CrowdStreet’s Darren Powderly is joined by Marci Loeber, Managing Principal, Griffith Properties, to discuss what it’s like to be a woman in the commercial real estate industry, the long-term value of life science properties, and opportunities in industrial.
Darren Powderly, Co-Founder & VP Capital Markets
CrowdStreet
CrowdStreet
Darren founded CrowdStreet in 2012 after identifying the need to radically improve people's access to commercial real estate investments via technology. Over his 20+ year career, Darren has transacted billions of dollars’ worth of commercial real estate investments and enterprise software contracts. Darren is a driven leader who loves building relationships based on mutual success. In addition to building businesses, leading teams and advising a prestigious list of national clients, Darren has personally owned commercial real estate, syndicated investment groups and developed properties from the ground up.
00:00:04 Hello everybody, this is Darren Powderly with CrowdStreet. Welcome back to StreetBeats. Today I am very pleased to have Marcy Loeber with Griffith Properties in Boston, Massachusetts with us. Mostly what we're interested in speaking with Marcy today is what she's experiencing, uh, as a, uh, as a real estate executive, as a, in a woman-owned business, uh, today in the mid sort of Covid environment. And, um, also get her perspectives on where she sees the, the industry going and market opportunities going from here. So, Marcy, thank you for joining us and welcome to StreetBeats. Would you give us a little bit of background about yourself please?
00:00:42 Sure. And Darren, thanks for having me. It's a pleasure. So, Marcy Loeber, I've been in the real estate business for almost 30 years now, though I'm not that old. I like to say the first 20 years I spent as an investment sales broker focused in Boston. And for the last 10 I've been, uh, the managing principle of Griffith Property. So, as Darren said, it's a woman-owned firm focused in value investing in core plus investing in Boston and the DC markets, um, office industrial and life science and Flex product.
00:01:15 Awesome. Well, Marsha, let's start off with, uh, the fact that you are a woman-owned business. Tell us about, you know, what that was like breaking into the commercial real estate industry as a woman, uh, and how things have changed since then.
00:01:29 So it was, I like to describe to people when I first got into the business, I go into the weekly sales meetings and I felt like I was going into a guy's locker room. I was the only woman in the room and it was always on Monday mornings and the guys like to retell their weekend stories. So it was, it was definitely a challenging environment for someone in their twenties to come into, um, an experience. So it's changed dramatically. There are other women in the business right now, other successful women, women always used to get in the business and land in part, I feel because it's a very hard business on the transaction side to raise a family because the phone last night, I had to get up in the middle of dinner at eight o'clock to answer the phone. When you're raising a young family, that can be challenging.
00:02:15 So I think the flexibility now that you have does make it easier for women to stay in the business longer. And when I made the transition from brokerage to the principal side and having always been a competitor in the sales side, you're competing all the time for business. I kind of looked around and said, how is Griffith Properties different from the other owner operators in our markets? And the conclusion was me. That was the biggest difference. I was a woman, so, and my father at that point was phasing out of the business and I said, we have to become a fully, I gotta own the majority of the company and become a certified woman-owned firm to get access to capital and differentiate ourselves. So, so we did that probably now seven or eight years ago and, um, really trying to, and my colleagues and board of advisors always say we don't take advantage of that enough for access to capital,
00:03:06 You know, uh, in addition to access to to capital. Um, are there other things that, you know, you would sort of, you know, advice that you would give women who are considering the industry today or already in the industry?
00:03:18 I think the biggest advantage, and I think why I stuck it out, is you need a mentor. And that mentor doesn't have to be a woman. It could be a woman, it could be a man, but you do anyone that's successful in any industry, they probably point back and they had a mentor. And I think it's almost even more important for a woman, and I say to young women and men who come in talk to me is, you're not when you're getting your first or second job, it's not about the company, it's about who you are working for and will they be a good mentor. Um, and I think, I do think it's even more important in, in our business, the transaction business because it is just such a tough business that mentorship is, is so critical to your success and being able to have someone help you to, to guide you throughout the process.
00:04:03 So the, yeah, the industry, uh, it is challenging. It hasn't gotten any easier recently, hasn't Marcy, so what are your observations? What are you experiencing just overall tell us what's going on at Griffith Properties, please.
