The ALX Show

Welcome to the ALX show your
premier source for DFW real

estate data and insights.

Let's get to it.

Brandon Giella: Hello and welcome back
to another episode of the A LX Show.

Today we are talking about, uh, the
tariff situation because it has really

affected markets over the last week or so.

Uh, today we are, this is, we're recording
April 8th on Tuesday, and markets have.

Uh, entered bear territory essentially.

I think the s and p 500 was
down 15 or 20% off its peak over

a week ago or, or something.

You guys correct me.

Um, but it's, it's.

It's been really, um,
volatile, to say the least.

So there's a lot of different arguments
about whether these tariffs are, uh, a

net benefit or if it's hearkening back to
the protectionism and mercantilism of old.

And there's a lot of, you know,
all the, the Nobel economists say

the tariffs are terrible, but maybe
there's more to the story than that.

Yeah.

And so Josh, Patrick, I wanna hear
what you guys are seeing on the

ground, um, different data you're
reading or seeing or thinking about.

And so, Josh, I'll start with you.

Before we started recording,
we were talking about how.

Um, there's, um, there's a
bigger picture when it comes to

a lot of these kind of moves.

It could be manufacturing, it could
be the federal deficit, it could be,

um, something that you mentioned a
few episodes back about where, um,

the market turmoil we're seeing is.

Yes, a short term pain, but maybe
there's some long-term benefits.

Maybe there's, uh, a story with the
treasury rate coming down and restarting

some, some capital investment from, from
different, um, sectors of the economy.

So I'm curious, what's your read
on what's going on right now and

how do you like, interpret it?

Think about it.

How should investors and listeners be
thinking through this, what they're

reading in the headlines right now?

'cause I know it can be painful and scary
depending on where you're coming from,

uh, in the market right now, but remember.

The market is not the economy.

Those are two different things.

So help us, help us think through that.

Patrick, I know your, your data whiz,
um, so I'd love to hear some things that

you're thinking through too, but yeah.

Josh, I'll start with you.

What, what's your take on all this?

Josh and Patrick: Um, it's hard
to get a real solid take yet.

I, I think we're trying to understand
the motives behind the tariffs and

tariffs, and I think there's, uh, a good
argument, um, that the administration

is making that, um, ultimately the
United States has been on the wrong

end of some bad trade deals for years.

Uh, a lot of jobs and opportunities
been lost to, to foreign countries

that we could bring back home.

Uh, the middle class has been suffering,
uh, quite a bit because of the loss

of jobs and the lack of high quality
jobs, um, in that sector, in that area.

And, uh, by bringing those jobs back,
uh, or incentivizing other, even other

nations, to invest more heavily into
the United States, which would also.

Um, create jobs, both, both, uh,
United the American companies kind

of reinvigorating and, and building
back and manufacturing coming back.

But then also foreign investment coming
directly in, um, creating a better,

um, better quality higher paying
jobs for the lower to middle class.

Um, ultimately in a 70% consumer driven
economy will lift all boats and will make,

you know, it gives real opportunity for
the United States to be, to be prosperous.

Um, you know, but.

You can also look at like, just, just
recently, the reciprocal tariffs.

You've got the, the, the 10%
baseline, and then you've also

got the reciprocal piece to it.

And, and I think those can
absolutely maybe be separated

in terms of what their ultimate
purpose is or the goal behind them.

Uh, the 10%, I don't know
if it's going anywhere.

And I think Trump is, I mean, he, he's
everything he said in his campaign, he

has stuck to, uh, the administration
has, has, has, have done, um, thus

far what they said they were gonna do.

So I don't know that we've got a real.

Uh, good case to doubt that, um, that
they mean what they say and that those,

that the 10% I, I think is, that's
where they see the value in the revenue.

They, they say, you know, five, six,
$700 billion a year over the next several

years equals, you know, trillions dollars
in revenue, um, that, you know, can,

can offset some, some, uh, tax cuts.

Um, that it could also pair with some
deregulation to really, um, get the, get

the supply side of the economy moving.

Uh, now the, so I think there's a lot
of benefits in, in addition to the

jobs that we talked about earlier,
but the reciprocal side, I'm just

curious, I, that to me may be more of a
negotiation tactic, um, in order to get,

uh, better deals on the table to, to
really attract, um, foreign investment,

uh, directly into the United States.

