The Growth Mindset with Robert Logan, Principal at B&D Holdings

On this episode, managing partner Aaron Strauss sits down with Robert Logan of B&D Holdings to explore the strategies driving their impressive growth in industrial real estate. 

Rob Logan is a Principal at B&D Holdings. Based in New Jersey, B&D Holdings is a privately held investment and development firm with a real estate portfolio of over 200 properties throughout 34 states. Their primary focus is on direct investments in industrial real estate.

In his role, Rob is responsible for overseeing Acquisitions and Capital Markets. Prior to joining the team, he spent two years at G.S. Wilcox & Co. where he served as an originator on the commercial real estate capital markets advisory team. Prior to G.S. Wilcox, he worked at Newmark Knight Frank on their New York City based debt capital markets team and at ICAP in structured credit products.

Rob has a Bachelor’s degree from Connecticut College in Economics and Latin American Studies and earned a Masters in Real Estate from New York University.

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Transcript

AY Strauss: Hello everybody, welcome to the Dealmaker's Edge. Today, we're really excited to be joined by Rob Logan, principal at B&D Holdings. Based in New Jersey, B&D is a privately held investment and development firm with a real estate portfolio of over 200 properties throughout 34 states and rapidly growing. Their primary focus is on direct investments in industrial real estate. Rob is responsible for overseeing acquisitions and capital markets. Prior to his role at B&D, he spent two years as an originator in the commercial real estate capital markets advisory team at GS Wilcox and Co. And prior to that, worked at Newmark Knight Frank on their New York City based debt capital markets team. Rob, we've worked a lot together. We have so much respect for you personally, for your team, for how much you guys have developed and grown. It's about time you're on. So thanks for making the time.

Robert Logan: Thank you, I'm truly honored to be here and the respect is mutual. We've loved the AY, top to bottom, I'm really happy to be here today. Looking forward to this.

AY Strauss: And you guys have been on such a tear, such tremendous growth, and you've really done so much in such a rapid time. I guess what I'd love to do is sort of just go back because the idea of the podcast, besides getting into the edge part, the mental health a little bit, is just understanding the overall career arc of the individual and how their background ties to their present success. Maybe we can go back, we don't have to go all the way back - but maybe we could talk about your schooling and your first interest in real estate if you'd like to start from there.

Robert Logan: Yeah I’d be happy to. I think my career path in commercial real estate isn’t a straight line. I think it's like maybe somewhat interesting, we'll find out. I went to Connecticut College, just a little   private   liberal   arts   school   in   New    London, Connecticut. Double-major economics and Latin American studies. So not necessarily any focus on real estate, but kind of a worldly take on what's happening in financial markets and economies around the world. I was fortunate enough to intern at Bear Stearns on a trading floor. And I really liked that environment. I liked the activity, the energy in that environment. So post-Connecticut, a year later, I landed at ICAP. ICAP's a London-based inter-dealer broker. So basically it's a trading floor of 500 guys. I had two phones, three screens, Bloomberg Terminal, people shouting at me. I was just making markets all day and executing trades. So, well, it really wasn't any training ground for commercial real estate, I think it's an excellent place for a young person to land right out of college because it's - you can't make mistakes, you gotta be accurate, you gotta be fast. It's competitive. And it's all about building relationships, which I think is the best part about it. The way to excel is to build a lot of relationships in and around New York City. Not to bore you on that, but that was 10 years, that was a long time. Then I kind of looked around the room and said, it seems, and you know, meeting friends in the industry and in different industries, I thought that commercial real estate seemed like a place where a lot of really successful people invest and own and devote their time. I wanted to transition out of the kind of Wall Street day by day thinking into more of a long term approach to wealth building. So I did the NYU Schack program at night while I was working at ICAP, which was excellent. I think that's a great program. It's in New York City. There's a lot of top professionals teaching in there in the business. So there's an academic nature, but it's really a live kind of sight into the real estate world. And it's one of those programs where you get out what you put into it. So I just attacked it. I've never done more homework on time and with as much effort in my life because I was a mature adult at that point. So I got A's, and no one cares about what grades I got, but for me it was important. I was learning, I was, I knew nothing about commercial real estate. My first class, I remember I had, every question was like, ‘I don't even know what any of this is, so just teach me’. So I did that, and then I quit. I was 34, 30, no, less than that, 31 years old. I quit my job at ICAP to take an hourly internship in New York city. I was married, like I made more than 24 than I did at 31 or 32, whatever it was. So I was - it was a risk, but I bet on myself and networked and used the internship to land with the Newmark team, Jordan Roeschlaub and Dan Fromm at the time who are A players, top of their game. But even then, I was the lowest guy on their team and had to work my way up. I don't know if you have any questions, I can keep going.

