Building Billion-Dollar Portfolio

A story about how someone built a $1B real estate portfolio focusing on retail shopping centers in just 7 years.

"I talked to somebody who built in the last 7 years about a billion dollars of real estate assets, with 40% debt so 60% is equity - about $600M of equity in these properties. They started from zero, with zero networks, zero ability to borrow.

They focus on retail real estate, basically commercial estate - shopping centers. They'll buy a shopping center that has a Hobby Lobby, Starbucks, whatever - about 6 spots. They'll buy it, build on it, lease it up, and then either hold it or sell it.

Their edge comes from a few things. They get calls directly from major retailers like Dollar General saying 'We want to be in Lexington, Kentucky.' Most property owners are a pain to deal with, but they're easy to do business with. They invest money to build out stores the way retailers want, while most owners don't want to invest in their properties.

They don't die by paralysis by analysis. While others get hung up on page 7 of the lease agreements, they keep their leases clean and simple. They're willing to bear some risk because they understand if things go wrong, they have backup plans.

They focus on specific retail categories that are expanding against the e-commerce trend: DIY stores like Hobby Lobby, anything catering to Black and Latino communities who shop in-person more, super low-end dollar stores that are cheaper than online, and treasure hunt experiences like HomeGoods where people enjoy the physical shopping experience."

They've compounded their money about 60% a year for 7 years, doing about 80-100 transactions in the last year alone - basically a real estate deal every 3 days.