YouSaid · the spoken record

Michael Levy

lines on the record: 102
first: 2022-10-07
most recent: 2022-10-07
sittings or episodes: 1
sources: podcast

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“No, one of the largest hotels in the United States, not the largest, but one of the largest is the Anatole Hotel in Dallas, Texas. It's approximately 1,700 rooms and 600,000 square feet of meeting space. And so, you know, and then there's land holdings in Dallas and industrial buildings. And there are other properties in Brussels. We own one of the largest. We own another trade center in Brussels that Tramel built, I believe, in the 1970s. And we own that today.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“In the 1950s, this was a build it, and they will come. Trammel had the view that if I build a permanent building, these trade shows that go all throughout the United States, if I can house them there permanently, retailers will come and visit the exhibitors. And so the Dallas Market Center is a 5 million square foot property that houses for various industries a permanent and temporary exhibitions, and we hold trade shows where literally hundreds of thousands of individuals per year from thousands and thousands of retailers come to Dallas, Texas to intermediate and mingle and spend time and examine and explore new goods for their stores.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, so we occupy about 15% of the space And virtually all of the tenancy at the campus are other principal investors, other family offices, foundations, private equity firms, hedge funds. And so”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah. So old Parkland Parkland Hospital was built in 1913, this beautiful red brick building that became derelict in the 1960s and 1970s. And in 2005, I believe, Harlan acquired the site, tore down most of the buildings except for the main beautiful hospital, and built 11 new buildings around it. And it's now an office campus in Dallas, Texas. It's Part Museum. The theme of the campus is the American experiment. The foundations of freedom and democracy. And there's tremendous manuscripts and art and statues exemplifying everything, starting with the Greeks, going all the way through entitlement and the founding fathers and Abraham Lincoln. And it's a beautiful physical campus”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“It's exploding I think you're at some level. You're having now the COVID-induced movement out of California and New York and Chicago is slowing down a bit. I know in New York some folks from Florida are moving back right now. Oh, really?”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“The nominal population coming to Dallas. And I think it's changing during COVID in any given year, but there's somewhere in the neighborhood of 110, 120,000 people moving to Dallas each year now.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“There are some terrific properties And they're in primarily not entirely Dallas, Texas, which is, as you know, the fastest growing metropolis in the country.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Those are properties that we own without investment partners, and those are properties that Trammel Crow back in the day or Harlan Crow in more recent years has developed and the family has held on to these properties for decades in many cases.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“The simplest way to understand us is we have a real estate development company called Crow Holdings Development. And underneath that, we have sub brands, Crow Holdings Industrial, Crow Holdings Office, Trammel Crow Residential. And then we have a separate real estate investment company that we call Crow Holdings Capital.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, it was a learning curve. Being around real estate finance for 25 years beforehand, I had interacted with and financed and spent time with real estate developers. So I didn't have to learn new industry jargon or lingo or market participants. Sitting on Wall Street, the perception is that you add value by your financial, I'll use the word engineering or your financial acumen. The reality is the people who add value are the people who actually build these buildings, who manage these buildings.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Part of it was shadowing. Part of it was independently spending time across the organization. I grew up in real estate finance. Our company's a real estate company that came to America through building real estate and then developed over time the capital markets and financial expertise. I had never built a building in my life. I had never leased a building in my life. I had never managed the building in my life. And so I spent that first year in the field at our offices talking to the people who do those things and learning so that when the time came the following year that the responsibilities became mine, I had good judgment and better judgment.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“I am maintaining. I came to Crow and had the privilege that my first year, I didn't have the title of CEO. I didn't have anybody reporting to me. I had a chance with Harlan to get to know the organization, to get to know the people, to get to know the culture, to build trust and build relationships and learn and understood what made this venerable institution in real estate. So successful, what made the alumni network that came out of Crow have such good will and good feelings towards our firm? And it was these elements of culture and the hallmarks of our firm, and so I simply said, don't screw this up.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And keep them. We have not experienced the great resignation. It has not happened at our company and our firm. So whether we're doing things right in someone's eyes or wrong in someone's eyes, what I can say is the very talented people who work here have decided amongst the opportunities that are available to them in them in the marketplace. Crow is the best opportunity for them and their families.