AY Strauss: No, I mean, It's an incredible thing at that point to already be past the point of being right out of college, to take that level of risk and it shows your conviction and that's impressive. Not everybody has the guts to do that.

Robert Logan: Yeah, it was certainly frightening and I had moments of panic along the way. But now, I think it all went as planned, but it wasn't easy. So basically, I just kind of bounced around a bit. I went to the capital market side of the business 'cause I had a history on that side. I haven't worked on the trading floor, paying attention to rates and markets and kind of structuring. I was on a derivatives desk. So I had an idea of tranches and the credit derivative structuring CMBS, that type of knowledge. I was, I kind of had my head wrapped around it a little bit even though I was more just a market maker. So, I kind of, same thing bet on myself again. Well, Jordan and Dan Fromm's team, I think is one of the best in the country. And I brought on Dustin Stolly later on. I mean, those guys are absolutely top notch. It wasn't the right fit for me because I was older and I wanted to kind of step more to, you know, front facing seat, having been a front office guy in my past life. So I moved out to GS Wilcox in New Jersey. I was good friends with Wes from NYU and I got right into originator role and absolutely loved it. I mean, I was putting out middle market life company debt in and around New Jersey, primarily. It's non-recourse money, so you have to really understand the bricks. It's not like you're a bank lender and you're just underwriting the individual to get the guarantee. So I learned a lot from those guys. They're really sharp real estate players. And I learned a lot about life company financing, which has continued to help me to this day. Unfortunately, one of my clients was Martin Segal, B&D Holdings. So I, who's an excellent guy and I'll touch upon him more, but I visited his office regularly and pitched my wear and he eventually said yes and hired me and then we did about 20 or so loans in a short period. So I basically felt like I was an extension of the office and then you know organically it kind of made sense for me to just come in full-time.

AY Strauss: That's great  - G.S. Wilcox,. what a great firm. It's a great story, great people, a great firm. You touched on Martin, great individual as well, and you guys have great chemistry and a great working history now. That was the very beginning of sort  of present day and fast forward, you've gone on to do hundreds of transactions together, you've really grown the platform. B&D is a first rate, five star, industrial investor that's partnering with major capital partners, major institutions. It's grown tremendously, your infrastructure, your deal making apparatus has grown. Then you've really been in the forefront of that growth. I mean, maybe you could talk about how things have changed in just the last few years for you. I mean, when you first got going, it was probably slower moving, and then the rapidity picks up very, very fast. So maybe we could talk about how that growth has been.

Robert Logan: I landed in an excellent shop, Martin Segal and his family. They're amazingly entrepreneurial, like profoundly entrepreneurial, something I thought I was a businessman, but I came here and Martin's father, Barry Segal, just a little history, and you know this, but Bradco Supply was the third largest roofing supply company in the country. Having started from one location in, I believe, Long Island, maybe it was New Jersey, I should know that, but, and then having up close to 140 locations nationally. Sold off pieces to, a piece to Apollo, a piece to Advent, and then they continued to try to bolt on and expand the business and were ultimately acquired by ABC Supply. So you're entering an environment that likes growth, understands scale, and on top of that, from an industrial investment standpoint, operated out of 140 locations across the country in various markets. So there's a comfort level with the assets. So I think Martin and my partnership, along with Danny and the rest of the team here has been excellent because he has this amazing expertise and he has a lot of interesting businesses here that are really impressive private lending arm and a few very impressive charitable foundations. I was, I just kind of added some fuel to the fire of expanding their investment thesis. So I'm going to give them all the credit, but really what we've done is say, ‘Hey, we know this asset class really well. We were operators, Class B industrial, IOS, which was not an acronym when I started. We understand this really well. We can look at real estate with a really smart eye, with the user eye and the investor eye and figure out how to deploy capital. Why don't we expand it to different markets, why don't we take some more risk, why don't we look at different profiles, deals from a core to opportunistic, you know, kind of spectrum and use our expertise to just scale this platform’. So we, we've kind of, I think we had eight or 10 people when I started and now we have a 26-person team, vertically integrated construction professionals, leasing professionals, acquisitions team, asset management, accounting department.  We think we remain well positioned in this, and this investment opportunity remains really widespread across the country, so we're excited about it.

