429. Multifamily Value-Add, Development, and Opportunity Zone Strategy with Barrett Linburg, Savoy Companies

Barrett Linburg (0:00)

You don't have to play hot potato. You don't have to sell it because the building that you own is not a ticking time bomb.

Haley Keene (0:11)

Welcome to The TreppWire Podcast, the show where commercial real estate meets data and insights.

I'm Haley Keene with Trepp, a data modeling and analytics firm for the CMBS, commercial real estate and CLO markets. I'm with Lonnie Hendry, Chief Product Officer. Today, we're joined by Barrett Linburg, founding partner of Savoy, a vertically integrated Texas multifamily real estate platform. Barrett co-founded Savoy in 2011 with the acquisition of an eight-unit apartment building in Dallas. Since then, the firm has grown into a significant Texas multifamily platform, developing more than $200 million in projects and managing roughly 7,100 apartment units across the Texas Triangle. Barrett leads Savoy's capital formation, investor relations and strategic growth with a particular focus on multifamily acquisitions, ground-up development and opportunity zone and other tax-advantaged investment strategies. Barrett, we're so excited to hear from you today. Welcome to our show.

Barrett Linburg (1:11)

Thanks so much, Haley and Lonnie. Thanks for having me and glad to get in the weeds on a little bit of everything that you just mentioned. So let's do it.

Haley Keene (1:19)

We're so excited. So I didn't mention this, but you've also built a pretty significant presence online on social media, sharing your perspective on real estate and opportunity zones. I know you've shared pieces of your story there before. But for our listeners, can you take us back a little bit? How did you get into commercial real estate and how did that ultimately turn into Savoy?

Sure.

Barrett Linburg (1:43)

I started as a mortgage broker right out of college in 2005 So I started arranging financing for not only apartments, but also hotels and triple net for a firm called BMC Capital. And started doing it right out of college. And I really thought, man, these are the, this is easy. Everybody makes a couple hundred thousand bucks a year. Like this is a no brainer. Why isn't everybody in this business? And after a couple of years, obviously GFC hit. And I realized why everyone isn't in this business. You know, this is cyclical. So I learned a little bit about how cycles work. But I also realized that I really love the business of commercial real estate, not only the numbers and the physical asset, but also the relationships that are behind it. And I sat down with a mentor of mine, and I was young enough at the time, 25 years old. And he said, you can go into a different business and start over, or you can stick it out and a new cycle will start. And you'll be one of the few young guys who stays in it to see the beginning of the next cycle. And if you want to do it, you won't make much money for the next few years, but you'll be there for the beginning of the next thing and you'll do okay. And I took his advice and took the harder path at that moment. And it was the right thing for me to do.

Lonnie Hendry (2:54)

Yeah, it's great. I mean, I think the mortgage brokerage thing is interesting because I remember back in the day, I was doing multifamily property management back in like 2005, 2006, and had a few people come to me and say, hey, you should get into this lending business. Like this is where it's at. And then to your point, it just kind of all fell apart during the GFC. And a lot of them, I'd say almost all of them changed course. Like they were like, we're not going to stick this out. It was great until it wasn't great.

So I know you just kind of gave us an outline there. You pivoted. You know, and Haley mentioned on the intro, your first deal was an eight unit property in Oakland. So maybe give us a little color on, you know, when you decided to do something different, what brought you to that deal? What did you like about it? And what did you learn from it?

Barrett Linburg (3:33)

Well, I think just one more thing on the mortgage brokerage. I think it's a wonderful way for people at the beginning of their careers to get a very holistic view into the entire business, right? You get to work with title companies, attorneys, insurance, and you learn the nuts and bolts of how a deal gets put together, how the sausage is made, and it worked really well for me. I didn't do that first deal, the eight-unit deal in Oglon, until 2012

So I had a long time in the business of learning how a deal is put together by watching other people do it and being very involved by arranging the financing. And that really gave me the knowledge and the ability to go tackle my first deal, albeit a very small one. And my mother-in-law was the equity. My wife was the property manager and construction manager, and wouldn't have happened without everything that they did. I really was just the one who found the deal and said, this one will work.