What Blackstone's Jon Gray Can Teach You About Real Estate

At only 53 years old, Jon Gray is on his way to being the most infamous real estate investor of his time

He began his career as an analyst at Blackstone and has since grown through the company, now leading way as the president of the company

In todays download, I'd like to share 11 powerful lessons from Gray every real estate investor should know

Let’s get started…

Lesson 1

Avoid the classic developer sin

Financing long duration assets with short term debt

Lots of leverage maturing in a short time has claimed the careers of many developers

Lesson 2

Invest based on large scale themes

Examples:

•E-commerce

•Life sciences

•Cold storage logistics

•Green infrastructure

•Big data

Lesson 3

Your first job should have two characteristics

1. A culture of meritocracy

Work hard - get rewarded

2. A culture of teaching

Real estate is most effectively learned through apprenticeship

Find a group that values teaching

Lesson 4

Take advantage of market inefficiencies

In the early 2000's, Jon Gray realized Blackstone could use (cheaper) CMBS debt to buy public real estate companies

With this, they bought bigger deals and supersized the company

Find inefficiencies and take advantage of them

Lesson 5

Beware of these Real Estate warning signs

1. Lots of cranes

2. Too much leverage

If you see these things, pump the brakes

Lesson 6

Only work on something you really enjoy

You will never be good at something you don't enjoy

Focus on finding something that gets you excited in the morning and chase being the best at it

Lesson 7

Luck is a core competency

Live a life that creates favorable results

"I am a great believer in luck, I find the harder I work the more I have of it" Thomas Jefferson

Lesson 8

Go where the tech and creative types are going

In todays day and age, tech and creatives are developing things that are changing our world

With that comes money

Find these places and ride the tailwinds

Lesson 9

Determine what's temporary and what's permanent

Global travel grew at 5% annually for 50+ years

Once the pandemic hit, the sector plummeted

Jon Gray uses this as an example of a temporary trend

Lesson 10

Be Aware of Inflationary Pressure

Avoid businesses that cannot pass on the increased cost to the customer (ex: fixed rate, long term leases)

Lesson 11

Find the right life partner

Life is unforgiving, you need someone in your life you can come home to and rely on

That's all for today friends

If you found value in today's newsletter, it would mean a lot if you share it with a few friends

Thanks for joining me this week,

Jake