotiation.

One of the, one of the things that you have to be adept at if you are doing investments in underinvested markets is dealing with unsophisticated sellers, so to speak, individuals sellers and a lot of families with tax issues and familial generational issues and being able to work through all of that to get to a deal on the other side. It takes like A little bit of psychology and a lot of real estate.

But we were able to get the, get the sites under control. And then we brought in lisc, helped us facilitate a loan with nicaf, which is a New York City acquisition fund. And so New York City acquisition fund actually provided our acquisition and pre development financing so that we were able to kind of get around the existing market so we didn't have to place market rate debt. And then we had M Squared come in. They have a fund and so they invested in the acquisition and pre development. And then we have a family office group that's the LP that's invested in the construction. So and then Mural is the remaining equity. So it was a little bit of a bespoke structure. The HPD and HDC are the construction lenders. So the entire kind of capital stack was around New York agency financing. So that's why I said it wasn't the best example. But it is an example of how you pivot, right. When they're, when different economic cycles are showing themselves in various ways, you have to be able to continue to drive.

The business and structure deals differently based on what's happening with current market conditions. And so that's what we did.

Well, Robin, I think it is a great story though, because it also exemplifies and talk about this in the book of how you gain that insider's edge. So you know, you said that when you're buying properties that whether you want to call Jamaica a secondary market, usually there's more time that you can get and you can get different terms because I would imagine if you showed up, and I'm sure the seller didn't say, okay, well you're going to put 10% deposit, hard deposit and close in 30 days with, especially when you get financing, it can take, certainly for affordable projects can take time. Right. So I'm sure maybe through, even though it sounds like it was an unsophisticated seller, that might have worked to your advantage because it gave you the time to put this affordable finance in place.

Yeah, that's exactly right. And you know, the one thing about Jamaica, Queens that makes it a good example is we looked at several sites in and around that area, but not every site had what I would call the bones to do what we do. And the Jamaica site is probably one of our most urban locations. We typically, you know, look for projects that are 2 acres plus and we can kind of create a massive, a massive environment. Like we have a project under contract.

In Atlanta that's on 24 acres as.

An Example, so this one is far more urban, but we do look for, you know, how does it operate relative to traffic and highway streets, what are the major highway thoroughfares, how does one get there vehicularly? How does one, what's the pedestrian throughput look like? How, what's the access to transit?

Right.

So with Jamaica, Queens is sitting right.

At the subway, but it's also sitting right at the LIRR that now goes to Grand Central.

So if you can create the right.

Type of ground floor activation that has the restaurants and the bars and the services that one would want who's a.

Young professional or a young working family.

And they may be priced out of Manhattan or Brooklyn, but they may consider Queens, but they're like, yeah, I don't.

Know there's anything there for me.

If you create that environment that is for them. Now you're changing who all can live in this mixed income environment and creating more diversity of incomes and even the types of people who are living in a given community. And so we look at it from that standpoint. And so to the naked eye it's just two really crappy car dealerships.

But.

But to me it's a covered land play that's providing income while we're doing pre development near a transit station. And it's a potential mixed use, mixed development opportunity. And so it's really having an eye.

Towards where do the opportunities lie to take something from what the naked eye says it is to what it could potentially be. Yeah.

So Robin, I've got to imagine, I mean, clearly with all this institutional experience that you have, because many of your listeners might say, wow, Robin, this sounds amazing, but I can't just call up Goldman Sachs and have them look at a deal. So I've got to imagine that was helpful when you went off on your own. But still, I mean, you no longer again have the backing of a publicly traded company. So you know, when you built out your company, did you build it out as if, you know, really kind of to an institutional standard? I mean, when you think about the way whether it's reporting, whether the people in the team. Team. What does mural look like? I mean, how many people are involved in this? I mean, is this really built for scale? Is that how you envision this?

Yeah, absolutely. So we are only four people. Five. Five including me. But we are absolutely built to an institutional standard. So I would say having run Our accounting at two REITs, our accounting is the same, our reporting is the same, our controls are the same. So that it gives the ability to Scale and everything we do, my staff will tell you, if they bring something to me and it's like, it works now, but if we had three more assets, it won't work. Okay, we're not doing that. So even if it takes a little more work now, everything, we do it so that it can be scaled, so that it would work from a scaled basis so we're not constantly retooling. And so yes, it is true that as a former COO of areit, I can call Goldman Sachs and at a minimum, but they will take my call. But if, when they are looking at our underwriting and go under our hood, if our systems weren't in place, if our underwriting wasn't sound, if our market knowledge wasn't there, they would then hang up the phone. So, you know, you, yes, they would take the call, but you have to have the things in place for them to continue those conversations and be wanting, be willing to partner with you. And so our back of house, I would say is. Would put it up against anyone's. And having seen the inner workings of other backs of houses. I know. And so we certainly do think about it from an institutional perspective.