So I, you know, it's, uh, I, I, I
think that, um, really the, the mindset

behind ultimately the, the good that
the terrorists can bring is a good one.

I think that the country needs it.

It's also better for security to, to
onshore some of the, um, essential

products and, and, uh, supply chains.

We saw through Covid when
everyone, globalization.

Globalization has been such
a big deal, and then covid

hit and everything shut down.

Well, if you can maybe protect, um,
your country and your, and your,

uh, production of goods, then.

Going through a big shock like that
isn't as painful, you know, so, so

we're, we're seeing, I, I think there's
a lot of good that can come from, um,

you know, the philosophy of tariffs,
the, the implementation, the practices.

It's just, it's, it is shocking.

It's something that, you know, it's,
it's, it's shocking the system and

we're seeing that, and you've got
people pricing in, uh, recession, uh,

recession because I think the tariffs
are gonna really, uh, impede growth.

And there's a good case for that.

Right?

I mean, I, we talked this morning, I was
talking to, um, a friend of mine who owns.

A concrete business, it said steel's going
up, uh, ca price of cables are going up.

Um, you know, so we we're going
to see some, some immediate price

increases, uh, while just during
the time that it takes to kind of

reassess like supply supply chains
and, and figure out ultimately where

the, where the tariffs are gonna land.

In the short term though, we know what
things are gonna cost, the increased

cost is gonna be, um, so it we're,
it's having an immediate effect.

Uh, for us in real estate, I want Patrick
to jump in 'cause he, he knows this stuff.

Um, he knows the numbers much better
than I do, but I mean, it, it's gonna

have an impact on new development.

We've seen it like from the, the,
the guy today on the concrete.

Um, but that's all through
the development process.

Um, all the materials that go into that.

Um, so what does that mean for
existing real estate and, you

know, potential value there?

Patrick, you gonna jump in on that?

Yeah, I think, um, I don't, I'm, I
think, I don't know what to think truly.

Uh,

Brandon Giella: Fair.

Josh and Patrick: no one really does.

No one really

Brandon Giella: That's
such a great response.

I love that.

Yeah.

Josh and Patrick: Patrick's
worn out over it all.

I think the, like the, the popular
thing right now is like debating

the merits of tariffs, and I think
that that's kind of like worthless.

Discussion 'cause like they've
administration's decided that

this is the path they were on.

So like, kind of, you know,
screaming into the wind about

whether or not they're worthwhile.

Brandon Giella: Yeah, yeah, yeah.

Fair.

Josh and Patrick: of a, a
waste of everyone's energy.

Um, so just kind of accepting like
where we are now and trying to figure

out what spooked the market so badly.

And I think the, the biggest thing is.

There's a, um, what It's really popular
to say that the United States was on

a, like unsustainable fiscal path.

Everyone on Wall Street and otherwise
probably agree with that statement,

but I think there's a big difference
between how imminent the current

administration thinks that that is
versus how everyone else thought it was.

So to implement these tariffs
as aggressively as they are.

And Trump talking about, you know,
surgery and this being an operation

that needed to happen and all that.

I, I think it's just because they view
the bill coming due a lot sooner than

everyone on Wall Street did because
we still have a really strong economy.

And so I don't know which side is right.

We, everyone agrees it needs to
be dealt with and we're just kind

of the market's figuring out how
quickly that's gonna be dealt with.

And so.

Um, I, I think I'm in the, the
same camp as Josh about the

large nature of the tariffs.

I think it, it, for some reason doesn't
get a ton of coverage, but like this

just straight out of Trump's playbook.

It's like you always come out
swinging with the big number and now.

Psychologically he has an advantage
to where if he negotiates a 40%

tariff down to a 20% tariff, which
is still massive, it looks like

there was a great deal struck.

You know, so I think
that's a big piece of it.

As far as what it means for like us
in the real estate world, um, slower

development is going to mean less supply.

So that's what I was getting.

Yeah, that's wanted to take it.

Um, it's gonna mean less supply
for the stuff that's already there.

So if you're talking multifamily,
it's just gonna mean, um, more, less

availability for someone to rent.

And so interest, I mean interest.

