Market in Turmoil! Dealing with Inflation, Interest Rates, etc. w/Adam Gower
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Episode Description
Welcome to the Freedom Point Real Estate podcast! Today's guest Adam Gower joins Jeremy Dyer to discuss capital call, rescue capital, the real risks of real estate investing, and much more.
Adam Gower Ph.D. is a 30+ year real estate veteran with over $1.5 billion of CRE investment and finance experience who today builds digital marketing systems for real estate professionals who want to raise equity capital online (aka ‘crowdfunding’).
CONNECT WITH ADAM GOWER!
Website: https://gowercrowd.com/
LinkedIn: https://www.linkedin.com/in/gowercrowd/
CONNECT WITH JEREMY DYER!
Website: https://startingpointcapital.com/
Instagram: https://www.instagram.com/startingpointcapital/
LinkedIn: https://www.linkedin.com/in/jeremydyer
Facebook: https://www.facebook.com/startingpointcapital
Book a Call! https://calendly.com/startingpointcapital/discuss-investing-with-jeremy-dyer?month=2023-12
Summary
Tip #1: Understanding Market Headwinds
"In a market affected by a panoply of headwinds, including rising interest rates, it's crucial to grasp the underlying factors driving the real estate cycle. Liquidity plays a pivotal role, and Adam provides insights into how it impacts the market dynamics."
Tip #2: Transparency Matters in Investments
"Invest with sponsors who prioritize communication and transparency. Adam emphasizes the importance of trusting sponsors who are open about challenges, enabling investors to make informed decisions when faced with capital calls or potential rescue capital scenarios."
Tip #3: Treating Capital Calls as New Investments
"When confronted with a capital call, consider it a new investment. Evaluate the opportunity independently, taking into account the changed circumstances. Adam suggests viewing each capital call as a standalone decision, considering risk, return, and potential dilution."
Tip #4: Evaluating Alternatives and Opportunity Costs
"Assess the alternatives available to you when faced with a capital call. Explore other investment opportunities, distressed deals, or even conservative deposit accounts. Understanding opportunity costs helps in making well-informed decisions during challenging market conditions."
Tip #5: Long-Term Perspective and Conservative Projections
"Invest with sponsors who have a long-term perspective and focus on protecting the downside. Adam advises avoiding the 'shiny object syndrome' and opting for sponsors who prioritize conservative projections, even if their upside returns may seem lower."
Tip #6: Learning from Past Downturns
"Look for sponsors who have experienced downturns and have learned from their mistakes. Assess their track record and integrity, ensuring they have adapted and grown from challenging market conditions. Learning from past downturns enhances the sponsor's ability to navigate the current market scenario."
Tip #7: Assessing Tax Implications
"Consider the potential tax implications of participating in a capital call. While Adam acknowledges his aversion to tax matters, he highlights the importance of seeking professional advice to understand the tax implications associated with capital calls and rescue capital scenarios."
Tip #8: Investing During Market Bottoms
"Identify opportunities to invest during market bottoms. Adam suggests that when the market finds its bottom and assumptions align, it becomes an opportune time to enter. Investors who understand the market cycle and act strategically can benefit from discounted real estate values."
Tip #9: Diversification and Risk Management
"Diversify your investments and practice risk management. Adam underscores the significance of spreading investments across different asset classes and locations. Diversification helps mitigate risks and provides a more resilient investment portfolio during market fluctuations."
Tip #10: Connecting with Industry Insights
"Stay informed with industry insights through podcasts and literature. Adam recommends his podcast, 'Real Estate Reality Show,' for valuable discussions. Additionally, explore books like 'Never Split the Difference' by Chris Voss for insights into negotiation and marketing strategies applicable to real estate investing."
