$3.5 Billion in Value Created - How the New Guard is Changing the Chicago Skyline & Beyond

[00:00:00] Speaker A: Foreign. [00:00:07] Speaker B: Welcome to the Real Estate Chicago Style podcast. I'm your host, Joe Smazel. I'm a broker with Entero Realty. I specialize in selling apartment buildings on the north side of the city, particularly mid market sized buildings, mostly private capital. So excited for the guests today we've got two of the most active developers in Chicago. Friendly competitors, which we'll talk about, but really two guys that are changing the landscape of the city and lucky to be friends with both of them. So looking forward to the conversation and like I said at the beginning of it, I want you guys to talk the whole time. I'd love to not have to say anything. Berg, CEO of Maverick, returning guest of the podcast, first ever. You were the first returning guest. You were the first guy on. Yeah, I knew even less about how to do this than I did then. So thanks for coming back. Maverick Adam has led Maverick with a relatively small team to be one of Chicago's most active developers. Also doing projects out of state as well, but they've built projects total consideration of about a billion five, total value and 2,000 units I believe on track to deliver. [00:01:19] Speaker C: 2,000? [00:01:19] Speaker B: Yeah, I'm a broken man. You just let that, you just, you just round up. It's fine. 5,000 sounds good to me. And just widely regarded as a guy that has the most promise in developing for the future. So excited to see the trajectory you're on is incredible. Excited to see what you guys continue to build. Matt Wilkie, managing partner of LG Group, 20 years in the business with some of it, much of it at LG Group. You can tell me exactly how long, but with some of the most active developers in the city as well. So wide ranging background, $2 billion in value per the website. So you got a little work to do. I know you started a little after him, but $2 billion, over 2 million square feet I believe, and then doing development, also have a construction arm which handles, you know, retail, build out, luxury homes, all things in between. So. Yeah. Is that about right, fellas? [00:02:18] Speaker C: I think you got it. [00:02:19] Speaker A: Okay, cool. [00:02:20] Speaker B: All right, great. Why don't we start by telling each of you answer this question. What's in the pipeline right now? What are you working on? And I know we've got kind of a range of projects for both of you in the pipeline. So rather than me go through them, why don't you tell us about what you're working on right now? [00:02:37] Speaker C: Sure. Right now we're looking for certainty. So shovels we have in the ground right now, we have an office Conversion project on Wacker under construction, delivering the summer. We have a ground up project, neighborhood project on Belmont under construction. We just bought a building on Maple in state that we're starting a renovation project on. So certainty is kind of like the word of the year of probably the last couple of years that we've chased. But also just really listen to the market. I think the market will tell you what to do. Matt and I both would love to be building big skyscrapers and that market will come back and when it does, we'll be ready. [00:03:23] Speaker B: Yeah, that's right. Matt, you answered the question too, please. What are you guys working on? [00:03:27] Speaker A: Yeah, I would say there's like a dual answer to the in the business answer and then the on the business answer in the business. We got a project in Phoenix that we just delivered that we're working on leasing up 747 units. It's a 1.3 million square foot building downtown Phoenix. [00:03:46] Speaker B: It's a big boy. [00:03:47] Speaker A: It's a big boy. So we got a lot of work to there to do. It's a, I'm sure we'll get into this in the pod about timing and real estate and you know, we're delivering in a somewhat soft market right now, but it's still a market that is growing. And so we got a lot of work to do next. Like a year and a half to get that sucker filled up. [00:04:06] Speaker C: What is that the leasing timeline? [00:04:07] Speaker A: Year And a half, 14 months. [00:04:09] Speaker C: Yeah. [00:04:10] Speaker A: And then, and then we have a project in Nashville, in midtown. So right on the way to Vanderbilt. [00:04:16] Speaker B: Yeah. [00:04:18] Speaker A: And right by like the Virgin Hotel right over there. We are on the, we're tapping out this week and we deliver that building the end of this year and that's a 393 unit, 23 story building that we're excited about. We got a lot of focus though on the market there too because that's also a little soft. So you know, so we got, so that's kind of the projects that are ongoing. We have two acres in full market straddling Lake Street. You see Lake in May that's entitled for about 1200 units over three buildings. The first building being the Trader Joe's anchored project at May and Randolph at that corner. And so yeah, we're spending a lot of time trying to just get that project started. And then we own a site in downtown Milwaukee that we're really close to starting and another site in Raleigh actually. And we're going to be dipping our toes into the build for rent townhome Market in the Southeast. [00:05:24] Speaker B: So every newsletter today is built to rent. [00:05:27] Speaker A: It's awesome. [00:05:28] Speaker B: I think it's a product type that's here to stay, though. [00:05:30] Speaker A: That's right. And aside from that, that's like on the. In the business development side of the business construction. Our GC business has been a big part of our, like, during this time. Right. During this kind of weird market that diversification has always been a part of. The business plan was to have different sources of revenue to stabilize a larger company. No different than vertically integrated developers with asset management fees or property management fees or broker fees. But we lean into that. We're proud to say that the company's actually grown about 30% over the last couple of years. [00:06:03] Speaker C: The construction arm. [00:06:04] Speaker B: The construction arm, yeah. [00:06:05] Speaker C: Nice. [00:06:05] Speaker A: And we're working really hard to get our identity of what that business is in the marketplace. Because it's one of those businesses where you do. We do so many different things. It's hard to communicate to the market like what we do. But it's, you know, it's a commercial GC and we're doing retail, entertainment, a lot of restaurant work, office build outs, all sorts of unique stuff. Nonprofits, veterinary work, private education. So it's a wide range of work that we're doing there. [00:06:39] Speaker B: So how do you both feel? I mean, in your answers? I heard you both talk about it. Like I said, just what I feel like is a range of product. You know, size range, geographic range, even different business lines. Adam, you guys are doing high rises like what we're sitting in, which we should have introduced. And you can in your answer, and you're also doing smaller neighborhood projects. But there's a lot of talk in real estate about focusing on a niche. It's such a competitive market, and you really need to know every lever to pull to make a project successful. So I guess how do you think about the balance between maintaining a level of specialization so that you're the best at everything you do, but still be able to have the diversification that's required to run big businesses? [00:07:27] Speaker C: Yeah, well, imagine being focused on one niche that was office in 2020. The problem with being a specialist in one particular thing is that it limits your ability to pivot. And like any investment fund that you invest in, do you really want to go all in on one particular product type, or would you rather be extremely good at lots of real estate related ventures, asset types? So that's, I mean, for us, the reason why we are unique in the sense that we develop at multiple scales and multiple asset classes. I mean, mixed use, office, retail, multifamily, self storage. Self storage. It's so that if the market changes, you're not out of business. [00:08:13] Speaker B: Yeah. [00:08:14] Speaker C: I mean, you saw a lot of groups who owned a lot of historical office space throughout the country. Chicago. [00:08:20] Speaker B: Yeah. [00:08:20] Speaker C: That lost a ton of money, Lenders, investors. We don't want that to happen to us. So we're diversified. [00:08:26] Speaker B: Yeah. How do you think about it? [00:08:29] Speaker A: Yeah, I think it's the same. Yeah, same. I mean, that's exactly right. I mean, we look at it a little differently though, from like the angle of what kind of company do we want to have? You know, what kind of people do we want to have? What's our abilities, like, what's the spectrum of abilities we can bring to a project? So I think that's when I talking before about, you know, all the things I talked about was like, what we have going on in the business, but on the business, we're trying to really restart our company under this more clear definition of like who we are. Right. And so we have this commercial gc and then what do we do and what do those people bring to the projects? And then now we have this developer builder model where we develop and we build multifamily and what does that bring to the, to the, to the equation? And we're starting to change our discussions around, like not just being like a developer that has to have money to go buy land to then execute a deal. It's like we can play different roles into projects. So we're actually seeing some consultation assignments, we're seeing developer services. It's like heightened owner's rep work. I mean, we're seeing all this come to us because of our collective experience across the diversification. [00:09:31] Speaker B: Yeah, that's. [00:09:32] Speaker A: Do you know what I mean? [00:09:32] Speaker B: It's smart. And it's also, when you're answering it, what goes in my head is like one makes you better at the other too. Right. Because if you actually know the construction side of it, it makes you a better developer. Vice versa. Right? [00:09:45] Speaker A: That's right. [00:09:45] Speaker B: So I think it's funny because me as a service provider, I think it's a little bit different because there's some similarities. But I have to think about a niche and knowing everything possible about that niche, knowing everybody that participates in and around that niche, and just being a guy who thinks about things pretty simply, like, I know everything it is there is to know. I don't want to say everything. I know a lot about Chicago multifamily. I don't know a lot about other things. So it helps me stay focused. But I think that's maybe a difference between being an investor running a bigger company and being a service provider is like being able to pivot opportunistically whether it's on a project or whether it's market conditions or whatever. So I think when we talk about diversification with you guys, this is a Chicago real estate podcast. We'll keep it mostly focused on Chicago, But I think your perspective in other markets can be informative in your answer so that you know maybe what to appreciate about doing business in the city. And then you know, you wish things were better in some ways too. So what's something, Adam, based on your experience in other markets, you think that we take for granted about doing business here in Chicago? [00:11:07] Speaker C: I mean, this is the easy answer, I guess, would be labor. So here's a true story. We have a site in downtown Columbus. If we're not