So rents are, um, gonna probably
grow at a faster clip than you

would've expected them to grow.

Um, and for housing.

New single family homes being built,
um, is probably gonna slow down.

But mixed with all that too is what is
the impact that all this has on the person

renting or the person buying the home.

And so if this shock is too great to
the system and we get plunged into.

A recession where there are a bunch
of corporate layoffs coming because

one, it's hard to plan and everyone's
frozen right now, uh, because we,

they are unsure about how these
tariffs are gonna be implemented, and

the timeline is being held to right
now, but has been extended in other

circumstances over and over again.

So you don't really know
when it's gonna happen.

And so when it does happen, how.

And it's pretty clear that the
US consumer can't foot the entire

bill of what these tariff increases
will do to the price of goods.

So the corporations are gonna
have to have their margins eaten

into to bear some of that also.

And how many layoffs does that create?

So, uh, and then so then how good is the
state of the renter or the home buyer?

And how does that, you know,
in the end affect asset prices?

The big questions out there right
now, and, and I, I personally,

I don't think it gets there.

Like, I don't, I don't think we get
to, uh, that point where the tariffs

are, it is just, uh, all or nothing.

We're going for it
regardless of the fallout.

Like, I, I think that's something
that as a business person.

Um, you've gotta be nimble and you've
got to take what the data's telling you.

You gotta make decisions based on it,
and you've gotta look out and see, uh,

you know, beyond, um, you know, where you
are and, and, and how to, how to adapt,

how to move and, and how to prevent.

I think some, like, what would
be maybe a catastrophe if it,

everything just shuts down and stops.

I mean, that then we're
talking about a deep recession.

I don't think anybody wants that.

Yeah.

Um, you know, especially
you've got the midterms coming.

You think about just
politically, nobody wants that.

Um,

Brandon Giella: have the
people that voted for Trump.

They would be severely uh, harmed
by something like that and be

very upset with Trump himself.

So, yeah.

Josh and Patrick: And, and so, and I,
I think that's what, it can be easy

to think about things in terms of
like, well, it's a one way, you know,

full speed, one way with no stop.

And I just don't think that most
business people don't deal that way.

I don't think Trump has given any
indication that that's his style.

I think he is, he likes to, when
he has leverage, he uses it and he

uses it to create chaos and he puts
everything out on the table and then

he takes the best deal he can get.

And, and it's, he's been
very successful doing that.

Mm-hmm.

So, I, so I, I think that, uh, that's
probably his, his game plan here.

I mean, that's on a whole nother level.

Like that's, you know, their, their
level of negotiation with other

countries and stuff is, you know,
that it's, it, it's way up there and

beyond, beyond what I understand.

But I think that if it does start to
have, and we're seeing that the stock

market went, you know, nuts the last
couple days, and then all of a sudden

Trump comes out and what does he do?

Hey, I'm having great conversations.

Hi.

His whole, like, his whole team
around him is saying, Hey, we're

having great conversations.

What happens?

It calms down a little bit.

So I, I mean, I, I think that there
is going to be some level of, of

tariff and it is gonna have, um,
consequences both good and bad.

And maybe in the short term it's
gonna be a little bit more painful.

But I do think that they're
adaptable and they're trying to get

the best deals that they can get.

And I agree.

I think what Patrick said is true.

I mean, they've got insight into
information that we don't, and I think

maybe, maybe the economic picture is a
little bit more dire than what we realize.

And we really don't know how much
of those numbers were inflated.

I mean, we, we, we don't know.

Like we, we got revisions on job
numbers constantly last year.

Um, we don't know the true inflation
numbers in the, in the impact

that it's, that it's having.

So.

Uh, especially on the people, uh, you
know, in the lower to to, to middle class.

We know that it's not good.

We know that there's a lot of struggle.

Um, so I, I think there, there's, and
we also have a looming, we talk about

it all the time, the debt wall in
commercial real estate that's coming.

So if, if you're, if you're doing
something that all of a sudden makes it

more affordable, uh, to refinance or more
feasible, I should say, to refinance, um.

You know, commercial real estate
that, that's important too.

'cause commercial real estate goes
down in a big way, then that's gonna

hurt, that's gonna be incredibly
painful throughout the economy.

on, on that note, I mean the silver lining
of Friday and Monday's blood bath was

that treasure yields fell substantially.

