Over the last 45 days, the world has changed. The Coronavirus pandemic has brought the world to a halt, closed schools, stalled the economy and changed the way we all think about simple daily tasks (where is all the toilet paper) and more serious issues (where am I getting my next paycheck). During this time, there’s been a flood of bad and worse news–and also a lot of silver linings emerge.
For Wildhorn, and me personally, we’ve taken this time to reflect, connect and be intentional with our time. We’ve talked a lot about how our goal right now is to put in more work than anyone else, so that we’re prepared for the recessionary world we’re all going to wake up to once we can leave the house. But what work is there to be done? How do we prepare ourselves for the next chapter?
One tool, and general theory we’ve discussed and implemented, is based on our friend Ryan Holiday’s Alive Time Challenge. We love the concept of using this intermission in life to better ourselves, our families and our business. To take good use of this time and make it Alive Time (aka valuable) rather than fall down the Netflix rabbit hole and waste away this opportunity with Dead Time. (To be clear, we have absolutely watched Tiger King, but as a rule are trying not to binge watch shows every night). Alive Time has been a great concept to wrap our minds around–how we can make good use of this daily opportunity and not waste it away.
As we aim to maximize productivity and be better people, we are thinking about Alive Time across three vectors: Ourselves individually, our families, and our business.
As individuals, we’ve all doubled down in our efforts to stay fit and healthy. Working out has been a part of our regular individual routines for a long time, but with fewer outside distractions and general noise/unnecessary meetings, we’re all making sure to get those workouts in. My gym has gone to hosting Zoom sessions and posting videos of classes we can take at anytime, which has been a great way to stay engaged. Like everyone else, we’re also getting lots of bike rides and walks in as well. It’s obviously an important time for everyone to stay on top of their health, but we’re also experiencing the mental clarity and stress relief regular exercise affords. In addition, I’m making sure to create time to read and think, practice my Gratitudes, and connect with old friends.
With my family, I’m working extra hard to take advantage of this new reality and unique opportunity to have us all together with no outside distractions or events to hustle around to. We’ve adjusted (mostly thanks to my wife) to school at home and getting our kids curriculum done each day. But outside of that, we’re trying to give them structure, creative outlets and positivity. We’ve enjoyed watching John Krasinki’s Some Good News broadcasts together. We go around the breakfast table and each share five things we’re grateful for everyday. We’re taking bike rides during the day, and giving them learning challenges each day. In the evenings, we play board games (Guesstures and Clue have been favorites)–all in the name of connecting and enjoying our extra time with them we wouldn’t normally have.
On the work front, which we’re managing between workouts and kid time, we’re focused on four key priorities. Our general focus has been making sure we utilize this moment for positivity and momentum rather than wallow in fear and negativity.
Asset Management.
Our last article was focused on how we’re responding to the Pandemic on site of each of our assets. Obviously this is a critical time to focus on our portfolio and ensure we do everything possible to protect our residents, our teams and our investors. We’re going to close April collections at over 95% across the portfolio, but we’re already looking at May and what strategies we should be thinking about as we enter Week 6 of sheltering in place. We take great pride in our relationships with our onsite teams, and are staying focused on what we need to do to support them and make smart decisions for our investors.
Being Opportunistic.
We recently wrote about this as well, and the pandemic hasn’t shifted our thinking. It will undoubtedly shift our strategy some along the way, but we’re continuing to look at opportunities–as sparse as they may be. While still extremely early in this recession and without data yet about how it will impact our markets, we’re looking at new deals for a variety of reasons. First, we continue to be mid- and long-term focused and think multifamily in Austin and San Antonio will continue to be a strong investment. Second, looking at new deals helps us keep a pulse on the market. What sort of cap rate are things trading at? Is there going to be a discount in a post-Corona world, and how much? If you don’t play on deals, you won’t know what the market is saying. Finally, looking at new deals creates opportunities and reasons for us to check in with partners and investors How are they thinking about the market right now? What is their temperature for investing in new deals?
Building Our Foundation.
This break in the action gives us a chance to focus internally, and on ourselves. What systems or internal assets do we need to update and/or upgrade? Over the last couple of years, we’ve been extremely busy and focused on new deals–but that doesn’t leave a lot of time for looking after the internal workings of our business. Right now, we’re using this time to clean up our CRM database. We’re re-working our underwriting model to be more nimble and flexible. We’re reviewing our internal company documents and succession plans across our assets. We’re updating investor materials to make sure they reflect the message we want them to in the new world. In short, we’re focused on making all our internal systems, processes and assets better during this time knowing they will serve as our foundation for the next several years of our multifamily business.
Investing In Our Future.
Tied to building our foundation, we’re looking to the future. We’re spending this time focused on future growth. That means checking in on investors–how are they faring during this time? That means fostering relationships with new and potential future equity relationships. More than anything, it means being focused on our growth plan and defining the job descriptions of the next couple people we’ll need to support our portfolio. In particular, we’re having deep conversations with a couple of people about joining Wildhorn. Do we think there is a mutual fit? Do our visions align? Are we wired the same way? Is there a net benefit to all parties if we move forward? It might seem like an odd time to grow your team, but we see this temporary slow down as a great opportunity to take a step back and make smart investments to our future.
As Monday turns into Blursday and we all watch the news unfold, we hope you are staying healthy, productive and finding the silver linings in this pandemic. If you are struggling, please reach out. We’d love to connect, talk shop, have a Zoom Happy Hour or just plain listen. We’re all in this together, and we’re going to emerge stronger. Wildhorn is working hard right now to make sure that is true for us.
Andrew Campbell is a native Austinite and Managing Partner at Wildhorn. He is a real estate entrepreneur who first broke into the business in 2008 as a passive investor. In 2010 he transitioned into active investing and management of a personal portfolio that grew to 76 units across Austin and San Antonio. He earned his stripes building and managing his personal portfolio before founding Wildhorn Capital and focusing on larger multifamily buildings. At Wildhorn, he is focused on Acquisitions and maintaining Investor Relations, utilizing his marketing and communications background to build long-term relationships.