doing a project in Chicago, we're doing a project in Ohio. It's where I'm from, my partner's from, and it's entitled for a building that looks identical to the St. Grand. The building we're in right now. It's 22 stories. It's got a bit more units, about 300 units. We talked to all the local GCs there. We built this building in 16 months. And Matt can tell you, like, that is probably the exact right time to period to build a building like this, which seems crazy. [00:11:42] Speaker B: It's like how long it takes to renovate a house. [00:11:43] Speaker C: Yeah, right. Or a bathroom. But In Columbus, Ohio, two different GCs looked at it and they quoted 42 months. [00:11:53] Speaker B: Holy shit. [00:11:54] Speaker C: Which is almost an entire presidential term, which is crazy. [00:11:57] Speaker A: That's crazy. [00:11:58] Speaker B: Yeah. How do you. You can't forecast. You don't know what market you're delivering into in 42 months. [00:12:02] Speaker C: I mean, you look in Columbus, there's very little high rise there. [00:12:05] Speaker B: Yeah. [00:12:06] Speaker C: And so especially like class A is a total different definition in Ohio than it is in Chicago. But I think if we take something for granted, it's gotta be just like how efficient it is to build, how amazing the labor force is in Chicago and that trickles down. I don't think that's just on the union side. I mean, even the subs here are 10 times better than we've experienced subs in other markets. Be curious to hear your answer on that. But it's probably the labor force. [00:12:31] Speaker B: Yeah. [00:12:32] Speaker A: Yeah. I would like, if, all things considered, if we could do everything in Chicago, we would. I think it's awesome to do development here. And I think there's that also concept with like understanding the entitlement process and navigating the city. Challenges from the outside perspective create like a high barrier of entry. And so you kind of. It's a nice market. [00:12:54] Speaker B: Creates a little bit of a moat around your business, right? [00:12:56] Speaker A: That's right. It puts moats around the business. Unfortunately. I think right now Chicago's exporting a lot of these talents right now to other markets. I mean we're literally living it in Nashville. I mean 42%, I think when I side check of our hard costs in this tower in Nashville are Chicago subs. [00:13:17] Speaker B: No kidding. [00:13:18] Speaker A: 42%. [00:13:19] Speaker B: How do you think that would differ if you weren't based here? [00:13:24] Speaker A: It would, it would make a difference because we brought guys with relationships down there and some had already started planting flags. They're no dummies. They were going into markets because there wasn't enough work here in the multifamily space or they were going into other types of markets, data centers, infrastructure and so. But it's a real thing and I fear that other markets are going to benefit something that was so special to Chicago. [00:13:48] Speaker C: Yeah, that's a good point. [00:13:49] Speaker A: So we literally have like the major trades are down in Nashville building this building. And it's great from a deal level perspective. I think it's a little sad on a macro. [00:13:59] Speaker C: What's the schedule to build the building? How long for? [00:14:04] Speaker A: 22 months on first early delivery. [00:14:06] Speaker C: And what would that same building be in Chicago? [00:14:08] Speaker A: Yes. 16, 17. It's like 400 units. It's a little bigger. [00:14:12] Speaker C: Yep. But still, I mean you've probably cut down, condensed the time period significantly by bringing the trades in from Chicago. [00:14:19] Speaker A: And the main difference really honestly is the concrete. Like the concrete in Nashville is like they're still 40 or 50% slower than Chicago. [00:14:27] Speaker C: That was the big issue we ran into in Columbus was concrete. [00:14:30] Speaker A: Yeah. Yeah. [00:14:31] Speaker C: I actually had a question about. I know this isn't exactly what you asked, but about btr, like you know, the build to rent townhouse thing. [00:14:38] Speaker A: Yeah. [00:14:38] Speaker C: I don't understand that business necessarily. [00:14:40] Speaker A: Yeah. [00:14:41] Speaker C: And I'm curious like what market you guys are doing it in and why you're doing it. The way I've always thought about it and this is probably way too stupid, but a building like this is 248 units. And we have one roof. [00:14:54] Speaker A: Yeah. [00:14:54] Speaker C: And we have one hot water heater. And if something goes down it can be fixed or it can be maintained. When you have 248 individual townhouses you have 248 roofs that could all have a leak. [00:15:07] Speaker A: Yeah. [00:15:07] Speaker C: It feels more so much like operationally inefficient to me. And I'm curious like I know it's hot, right. There's a lot of money chasing it. [00:15:15] Speaker A: I'm just curious thought that way I would counter it. I think that in a townhouse every square foot you deliver is leasable. You have no waste. [00:15:25] Speaker C: True. [00:15:28] Speaker A: The consumer treats a townhome like it's their home, not like apartment where they're being served by a management company at their disposal. [00:15:36] Speaker C: Yeah. [00:15:38] Speaker A: The systems in the townhome are like the most basic. You have one furnace, you got one little water heater and there's like not much can go wrong. [00:15:46] Speaker B: Yeah, sure. [00:15:47] Speaker A: Versus a building that can have a slew of issues. Right. [00:15:51] Speaker B: Different from a staffing system. Different from a staffing. [00:15:54] Speaker A: Yeah. There's this. The opex is so different. Now the challenge with townhomes is like you're competing against homeowners or home builders that can build them under a different model. So it's like this weird balance of like, well we're building for rent and we care about the yield to build costs because rental demand is high. [00:16:10] Speaker B: Yeah. [00:16:11] Speaker A: But if you look in your per unit basis versus like a home builder where you can go buy a townhome in theory less than what you're delivering your townhome for as a build for rent model. [00:16:20] Speaker C: Yeah. [00:16:21] Speaker A: That's where you get a lot of tug and pull. But the cost to deliver for those home builders is so much different. Like they are. They have a way different approach to delivering. [00:16:30] Speaker B: Well, so I think some of it's also, you know, the capital, you know, and so you know, in if you're going to build a 750 unit project or a 400 unit project, totally different capital sources from those and you have to go where the capital is willing to go if you're going to build that scale. [00:16:50] Speaker C: But think about that. Why is there capital chasing btr? It's a, it's a relatively newer asset class. Right. And has there been a BTR community that's traded? Yes, probably. Has there been a BTR community that's 10, 20, 30 years old that's traded? [00:17:07] Speaker A: No, that's the problem. You can't copy or exits in most of these markets. You can't. You also there's like devil in the details with btr. It's like a definition that covers actually a wide spectrum of different projects. [00:17:18] Speaker C: True. [00:17:19] Speaker A: So it's still a very unproven snowplow. [00:17:23] Speaker C: Got a lot more snowplow than you do at one building. [00:17:25] Speaker A: But yeah, I mean, I think, I. [00:17:27] Speaker C: Think it'll be interesting when people start underwriting capital improvements because they got to replace 300 roofs versus at a new construction building. But you can much more easily pivot to for sale than you could if you were doing a high rise. [00:17:43] Speaker A: If you look at. [00:17:44] Speaker C: Unless you build as nice as I do and then you can condo everything individually. [00:17:47] Speaker A: It wasn't too long ago where old apartment buildings were being converted. [00:17:51] Speaker C: That's true. That's true. [00:17:53] Speaker A: As an exit strategy. There is no reason that couldn't happen in different asset classes. Like, it's a very new market. Like bills for rent, single families, townhomes, whatever you want to call it is very brand new. So we don't know. [00:18:04] Speaker B: Yeah, who's to say those don't pivot and get converted to for sale down the road? [00:18:08] Speaker A: Right. [00:18:09] Speaker B: But that's the weird thing about real estate. You and I talked about it for a minute yesterday when we were catching up. It's like. And I think, you know, talking to two developers who are building a lot of it, it's a unique opportunity to ask you a question. But like, you know, you think about the balance of, like, the durability of a project, for it to be able to stand the test of time and then also to make sure that you're hitting something that's, you know, in vogue for the market today and that the capital will actually stand behind you to build. And so, like, you know, a lot of what I sell, like vintage apartment buildings on the north side of the city. These buildings are 100 years old, 100 plus years old, and it's wild to me to stand in them. You know, in walking through one yesterday, I'm like, this unit has been substantially the same for 100 years and has never been obsolete. Right. There's a new kitchen, new bathroom a few times. You know, occasionally you make a slight modification to the layout to make sure that it suits the renter today. But how do you like, do you. How far down the road do you think when you're conceiving a project. [00:19:19] Speaker C: Is. [00:19:19] Speaker B: It just, you know, is it like making sure that it makes it through kind of the horizon of that deal and then after that it can be whatever it's going to be or how do you like, how long you build a stink green? You build a high rise in Streeterville, like it's going to be for probably longer than we're going to be around. Do you think about that or is it more like here's the time we plan to own it. That's what we're focused with. Let be what it'll be. [00:19:47] Speaker C: After that, I would say, I don't know if there's a cheat answer. Two things. One, you're only as good as your last project. And so you can't build crap. [00:19:59] Speaker B: Your last project or your next project. [00:20:01] Speaker C: Your last project. [00:20:02] Speaker B: Okay. [00:20:02] Speaker C: Because you know, if we were to put something up like St. Grand or anything really, and it's a total dud because we cut corners and we used crap material. [00:20:12] Speaker A: You mean from like a material like building functioning. Yeah. [00:20:16] Speaker C: Aesthetics functioning. You know, planning people remember that. I mean we've all seen. Look at the most prolific developers in this city and other cities and look at their biggest failure that everyone might know about. It has a lasting like image in everyone's brain. Like, man, this company really fell from where they were. [00:20:38] Speaker A: Right. [00:20:39] Speaker C: And like that means you have to fight for every single project to be really, really good and really well executed. You have to really care. And then the other thing is you can't time a market. It's actually, it can happen by luck, but it can't happen by design or by strategy. And Matt and I know this not to speak for you, but like when you're pitching an investor, they're like, well, how long are we going to hold this building for? And you're like, I don't know. Well, the market will tell us when to sell it. Yeah, yeah. So if it's in one year, if it's in 10 years, the building better be in tip top shape or else you're not. You're