And then that was, you know, all of a
sudden was that was the chest move that.

The administration was making
was, let's take tank yield

oil two so we can Oil Yeah.

And oil two, oil two.

So we can refinance a lot of this
debt and, you know, get our interest

payment down to a more reasonable level.

Uh, but then, uh, I mean, if you're
looking right now, I think we're

back at four 20 on the tenure.

It popped up.

Yeah, it popped it up.

Um, so th that hasn't necessarily
materialized sustainably yet.

It could go back down.

I think there's a lot of o other reasons
for why I think we're seeing a range.

Don't you think, like, do you think
you guys we're kind of seeing a range?

Like, 'cause what was, what do
you think was priced in last week?

I mean, pri like, like, like spooky,
like recession was priced in or like

stagflation and what did it go to?

What was it?

The, yeah, I mean I, we've probably
gone up four quarter, 30 basis

points since where, from where
we were to where we are today.

I just wonder if we're starting to see.

If it's becoming a little bit range bound,
which is positive, 'cause you can then

start to kind of like, make decisions
or, or plan for things that no one knows.

But if all these, like different
scenarios were priced in, in the, in

the 10 year, you know, went up to four
and a quarter, or it got down to as

low as what, like 3, 7, 5, I mean,
it went, went way down 50 points.

I mean thereabouts, like I think it was
historical moves the last couple days.

Um, then people are pricing in these
different scenarios and you can kind of,

kind of see, well, if this stuff happens.

That maybe we're fine.

We're kind of getting, and maybe
it's no longer, like maybe the

ranges are just a lot more volatile,
um, than what we're used to over

the last, you know, so many years.

But we're seeing like, okay, if, if
people think this is gonna happen,

this is how far that yield's gonna go.

If people think this is gonna happen,
this is how far maybe that yield can drop.

Because there's other things
at play, people are still

concerned about inflation.

Um, and that's a big one, right?

It's recession around inflation or, or
stack inflation, um, you know, is one

that we're hearing a lot right now.

Yeah.

And I don't know.

I mean, so if, if we're gonna settle in
the like low fours on the tenure, then

like then none of this was worth it.

If that was the goal.

I mean like that's where we

Brandon Giella: Because, because
it should go lower, to be

Josh and Patrick: yeah, well
and it went, it was already

going that direction I think.

Right?

What you're saying?

It was low based on, it was
kind of moving that way.

Recession fears.

And now it's funny because we jumped
up yesterday and you read anything

about it and it's like, whoa, the
yields jumped on, recession fears.

And I'm like, well, that's not true.

Um, so I think, but I think what happened
yesterday with the Big U moving yields was

there were a lot of, uh, wall Street firms
who had purchased a lot of stock on margin

that had margin calls after the declines.

And so they had to sell a bunch of bonds.

That's at least my theory because the
other popular theory is that China

is retaliation, started dumping a lot
of their, um, US treasury holdings.

And looked at all the other
country's 10 year bonds yesterday,

and it was up everywhere.

So, um, I don't think that
that makes a ton of sense.

So I'm, I'm hopeful that this was, you
know, people needing to generate some

cash real quick and selling some bonds.

And we'll start to trickle, we'll
trickle back down a little bit today.

So, um.

But the, the silver lining was, hey,
lower interest rates in our world is gonna

create, uh, more attractive refinances
gonna stimulate home buyer applications.

Mm-hmm.

Um, but if that's gotta materialize
and it's gotta be sustainable, it

can't be 30, 40 basis points swings.

'cause that's not gonna
activate anybody any action.

There's pause, people
just, just sit it out.

Uh, too much volatility just cause
people to not wanna do anything.

In fact, it is.

Brandon Giella: Well, yeah,
that's what I'm curious about.

And I am a novice in these areas.

I'm also extremely jet
lagged, flying South Africa.

But, uh, I'm curious what you guys think.

Like, is this one of those situations
where if there's a lot of volatility going

on, that's the time to make investments,
uh, you know, be greedy when others are

fearful or fearful when others are greedy.

And this is a time when
people are very fearful.

Is this a time to be looking at
making moves and investments, or

is it time to sit back and kind of
like, kind of watch what's happening?