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“I maintain it by pursuing that in that I'm not I'm continuing to focus on how do I continue to, one, be thoughtful with respect to strategies. I mentioned these secular trends. There's obviously sub strategies underneath that. So hopefully we're smart. And we develop strategies that make sense in light of where the world is heading. The second thing is I work very hard to make sure that the compensation structures with our people are aligned so that if we do well, they do well. And the last thing I would comment on this, we have now lived through the great resignation. I talked to my friends at businesses all over America who talk to me about how difficult it is to attract talent, how many people.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“I do present, we have an advisory board, and Harlan is chairman of the advisory board, and Harlan's engaged in the business with me. And so I'm keeping them regularly apprised with respect to the strategy for the business and the financial results for the business. The primary objective, if Harlan sat here today, the primary objective we're solving for is culture Culture is inviolate. And that goes back to at Crow Holdings, our culture. And the culture is based upon creating opportunity for the people that work here. And if we do that well, then the other elements of our business, our customers being happy with our work. The financial results that follow that will come true. And that's been going on at Crow for 75 years. And that works for us.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“So we are very focused on delivering the investment performance at every level in what we do. And in that area, again, we are focused on whatever the return metrics are, whether it's IRR or multiple. And our track record stands for itself over time, and we have delivered for investors over time, which is why they continue to do business with us. But as it rolls up to Crow Holdings, that is not what drives us. Do I report on our financial results? Of course I do. Do I try my best to anticipate what we may do in the next year, and we may talk about this later, but your ability to guess the future with respect to how it all rolls up to the corporate entity. The other thing I learned in my prior life when I was working on Wall Street is that hunt for the elusive earnings this quarter can also drive very short-term behavior on behalf of the institution that can have a profound impact on the people that work there and really break the trust between the company and the people that work there.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“So, I need, and I like to distinguish that's at Crow Holdings at the company level. Now, almost all, not all, but almost all of the real estate investment activity and the real estate development activity, we are in partnership with institutional investors and individual investors in a fiduciary capacity.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Correct. We don't have that. And so we don't have those outside forces driving us with respect to how we behave, what we do, how we act”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“On behalf of the family, it is our ethos. And the moment, look, the moment that your company Brings an outside shareholder. The moment that your company becomes public, things change.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure. Two things. One, at the company level, at the Crow Holdings level, in particular because we're not public, we don't have any outside shareholders, we don't run the business according to an earnings objective. We run the business according to creating opportunity for the people that work here in an aligned way so that they can grow in their careers and they can create opportunity and will participate in that opportunity with them. So as it relates to the company and doing the right thing, it's treating the people that work for us the right way so that they love their work and then they'll love their clients and they'll love their opportunity.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Largest developer of apartments in the United States over the past 40 years. We view it as both our obligation as well as an opportunity. So we've been very focused on workforce housing.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Within multifamily, so now to take the next layer down, we're pursuing two areas within multifamily. One would be Class A beautiful new properties that professionals are renting because they want experiences in life to rent and not own, as well as everything from student loans to other costs are making rentals more attractive to them. But the area we've been particularly focused on is workforce housing. First responders, firefighters, teachers, cops are having a very, very difficult time finding places to live. And so we've been very focused on building new supply. There's a lot of arguments about rent control or about owning older properties and making sure that the rents don't go up through agreements. But the solution is not taking older properties and holding them there. The solution is new supply.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And as well as just overall quality of life. And this is not just COVID. We've seen the impact of COVID. But long before COVID, it became very clear people are leaving the Midwest and the Northeast and the West and they're moving into the Southeast and the Southwest. And so that defines not everything we do, but that drives a lot of our decision making.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Decades long. And there are several things that to us seem fairly self evident. One of them I've highlighted, which was e commerce. And if you believe that e-commerce will continue to gain share, then you know that's a positive for industrial and that's a negative for retail. You're also looking at demographics, the age of people. You know things about young people, things about the trailing ends of the millennials or the leading edge of the Gen Z. Young people rent. They don't buy. And so we have the largest group of young people in history going through in their mid-20s now going through the U.S. demographic chain. And so being long the apartment sector or the multifamily sector. And the third main trend that we're looking at is Americans are moving to the southeast and the southwest.