countering your business plan. But the one certainty is that you can't time the market, that's for sure. [00:21:23] Speaker A: Yeah, yeah, I agree. I mean it's, it's to finish a business plan in the merchant development world. Right. Because I, I wish I had all the money in the world to develop and hold forever and have a legacy. But that's not the reality of our firm. Right. When you go to sell that building because you eventually will. Right. That's our model. Most developers model it isn't. It is so difficult to deal with issues at that point. It's a motivator to make sure you're doing things right and that that building is ready at any point to go through a property condition report and to kind of go through that process. Yeah, but you're right. You walk these old buildings and it's amazing. I mean, I think we're so lucky In a city like this. But you go to, like, a new market that we all. Everyone talks about outside of Chicago or, you know, the main top three, they don't have that because it's all new. [00:22:14] Speaker B: Right. [00:22:14] Speaker A: It's all new in the last 10 years. So, like, it's kind of interesting thinking what happens to those markets in, you know, 75, 100 years. [00:22:23] Speaker B: Yeah. I mean, if all the projects, they're. [00:22:24] Speaker A: Not proven, like, it's not proven totally. It's not proven. [00:22:27] Speaker B: If everything that's conceived right now were to get done, it's still. It doesn't even move the needle on the supply that we have. And that's what people talk to me all about. Like, you know, they go to Phoenix or they go to, you know, the buzzier markets, but in Chicago, it's such a mature market, and these rental markets are so mature. [00:22:49] Speaker A: And. [00:22:49] Speaker B: And now even talk about, like, new luxury stack, which is a lot of what you're building, because it's really hard to build anything other than luxury stack. And you talk about, like, Gold Coast, Lakeview, Lincoln Park, West Loop. Now even it's got 15, you know, West Loop being kind of the shortest is like got a 15 years of a proven track record of it being a market that can support a lot of luxury housing. A lot of people want to live there. But you don't have that same perspective in other markets or less mature markets. Right, Right. [00:23:23] Speaker C: Well, so talking about, like, historical buildings and building for the next hundred years, where you have this conversion of 65 lacquer, this is one of the coolest parts of the building is you go to the top floor and you just look at the elevator, the top of the elevators, and they're like, you know, the big wheels. The big wheels and big pulleys. You don't hear anything. I mean, you could be next to it and it's spinning 100 miles an hour, and it's silent. And you look at buildings that are, you know, not quite as tall as the building we're in right now, but they're all brick buildings. [00:23:57] Speaker B: Yeah. [00:23:58] Speaker C: And that's how they were used to be built, because materials probably a lot cheaper. Brick by bit. [00:24:03] Speaker B: Yeah. But even at the top of it, at that point. Blows my mind. All those years ago, that was the tallest building, and somebody took the time to add this decorative terracotta or something at the top. It's almost like to say, we know where the market's going down the road, and we want this to be the image of the building. If you're Ever looking down on it, just know that it's still a cool building, you know. So hearing you guys talk about, like how much you care about the business, I know that you're, you know, you're long term focused guys, your businesses are here to stay. We've got a lot of peers and colleagues and such in the business that really care about Chicago in general, care about the health of the real estate market here, the health of the city. One thing that's been an initiative for me lately is to try to play a small part in promoting the humility of a housing provider or of a developer. And it's wild to me that I know all these people who own and operate buildings or building buildings here that really care and are really trying to do it the right way and be good people to deal with along the way. And still there's this disconnect with the public's perception of real estate people in general. And it's frustrating to me because I think that, like, the built environment has a ton to do with it's the fabric of a city. And if you want to live in an urban setting, you have to have density, you have to have new buildings coming in. It supports the restaurants, it supports all the entertainment that we have. It supports the desire for people to come here from out of state. And so maybe talk to us about the initial. You've got a site, excited about it, you think it's a great fit for some scale of a project, and you go present it to the community, talk to us about how that typically goes and how you approach it, and maybe go full circle with it into how it usually ends. [00:26:22] Speaker C: I would say that the perception of developers being greedy rich people who are trying to gentrify a neighborhood, as if that's a bad thing, is very real. And it makes it really tough for us to wake up the next day and still feel good about what we're doing, sometimes only personally, even though you know and your moral compass is still telling you that this is the right thing to do. And there's a lot of support out there also, but there's a lot of things that are informing that opinion, so I'll be very specific. There's a Fritz K ad right now about leveling the playing field between homeowners and developers. And it's a developer sitting on a seesaw and the homeowner sitting on the seesaw. And the developer is wearing a suit and he's like got a cigar in. [00:27:17] Speaker B: His mouth or something. [00:27:17] Speaker A: And the homeowner. [00:27:19] Speaker C: Yeah, and the homeowner is just like, sitting there. And they said, I'm trying to level the playing field between the homeowner and the developer. And I'm thinking, okay, so now the perception is the developer is bad. If you're a homeowner. You see this ad, but how many people live in Cook county who are renting apartments? [00:27:36] Speaker B: Yeah. [00:27:37] Speaker C: I went on chat CBD as soon as I saw this ad. I'm like, how many people are renting homes? It's like, like 46%. So immediately I'm thinking, okay, so if he's advocating for raising taxes for developments, developers, AKA renters, he's effectively raising rents for half of the people who are living in his, you know, in his county. [00:27:58] Speaker B: Yeah. [00:27:59] Speaker A: So. [00:27:59] Speaker C: But people don't see it that way because if you're a renter, you maybe don't put that together. And if you're a homeowner, you're like, yeah, absolutely, I don't want my taxes going up. So I think, like, publicly it's. It's pushed out that. That is the perception of a development company. I think the second part of that, too, is just about affordability. So you talked about building luxury housing. The reality is it doesn't matter if it's luxury housing or non luxury housing. More housing means more affordable housing. [00:28:26] Speaker B: Yeah, right. [00:28:27] Speaker C: Supply and demand. [00:28:27] Speaker B: Yes. [00:28:28] Speaker C: 101. [00:28:29] Speaker B: Go look in one of the markets that's oversupplied right now. [00:28:32] Speaker C: Exactly. [00:28:32] Speaker B: Yeah. [00:28:32] Speaker C: If we were Austin, Texas, rents would be going down. [00:28:35] Speaker B: And not just in class A, class B, class, the whole spectrum in everything. Yes. [00:28:39] Speaker C: But we. And I don't know if you ever read the book Abundance, but a buddy of mine had gotten me the book. [00:28:46] Speaker B: I don't read very fast, man. [00:28:48] Speaker C: They have book on tape. But it's. I mean, the title gives it away. [00:28:53] Speaker B: Yeah. [00:28:54] Speaker C: The more you build, the more affordable it is. And that it's. It's more than just that. But I was speaking at a community event in Uptown once, and I had talked about how we had delivered a project, and we were talking about the after effects. It wasn't even talking, like, asking for zoning. And people were booing me at the meeting. And these guys stood up at the meeting. They said, you should be applauding. He made your rents cheaper. And they said, well, our rents have gone up, so how did he make my rents cheaper? And it was interesting because they're going. I'm not doing the talking. They're going back and forth and like, your rents would have gone up higher had they not built this housing. [00:29:29] Speaker B: Yeah. [00:29:30] Speaker C: And I think the perception is if you bring nice housing, it means you're raising people's rents. When if you look at the simple supply and demand like that principle alone, you would think, oh, yeah, actually, we should be finding ways for Matt and Adam and everybody to build more housing so that it becomes a more affordable city. [00:29:50] Speaker B: Well, and the sites that are getting developed right now are either not existing apartment stock, because anything that's even moderately healthy and safe to live in is worth more as an apartment building than it would be for a land site or it's, you know, vacant land or, you know, tired strip center or whatever. So, like, there's rarely displacement that comes with a new development in my eyes, you know. And, you know, before I go off on another soapbox, I want to give you a chance to answer, like, is there anything that comes to mind on that for you? [00:30:25] Speaker A: Yeah, I mean, I think. I think about this a lot because you go into this business, you have to have a certain makeup to do this. It's when you create something so tangible as a building, you impact so many people directly, you impact the community so directly, you're creating one of the most core needs in humanity, which is shelter and environments. It's like at its foundational level, you're creating something that is going to be around for a very long time. There's not many businesses that you can say that. And not only are you doing it, you're actually, you're taking the lead of it. Right. And I think so. That's like, that's one side of the. Of the. Of the simplicity of it. The other simple thing is to do it. You also have to make up where you're willing to take risk. And you have to be an intelligent businessman. You have to understand how to analyze your options to execute this thing. You take all that burden, right? You're the accountable person or firm to take all the risk and do this. It would be so great if there was maybe more acknowledgement to what that actually is in the marketplace and what the business is to people, because I don't think the public. And it's not. I'm not saying they should, but it'd be great if they would take the interest to understand what really it is like, what it looks like, what's the semantics of executing these projects. Because you put your life on the line. Like, you sign away everything you've done to get these projects done. But on the same side, in our current environment, let's just be honest, there's a lot more spread between the haves and have nots than there were last cycle. And so I understand. I mean, it's gotta be so frustrating for people who are having a hard time and they don't have many options out there. [00:32:03] Speaker B: Well, I like what you just said about, you understand, because I think what the industry has missed in the last few years is the empathy is and is the willingness to be transparent and just be another human being about what you're dealing with. And a couple examples that