How To Create Value, Cash Out On Risk-Return

March 1, 2018

“We are all in the capital allocation business.  One of the lessons from 2008 is that the market is always moving, and the market doesn’t care whether we agree with it or not.”

So said Matt Bear, founder and CEO of Bear Real Estate Advisors, who recently chatted with on lessons learned and how looking for market insights helps to create value. “Our role as advisors and principals is to make decisions based on what the market is, not what we want it to be,” he explains. “Predicting market changes is a fool’s game. However, looking for market insights is where the professional focuses their time to create value and achieve the highest return on their money relative to the risk taken.”

As for issues to look out for in 2018, Bear says look at labor. “Construction activity is accelerating around the US as the industry leaves the doldrums of the recession,” he tells, however, he says that “for a variety of reasons, immigration being just one of them, the labor supply to do the work has not kept pace with the new demand. Therefore construction costs seems to be increasing daily and competition for the workers is getting fierce and cutthroat.”

To Bear, that is the number one threat to the industry over the next year or two.

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