I don't know.

Like, like, I guess what I'm
trying to get at is like, given

what you're seeing, what we know.

Um, and there's all kinds of theories.

What do you do?

Like, what is the next step?

You know, what is the,
the, the playbook here?

Josh and Patrick: Yeah, I mean,
I guess it should speak just in

terms of real estate investments.

I think if you were to talk to a, um.

Um, you know, financial advisor,
they'd have a certain advice on some

may, maybe stocks that they think
are also, um, you know, undervalued

and maybe it's a buying opportunity.

I, but, uh, for us, uh, you know, for
what, what we do and what we know, um,

I think that, uh, there
is a good argument to, to.

Take a break.

Just take a breath for just a little
bit and just see, um, because it's

been so volatile in the last few days.

Um, as much as you can, like
we've got deals that, uh, have

maturities and we've got a refi.

I mean, there, there's no, you
know, we can maybe work out an

extension or something, but, um,
that's not gonna be real long.

So, I mean, there's, there's things
that we've got to move on, uh, and

we're just praying and hoping that, um.

Rates will, will work in our favor as
that, as that day gets closer, uh, on

like, but we, on our lending stuff,
I mean, we're looking at a deal.

We were had a deal around the street.

It was two acres that were gonna be, um,
that was rezoned and replanted into four

really great lots in this great community.

And, um, you know, the numbers were good.

The numbers made the
deal work economically.

It was, it seemed like, you
know, based on where the comps

were for the finished product.

Yeah.

It, the deal could work for a
builder that wanted to go in and.

And, and finish the development
and, and, and build it out and,

and, you know, sell it custom.

And it was that kind of location.

Uh, but surprisingly the builder
interest waned, like, because

of over the last few weeks.

Um, you know, there's,
'cause it's a long process.

So when you're thinking about that, you're
thinking about, well, the development

could take, you know, six, six months
to, to nine months, somewhere in there.

Um, and then you've gotta build all
these houses or you gotta wait in, in

this case, I think the, the play was.

Probably to wait on, on, somebody
come in and say they wanted to build a

custom home on the, on one of the lots.

So, I mean, you're looking
at 12 to 18 months.

Um, so then you've got even, you know,
there's, there's more that goes into that.

Uh, where's the market gonna be then?

Um, you know, if the market's, if,
if the market's gonna soften a little

bit, um, then I'm, and I'm paying
too much today, uh, for, for what?

These lots, lots cost.

Well, the seller today thinks
they're getting a good deal

because by today's numbers.

Yeah, it could work if you could
have the house built in two weeks.

Yeah, I'd say it's, you know, I mean
that's, but you know, if you could have

the house built in the next, you know,
few months, it, yeah, it, it works.

But that's not reality.

Um, so I think there's, there, there's,
there, there's still opportunities to be

had, but it may be like we talk about a
good buying opportunity, um, if you find

sellers that need to sell, in this case,
um, the owner didn't, didn't need to sell.

At least that's the
indication that we got.

Um.

But in, in other cases where life
circumstances do dictate, Hey, we gotta

go, then it could be a buying opportunity
because what I'm seeing, typically when

it gets chaotic, most people do step back.

So the demand, um, goes down.

Um, so when demand goes
down, price goes down.

So I think it's gotta
be really opportunistic.

Uh, you know, I, I think you're, you're
okay if you just stress test, um,

whatever investment you're gonna make by.

You know, just, yeah, it, it's different
depending on the, on the product

type in the area, but stress it based
on, hey, if things go wrong and you,

you have to apply a number to that
scenario, what does this look like?

Um, and, and you know, if you can, you
can fix your debt, you can do that.

Some people would argue, don't do that
right now, you know, there that's right.

Rates are coming in and we're
talking more bridge debt.

Um, some, some bank debt too,
but the, on the development

side, it'd be more prime driven.

But those, those rates likely come in.

You don't necessarily
wanna fix your debt and.

Uh, a lot of development stuff too.

Banks don't wanna fix
their debt debt either.

They may, the banks probably
do wanna fix it today.

Brandon Giella: mm.

Josh and Patrick: If we can lock it up
there high today, let's do it because

it, it is likely that those, those
interest rates are, are coming down

over the next, you know, several months.

