In the beginning of Adaptive, we found ourselves in the annoying situation of having more deals than capital to do them.
We “solved” this problem by doing these deals on a fee-only basis (eg in exchange for cash fees but no upside in the deals). I put “solved” in quotes because this was a terrible solution from our perspective… the owners we helped made so much money on those deals that it makes me cry to think about it.
Over the past few years, Adaptive has moved into a new phase, one where we have sufficiently-strong relationships with capital providers that we can do any deal that makes sense.
I used to tell people that I wanted Adaptive to end up managing hundreds of millions of dollars of outside investor capital without having any idea how we would get there.
Now, mostly because we found wonderful capital partners and my partner executes the hell out of apartment projects, I can finally see how it will happen.
It’s not going to be by taking some gigantic leap. Instead, it’s going to be inch by inch, doing the same thing we’ve always done… finding under-managed assets, buying them for fair prices, avoiding making really stupid mistakes, doing high quality design, treating people with whom we do business fairly, under-promising, over-delivering, etc.
In other words, we’re going to keep chopping wood. But we’re going to do it secure in the knowledge that we are, indeed, going to get where we want to be.