One frequently asked question we receive is regarding our bandwidth as fund managers: “How do you manage all of your activity as a small team?”
First and foremost, we are active investors and often sponsors of our projects, but we hire resources to facilitate and manage projects under our approval authority and care. We are also hiring internally to make sure our ability as partners is multiplied.
We purposefully established a small internal team and a boutique fund size, $50M of equity this year in our third OZ Fund. Our target markets have been long ignored not because of lack of opportunity or potential for returns, but because most institutional capital is outsized for our market, preventing them from pursuing the deals which appear most attractive to us.
We are the primary investor and control each of our developments. However, we are not the developer. Specifically, on the housing side, we have established partnerships with for-fee developers to help with all phases of development. Each developer we hire is the best developer for the location and size of the investment.
Managers and Operators
We are contracting established property managers for our housing projects and have an on-site operator for each of our outdoor hospitality projects. Our involvement in the day to day of each development is more intensive until stabilization, which takes about 3 years for our larger housing developments. This is why our asset management fee drops from 2% to 1% per year after year 3.
Hiring More People
As we scale our operations, we will scale staff proportionately. This week we hired Kyle Oberkoetter, who will assist with analyzing, sourcing and stabilizing each of our developments. We also have an offer out for a new Outdoor Hospitality Coordinator to help oversee the budget, marketing, and operations of our outdoor hospitality investments.
Best In Class Fund Advisors, Administration, and Legal
We are beyond grateful for the guidance from our fund advisors, including Ryan Smith of Zoma Capital and Partick Vahey of Greenline Ventures. NES Financial handles our fund administration, Snell & Wilmer handles legal for our funds, and Brownstein Hyatt Farber Schreck handles legal for our developments.
Ultimately, our broader team is more extensive than it may appear. We will continue to right-size our team and capacity to invest in our target communities.