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Sure. Well, stepping back, Barry, we've learned over the years that it's very, very difficult to predict the economic cycles, the capital market cycles, and trying to hang your hat on that as an investment strategy is often hollow. And so we're”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“It's always a defined strategy. It's always a defined strategy usually demarcated by geographic objectives or other property size, property configuration objectives. But there is a strategy within industrial. We use the word industrial. That can mean a lot of things or a lot of different things to different people. Our real estate investment company invests in real estate across the United States primarily in commingled funds. Occasionally in joint ventures with investors, but primarily in co-mingled funds”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“We are not publicly traded, and we have no outside shareholders in the company. It is owned by the Crow family. Our real estate development business engages with investors in three ways We either pursue one off development projects. In a joint venture with an investor, or we have a programmatic relationship with an institutional investor where we'll develop many properties over time. Or we'll have a commingled fund with a group of investors also developing properties over time.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Certainly in 2010 and 2011, they did. And today, it clearly is the most favored asset class. But nonetheless, when you're looking at secular trends, that secular trend seemed to us to be very clear. And so we amplified our industrial development activities. And today, we're one of the largest developers of industrial real estate in the United States.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And it's on Cole Street in Dallas, Texas, and my youngest son is named Cole. So I love it. I think it's coincidence Look, you could see the e-commerce trends coming from a mile away. It started in the mid-90s, but it became very clear a decade ago that this trend was accelerating.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“We have a big problem in America. We don't produce enough housing, particularly for working class people. And it's a great opportunity from a development and an investment perspective, but it's getting harder and harder to build. And it's an area we have a lot of expertise in.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Exactly, exactly. But both businesses have a high degree of overlap in terms of their strategy. So as a real estate developer, we have built more apartments in the United States than any other firm.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Correct. We both have a real estate development company. And a real estate investment management company. And they're two different businesses with different people”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Correct. So we're headquartered in Dallas, Texas. We have about 21 offices around the country and other cities. We are a Dallas based Dallas headquartered Dallas cultured company. At our core and at our roots.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Someone ultimately, like me, not me in particular, but someone who didn't come up the ropes from the real estate side, who came up the ropes from the capital market side of things, to augment the great skills and capabilities in the company. Now, it's not self-evident that on a piece of paper, this New York guy trained on Wall Street went to Brooklyn Law School would be a great fit with a Dallas-based family-owned company called Crow Holdings, but it was a great fit, and we share very common values.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, Trammel ran the business until the very late 1980s, and we had a terrible time for real estate in the late 1980s. And his son Harlan took over in the late 1980s. And in 2014, Harlan began to think about his succession and made a decision that he wanted to go outside of the company. And specifically to bring in someone who had more capital markets experience.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“There are the soft costs. There's the financing costs along the way. And as you said, there's engineering and other costs that come in. And so I don't know if 120% would have been the norm, but certainly for discussion purposes, you're borrowing 100% of the cost to build a building. And so you don't need to come out of pocket with any equity. Now, we just talked about leverage a minute ago when times are good and times are growing. That works out well. And as you pointed out, in the 1950s and 1960s in America, those were tremendous times for growth and opportunity. And so the company flourished.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“It was a great time to be a real estate developer, and there was tremendous growth throughout the United States. There was also another dynamic that the banks at that time would lend sometimes more than 100% of the cost to build a building.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And that way of doing business was different than others. He also took an approach that, and I use the word speculative, meaning he built the building in the hopes that someone would lease it. He didn't build the building with a lease in hand. He built the building and then it got leased.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And Trammel had a great optimism, great insight, great foresight, but he also had a way of doing business. He didn't have the means when he started out to employ people. He partnered with people. He had an ability to work with many of the local banks and regional banks to get loans to build real estate. And he partnered with young people all throughout the country and said, look, I'll go into business with you all on a handshake. We'll split the ups 50-50, and I'll help you get started by helping get them financing for these projects. And so with that trust and with that love that he had for people, he went on to build partnerships all throughout the United States.