On February 7th, 2019, the Baker Program welcomed Seth Singerman (SHA ’99) back to campus to present as part of our Distinguished Speaker Series. As a leader in real estate private equity, Seth has built a multi-billion-dollar firm on the principles of discipline and integrity. His firm, Singerman Real Estate is a value investor with a broad investment mandate. The ability to invest anywhere in the capital structure and any geography across the country in search of price dislocations in real estate assets is unique to all but the largest and more renowned funds. Having just closed his third fund, a $500 million-dollar capital raise, the Baker Program and its students are honored to learn from one of our most distinguished alumni.
From the beginning of his presentation it was clear that Seth’s background at a real estate focused hedge fund translated well into his private market investment path. Where most speakers look for value in a top down investment approach, Seth seeks to capitalize on asset price dislocations as a discreet pricing mismatch between the relative value of an asset and its relative position in any given market. Seth began his early career as a rising star in real estate private equity out of Cornell and then excelled at a real estate focused hedge fund after graduation from Northwestern’s Kellogg MBA program.
Seth emphasized the importance of staying diligent with regard to your investment discipline and being willing to walk away from deals. It quickly became apparent that Seth practiced his own advice as he went through case studies of different opportunities and distressed portfolio deals he has acquired. In many cases Seth talked about finding middle ground between parties. The nature of value investing can often dictate that different real estate interests are at unequal and often vulnerable positions relative to each other. Often it takes a strong capital partner or a new vision to get a deal done and it was obvious that Seth’s emphasis on collaboration and creatively looking at where value can be created has had a positive impact on deals that Singerman Real Estate touches.
Looking across the investment universe, Seth acknowledged that we could perhaps be near the end of a cycle, and at the same time, debt markets look relatively cheap with high competition and supply versus equity markets. He also mentioned that his ability to invest in across the capital structure is an advantage that he hopes will help dampen volatility if markets experience a downturn. Seth opened up about his portfolio and detailed some of the aspects to underwriting that his firm uses. As a value investor, Singerman Real Estate underwrites to significant downside levels of risk and enters deals where healthy IRR projections and strong Equity Multiple proformas are possible even in a risk-on state of the world.
Students were appreciative of Seth’s transparency and willingness to teach real world principles. As the search for internships and full-time positions is well underway, Baker students appreciated Seth’s ability to describe how he came to create his company and find success through passion and hard work.
