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[SUPER HOT SHARE] Niche Silo

Niche Real Estate Products

Ok, fellas. I’m bored to tears in real estate and am looking for new interesting paths and new challenges. What are some niche real estate products that people rarely think about? Self-storage was the trendy niche that, in my view, is now overbought in a lot of U.S. markets. What are some other interesting niches? Section 8 housing, military housing, data centers, etc. Thoughts?

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Comments (111)

Apr 8, 2019 – 11:01pm

Racetracks seem fun/interesting. What about power plants? Missile silo->doomsday bunker conversions?

I don’t think any asset classes are boring, but rather it is various risk profiles that are boring. If you’re buying a stabilized Class A apartment building, sure there isn’t a whole lot of interesting analysis to do there. But if you’re building a Class A apartment building on an environmentally contaminated site, now you’ve got all kinds of “interesting paths and challenges” as you put it.

Apr 8, 2019 – 11:18pm
 VolatilitySmile:

Missile silo->doomsday bunker conversions

Well now my investment criteria will actually have competition… the gig is up

“The three most harmful addictions are heroin, carbohydrates, and a monthly salary.” – Nassim Taleb
Apr 8, 2019 – 11:46pm

I’m actually interested in building car or (loosely) “race” tracks for a future when autonomous cars dominate and people want to go to the track to get in some real driving time. But I fear I’m a decade ahead of my time. Timing is everything.

Array

Apr 9, 2019 – 9:30am
 real_Skankhunt42:

Section 8 housing, military housing, data centers, etc. Thoughts?

Can’t speak for the others but Sec8 is pretty overpriced as well. Folks realized about 10 years ago that it’s a superb asset class.

One play I’d be interested in within the Section 8 market is buying PBS8 buildings in low cost of living areas and then moving the contract in-state to a high cost of living area. As in, buy 100 units in Baker, CA or Utica, NY and then move those contracts in LA/NYC. Haven’t done enough research but I am pretty sure you can do it as long you can prove out that the original building won’t suffer from having the contract removed. Seems like there should be a real arbitrage opportunity there.

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May 2, 2019 – 1:45pm

How would that work? I thought that the section 8 was tenant based not property based. As a property owner, if you weren’t able to attract voucher tenants in Utica or Baker, you’d just have to adjust rents appropriately if you wanted to lease up – right?

Apr 11, 2019 – 12:50pm

Probably as you’d imagine. They seem to be a section of the entertainment industry that is stagnant and nowhere near as popular as it was 15-20 years ago. I mentioned this primarily to seeing Bowlero posting a position for an acquisitions analyst.

Apr 9, 2019 – 10:28am
 real_Skankhunt42:

What are some niche real estate products that people rarely think about?

Border security.

I’m surprised you don’t lobby for privatization or public/private partnerships on the wall and kid cages. Hard costs are basically a retaining wall and low-fi self-storage.

Commercial Real Estate Developer

Apr 9, 2019 – 1:06pm

Incredibly niche but I find airport development extremely interesting, I don’t know why.

I would love to work for say, JetBlue in their Real Estate/infrastructure group for their JFK development.

Apr 9, 2019 – 3:23pm

+1 on the airport development. Coming out of engineering school a couple years back, it seems like a lot of my friends ended up doing design/construction on airports. With rapid urbanization of the south/fringe cities, it seems like expansion and development can’t keep up. Don’t know much about it but it definitely seems hip.

Apr 9, 2019 – 5:08pm

Even well-established airports like ATL are undergoing massive renovations

Commercial Real Estate Developer

Apr 9, 2019 – 6:30pm

Airports are very difficult from the construction/ development perspective.

“The three most harmful addictions are heroin, carbohydrates, and a monthly salary.” – Nassim Taleb
Apr 9, 2019 – 6:42pm

I bet.

JetBlue had a Senior Analyst position a couple months back. Seems like you need a heavy technical background in construction/engineering/architecture.

Apr 15, 2019 – 1:00pm

VINCI Airports is big in this space, GIP sold their stake in Gatwick to them late last year.

On another note, a reit in my market has started to develop their FBO (fixed-base operator) activities. Could be an subsection worth looking into.

Quant (ˈkwänt) n: An expert, someone who knows more and more about less and less until they know everything about nothing.

Apr 10, 2019 – 12:01am

How about Sports Arena developments? Anyone have personal experience with something like Barclays Center or Chase Center? Fully private developments. Owners in each case hire top guy to lead whole team. Build an arena,offices, retail, put a whole business plan into operation then bounce somewhere else in the world to do it again.

Apr 11, 2019 – 12:55pm
 pere797:

How about Sports Arena developments? Anyone have personal experience with something like Barclays Center or Chase Center? Fully private developments. Owners in each case hire top guy to lead whole team. Build an arena,offices, retail, put a whole business plan into operation then bounce somewhere else in the world to do it again.

I got to tour SunTrust Park when it was under construction. Built by “Braves Development Company” while selling off other uses (like the multifamily and the retail) to well known local developers.

Commercial Real Estate Developer

Apr 10, 2019 – 6:43pm

How does one get this job?

“The three most harmful addictions are heroin, carbohydrates, and a monthly salary.” – Nassim Taleb
Apr 10, 2019 – 5:07pm

Not sure if this qualifies as niche or flat out creepy but I know a group that specializes in funeral homes and cemeteries. In talking with a few guys who work on this platform the returns were pretty compelling. Not exactly what anyone in undergrad might aspire to be but cash flow is cash flow. I mean if nothing else talk about a reliable sector!

Apr 10, 2019 – 5:36pm

Like, he would build funeral homes? Or he would actually enter the funeral business?

Array

Apr 10, 2019 – 5:57pm

Acquisition, ownership and operation. They don’t build them. The company typically targets “combination” facilities, characterized by a large cemetery with a funeral home either on-site or in close proximity. Overarching attraction here in talking to them was the lack of correlation to broader economic cycles and the high barriers to entry. Interesting to say the least.

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