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, well, thank you, Barry. In 1948, there was a young man who built a speculative industrial building in Dallas, Texas, and his name was Trammel Crow. And Trammel went on in the 1950s and 60s to become the largest real estate developer in the United States. Wow.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“in California Sure. The real estate industry is as large and as vast as it is like many industries is kind of small. And these various organizations are opportunities both to network. As you get older, they're friends of yours there. It's an opportunity for old homecoming to see people. And it's an opportunity to learn. It's to compare notes. And sometimes it's an opportunity to give back depending upon the mission or objectives of the institution. But most of the time, it's the ability to gather with peers in the industry to talk about what's going on. Some of them are very confidential forums off the record forums where people can speak their minds, where you're not going to read about it in the press. And so you learn as you get older, you find out most of the time that you're not necessarily learning new things. You're confirming what you either like to believe or what you thought you believed. And that confirmation is sometimes helpful.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“My life, that none of that mattered. All that mattered was my heart pulled at me and said, I want to work with these people.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Who was the patriarch of the family and the son of the founder of the company? And he was looking for someone to succeed him to run the business. And I found him to be a fascinating individual and a very kind, benevolent, interesting human being. And we talked off and on for about two years. And then in the summer of 2016, my wife and I went to spend some time with Harlan and his family in the business, and we were flying back from Dallas, Texas to New York. My wife looks at me and she says, you need to go do this. And she knew what I knew, which was it pulled at my heart. When you work at a firm like Morgan Stanley or you work on Wall Street, in any given year, there's always someone knocking on your door. There's always an opportunity. And I had always analyzed these opportunities. You know, I made this much money or I had this much authority or what would this title mean? And this was the first time in”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“It was, it was. Again, I was working from real estate into alternatives, into investment management broadly. And my career was going well, and I was doing interesting work. But in 2014, I met this really interesting guy named Harlan Crow.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“And beyond. Sure. And that's where it comes to alignment and the people that work. If they have nothing but upside and they're not participating in the downside, then the use of leverage. And so whether you're an employee of a large firm or you're managing a fund or whatever position that you're in, being fully aligned with investors is a great guardrail with respect to these questions of the use of leverage.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Most formative period of my career without a doubt. And I think most people, you learn more from the difficulties than you do from the success. It was a reminder of our inability to see the future, first point. But within the core business of finance and real estate, the first lesson was leverage. You know, it's leverage that'll kill you. And it's leverage that will take you down. There were other things that I learned. The people I had worked with and the groups I had worked for, both as an advisor as well as Morgan Stanley.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“It was late 2007, and the markets hadn't yet entirely cracked. And I had an assignment as an investment banker to work for one of the country's largest pension funds, who was on the leading edge of bankruptcies and restructurings in the real estate portfolio. And so I had a lot of advisory work. And then once Morgan Stanley is a firm in the winter of 2008, hit the wall, like many financial institutions, real estate was a leading edge of that wall. And so I had a chance to work with the firm on restructuring its real estate holdings and the real estate business.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“That was not. That was the investment management division. The first half of my career at Morgan Stanley was real estate investment banking And the second half of my career transitioned into real estate investing, which transitioned into alternatives, which transitioned into investment management more broadly.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“I started out at Prudential Securities, and that's where I worked while I went to law school, and they gave me a chance in the business. I had an opportunity a couple years in to work for Solomon Brothers. And at the time, I knew that there was a pecking order in investment banking. And Prue was great and great people I work for, but I knew that Solomon was to step up. And so I took the opportunity with Solomon Brothers. Well, very quickly, Solomon Brothers got gobbled up by Smith Barney. And very quickly, Smith Barney got gobbled up by Citibank. And I remember going into the headquarters, and they were selling me checking accounts as I was walking into the office one day. And I said, I'm not quite sure this is what I was hoping for. I was lucky enough at the time to have an opportunity to move to Morgan Stanley, and I took it.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source
“Absolutely not. When I was going to law school, I went at night and I worked during the day for the lawyers. And most of the lawyers I work for said, you don't want to do this. You want to work on the business side. Those guys have more fun and they make more money. So I talked my way into a job in investment banking. I went into training and they placed me where they saw fit and dropped me into the real estate group.”
2022-10-07 · Masters in Business · Michael Levy on Real Estate Finance · IDENTIFIED FROM THE TRANSCRIPT · source