come to mind when you were talking about real estate taxes. And if the burden shifts to commercial real estate versus residential real estate in the sense of if it shifts, then, you know, all the renters are going to bear an additional burden. So, you know, something that I've done at a very small scale is if we have a building and taxes went up, call it 20%, 25%, say, you know, increasing your rent 5%. Just I wanted to give you a little context so you don't just think it's going into our pocket. You know, here's. Here's our tax bill. And I just copied, you know, I just attached the tax bill to the renewal offer. I also said, you know, that's just one of the variables. You know, insurance went up to a similar degree. So, like, we're just kind of. We're doing it to keep up and we're doing it to make sure that we can still maintain a standard of living that we're proud of offering. And I hope that works. And if it doesn't, I understand. And I feel like that tone is way different than this defensive. Here's the renewal. [00:33:24] Speaker C: Yeah. [00:33:25] Speaker B: You know, eat it or not, you know, and. But so few people, because we've been. The industry's had to be defensive the last few years. You know, I mean, there was like, wouldn't be a real estate podcast if we didn't have somebody's phone ring. But, you know, because we've been feeling attacked, you know, we have not been willing to be the one to be empathetic. Like, you know, during after Covid, there's this like, public, like, huge politicians promoting this, like f the landlord mentality. Cancel rent. [00:33:59] Speaker C: Right. [00:34:00] Speaker B: And, you know, it's like, I'm not going to name them because they're not a public group, but I had a group that had a. In a particular neighborhood, had a lot of that opposition, said, understand that everybody's under a lot of stress. If you'd like, you're welcome to come in and review our books with us because we want you to see how thin the margin is here and want you to see all the people that get paid to run these buildings the way that we take pride in running them. But I think too often our industry is like, not willing to be the first to extend that empathy. And I think it'd go a long way. You know, if we say, you know, some ordinance comes up and we're like, you know, housing providers didn't have a chance to talk about that. It's like, well, show them that you're a person first and then maybe they'll invite you, maybe they'll call you next time. [00:34:54] Speaker C: So what other business does that really exist in? I mean, the price of eggs goes up. It's not like you go to Whole Foods. You're like, show me how much money you're making on those eggs. Right. [00:35:05] Speaker B: Oh, fill up your grocery cart, run out of Mariano's. [00:35:07] Speaker C: Right. I mean, I think it's a really interesting point. The other thing too is like, lawyers do that, right? [00:35:14] Speaker A: They're good about sharing their. [00:35:15] Speaker C: Yeah, right. Why did your rates go up? Well, because ChatGPT might be putting us up. I mean, I think, like there's a part of having good morals and wanting good. And personally, I want, I have good morals, I think, and I want good. [00:35:29] Speaker A: Yeah. [00:35:30] Speaker C: And so at what point does that get in the way of, of creating more housing? [00:35:33] Speaker B: Yeah. [00:35:34] Speaker C: So here's a good example. The energy code in Cook county, in Chicago, in Illinois is the most restrictive energy code in the country. [00:35:42] Speaker A: It is. Yeah. [00:35:43] Speaker C: And who doesn't want a very energy efficient city? I would love to have live in the most energy efficient city. What was the ripple effect of that? Construction cost goes way up. Less building, less apartments, higher rent. [00:35:58] Speaker B: Right. [00:35:58] Speaker C: Less affordability. So, okay, talk about affordable housing. I think Matt and I would agree that we are fans of affordable housing. Create more housing, create more housing options for everybody. However, to what extent are you now actually your affordable housing policy is raising rate rents for people because you're making it so restrictive to build that. Therefore, you've actually created the inverse property problem. You, you had a good intent, but your solution to that actually had the opposite. [00:36:31] Speaker B: Like, I mean, rent control is the, is the example that's always never a success, never an example of rent control in a market promoting rent affordability. [00:36:40] Speaker C: It seem to me, it, I mean, and this is like typical podcast, it seems so obvious that if you had a expert in supply chain economics, go into city hall and explain, strip all like affordability, strip all requirements and just build like they do in Austin or other communities and rents would go down like there would be a paradigm shift. [00:37:04] Speaker B: Yeah. But the problem is not as much city hall as I see it. It's more about the public's perception because city hall will track with whatever the voters want, you know. So I think the thing that would actually change it is like if the public viewed it a little bit differently. Something not to gloss over is, you know, what you talked about this tremendous level of risk. [00:37:25] Speaker A: Yeah, yeah. [00:37:26] Speaker B: And I mean, maybe you expand on it because I think that there is. I think that there's. Most folks don't understand the margin on these. You know, they look at this project and you know, it's $110 million, $120 million. Okay, $140 billion project and say, I mean, wow, you must, you must have made tens of millions of dollars from it and don't understand because how would they. But the capital stack and everything having to go right for it to be worth more than what you have into it for. Right. And also this idea that if you're going to do all that, there should be no incentive for anybody in it. Like why It's a tremendous undertaking. That's right. Do you want to expand on what you had mentioned at all or did we cover it? [00:38:22] Speaker A: Yeah, no, I think you're right. And I think just to bring it back around to maybe the Chicago specifics, I said all that. And then the reality is we have some of the best fundamentals right now as a city to attract more investment, which would spur more housing. And if you really want to be. Again, I'll probably say this comment back to basics, like during this pot a lot, it's like just at its simple level. The reason why Adam and I can't get some stuff going here is because you said certainty. I call it predictability. The second that there's rumblings in the market about rent control or there's mansion taxes being proposed and voted upon, now you have whole districts of the city that are putting in anti gentrification rules about trying to dispose and sell your property, affecting your valuations of real estate, whatever they are, at its foundational level, they are behaviors that are not predictable in the future. And so you literally just have investors that are simply saying, well, what's my downside here? Well, this is going on in this market and it's not going over in this market. So I'm going to go over to this market and just. It's like simple. Right? It's just simple. And that is, I think, having such an adverse effect to the growth of the city. That's not being talked about. [00:39:39] Speaker B: Yeah. [00:39:39] Speaker A: Just those behaviors and that the lack of acknowledging. Just acknowledge that we can change some of this communication around what is trying to be achieved. [00:39:49] Speaker C: But how, in some ways is it not a benefit? I mean, if you can fight through it, if you can actually get a shovel in the ground in the city, you're left as one of the only buildings to deliver into a market and. [00:40:03] Speaker A: I think on to hit your business plan on a cash flow perspective. Yes, but then who's there to buy it? To invest millions and millions of dollars into purchasing that building? Well, those conditions exist. So Chicago's on a cap rate basis then I think it's a different market than other markets. Then valuations are not. [00:40:23] Speaker C: There's a reason why, Adam, I don't want to speak for you on this one, at least can build a high rise in Chicago, whereas it would be very hard for me to build a high rise in New York City. Because the groups that are building high rise in New York City are huge, huge firms. Right? [00:40:39] Speaker A: Yeah. [00:40:39] Speaker C: They're not groups of 11 who have a little office in Bucktown. [00:40:44] Speaker A: Yeah, that's true. [00:40:45] Speaker C: And the reason why, I think is because Chicago is a very entrepreneurial market. You can build nice. You can, hopefully the market will like rebound in the sense of institutional capital coming in. I mean, if you look at Chicago historically, institutional capital comes in. Institutional capital goes out. It comes in, it goes out. And if you're an entrepreneur, it's the best real estate market in the country to be in, because you have to build in the market where they're not there and you have to deliver in a market where they come out there. [00:41:13] Speaker A: That's right. [00:41:14] Speaker C: It's hard to say, like, is that really going to be. Is it going to come back and forth through throughout the rest of time? I don't know. Yeah, but look, in New York, it's fully institutional. Look, in other markets, like the rest of the Midwest, there is no institutional. You know, we built a building in Cleveland, Ohio. There's no institutional players. [00:41:29] Speaker A: Yeah. [00:41:30] Speaker C: At least as entrepreneurs, there's not a better market in the country to be in, even with, you know, its pros and cons, than Chicago. [00:41:38] Speaker A: Yeah, I agree. But I'll tell you, spend some time in Nashville and see what local people did with real estate over the last 15 years. I mean, that's. It was like shooting fish in a barrel. [00:41:51] Speaker C: Nashville's cool. Chicago's cooler. [00:41:53] Speaker A: I don't disagree. [00:41:54] Speaker C: I love Music City and I love Broadway, but there, I don't know, it's a small town. There's nothing quite as inspiring as Chicago. [00:42:03] Speaker A: I'm telling you, a small town. I'm saying that from like the realities of how the entrepreneurial spirit there drove some things. [00:42:09] Speaker B: So. Yeah, well, I think it's also like, you know, a lot of what I do is private capital. And you know, in that setting somebody can feel more entrepreneurial and have you know, this instinct or these intangibles kind of drive why they're gonna do it. And oftentimes in Chicago it comes with a long term perspective on things, which is helpful. And you can kind of have those, you know, those animal spirits and that entrepreneurial like drive and you know, so that's why we've seen a really healthy kind of like middle market space. But, but we want to see institutional activity pick up and it feels like it has. [00:42:52] Speaker A: I mean I think when I was speaking to those like high level that was around the institutional capital striking the $100,200,000,000 checks. [00:43:00] Speaker B: But Matt, that tracks like, that sets. That's what is in cranes all the time. That informs. That informs some, some of the, like the broader market. And that'll make for a lot deeper buyer pool even in the middle market space if we see that continue to perk up. [00:43:14] Speaker A: Yeah. So you're right. It's picking back up. There's some big players that are very active in Chicago right now. Obviously the most public one is Lincoln Yards getting recapped out. I