00:04:15 Sure. And our, and over time our portfolios really shifted away from office. So during the covid 19, that's sort of really, we fared almost better because of it. I'd rather be lucky than smart. Mm-hmm. So, and, and we have, so we do have some suburban office, but that, I think suburban office is gonna be the beneficiary of what's going on right now. The majority of the other, what we own is it's either life science, industrial, or if it is it's office r and d where you have to go to the office cuz you're making something in that space.
00:04:44 You talk, uh, in on your website and I know, uh, one of the things that is, uh, key to your experience not only as an investment sales broker prior to, to uh, you know, founding Griffith unlocking value and it, let's talk a little bit about that because I think it's a unique concept of unlocking ba value in a building that, you know, a seller is selling for whatever reason you're looking at it and trying to, trying to figure out your value add business model and increasing the value. H how do you look at that in today's environment where, you know, we, we have been at, you know, pretty lofty prices. How do you unlock value, uh, in Boston and DC and the product types that you're pursuing?
00:05:28 Um, that is a challenge cuz pricing, you're right, pre covid got to be crazy. Um, and in some asset classes that hasn't necessarily changed. So it's really sort of the, the secrets that there's not a lot, it's a secret sauce. I'm not sure how secret it is. Others certainly are doing it. But for example, um, it's the ability to convert an office building to a life science, a lab ready life science. And part of it is understanding the bricks and sticks. Part of it of it is having the conviction and the understanding of the market and the conviction that you can lease it up. And here's the timing because we've done, we've done it before. It's, you know, everyone in this market is trying to convert every kind of building to life science. Number one, not every building can become a life science building. You have to have, you gotta be able to check the boxes and understand what the pitfalls can be. And not everyone can raise the capital, either the debt or equity to do that. So we do have that sort of track record, we have that conviction, we have those relationships that we can take an office building that we have the confidence in and unlock that value as a life science.
00:06:35 Yes. Makes perfect sense. Let's switch to logistics and industrial. Just, just tell us what's going on. What are the trends that you're seeing there? How do you unlock value, uh, in industrial and what are some of the opportunities that you see today?
00:06:49 If you see what people are lending on the sort of the number one product type these debt funds wanna focus on is industrial. So from that standpoint, from transactions, you can actually capitalize those deals. Uh, you've definitely seen rents sort of stay flat or even increase in some instances. Obviously a lot of that's driven by the e-commerce, the Amazons of the world around here. The other dynamic we have in Boston is not to go back to life science, but if you look at the GMP, so 80, 85% of our drugs have been manufactured overseas. That's now coming over back to the US because of obvious supply chain issues. Right. And there's a big, been a big beneficiary of that. Those that those requirements and the best buildings to manufacture drugs in and convert it to sort of GMP facilities are industrial buildings. So you're seeing sort of the Amazon's of the world, the Walmar's of the world sort of compete with the life science companies for these GMP type facilities.
00:07:50 So you guys have, uh, you and your dad and your team, uh, of course have worked through multiple market cycles. Can you speak for a second? What's different this time?
00:07:59 Yeah, we've lived through a lot. This is just so different. I think there's a couple factors. Number one, it's become so emotional for people. You can't figure out a reaction whether it's a tenant you have a discussion with, you would expect they wouldn't ask for something and they do. So everyone's, it's so emotional. People just are reacting so, so differently. Mm-hmm. <affirmative> the biggest, I think one of the biggest differences is the impact is so varied by product type where retail and hotel are upside down, but you have life science and industrial that haven't even missed a beat. That's just very, very unique to the other cycles, uh, where it was just, it was so different.
00:08:38 So where, where do you see some of the opportunities, uh, going forward? Marcy, are you currently buying?
00:08:44 Yeah, so we're gonna stick to our knitting stick to what we know, which is right now industrial and life science. We'll do flex and r and d We are looking at some office, but very, very selective if it's a, if there's a good story behind it. Are
00:08:59 There any other thoughts you wanna share with the audience today, Marcy, before we wrap up?
