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Douglas M. Weill (SHA '88). Real Estate as Institutional Asset. Capital Investment and Fund Management.

Aug 18, 2022
Image of Doug Weill, Founder and Co-Managing Partners of Hodes Weill Associates

Cornell Baker Program welcomed Doug Weill as a guest to our Distinguished Speakers Series. He is the Founder and CoManaging Partner of Hodes Weill Associates. David Hodes and Doug Weill founded Hodes Weill Associates in 2009. The firm has evolved into a global capital advisory firm that focuses on real estate investment and fund administration. Mr. Weill oversees the firm's origination of new business, manages institutional private placement assignments, and leads the operations of the firm. Prior to joining Hodes, he worked as a Managing director at Credit Suisse. There, he co-founded Credit Suisse’s Real Estate Private Fund Group. Credit Suisse’s Real Estate Investment Group was also co-managed by him. He holds a Bachelor of Science in Hotel Administration degree from Cornell University. He serves on the Advisory Board of Cornell Real Estate Council and the Board of Directors of Cornell Real Estate Council.

Mr. Weill structured his talk around Hodes Weill's operations in the real estate private equity industry, where they provide strategic advisory services to investment management firms, providing access to capital from institutions around the world. Hodes Weill, founded in 2009, has raised more that $20 billion for clients. The firm's various strategies include closed and open-ended, commingled, joint ventures and separate accounts. The firm markets to institutions globally, including pension funds, insurance companies, sovereign wealth funds, and university endowments, and operates in the U.S., Europe, Asia, the Middle East, and occasionally emerging markets. Weill also spoke about the firm's plans to diversify its focus to real assets and infrastructure as well as to open an Amsterdam-based office.

Hodes Weill's goal is to provide institutional investors with access to a variety of investment strategies. This will be done by using their strong institutional process knowledge and investment market experience. Mr. Weill highlighted that, with 3,000 active institutions around the world, investment strategies vary in shape and size, with some firms preferring a diversified portfolio in multiple countries, while others focus on specialized assets such as data centers and logistical warehouses. He also pointed out that certain firms have developed targeted strategies to invest into movie and television production studios, in part due to recent growth of 20%-30% in media content consumption.

Weill explained to us that institutional investors are experiencing an unprecedented increase of capital allocations. Many global institutional investors are increasing their pace of investments in real estate, in order to reach their target allocations, which average 10.7%. The Institutional Real Estate Allocations Monitor, which the Baker Program produces annually, shows that institutions are significantly underinvested in relation to their target allocations. It is an average of 140-150 basis points or 1.40% to 1.50%. To hedge against rising inflation, institutional investors also plan to inject capital into the market. These conditions have made it very active for institutional market transactions in Q4-2021. This activity will continue through 2022, Mr. Weill says.

Hodes Weill is a leader in institutional capital market investment. Mr. Weill shared with us that the key to his firm's success is to demonstrate expertise in the field, provide a strong track record, and establish an experienced team. He said that it was crucial to align your interests with institutions and have an understanding of the institutional process for success in this area. He is excited to witness the industry's evolution and anticipates that there will be continued growth in institutional capital allocations in the future.

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