mean that group is really bullish on Chicago right now. [00:43:24] Speaker B: Yeah. [00:43:26] Speaker C: I mean there's been institutional sales in Chicago. [00:43:28] Speaker A: Yeah. [00:43:29] Speaker C: Milieu just sold to Morgan Stanley. There's. I mean there's institutional capital coming in. [00:43:36] Speaker B: Yeah. [00:43:37] Speaker C: Cap rates are going down. It's trending the right way. [00:43:39] Speaker A: It is, yes. [00:43:40] Speaker C: It's. It's hard to be patient when you're a developer chomping at the bit. You're like, just trust. Like if we build it, we. The time will be right. [00:43:47] Speaker A: There's a window where you wait too long and then everybody jumps in the swimming pool at the same time and then costs go up. Yeah. It's like popcorn. Right. Like it's going to go off and then all of a sudden if it's in, you're in the middle of it. It's just you. That's what we talk about all the time is just angst to be one of the first ones out. [00:44:01] Speaker B: Yeah. [00:44:02] Speaker A: Because you are. We're going to hit this incredible delivery timeline. [00:44:05] Speaker B: Yeah. [00:44:06] Speaker A: We all know it. Like you can judge that right now based on the lack of activity but. [00:44:10] Speaker B: You'Re often, you know, even if your decision maker, ultimate decision maker on a project, you're still having to make a decision by committee. And then so you don't, you don't always have the opportunity. Like is your investors have a say, like even like the lender has an influence on it, depending on like the maturity and stuff. And so like, you know, you have to, you can't always, can't always do what you want to do as an individual entrepreneur, right? [00:44:36] Speaker A: No, of course not. [00:44:38] Speaker C: I mean, that's why we've done smaller scale projects, because I can't sit on my hands until the time is right to develop high rises. We own sites that are ready to shovel ready and when the market is ready, we'll develop them. But like neighborhood projects, those are actionable now. [00:44:58] Speaker B: Yeah. [00:44:59] Speaker C: And we're in this business to build, so if that's what the market's telling us to build, that's what we're gonna do. [00:45:03] Speaker A: Yeah, I mean, I know and I agree. I think that's a, that's, that's a really smart move. I think that's like right now anything you get done is gonna. [00:45:10] Speaker B: You guys have a boutique project in the pipe, right? [00:45:12] Speaker A: Which one? [00:45:12] Speaker B: Northwest in Fulton. Market, right? Carroll, right? [00:45:15] Speaker A: No, no, no, no. We were working on, as a consultant on getting that deal kind of entitled, but we'll see how it goes from there. [00:45:21] Speaker B: Okay. [00:45:22] Speaker C: How do you feel about the consultant role? Because people have asked us to do that and to some extent it'd be great to like for fee income, etc. And it's fun. But also, aren't. Aren't you just kind of given spilling all the, the secret sauce and now they're just going to take everything they just learned from you and do it themselves? [00:45:41] Speaker A: I mean, you and I are friends, right? But we're also competitors. I mean, is there really any secret sauce in this business? At the end of the day, I don't know the models, I think, I think our culture and our firm is really, we maybe to a fault. We seem to be so transparent with people. We share models, we spread around spreadsheets. We're like the last people do NDAs. Maybe that's a bad idea. But I mean, we think it's more about your, your trust. The trust you build, your experience. Do you do what you do? Do you live by your values? I mean, I. And then it's all about surrounding yourself with the right people than it is having some unicorn, like, what's your magic? Is there a magic plumber out There, that saves you 10%. Like what, what is, is there really a, a unicorn? Right. I don't know. [00:46:24] Speaker C: I think if there's anything that is the unicorn. Yeah, it's efficiency really. [00:46:33] Speaker A: I mean like, like decision making. [00:46:35] Speaker C: No, like smaller scale. So example would be Belmont, our project on Belmont. [00:46:40] Speaker A: Right now. [00:46:42] Speaker C: We had multiple GCs and developers look at that project and wonder like, how are you building this so cheap? Yeah, and we're lean, we're extremely lean. But we have a program like we know what material to select, we know what rents, we know how to eliminate waste. [00:47:01] Speaker A: Were you making design decisions around that or just like your collaborate, like you know, your subs and your. [00:47:07] Speaker C: I mean, I'm talking about like structurally, like what is it a wood building? Is it a concrete building? [00:47:12] Speaker A: Yeah. [00:47:13] Speaker C: What's the facade? What type of windows are you getting? I mean really like the high level stuff that trickles down. Are you getting, are you, has the building been designed? I mean, giving the secret sauce away. Is the building 60ft or is it 70ft? Because as you know, PVC pipe versus not PVC pipe. There is a lot of tricks that the general public doesn't necessarily know. Public being like developers. But I mean, if you start to consult on them, which if I had more time, I probably would do it. But like, you know, do you miss out on the next great site because there's another buyer? I mean there's not a lot of competition in this market unless you go out and you grow it, which is I guess effectively what that is. [00:47:56] Speaker A: Yeah, I don't know. I mean, I think we have a couple third party multifamily assignments as a builder and we brought in our whole development team to totally analyze their plans and find more leasable square footage and give them ideas about, you know, hey, you have this sidewalk and this unit. You could move the sidewalk and create a front yard for that unit. And you know, like all these programmatic ideas that we're just, it's like to us we just do it. Like we're just trying to be helpful, you know. [00:48:22] Speaker C: Well, ultimately if you're going to over. [00:48:24] Speaker A: Over the macro scale, like comes around, I don't know, you just. [00:48:27] Speaker C: Well, I think it's a great example. Joe just said, aren't you building this project where you're not. So, so whether you build it or not, you're associated with it. It has to be a good project. [00:48:33] Speaker A: Yeah. [00:48:34] Speaker C: So it makes, I mean that makes sense. [00:48:36] Speaker B: Well, and also I would, you know, I don't know if it's the case or Not. But from my seat, it seems like also, you know, you have, it's a big business and you have. And you're building these projects and you have to be equipped with your team to have enough bandwidth and hands on deck to be able to build a really big project. And, you know, we just talked about that. It's not always convenient or even available to do so. So it's like running a business too. Right. I mean, you gotta like pay salaries and stuff too, in a way that's still in the same sphere, still doing the same thing, even if it's not yours. [00:49:12] Speaker A: And that's, I think it's been, you know, one of the biggest challenges is when you get set up to run these big institutional LED projects. You have to bring so much firepower to your operations. [00:49:21] Speaker B: Yeah. [00:49:21] Speaker A: Accounting, project management. And yeah, it's great when the project's going on, but then you have this tale of obligations that you don't, at the operating company level do not get compensated for. [00:49:31] Speaker B: Yeah. [00:49:32] Speaker A: And at the front end, you do not get compensated for. So what has been a difficult pivot for us, like we, you know, small products is a great solution. Right. But it's like you got to. How do you forecast that? How do you plan around the uncertainty of a pipeline when you. But you need to maintain a staff? So you just. It's the ebbs and flows. We've leaned into our general contracting business to grow because it is. And it's a great business. And so that's how we look at it, is how we can just leverage our abilities, get some consultation work developer. [00:50:01] Speaker C: Services, alternative revenue streams. [00:50:04] Speaker A: Alternative revenue streams, yeah. So that's it. I mean, you gotta do something. [00:50:07] Speaker B: If I'm driving around the city then, and I see the, you know, the LG Construction sign all over Fulton Market, building out every restaurant that we like to go to. [00:50:15] Speaker A: Yep. [00:50:16] Speaker B: Or if I, you know, I'm in Lincoln park and on Halstead, I saw, you know, you have the, you know, the branding up on the storefront and then it's specialized and I go in there and look at bikes and like, to me, that still advances the brand. [00:50:30] Speaker A: It does. Yeah. [00:50:31] Speaker B: You know, so to me, it's still like being in the game. Even if you can't always be building 500 unit high rises. [00:50:37] Speaker A: That's right. You know, that's right. That's how we're doing it. Yeah. [00:50:39] Speaker C: I don't know if this was your intent, but what I. When you guys rebranded to LG Group. [00:50:43] Speaker A: Yeah. [00:50:44] Speaker C: The first thing I thought was this is really Smart. Because they're creating enterprise value. [00:50:48] Speaker A: Yes. [00:50:48] Speaker C: Versus like yeah, we're GC or we're a developer or whatever. Now you have like lg. The brand has enterprise value. [00:50:56] Speaker A: That's right. And that was strategic. We wanted to make sure we had an umbrella that we could start like an ideal state. You could start adding in all these cool companies. Right. Like these big mega companies over the years and years and years. And Brian founder is like what was so wonderful about him? He just keeps pushing like how do we keep. He's all about growth and creating opportunities for people and you know, it's awesome. But it's hard. It's so much work. [00:51:20] Speaker C: Do you own trade specific. Like you don't self perform any trades. [00:51:24] Speaker A: But that business is like from a. It's a great business right now. Like plumbers, electricians, H Vac companies. I think over the next few years are going to be some of the most successful, especially the ones that can do service work. [00:51:38] Speaker C: I mean it's get into the elevator business. [00:51:42] Speaker A: Yeah, we need some elevator companies. [00:51:44] Speaker B: Jeez. [00:51:45] Speaker A: But no, you're right. I mean that's where you get. It's really gets interesting when you think about a company can scale and there's. I know there's a lot of examples where large developers have figured out how to monetize all these services and kind of quote unquote self perform them or be vertically integrated with them all. It's kind of weird because that's also mean you're making money on everything you're doing. But if you're executing and you have a really successful, successful track record and you're returning good returns, your investors, I mean then it's like one point of accountability for as many things as possible. That's a good thing. You know, it's so it's, it's. It's kind of interesting to see where it goes. [00:52:16] Speaker C: I'm gonna see you mowing the lawn at Arthur on Aberdeen. That's up there sweeping. [00:52:23] Speaker A: What you're doing it too. That's how you're executing. You're making sure you're delivering it at the right price. You're controlling it. [00:52:29] Speaker C: Yeah. [00:52:29] Speaker A: Because the days of. And this is a long time ago, but did work at one time where you could buy a piece of