00:09:03 Um, I do think this is on our recovery. Everyone asks sort of what do you think? Is it a w is it a V? And, and I guess I would look at it as being kind of a flat v I do think it's gonna come back. I do think it's gonna be very selective on when it comes back. I think the macroeconomy again, will come back. It'll be a flat V. Um, I do think a lot of it, the timing of it, i, I I believe it does depend upon when we get a, um, vaccine or a very strong therapeutic. Um, and people get the confidence if people are still staying at home and schools don't open next fall, that's gonna have a real impact on people's, uh, emotional well beings, which is gonna slow the recovery.
00:09:44 Right. Well, uh, stay healthy. Stay well. Enjoy your summer. Uh, thanks for being our guest on StreetBeats today and uh, we'll look forward to speaking with you again very soon.
00:09:56 Thanks Darren. Appreciate it.
00:00:42 Sure. And Darren, thanks for having me. It's a pleasure. So, Marcy Loeber, I've been in the real estate business for almost 30 years now, though I'm not that old. I like to say the first 20 years I spent as an investment sales broker focused in Boston. And for the last 10 I've been, uh, the managing principle of Griffith Property. So, as Darren said, it's a woman-owned firm focused in value investing in core plus investing in Boston and the DC markets, um, office industrial and life science and Flex product.
00:01:15 Awesome. Well, Marsha, let's start off with, uh, the fact that you are a woman-owned business. Tell us about, you know, what that was like breaking into the commercial real estate industry as a woman, uh, and how things have changed since then.
00:01:29 So it was, I like to describe to people when I first got into the business, I go into the weekly sales meetings and I felt like I was going into a guy's locker room. I was the only woman in the room and it was always on Monday mornings and the guys like to retell their weekend stories. So it was, it was definitely a challenging environment for someone in their twenties to come into, um, an experience. So it's changed dramatically. There are other women in the business right now, other successful women, women always used to get in the business and land in part, I feel because it's a very hard business on the transaction side to raise a family because the phone last night, I had to get up in the middle of dinner at eight o'clock to answer the phone. When you're raising a young family, that can be challenging.
00:02:15 So I think the flexibility now that you have does make it easier for women to stay in the business longer. And when I made the transition from brokerage to the principal side and having always been a competitor in the sales side, you're competing all the time for business. I kind of looked around and said, how is Griffith Properties different from the other owner operators in our markets? And the conclusion was me. That was the biggest difference. I was a woman, so, and my father at that point was phasing out of the business and I said, we have to become a fully, I gotta own the majority of the company and become a certified woman-owned firm to get access to capital and differentiate ourselves. So, so we did that probably now seven or eight years ago and, um, really trying to, and my colleagues and board of advisors always say we don't take advantage of that enough for access to capital,
00:03:06 You know, uh, in addition to access to to capital. Um, are there other things that, you know, you would sort of, you know, advice that you would give women who are considering the industry today or already in the industry?
00:03:18 I think the biggest advantage, and I think why I stuck it out, is you need a mentor. And that mentor doesn't have to be a woman. It could be a woman, it could be a man, but you do anyone that's successful in any industry, they probably point back and they had a mentor. And I think it's almost even more important for a woman, and I say to young women and men who come in talk to me is, you're not when you're getting your first or second job, it's not about the company, it's about who you are working for and will they be a good mentor. Um, and I think, I do think it's even more important in, in our business, the transaction business because it is just such a tough business that mentorship is, is so critical to your success and being able to have someone help you to, to guide you throughout the process.
00:04:03 So the, yeah, the industry, uh, it is challenging. It hasn't gotten any easier recently, hasn't Marcy, so what are your observations? What are you experiencing just overall tell us what's going on at Griffith Properties, please.
00:04:15 Sure. And our, and over time our portfolios really shifted away from office. So during the covid 19, that's sort of really, we fared almost better because of it. I'd rather be lucky than smart. Mm-hmm. So, and, and we have, so we do have some suburban office, but that, I think suburban office is gonna be the beneficiary of what's going on right now. The majority of the other, what we own is it's either life science, industrial, or if it is it's office r and d where you have to go to the office cuz you're making something in that space.