And that's great advice for everybody listening who's looking to build out an investment platform as you want to do it in the right way, not only can you scale it, but also to really. Because I imagine, you know, if you build it right from the start.

That's right.

You know, as opposed to continuing to try to go back to the drawing board. So, Robin, this has been tremendous and with only a couple minutes left, because I'm sure, and I love the fact that we're talking about really purpose development, mission driven. But someone's listening to this saying, you know, Robin, I would love to do something. I see this underserved community I'd love to develop here. I just, I can't get the capital interested in it. What would you say to that person who has that vision? Yeah, but again, that only gets you so far. Someone has to lay out the capital for it. So say to that person who maybe doesn't have the institutional background or the ability to get Goldman Sachs on the line, what do you say to that person to get that project out of the ground?

Yeah. So I think there's no question that in these underinvested markets it takes a combination of public and private capital. And there's, I don't know if there's any way around that. Like simple fact, one place you could start is if you don't have the private capital in place first. You could go to the municipalities first and show that vision and your interest around what you're trying to do and really seeing what, what public funds might be available to help. Because then when you are trying to get private capital or even when you're trying to get debt, you have taken a chunk of the capital stack and put some certainty around it, which does differentiate your deals from other kind of, of market rate deals that investors are looking at. And then maybe I would go to the debt next so that you kind of get the municipality the subsidies, grants, tax abatements, whatever it is in place, then maybe see what types of financing might be available. There may even be, you know, there's green financing, there's, there's sometimes there's low interest debt for underinvested communities. And so taking advantage of some of those debt instruments to see how that then also bolsters your stack. And then do the equity last because, because then, you know, you might be able to go to friends and family or do some type of crowdfunding or something for that remaining piece, but you've got the first two pieces in place already.

And so it makes it, it makes the sell a little easier because that's the first question people usually ask. I will admit we usually do all three at the same time, largely because to your point, if we're not using, you know, like in the example of Hillside where it's New York agency financing, if we're using kind of more market debt and our private equity relationships, the end we're dealing with a, a more market transaction on the sales side where we do have, you know, 60 days of due diligence, 30 days to close type of thing. The timing is such that we have to do all of it simultaneously because there's so many pieces and parts. If it was just like a basic shopping center somewhere, then we might be able to bifurcate it a little bit. But when we're doing large mixed use development, we attack all three of them and then bring the stack together. But I think that that does, people do rely on our expertise when we're doing that. And so I think that's what allows us to be able to do it that way. And so if we didn't have that, I would do it in that order.

Yeah, I love what you said about reaching out to the public sector as well, because I think oftentimes people think, oh well, you know, government's only going to throw up roadblocks and make things more difficult. And yet you find within government There are definitely arms that are there to really work with the private sector. I think of the EDC here in New York, I mean, or even in each of the boroughs have their own economic development agencies. And I know when I'm working on a large development opportunity, even on the brokerage side, how helpful they want to be. And it's look, have you thought about this type of use or this kind of tenant, or have you thought about this kind of bonus? So think being aware of that and creating value is really a big piece of it. So, Robin, this has been fantastic. We really appreciate your sharing your story. Any closing thoughts, any, you know, thinking about your journey and kind of what has been the key to your success? What would you say in advice for those listening right now as they think about their future career?

Yeah, I would say particularly in this industry, but perhaps in any industry, one of the most important aspects is relationships. None of us can do this by ourselves. And having those relationships and having, you know, garnered and created a lot of relationships throughout my career has been extremely helpful in a way that I probably could have never imagined. Because when you do go out on your own, you are on your own. And so being able to reach back to all of those different relationships that I've had over the course of my career has been extremely helpful. And I think for, you know, people who are younger in, in, in their career and the fact that there's a lot of hybrid work and, you know, people are on their phones all the time and don't communicate old school the way we used to, really just to focus on how important it is to maintain relationships, create relationships and maintain relationships in this industry. I think that's a critical component for, for kind of the younger generation coming behind us because it operates differently now, but the core of what relationship building does hasn't changed.

Well, Robin, I could not agree more. And that's a great way to end. And thank you everybody, as always for joining in. I know we had a little bit of a delay there, but hopefully you all stuck with us. And so once again, so appreciative to Robin. So if you would like to get the show notes for the this episode, James Nelson.com develop this site for your benefit. There's also great video series White Papers on there to help you gain the insider's edge to real estate investing. And if you like this episode, share it with a friend. That's how we get the word out on this. So wishing you all the best until next week. Thank you again for joining.

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