AY Strauss: No, 100%. I had that first chair seat to watch that growth has been incredible. And it's really exciting. And you're right, it comes from a great platform, it comes from working with people with high integrity. It comes from investing in those relationships. People trust you'll do the right thing at the right time. That's obviously huge in the business. Should we touch on market right now? Should we go there? Should we talk about where you think things are going? Obviously, there's a lot of macro things happening out there, but I mean, your thesis remains the same. You're looking for excellent real estate that you can continue to acquire. Has the mood shifted at all one way or another in the last several months for you guys?

Robert Logan: You know, not really. I think what sets us apart is we have a lot of tenant relationships in the space. So we're continually in constant discussions with these tenants and where they wanna be, where they're growing, how their businesses are performing, what type of assets they like, what are their needs. And so far, in our kind of niche expertise, which has been kind of the light industrial, shallow bay industrial, and a lot of industrial with outside storage, IOS, we haven't really seen demand slow. And I think that's for a few reasons, right? I mean, they're not building, we all know this in the industrial space, they haven't been building new shallow bay assets. It's hard municipalities really don't want new outside storage, so it's hard to replicate that. Then a lot of these locations are truly infill, they're really last mile locations that needed to serve these local population centers. So, you can't go 30 miles outside of town and build a big bomber and take advantage of the land because some of these tenants have almost a retail component. They really need to be inside and serve these areas so there's just a lack of supply and even though the space has become really competitive in the sense that there's a lot more people doing what we're doing now, I think we're early on, and it's a fragmented ownership space, and there's still a few years of runway here for us to really find great opportunities. It's kind of what we've been doing. I always make the joke that when we started here, we would just offer our own buildings and the sellers would call us and thank us. And now they have a lot of people calling them. So then they think their assets are worth a little bit more than they should be, but there's still enough owners out there that we're finding great opportunities.

 AY Strauss: For sure, for sure. Any focus you think besides we're doing more of the same, you guys have had really excellent growth and built the team beautifully and the reputation has expanded as well. Any particular focus for you either within the business or within the industry or to up your game at all or more just continue to execute at a high level day to day?

 Robert Logan: No, I think we're doing a few things differently now. We've invested in hiring people to work directly with the tenants proactively. A lot of that happens organically given our portfolio and given the number of assets we own and our history in the space. But we wanna really maximize that. So we've recently made three acquisitions hires. One with  geographic focus, but the two others   are  really processing and just speaking to the tenants on an ongoing basis. 'Cause we think as the space gets competitive, that's gonna give us the edge versus upstart shops that are just taking advantage of kind of a secular play, but they haven't been doing it for a while, and they might be smarter than I am, but they may not have the history that we have. So they may not see the opportunities that we are able to see. So I think we'll continue to invest in that space. We're also building out our development capabilities, something that's grown in the last few years. We've been doing build-to-suits for a national consumer staples company across the country. And that's going to that will continue to grow as we continue to offer more services to these tenants and become a full service real estate shop, which is then going  to present these investment opportunities where we can take advantage of land, space, buildings, whatever we find. So those are areas of emphasis right now. It's not just doing the same. It's how do we do it more efficiently and at scale? And I think the tenant relationships are a big advantage we have.