land, go hire an architect, bid out a GC and just go to a meeting every week. Those, those days are gone. You have to know how to set these projects up. And you can't just go trust, you know, all the groups to do it. Yep. Right. I mean you can't you have to have that knowledge. [00:52:49] Speaker B: So I feel like the market as it is today, we've got. I don't know if it's just from my perspective or if it's actually what's happening is like, we've got this, like, youngish, you know, group of, like, kind of this new guard kind of coming in almost, I feel like. And really like leading the charge on being the most active today. And I think you guys. You guys are a great example of that. And I think what's. I don't know this because I wasn't around, you know, in the last, Like, I wasn't around until before, you know, 15 years ago is when I started. But, like, it feels like that group is you guys, again, being an example. Friendly competitors and collaborative and cheering each other on, wanting the projects to go well. The competition that's out there right now, to be honest, I feel it with brokers. I'm good friends with most of my main competitors in the brokerage business because them doing a good job is better for the market. It's better for the transactional market. And I don't know if it's that I'm just a little bit older and not feeling as pressured about every single assignment or if it's just a sign of the times that I feel like this group of developers and service providers are just maybe more collaborative than in the past. Do you guys feel that, or is that just my perspective? [00:54:16] Speaker C: 100%? [00:54:16] Speaker A: Oh, yeah. I think since COVID and I think the love for the city, like, those two things, like, I mean, Adam and I got to know each other, it was like we hit it off right away because it was like, I don't care. I hope. Please go get that deal done. Or are you looking at that land? No, go for it. What I can have you with. Adam's brought me things to look at. I budget stuff for him to give construction insight. We're sharing notes. It's like a market where there's plenty of room for everybody to be successful. Successful. Like, I think at the end of the day, like, I'm cheering for all of us to be successful because we love the city so much. Born and raised here, are raising families here. I want my kids to raise families here. And there's a more urgency now than ever to, like, keep this city and make it what it could be. Right. [00:55:01] Speaker B: Yeah. [00:55:01] Speaker A: And, like, we have to be a part of that 100, like, and we have to do it together. [00:55:05] Speaker B: Yeah. [00:55:06] Speaker A: Like, the. I don't. I worked, you know, before LG I worked for, for Jim Letchinger. I mean so he was like first heard of him. Talking about an amazing first mentor. Right. [00:55:15] Speaker B: Yeah. [00:55:16] Speaker A: And what, you know, Jim taught me very much about how he was such a good communicator networker with like the community of the developers and the service providers. [00:55:26] Speaker B: Yeah. [00:55:26] Speaker A: He was very, always very honest, always very straightforward. Never played any games. You always knew where you stood. And that's how I feel that like that's my goal in the community. [00:55:36] Speaker B: Dude. But it's what's happening. [00:55:37] Speaker A: It's my goal. And like Brian help people. [00:55:39] Speaker B: An incredible guy. [00:55:40] Speaker A: Yeah. I just want to help people. Right. That's where I, I go home at night not happy about like did something happen? Good financially at work it was like did I help somebody? [00:55:50] Speaker C: Yeah, yeah. [00:55:51] Speaker A: Like that's how you, that's when you sleep good at night. [00:55:52] Speaker B: Yeah. [00:55:53] Speaker A: At least so I don't have to get too squishy about it. But like I think that's where I, I we said this, that we were like feel like we're part of this younger group that's growing up in the market. [00:56:03] Speaker B: Yeah. [00:56:04] Speaker A: With you and this is exciting. We have a long Runway together. It's gonna be awesome. [00:56:08] Speaker C: It's more fun, frankly. Way more fun. Like you live once. Right. Do you want to go and do it the way the old guard did it? [00:56:14] Speaker B: Yeah. [00:56:15] Speaker C: Where everyone kept their notes like this. No one consulted anybody else. No one shared notes. Like it's fun to do it as a group of friends and I get dinner with, you know, other young developers. I was with Nick Melrose last night. Another young guy who's awesome dude, just like super fun. [00:56:34] Speaker A: He's doing great. He found some good capital. He's doing great. [00:56:36] Speaker C: He's awesome. And I mean there's range group and there's people outside. There's Shane Rockman and there's like all this new energy that I think is harnessed between groups like us and, and, and them that is going to be huge for the city. [00:56:52] Speaker B: Yeah. [00:56:53] Speaker C: Because again we can't do this in New York. [00:56:55] Speaker A: Right. [00:56:56] Speaker C: But if we band together, if we become buddies, if we share notes, than the sum is greater than all the parts individually. [00:57:03] Speaker A: Like rising tide, raise all ships. The whole thing. [00:57:06] Speaker C: We can do much more. [00:57:07] Speaker B: Yeah, I agree. It's more fun. It makes me bullish about. I think when you have been doing it for long enough to have had some success and to just have the perspective of this longer time horizon, then what happens in this immediate deal allows you the perspective to be a little Bit more holistic about it, Think about it a little bit more globally. And it just makes me. It makes me bullish about the city in general. And the real estate business here is like having a lot of good people that I feel like are now really at the core of it, you know, not so much, you know, the up and comers really kind of who's here and who's most active. And I think it goes a long way in being an example for the next crop too. You know, Chicago is a city based on like talented people, ambitious people coming here, working with lg, working with Maverick, working with interior, whatever, and learning from people who are trying to do it the right way. And to try to like do it the way that's the right way, not just for them today, but for the market in general. And build a business that's lasting is a better place to be than a bunch of people trying to cut each other's throats all the time. [00:58:13] Speaker C: Yeah, I mean the idea of having the two of us on the podcast at the same time is awesome because. And we're limited by microphones or else we might have more people sitting. [00:58:22] Speaker B: It was cute before we were on tape. The pillow wasn't there and you guys had your arm around. [00:58:27] Speaker C: But I mean like that, that is imitation is the greatest form of flattery. And I and Matt and I joke all the time, like I'm happy if people come to this building or any of our projects and steal something that we did and implemented in their project. Yeah, that's what I do all the time. [00:58:44] Speaker B: Right. [00:58:44] Speaker C: I mean, we walk. It's our job to know every single thing that's happening in the city as it relates to like the next thing for real estate. [00:58:51] Speaker B: Yeah. [00:58:52] Speaker C: All I'm doing is going out there and trying to like take from what other people came up with, what are great ideas and implement it into our own projects. [00:58:59] Speaker B: Yeah. You guys, being some of the most active developers, have your finger on the pulse about what your customer is looking for as much as anything. And I feel like through this, you know, if we look at the last 10 years, there's been. It was like micro apartments at one point in time. It was amenitizing to a level. It would strike some people as abundance. But has anything changed today that is informing what you guys are trying to build? [00:59:35] Speaker A: I would say because of such a big variety of supply and demand across the national landscape, it's very market driven. Like the supply and demand thing is kind of big difference between south up here and Chicago is going to Be in this really high demand, low supply condition where then the trends kind of don't matter as much because there's just not enough supply. But I think like in our portfolio, parking has become extremely valuable to a lot of our buildings. I think, you know, since COVID like human nature, like people are starting to go back to their own ways and people. More people have cars, especially in Fulton Market. I think that's a more of a car market than people give it credit for. So our next building in Fulton is going to be parked. We. We added a substantial amount of parking into that program. Not just to be. We went from like a point 22427, call it to like a 0.45. [01:00:35] Speaker B: Oh, dang. [01:00:35] Speaker A: Yeah. So we're at like doubling parking. [01:00:38] Speaker B: Yeah. [01:00:38] Speaker A: I mean, we're getting almost 500amonth. Month for a parking spot in full market. [01:00:43] Speaker B: Oh my gosh. [01:00:43] Speaker A: Crazy. [01:00:44] Speaker B: Yeah. [01:00:44] Speaker C: But after you build all this parking, you're only going to be able to get supply and demand. [01:00:48] Speaker A: We'll see. I think from. I think amenities still are very important. You know, people want to have a feel like they can go to places, but. But I think the neighborhood is still the ultimate amenity, like river north for us, our PUGO project that came out of the gate beating Fulton Market because it's just more established neighborhood. So I think the neighborhood being the amenity is going to be a little bit more important. [01:01:13] Speaker B: Yeah. That level of tenants still got the east bank membership or whatever. [01:01:16] Speaker A: And I think these classic high rise apartment buildings are newer class to the global real estate landscape for the last, you know, since the great financial crisis. Right. So like now they're all becoming somewhat commoditized. Right. They're all kind of like the same. And like renters, your consumer, you kind of just bounce around in a certain market. So it's like, it's hard to know what the right, like, need is on the amenity front too, these days. [01:01:43] Speaker C: You don't want to get too cute. [01:01:45] Speaker A: Right. [01:01:46] Speaker C: There's also functionality, which is probably the. Should be the biggest trend because, you know, home automation. Remember that was the whole thing. Everyone's like, oh, you can control everything by, you know, clapping or snapping or whatever. And then it's like, well, none of it works. So that was fun. [01:02:02] Speaker B: Now I got all these like iPad jacks. [01:02:04] Speaker A: Right. [01:02:04] Speaker C: Operational nightmare too, right? [01:02:06] Speaker A: Yeah, exactly. [01:02:07] Speaker C: So I mean, I think the reality is like, if I was renting an apartment, which is what I think we try and see every single project from what. What would you want? I want something that Works is like, number one. I want something that's quiet. So maybe not an amenity, but sound attenuation is, like, the number one thing when you're living on top and below and next to somebody. [01:02:28] Speaker A: Especially in, like, your smaller deals that are more wood frame. Yeah, that's. [01:02:31] Speaker C: Oh, man. [01:02:32] Speaker A: It's harder and harder in those projects. [01:02:33] Speaker C: Exactly. Wood frame is a great example. Like, how do we get to an stc? As if it was a concrete building? What