You don’t often hear the phrases “cult of personality” and “multifamily real estate” bandied about in the same sentence.
But the staid world of rental housing is attracting two outsized personalities seeking huge profits — and trading on their considerable charm to do so.
Our cover story this month profiles Grant Cardone, the energetic sales trainer, motivational speaker and emerging real estate mogul, who claims to have amassed a $5 billion apartment portfolio funded by investments from 10,000 of his devotees.
In a story by Francisco Alvarado, we find Cardone at his annual 10X Growth Conference in Florida, strutting through pyrotechnics in front of a crowd of several thousand, exhorting them to seize their fortune, telling them “don’t be a little bitch” and that “the average are doomed.”
Cardone raised $45 million from that event’s attendees for real estate deals in Miami and Houston. And he’s been able to paint a picture of the high life he’s living (a Gulfstream jet with his logo on the tail) for his more than 10 million followers on social media, drawing additional investors. It’s an unusual approach to dealmaking, to say the least, and it’s drawn plenty of doubters.
Another big personality — best known for founding the cult of “We” — is making his way into the multifamily space. WeWork co-founder Adam Neumann, who famously exited that company as it prepared to go public in 2019, is placing a well-funded bet on the rental sector. The implosion of WeWork at the end of his tenure notwithstanding, Neumann has the backing of big-name venture capital. Andreessen Horowitz has made a $350 million investment in Neumann’s new company, the biggest single bet in the firm’s history.
Details about the new company, named Flow, are scarce, but Keith Larsen and Lidia Dinkova set out to look under the hood. As they report, the barefoot co-working guru wants to bring the same communal spirit to rental housing: “He has grand plans to transform real estate. And he is, once again, preaching the gospel of community.”
Cardone and Neumann aren’t the only big personalities in this issue. We’ve got several other profiles of colorful players doing big deals across the country.
In Chicago, where Google is making a big bet on the Loop, developer Mike Reschke, the so-called “Harry Houdini of Chicago real estate,” is at the center of it.
In Los Angeles, we sat down with Jaime Lee, the heir apparent of Jamison Properties, whose family redeveloped Koreatown and currently owns around 15 million square feet, likely making it L.A. County’s largest private commercial landlord.
In San Francisco, Hamid Moghadam, CEO of Prologis, the world’s largest industrial landlord, has a message for the mayor after being brazenly robbed at gunpoint by two men who jumped out of a car and stole his Patek Philippe watch: We need to clean up. “I am deeply concerned that our city may be so far down the path toward decline that we may never recover,” he said, threatening that companies like his may leave.
And in New York, we profile Jay Martin, the feisty executive director of the landlord group Community Housing Improvement Program, whose war of words (or tweets) has targeted many a tenant activist and Democratic socialist as a heated battle between market forces and government intervention plays out in the city.
Finally, less about personality and more about deep pockets, we look at the top lenders in New York real estate as well as private equity’s insatiable appetite for rental properties amid high rents — similar to Cardone and Neumann, but much more under the radar.
And don’t think we’ve forgotten about Compass, the biggest story in the residential brokerage world right now. After losing $289 million in the first half of the year, the company has only $430 million on hand, leading to speculation about what lies ahead after the company went public last year.