 AY Strauss: Absolutely. If you can understand what they're doing and what they need better than the next competitor, you're going to have incredible insight for sure. And we certainly watched you build your team at all levels, which is terrific. Let me ask you another question. There are times when you're juggling so much. I mean, I see some emails that you're on and I'm thinking, how does Rob handle this? How does the team handle it? It's just so intense at times. In your most intense capacity, say you're closing multiple deals in a week and you've got a million responsibilities, how are you managing through those sort of super crunch periods? I know there's no great answer, but I think everyone struggles to find their mindset. We call this podcast The Dealmakers’ Edge, but we really like trying to get in the mind of the people who are making it happen.

 Robert Logan: First of all, say we have a great team. That's the easy cop out of everyone else's.

 AY Strauss: All good.

 Robert Logan: We have a great team here that really does amazing work and we're kind of a processing machine. But personally, I think you gotta have a little bit of an obsession. I love, I really, for whatever reason, my wife even makes fun of me, love what we do and what we buy and love metal warehouses an industrial land across the country. But, I think it's effort, right? I don't know if there's any secret to this business. I always tell a lot of people that it's not complicated, but it's incredibly hard, incredibly hard. And I think that is just work ethic, right? So a lot of our guys, you know, we work late hours, we work weekends. I think a lot of people in today's world don't seem to like to read, but if you're just willing to read extensively for hours on end, I feel like it's a massive edge. So, when we're really busy, I just put in the hours and rely on our team and we've built that culture of high output and high effort. It's a combination of, I guess, love what I'm doing and working very, very hard.

 AY Strauss: No, we've certainly seen it. And, you know, keep doing what you're doing for sure. Very impressive. What about anything I could have asked you, but didn't ask you? Either about the platform? Why should people reach out to you, specifically B&D, as a first class investment platform? Anything you think it would have been a good question to ask here, but maybe I didn't get to. Maybe just shine a little bit more on where you guys are emerging because five years ago to where you are now, now you're one of the top players and the growth is there, the platform is spectacular. What else could I have asked you to help just try to share the story a little bit more?

Robert Logan: I think what's interesting to highlight about B&D is we're so in the flow of the space doing 25 acquisitions a year, while doing five to 10 Build-to-Suits , while having a private lending arm on the RTL space. Having been an operator, and having direct relationships with our tenants. I feel like we see a high opportunity set maybe compared to a lot of people, and we're just in the flow of these assets that we invest in. So it's not like we're making two or three investments a year and turning down deals. It's not just, I want to be clear, I don't think it's just seeing opportunities 'cause anyone can sit at their desk and see every broker opportunity and call people and figure it out. But we're also executing along the way. So we're constantly speaking with lenders, negotiating insurance premiums, negotiating leases with tenants, working with market brokers. I just think that gives us a huge advantage. I feel like the information flow and a relatively inefficient industry still, I think over the next four or five years, data will really emerge and become more efficient. But for now, if you're in the flow and constantly getting updated information, it just gives us such an advantage as a player. That's part of what I sell our partners and our investors and our tenants and our team and new people who would want to work with us. That B&D it's continual growth change because we're actively evolving with the current marketplace. We're not kind of waiting and I think you can invest in all environments, right? So if rates are up, if rates are down, if certain local economies are strong and others are not, there's always places to deploy capital in commercial real estate in the United States for now. We're in the flow and that's just a big advantage 'cause we'll keep doing it and just evolve as the space grows.

AY Strauss: Amazing and well said. And again, it's been wonderful to watch that growth. You have a ton of growth ahead of you if this speed keeps continuing. So it'll be exciting to continue to watch that. I guess on that note, we'll wrap, but Rob, I really want to thank you for all that you're doing, being a guest here, and just continued great success to you, Martin, the whole team, Danny, everybody back at the shop. Hopefully we'll have many more conversations watching this meteor ship continue to rise. Thanks for being on with us today.

Robert Logan: Aaron, thank you - and thanks to your firm for all your support over the years. We're excited to keep it going. Thanks very much.

AY Strauss: Of course. Take care