Blue Vault – Bowman Alts Week 2021: A Quick Overview of Some Insights from Day 5
March 15, 2021 | James Sprow | Blue Vault
Four Springs Ten31 Xchange Platform Overview
Eric Paul- President, Four Springs Capital Markets
William Dioguardi, CEO and Chairman, Four Springs Capital Trust
Jared Morgan, SVP, Head of Acquisitions, Four Springs Capital Trust
Founded in 2009, Four Springs Capital Markets is a wholesale distribution company that markets to independent broker-dealers, RIAs, and family offices to reach a wide array of prospective investors who hold appreciated real estate and are seeking to defer taxes.
The company has upcoming DST offerings including a 312,000 square foot “last-mile” industrial property in Oklahoma City, OK, a $46.7 million offering. They are also targeting a healthcare property with a dialysis center, blood plasma collection facility, and general healthcare tenants for an approximately $50 million offering. 
Among Four Springs’ investment criteria are real estate first, rents at or below market, strong locations, great alternative uses. Their diversity makes them unique in the DST space. They look for long-term leases with minimal landlord responsibilities, making sure tenants have the strongest credit. All of their current tenants have paid full rent during the pandemic. Through existing relationships with developers, they are seeing many deals before they go to market. In Q1 2021 they are closing at about $100 million in deals.
Orion Advisor Tech Innovative Tech Meets Cash and Credit Solutions: A Winning Combination for Advisors
Tricia Drexel, Strategic Relationship Manager, Orion
Steven Canup, Managing Director, Orion
Orion is developing a comprehensive solution to bolster their tech-enabled fiduciary framework, with a fully-developed suite of banking services that will include:
• Lending and cash management including a range of FDIC-insured deposit programs
• An experienced service team with 125 years of collective banking experience
• Confidentiality and protection of client relationships
The addition of Focus’ banking solutions to Orion’s tech-enabled framework puts advisors in a better position to:
• Increase client retention
• Compete on a larger scale
• Attract and serve high-net-worth clients
CAIS, “Uncovering the Science of Client Motivation!”
Tim Maurer, CFP, Director Advisor Development, Buckingham Wealth Partners
Andrew Smith Lewis (aka “ASL”), Chief Innovation Officer, CAIS
This session provided a wealth of ideas about the psychology of financial decision making and the psychology involved in serving clients. What follows are some of the most stimulating ideas that Tim Maurer and Andrew Smith Lewis presented, followed by a list of books Tim Maurer recommended.
Tim: I want to throw this out to advisors. 80% of client recommendations are not implemented. If there is anything that is even close to true in that statistic, it is a massive fail. Can you imagine going to an attorney and having 80% of their recommendations ignored?
Tim: A book that is valuable in this regard: Thinking Fast and Slow by Daniel Kahneman. Our brains operate at two different levels. System 1 is immediate response. System 2 is slower, more considered. We prefer System 2, but that is not what is happening. We rationalize the decisions that System 1 makes using System 2.
ASL: The big take-away for me is to be in the listening mode. The most important thing is how do you get there.
Tim: It has been suggested that one of the things we need to do is talk less and listen more. The initial interview should be 80:20. 80% listening and 20% talking.
ASL: If behaviors don’t change then learning hasn’t really occurred. That’s the most simple definition of learning. You have to capture and maintain their attention.
Tim: We tend to be accomplishment driven. The point of this work is not to have less outcomes. It is hard for me to just shut up. Allow 9 seconds of silence before you actually speak up. For interacting with a client silence is a tool. What’s the magic of it? If you just shut-up, the client is more apt to fill that space. When a client shares with us for the first time, we get layer number 1. If you wait and are silent, you will get to Layer 2, and even Layer 3, which really motivates you.
Tim: Autonomy, Mastery, and Purpose. Four things you can do. There are only a limited number of decisions we can make in one day. Simplify everything about your client experience. Give your clients as few decisions as possible. Help your client dominate your meetings.
The Eagle Group
Ron Reeser, Managing Partner / CEO The Eagle Group
Neil Paine, Managing Partner / CFO The Eagle Group
Ron Reeser presented the Eagle Pioneer Mine which is in an opportunity zone in Arizona. The mining plan has the potential to yield monthly EBITDA starting at $1.2 million, scaling to $4 million per month within 18 months. Bald Eagle Partners are now raising $25 million in 10% convertible preferred units to launch full production. The company is targeting a 50% IRR for the preferred unit investment if held until the depletion of the mine, expected in 2031. The breakeven price of gold for this mining project is just $600 per ounce, with gold recently trading at over $1,800 per ounce. 
The key investment advantages: proven historical mine with strong gold content; QOZ investment with favorable tax treatment; an innovative mining process recovering 65% of available gold; expert mining team with over 40 years of experience; 10% preferred cumulative convertible unit option providing investment seniority.
Versity Investments, “Why Student Housing & Why Now”
Brian Nelson, President & Founder, Versity Investments
Jason Kjellson, EVP, Versity Investments
Brian Nelson illustrated how Versity has a large market share, with 31 properties in 16 states and $850 million AUM. Versity is bullish on student housing coming out of COVID. Versity has done ten full-cycle properties and expect to sell more properties at very high IRR levels (averaging 50%+ total returns to its investors).
One of the trends in university housing has been “de-densification” meaning reducing the number of students per room, putting more students out to private housing. Brian thinks there will be a strong uptick in demand in the Fall of 2021.
Politically speaking, both sides of the aisle want to make college education easier. No one is coming out of COVID saying they don’t want a college degree. More people are looking for ways, and more and more international students wanting to come to the US. 18-24 year-olds do not want to be studying from home. They want to have the college experience. Nothing can replace that. Data is showing that the big schools are getting harder and harder to get into. The reality is that enrollment in public four-year institutions will increase, along with the demand for student housing.
“We have 600 individual leases all guaranteed by high-income parents. Well diversified tenants from all over. Our expense ratios are very low. Our expense ratio is only 32%. If you do it right, you have very low expenses. We have more upside with low downside risk.”
Versity has two current offerings: Wolf Run and Astoria, DST.