types of things are you doing? [01:02:39] Speaker A: Yeah. [01:02:39] Speaker C: I mean, there is still this, like, blurred line between residential living, condo living, and hospitality. And what's the sweet spot between all three of those? [01:02:52] Speaker A: Where. [01:02:53] Speaker C: If you go to hospitality, is that a place you really want to live? I've stayed at nice hotels. I'm sure we all have. Do you want to live there? Actually, we lived in a condo building. Joe and I lived in the same condo building. At one point in time, there was a fire, and I had to move out for an entire year. That was before I was a gc, So I didn't. I couldn't control the process. And my wife and I were so excited we got to live in a hotel. We're like, this is going to be great. [01:03:16] Speaker A: How long? [01:03:16] Speaker C: We didn't know how long we end up being there for three weeks. And by the end of three weeks, and it was a nice hotel, we were like, this is awful. [01:03:22] Speaker A: Yeah. [01:03:23] Speaker C: I mean, it was miserable. [01:03:24] Speaker A: Miserable. [01:03:25] Speaker C: But, you know, you want a functional home. [01:03:28] Speaker A: Yeah. [01:03:29] Speaker C: And, like, having appliances that work okay. It doesn't tell me what the temperature is outside, but it tells me what the temperature is inside the fridge. I mean, I think that the. Having, like, things that work and talking about standing the test of time, things that aren't breaking down, you're spending the money, is much more important. [01:03:47] Speaker B: Yeah, it's. It's harder to advertise in online posting, but you can touch and feel it when you come and tour it. And then it helps on retention. Right. [01:03:57] Speaker C: Retention's the biggest thing. I mean, retention. If you can, like, focus on retention, then. And. And there are things, outside factors. People are moving out of state or getting new jobs or whatever it is that may pull from that. But the reality is, is if you have a nice, clean apartment that works, people are going to stay. And the reality is attention is huge. There's nowhere else to move to because there's no new product. [01:04:21] Speaker B: So that's where, you know, I go back to the comment about, like, intangibles and apply it to this conversation is like, when I'm. When I'm showing something to sell. You just can't fake whether the customer is happy or not. [01:04:32] Speaker A: Yeah, right. [01:04:33] Speaker B: You can't. They can't. And like it's more than just whether there's a gym or not. Is the gym well equipped? Are people in the gym using it? Is it like, is it in the right spot in the building? You know, is there, you know, like is. Is it a happy community? You know, and there's how it's being. [01:04:52] Speaker A: Managed, you know, like it's. [01:04:53] Speaker B: Yeah. Is it clean? [01:04:55] Speaker A: Yeah. [01:04:56] Speaker B: I mean like that's probably like talking about the basics is probably like different than I thought that the conversation about trends would go. But it, I think it's a great example of like, you know, sticking to the meat and potatoes of what people are looking for in housing. [01:05:10] Speaker A: Yeah. [01:05:10] Speaker B: And if you're doing that, it shows. [01:05:13] Speaker C: Yeah. [01:05:14] Speaker A: I also, I thought another thing that is a trend that we're really actually focused on is, is putting more priority on the retail. I think the retail can be a dog in some of our buildings. If you don't figure out the retail portion and it starts to matter to just to your point, like what the build, how the building's functioning as it's multi, as it's mixed use asset, like. So my point is we sold our 1220 West Jackson building and then converted the buyer, actually converted the retail to more residential. [01:05:46] Speaker B: Yeah. [01:05:46] Speaker A: So it's like, I guess it's more like seeing where you can actually maximize residential even at the ground floor level. Because retail just isn't a strong need in that micro market or that block and really acting upon it that way and then being thoughtful about what the retail is. If you have a high retail environment because it matters to the building's performance, it also matters like next door, it's still much more impactful to the residents if it's in the building. It's just something about it. [01:06:11] Speaker B: Dude. I agree. In addition to that, it's also like the cachet of the building. Like. Yeah, mixed use real estate is, you know, in an urban setting is a. Is like. I use the comment again about the fabric of the market. I mean like your wells project, smaller project for you guys that you develop. But like there's a high end wine store, there's a foofy bakery. It's like that's okay living above that is not that you're necessarily buying a bottle of wine or buying a cupcake every day, but it adds cachet, you know, if you are above a vacant storefront or if you're above you know, a smoke shop or whatever. [01:06:49] Speaker A: It. [01:06:49] Speaker B: It's a significant ding. And it's like, you know, you guys care a lot about the brand of your business. [01:06:55] Speaker A: That's right. [01:06:55] Speaker B: And like, I'm not. There's the economics of it, which sometimes you have to do what you have to do and. But if, if it's thoughtful and if it's additive, you guys each have projects, one that have grocery stores as anchors of a multi family project. [01:07:11] Speaker A: It's the best retail you can have in a, in an apartment building. [01:07:14] Speaker B: Oh my God. [01:07:15] Speaker A: By far. [01:07:15] Speaker B: Yeah. And you go downstairs and then it's also, I mean, it becomes this like anchoring property in the neighborhood too. It's like the building with Trader Joe's, the building with all. It's like, it's. No, yeah, right. [01:07:33] Speaker C: Yeah. I mean, to that point, it's not only an amenity to the residents and amenity to the entire community, but again, looking at from the lens of if you live there, what would you want there? Do you want a mattress store who might pay another dollar a square foot, or do you want a bakery or a fitness facility or something else? [01:07:51] Speaker B: Yeah. [01:07:51] Speaker A: Service provider. [01:07:53] Speaker C: It's not rocket science. It's if you put yourself in those shoes, what would you want? Yeah, I mean, everybody wants the same things. They all want nice things. [01:08:02] Speaker B: High end fitness concept here. [01:08:03] Speaker C: Exactly. I mean, there's a tremendous example in this building. We had planned for medical office and ended up doing high end fitness. [01:08:11] Speaker A: It's huge. [01:08:12] Speaker C: But think about how if you're a resident, are you going to use a specialized medical office or are you going to use a gym? [01:08:19] Speaker B: Yeah. [01:08:20] Speaker C: I'm probably not the best spokesman because I'm not a big gym user these days, but if I lived in this building, I would much prefer, you know, living above a gym than I would, you know, an office. [01:08:29] Speaker B: Yeah. But I don't blame you for conceiving as that because we're two blocks from Northwestern. [01:08:32] Speaker A: You know, there's market demand there. [01:08:34] Speaker B: Yeah, yeah. Now you guys have been. Have been awesome. We're going to. We kind of did this podcast. A little backwards as usual. I got a fluff question or two for you guys and then we'll wrap with a more meaningful one. But what's this is like a total rookie podcast. Like no. No segue to this whatsoever. What's the best meal you've had in Chicago recently? [01:09:00] Speaker C: I've got one. Last night I was at Moody Ton, the only Michelin starred brewery in the world. [01:09:10] Speaker A: I didn't know that. Okay. [01:09:13] Speaker C: In Chicago on South Wabash. [01:09:16] Speaker B: Young dude, right? [01:09:17] Speaker C: Yep. Jeremy Cohen runs it. I think he was Crane's 40 under 40, you know, must mean something. But he. I mean, it was awesome. And the reason why I thought it was so incredible was I'm not a big beer drinker, and the first couple beers that I drank, I literally thought were wines because they came in wine glasses. But it was. I mean, I just remember, like, thinking, this is the best steak. And I was literally at Joe's, like, a couple weeks ago thinking, that was a great steak. [01:09:44] Speaker A: This was. [01:09:45] Speaker C: Was fantastic. So I'm gonna say best meal so far. Moody tongue. [01:09:49] Speaker B: Cool. [01:09:50] Speaker A: That's tough. That's good. I say I recently had that beef Wellington at Obelix over there. [01:09:57] Speaker B: I haven't had it. [01:09:59] Speaker A: Oh, that was. [01:10:00] Speaker C: That's special. [01:10:01] Speaker A: It's like. That's a special dish. It takes so much time and process to make. It's like a classic. [01:10:05] Speaker B: Yeah, it was awesome. [01:10:06] Speaker A: That was awesome. [01:10:07] Speaker B: The reason I asked the question is because I got an answer for it myself. This time around. We had our kids soccer. It was cold. This is a month or so ago. It was, like, over, like, Cricket Hill ish, you know, Montrose in the lake, kind of, which is an incredible setting to watch your kids soccer. It was one of the things I like about city living. But my son finished his game. We were like, what do you want to eat? And I thought he was going to say, like, Chipotle or something. We eat all the time, you know? And he's like, let's go to Manny's. And I'm like, wow. He's a. I'm like, I'm first of all, really proud dad right now that you said, man, we've been talking about it. And it was so. We were still, like, so cold when you got in there, and you go down there and wait in the cafeteria line. It's just like, it's such an amazing experience. And then the food's awesome. So that was what was driving, dude. I got, I think, everything. One of. I think I went around the world. All right, what's a. You talked a little bit about this, but, you know, let's call it out explicitly. What's an initiative, the professional initiative that you guys have this year, either for, you know, yourselves leading the businesses, or like, a team initiative. [01:11:18] Speaker A: The business initiative, the big one here is to take a more capital first approach to our development pipeline. So we've been very successful for 20 years, finding great property, setting deals up, and then raising them on, like, a deal by deal basis. And we really are motivated now to convert it to more of a capital first. So we're going to go out with our first fund and it's. [01:11:41] Speaker B: Is that breaking news here on the podcast? [01:11:43] Speaker A: It could be breaking news. Yeah, yeah, you heard it first. We are very excited, but I think in human nature also nervous. Like this is something, this new frontier for us. And we're excited because I think we have something that a lot of developers strive for, which is an amazing portfolio of work and a lot of people that we know and we've always done what we said and proven our abilities. So I'm like really anxious to get into it, but nervous and we'll see what happens. [01:12:10] Speaker B: I love that. I love. Also I think that's really like, it's something that is. My perspective on feeling a little bit nervous about things has changed recently. I was like gravitating towards things that were more comfortable and now it's like if you, you know, it makes you feel alive, you know, makes you feel like you're doing something that could be worth doing, like going for it a little bit. What about you, Adam? [01:12:35] Speaker C: I would say owning the brand, you know, we're, we're