Continuing the weekly video series with the American operators of all our clients' real estate assets, we spoke with Nathan Nelson, Senior Vice President at Peak Capital Partners.
Representing Peak, a Utah-based company specializing in multifamily properties, Nathan shared his view on the American market and the sector they operate in. In addition to assessing the performance of the Real Estate Private Equity fund managed by Peak, he commented on the resilience observed in certain property classes and reinforced the importance of diversification across assets and regions for a balanced portfolio.
Watch an excerpt from the conversation.
Video transcript
Renan Barros: “Hello everyone. My name is Renan Barros, I am the CEO and co-founder of Ativore. I am here again with Nathan. Nathan, thank you very much for speaking with us again and for talking with our investors. It's always a pleasure to have you here.”
Nathan Nelson: “It's good to be here. It's good to see you Renan, I'm glad you're well and I'm glad you're safe. I'm Nathan Nelson, from Peak Capital Partners. We are a real estate private equity firm based in Utah in the United States, specializing in multifamily investments. Happy to be with you today, Renan.”
Renan Barros: “Thank you. So, Nathan, we recently wrote an article talking about how the United States is the country most prepared to deal with COVID-19 among all countries in the world. Especially when we compare the United States with Brazil, for example. Since the last time we spoke, are you feeling more comfortable or more skeptical about what the future holds for your country? And, specifically for multifamily properties, what do you see in the coming months?”
Nathan Nelson: “That's a good question. I think it has been a time of uncertainty here, just as it has been anywhere in the world. And it has been a time with reasons for significant concern, obviously, from the standpoint that it is a health crisis. But I think our country, generally speaking, has responded well, and I'm speaking specifically about individuals and each state's individual government, which are the (bodies) articulating the various directives that have been issued and overseeing their implementation. All the 'stay at home' efforts, the quarantine, and all these things, are, overall, being guided and overseen by the states (state governments).”
Nathan Nelson: “I believe, just one final comment on your question, one of the things we have been saying for a very, very long time is that, in the United States and, in fact, anywhere in the world, people's primary needs are: first, to eat and, second, to have shelter. So, having shelter, having a place to live and to go to sleep at night is preeminent over everything else. With that in mind, people will pay their rent before spending to go out to dinner, or before taking a trip and staying in a hotel, for example. This is what we really anchor our entire investment thesis on, and it is the reason we are focused on multifamily as a company.”
Renan Barros: “Adding to what you just said, which is great, I think it's very good when you have an investment like that where there are fifteen properties spread across ten or eleven different states. If you have, on one hand, a property that isn't performing well, you have, perhaps, (on the other hand) fourteen properties that can make it (the investment) work. So, I think it's a big advantage to have this (fund) structure with many properties inside it, right?”
Nathan Nelson: “That is correct. This is the time when I think it becomes very clear that having a diversified portfolio is very important. Because, when you have a diversified portfolio, as you said, you have a property that may have some problems, but you don't feel the full weight of that, because it is supported by the other ten properties that are healthy and doing very well. I think this is one of the reasons we love and like the fund structure, in particular. It provides investors with these diversified portfolios and the benefits of diversification. That's a great point.”
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