00:04:44 You talk, uh, in on your website and I know, uh, one of the things that is, uh, key to your experience not only as an investment sales broker prior to, to uh, you know, founding Griffith unlocking value and it, let's talk a little bit about that because I think it's a unique concept of unlocking ba value in a building that, you know, a seller is selling for whatever reason you're looking at it and trying to, trying to figure out your value add business model and increasing the value. H how do you look at that in today's environment where, you know, we, we have been at, you know, pretty lofty prices. How do you unlock value, uh, in Boston and DC and the product types that you're pursuing?
00:05:28 Um, that is a challenge cuz pricing, you're right, pre covid got to be crazy. Um, and in some asset classes that hasn't necessarily changed. So it's really sort of the, the secrets that there's not a lot, it's a secret sauce. I'm not sure how secret it is. Others certainly are doing it. But for example, um, it's the ability to convert an office building to a life science, a lab ready life science. And part of it is understanding the bricks and sticks. Part of it of it is having the conviction and the understanding of the market and the conviction that you can lease it up. And here's the timing because we've done, we've done it before. It's, you know, everyone in this market is trying to convert every kind of building to life science. Number one, not every building can become a life science building. You have to have, you gotta be able to check the boxes and understand what the pitfalls can be. And not everyone can raise the capital, either the debt or equity to do that. So we do have that sort of track record, we have that conviction, we have those relationships that we can take an office building that we have the confidence in and unlock that value as a life science.
00:06:35 Yes. Makes perfect sense. Let's switch to logistics and industrial. Just, just tell us what's going on. What are the trends that you're seeing there? How do you unlock value, uh, in industrial and what are some of the opportunities that you see today?
00:06:49 If you see what people are lending on the sort of the number one product type these debt funds wanna focus on is industrial. So from that standpoint, from transactions, you can actually capitalize those deals. Uh, you've definitely seen rents sort of stay flat or even increase in some instances. Obviously a lot of that's driven by the e-commerce, the Amazons of the world around here. The other dynamic we have in Boston is not to go back to life science, but if you look at the GMP, so 80, 85% of our drugs have been manufactured overseas. That's now coming over back to the US because of obvious supply chain issues. Right. And there's a big, been a big beneficiary of that. Those that those requirements and the best buildings to manufacture drugs in and convert it to sort of GMP facilities are industrial buildings. So you're seeing sort of the Amazon's of the world, the Walmar's of the world sort of compete with the life science companies for these GMP type facilities.
00:07:50 So you guys have, uh, you and your dad and your team, uh, of course have worked through multiple market cycles. Can you speak for a second? What's different this time?
00:07:59 Yeah, we've lived through a lot. This is just so different. I think there's a couple factors. Number one, it's become so emotional for people. You can't figure out a reaction whether it's a tenant you have a discussion with, you would expect they wouldn't ask for something and they do. So everyone's, it's so emotional. People just are reacting so, so differently. Mm-hmm. <affirmative> the biggest, I think one of the biggest differences is the impact is so varied by product type where retail and hotel are upside down, but you have life science and industrial that haven't even missed a beat. That's just very, very unique to the other cycles, uh, where it was just, it was so different.
00:08:38 So where, where do you see some of the opportunities, uh, going forward? Marcy, are you currently buying?
00:08:44 Yeah, so we're gonna stick to our knitting stick to what we know, which is right now industrial and life science. We'll do flex and r and d We are looking at some office, but very, very selective if it's a, if there's a good story behind it. Are
00:08:59 There any other thoughts you wanna share with the audience today, Marcy, before we wrap up?
00:09:03 Um, I do think this is on our recovery. Everyone asks sort of what do you think? Is it a w is it a V? And, and I guess I would look at it as being kind of a flat v I do think it's gonna come back. I do think it's gonna be very selective on when it comes back. I think the macroeconomy again, will come back. It'll be a flat V. Um, I do think a lot of it, the timing of it, i, I I believe it does depend upon when we get a, um, vaccine or a very strong therapeutic. Um, and people get the confidence if people are still staying at home and schools don't open next fall, that's gonna have a real impact on people's, uh, emotional well beings, which is gonna slow the recovery.
00:09:44 Right. Well, uh, stay healthy. Stay well. Enjoy your summer. Uh, thanks for being our guest on StreetBeats today and uh, we'll look forward to speaking with you again very soon.
00:09:56 Thanks Darren. Appreciate it.