pretty vertically integrated. [01:12:43] Speaker A: Right. [01:12:43] Speaker C: We conceive, we develop, develop work construction. And something that has like occurred to me and us over the past couple of months is we build these awesome buildings. [01:12:54] Speaker B: Yeah. [01:12:55] Speaker C: And our brand is behind them. And then the day that they get their certificate of occupancy, we hand them off. And somebody else is now we're talking about management companies. Someone else is now holding your brand, representing your brand. And sometimes that's a great thing. I mean, this building is a great example. Cushman Wakefield manages this building, does a fantastic job. Absolutely fantastic. And we've worked with a lot of great management companies, Peak and mid M and all these groups, they're great. You're only as good though as the person, the people. [01:13:26] Speaker A: Yeah. [01:13:27] Speaker C: And one thing I know about Maverick is we have the best people, second best lg. [01:13:36] Speaker A: You have great. You have amazing people. [01:13:37] Speaker C: We've got good people. [01:13:38] Speaker A: You have amazing people. [01:13:39] Speaker C: And these are our babies, you know, we got to take care of them. So this isn't necessarily like we're launching Maverick PM or anything quite like that, but it's really taking a more like totally hands on approach throughout the life cycle of the deal. Yeah, we're pretty involved already. I mean, you can talk to any property manager. They're like, man, these guys are constantly pushing. But on our smaller assets, our more scattered site, mixed use stuff, we are going to manage some of that stuff in house. [01:14:08] Speaker A: It's awesome. [01:14:09] Speaker C: So it's, it's fun, it's exciting. And we've started doing it a little bit. We have a seven unit building. It's very important, very big in Wicker park that we're managing ourselves. But here's a good example. So that building, brand new construction, somebody moved in and their washer dryer wasn't working. And then, and it's brand new. You know, things happen. [01:14:28] Speaker B: Yeah. [01:14:28] Speaker C: And unfortunately that same person, person, their furnace went out and it's bad luck. Bad luck. And you know, we're like, oh man, how does that have to happen? But we're managing it. So we called that person and they never asked for anything. And we said, don't pay rent this month. And they're like, what? I mean, these aren't cheap units. They're like, what are you talking about? We're like, don't pay rent this month because you've had to go through this experience. And that probably isn't the best thing to do on paper. But is that person leaving in a year where you got to pay a whole nother commission and all these other things? I mean, we talked about retention. There's like a humanity to management, which I think a lot of property managers do have. But then there's also something about just like protecting the brand at all costs. [01:15:10] Speaker B: Yeah, Yeah. I mean, your friend at Moody Tongue, if somebody comes down and has a bad meal. [01:15:15] Speaker C: Right. [01:15:16] Speaker B: You know, it's like, it's about controlling the whole experience too, of your customer. And sometimes in real estate, you take, you know, a little bit more of a hands off approach to something because you think that there should be a buffer. But what the customer would really appreciate is the opposite. Like, the buffering sometimes, like, can exacerbate the issue. [01:15:36] Speaker C: Imagine you go to a restaurant and they bring you free dessert or free drinks without you having to ask for it. You're always like, that was awesome. [01:15:43] Speaker B: Yeah. [01:15:43] Speaker C: Like, okay, I had a bite of this, but this restaurant's great. I'm coming back here. I'm referring it, this is a great brand. It's the same thing in real estate. [01:15:50] Speaker B: Yeah. We're going to wrap with a question. You know, one thing I did for this differently was I took a bunch of notes on it yesterday. Like, I sat there for an hour with a cup of coffee and, like, didn't turn my email on yet. And I had not written anything since like high school. Like, like longer form, like, and I hadn't been able to think as deep as. Like, for the first page, I was like, what the fuck are you doing? This is so inefficient. Like, my writing was disgusting and, like, it was slow. And then by the end of it, I'm like, that was the most, like, thoughtful thinking that I've done in a long time. So that's why everybody saw me fumbling around in my notebook today. But you guys have been awesome. I'm a huge fan of your work. Lucky to be friends with both you guys. Leave us each with a piece of advice that you would give somebody in real estate that looks up to you, and that is either trying to start their real estate career or propel it to the next level. [01:16:59] Speaker C: Pick up the phone. Pick up the phone and call. I think the lost art form of calling people has gone away. And people email and. Or LinkedIn or whatever and follow up. You know, if someone. If you say you're gonna do something, do it. There's a couple young guys who have repeatedly followed up with me and called me, and I've given them more time than most other people because of those two things. It's really, like, the most important stuff. [01:17:32] Speaker B: But when they call you, why do you give them your time? Which is really valuable because I get asked for my time a lot too, and I'm gracious about it in some instances, and I'm very quick to dismiss it in others because I find that if somebody comes to me constructively, I can really tell. Like, somebody asked me for some advice the other day and then sent me. [01:17:55] Speaker A: A. [01:17:57] Speaker B: Shared an Apple note with their five questions that I could just fill out at my convenience with my iPad. And I was like, this is. And then somebody would, like, you know, just ask a generic question on LinkedIn, and I'm like, I'm just. I'm not gonna answer. So what was it about those. Those people reaching out that made you give them time? [01:18:15] Speaker C: It was just the. Like, how genuine they were. So younger guy called me. [01:18:20] Speaker B: What's his name? [01:18:21] Speaker C: Asher Motu called me, and he was. [01:18:24] Speaker B: Like, these guys are hustling. [01:18:25] Speaker C: He's like, I. I look up to you. And I was like, oh, okay. Well, pulling out the heartstrings and like, can we. Could we grab a cup of coffee? I think I could provide value. I mean, simple enough. And he called me, he emailed me, and I remember thinking, this is what I would do. This is what I did, you know, when I was young. And there will be a hundred people that you reach out to who will not give you the Time of day but just waking up the next day and doing it again. [01:18:52] Speaker B: Yeah. How about you? [01:18:53] Speaker A: What's a piece of advice that's a good one that's hard to beat actually. I'm a big believer of picking up the phone that is a lost. Like I re. I made a big mission to be on my phone and not in front of my computer this year. I would say that you have to do a little self exploration for in any career if it's a career advice driven. Yeah, I think there's a miss of like people trying to actually take time to understand themselves and what motivates them and getting like honest about who they are because that ultimately will define more things than knowledge or like that will drive where they go. So I think it sounds a little squishy but it's really important that young people take the time and understand that. It's really important to understand themselves. And I think the second thing is that no one's going to teach you. You to have, have to go out and learn, which is a very big difference. So you have to take the mental time and whether it's a notebook, but you have to go actually be thoughtful and authentic about what you really want to learn. Yeah, I will not take a meeting with somebody if they just start like, what do you. How did you do it? If you don't have specific questions or you don't have your own thoughts going into the meeting, you're not prepared. I'm not interested in the time. [01:20:10] Speaker B: I think it's awesome advice. And what you said about being thoughtful. [01:20:13] Speaker A: By the way, I would tell them that I'm like, I can't. You have to come back to me at a different time. [01:20:18] Speaker B: But a lot of people in real estate, they, you know, I don't know if it's just brokerage, but they say like, you know, you interview them or you're just grabbing a cup of coffee to try to be helpful or something like that. They're like, yeah, you know, I really want to own buildings and you know, get in on the principal side. And I'm like, well, you know, there's other ways to get started then. Like if you're going to be a broker and you want to be a broker in 15 or 20 years when you're starting to see the fruits of your labor, then do it today and work really hard at it and know that there's going to be different cycles and good days and bad days and you'll work through and that's what you really want to do. If you really want to do it to be a builder, then you're better off getting experience from somebody else where you're going to sharpen your sword and actually apply what you're doing today. Because the second it gets hard, if it's not what you want to do long term, you're going to be like, well, this isn't really what I want to do. And you're getting words out. [01:21:10] Speaker C: Right. [01:21:10] Speaker A: You have to be willing to learn. You have to. Like, no one's going to teach you. Yeah, you have to learn it. [01:21:15] Speaker C: Yeah. [01:21:16] Speaker A: And you got to learn. [01:21:17] Speaker C: And, you know, it's funny, like, we'll look for people periodically and the younger generation will come and say, you know, I want to get paid this huge salary and if. Unless you're going to pay me that huge salary, I'm not interested in working for you. Yeah, yeah. And it's like, well, what are you getting out of this experience? [01:21:33] Speaker B: Yeah. [01:21:34] Speaker C: You're getting a first class education that you can't learn at University of Chicago or Northwestern about how to be a real estate developer. Yeah. Maybe you're learning the wrong things from me and the right things from you. I don't know. But that is invaluable experience. I mean, I looked at when I first started at Maverick. I mean, we talked about this last time I was talking with you. It was. I said, I'll work for free because in other environments I would have to pay 40, $50,000 a year to get the same education. [01:21:58] Speaker B: Education. [01:21:59] Speaker A: So, you know, I'm not sure that education exists. [01:22:02] Speaker C: It really doesn't. It really doesn't. But, yeah, it's been. It's been a wonderful experience and I think the future is bright. [01:22:11] Speaker B: Yeah. [01:22:11] Speaker C: We got a lot of young guys and girls who, like Matt and I, are excited about being part of this new, you know, changing the guard. [01:22:19] Speaker B: Yeah. Yeah. Let's leave it there. You guys are awesome. Thanks for what you're doing. This is fun. Keep it up. [01:22:25] Speaker C: Yep. [01:22:26] Speaker B: Maybe you'll come back a third time. We'll have you back for sure. [01:22:30] Speaker A: Do it at LG Building next time. [01:22:31] Speaker C: Fair? Fair. [01:22:32] Speaker B: Yeah. [01:22:33] Speaker A: Deal. [01:22:33] Speaker B: Cool. [01:22:34] Speaker C: Deal. [01:22:34] Speaker B: Thanks, everybody. [01:22:35] Speaker C: Thank you. [01:22:35] Speaker A: Thank you.