This week on our Masters in Business interview, we speak with Jonathan Litt, founder and chief investment officer of Land & Buildings. Litt founded Land & Buildings in the summer of 2008 and has built it into a prominent activist hedge fund in the real-estate space. He has more than 25 years of experience as a strategist and an investor in both public real-estate securities and direct property.
He explains how tax reforms in the 1980s eliminated many of the benefits of owning real estate in a private structure. This was a sea change leading to the rise of REITs. After these changes, many real estate companies had no choice but to either go public or go broke.
L&B likes buying cheap real estate in the public markets via REITs. Litt notes the new “Work-from-Home” experience was far better than previously experienced. Productivity was higher, and the technology allowed a much better experience than the 2000s version post 9/11. Given the high cost structure in big cities like NY and San Francisco, L&B expects those real estate centers to be challenging investments going forward.
His biggest bets are in the suburban single family home space. He is looking at a 1% population bleed from urban centers increasing somewhat, as post pandemic home owners and millenials, rediscover the advantages of Suburbia.
His favorite books are here; A transcript of our conversation is available here Monday.
You can stream and download our full conversation, including the podcast extras, on iTunes, Spotify, Overcast, Google, Bloomberg, and Stitcher. All of our earlier podcasts on your favorite pod hosts can be found here.
Next week, we speak with Luke Ellis, CEO of Man Group, a global active investment manager with $104.2 billion in AUM.
Jon Litt’s Favorite Books
Outliers: The Story of Success by Malcolm Gladwell
Sapiens: A Brief History of Humankind by Yuval Noah Harari