The FORT Podcast: Cullen Aderhold

Cullen Aderhold is the Senior Director of Capital Markets at JLL. JLL buys, builds, occupies, and invests in a variety of assets including industrial, commercial, retail, residential, and hotel real estate. From tech startups to global firms, their clients span industries including banking, energy, healthcare, law, life sciences, manufacturing, and technology. In this episode, they discuss the shift in capital markets due to the COVID-19 pandemic, lender strategies, private fund structures vs. REIT structure, hotel & retail loans, and much more.

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01:03 — If you had to describe your job, what do you do? How did you get to where you are today?
02:17 — What asset classes do you work with? Are they nationwide?
03:28 — Did you know you would get into this line of work, or did you stumble upon it?
06:20 — Are there certain things that great real estate investors do that set them apart from the rest?
10:27 — What has the last month been like in capital markets as an owner?
13:58 — Did you have a signed deal before this situation started? Did it move forward or could the lender rescind?
16:44 — Is anyone acquiring debt right now? If lenders are moving forward, are they borrower-dependent or asset-dependent?
19:21 — How are lenders pricing right now?
24:43 — Is a private fund structure similar to the mortgage REIT structure?
25:42 — Hotels and retail have been hit hardest—will they be the last loans to come back?
29:39 — What things are people getting loans for that we wouldn’t have seen before?
31:15 — Is there a pent up demand for refinancing as soon as things recover?
33:02 — What will happen to loans that were going to be refinanced or sold?
35:40 — Do you or JLL deal with distressed debt situations? What happens to distressed debt that comes to the market?
37:05 — Do you remember the moment that the COVID-19 pandemic began to feel very real?

Episode Summary

Aderhold’s narrative, oscillating between the energy sector and real estate, provides a reservoir of insights and strategies that can navigate one through the multifaceted world of investments.

Cullen Aderhold’s early tryst with real estate commenced during his college days. Captivated by the promising returns of property acquisition, especially when juxtaposed against traditional stock investments, he was quick to identify the potential that lay in bricks and mortar. However, post-college, Aderhold ventured into the energy sector, primarily focusing on oil and gas. The unpredictability and volatility of this domain stood in stark contrast to the relative stability of real estate, a realization that soon steered him back to his initial passion.

One of the pivotal moments in Cullen’s journey was his transition from the energy realm back to real estate. His success story is dotted with the significance of networking. Both he and Chris underscore the indispensable role of fostering and nurturing relationships in the industry. It’s not just about properties; it’s about people.

Diving deeper into the mechanics of real estate, Cullen elucidates his strategy of long-term holds. In a world teetering towards immediate gratification, he champions the power of patience and the magic of compounding in real estate investments. Financing, an often daunting aspect for many, is another area where Aderhold has considerable expertise. By leveraging debt astutely and maintaining an impeccable credit score, he harnesses the financial instruments to his advantage while also cautioning against the perils of over-leverage.

For those on the brink of their real estate journey, Cullen’s advice is invaluable. He advocates starting small, immersing oneself in market research, and emphasizes the irreplaceable importance of due diligence. Every property has a story, and understanding that narrative is key. Furthermore, understanding market dynamics is crucial, especially when navigating the cyclical nature of real estate. Recognizing the signs, preempting downturns, and having strategies in place to mitigate risks are skills honed over time and experience.

A glimpse into the future with Cullen paints a picture of optimism. He is particularly bullish on markets grounded in strong fundamentals. In an era where technology is reshaping boundaries, the implications of trends like remote work on real estate are profound. Aderhold believes in adapting to these evolving paradigms, ensuring that investments today are future-proofed for tomorrow.

No journey is solitary. Reflecting on his path, Cullen emphasizes the importance of team-building. Aligning with individuals who resonate with one’s values and goals is paramount. It’s not just about building properties; it’s about building relationships.