Um, but what, what you do is, I think
it's kind of the boring playbook, but

it's, it's one that you just got to say
by you, you look for great opportunities.

You kind of know 'em when you see 'em,
but you just, you just gotta, it, it just,

it's that, it's that much more important.

That your underwriting is right,
that your operation is right, that

you've got the right team around you
because the implementation in times

like this is absolutely critical.

You, you, you're racing against time.

Um, you don't have a lot of room for
mistakes if the market's changing.

And that's true of, of any time,
but especially now when things

are on such dramatic swings.

Um, just make sure your process
is right and there are, there

are opportunities out there.

We'll see, like this lane we're
talking about today, I mean.

Uh, we could come next week
and all of a sudden there's

a significant price decrease.

Well, now it's like, hey, yeah, it's
volatile, but this is a great deal.

We know that given on the historicals
of the area, the trends in the

area where, where it's going.

The other comps, uh, you know, we've
got enough people that saying that

development costs are, are in line.

Like, yeah, this is a good deal.

Like this is a good deal.

We're gonna be, you know,
we, we need to move on this.

Um, and that's when a lot of people make,
build their businesses and, um, you know.

a lot of money is, is when they're
willing to take those calculated risks.

And a lot of people
are, are sitting it out.

But like I said, but I, I,
I think sometimes sitting

it out is the right move.

It's just, it's, it's so,
it's so deal dependent.

Brandon Giella: Hmm, interesting.

Are there things that you are looking
for over the next, like couple of

weeks that, um, I guess maybe it's like
little flags or little indicators to you

that are really important or, or just
something that is, you know, interesting,

something you're just kind of watching.

Uh, and I guess a small example, and this
is very macro, but something that keeps

coming to mind and maybe it's just a fear
of mine or, or something, but when I'm.

Hearing, you know, headline news
or the administration makes some

kind of announcement or policy
adjustment or something, how do

other countries react to that?

Or how do other leaders react to that?

So, for example, this is a very
small, limited example, small market,

but, um, when a lot of tariffs were
announced, uh, the Canadian whiskey

world, uh, became very irate about that.

And there were a lot of stories of stores
shoving, you know, Kentucky Bourbon.

Off their shelves, essentially
to just have Canadian whiskey.

And again, it's a very small, uh,
market and a very extreme example,

but that kind of thing, like how are
other people, other countries, other

industries kind of taking this news
is something that I'm thinking about.

But I'm, I'm, yeah.

I'm just wondering if there's anything
that you would advise folks that are

listening to kind of pay attention
to or think through along with you

as you guys are thinking through it.

It.

Josh and Patrick: Um, I think
that, uh, just keeping it

focused on our real estate world.

The thing that I'm watching, uh,
are the publicly traded REITs.

Brandon Giella: Okay.

Why?

Josh and Patrick: the, um,
they have gotten hammered in

all of this and, um, that is.

Not in totally puzzling to me,
but it is kind of a, like, hmm,

it makes you think a little bit.

Uh, and I'm not talking about like
the development focus one, like

obviously home builders and all
that have gotten slaughtered 'cause

the expected increase in costs.

But the REITs who are really, really
large, uh, apartment owner holding res for

instance, um, have gotten hit really hard.

And I, I, the only reason I can
really, really think that of why

that's the case is that there, what's
being priced in there is the, like,

complete deterioration of the consumer.

Um, I can't really, maybe I'm just
not seeing the picture clearly, but

I can't think of another reason why
that would be happening right now.

Um, and so my hope is that that is a
reaction of, Hey, let's go to, let's play

out this worst case and see what happens.

And if they end up in a better
position, then you'll see that

kind of start to make a comeback.

So, but I think that's all just a fore.

The publicly traded commercial
real estate owner groups are just

kind of a forerunner of what the
sentiment in the private markets are.

So.

Uh, I suspect that you'll see that
start to improve as we kind of absorb

all this and start to get the first,
uh, employment readings after all

these tariffs take effect and all that.

And I, um, I think that I,
I'm hopeful that that will

start to improve that outlook.

Brandon Giella: When, when
is that data coming out?

When are you looking at that?

Josh and Patrick: Yeah, we're a month out.

I mean, just had the, the last
report came out on Friday.

It was positive 220

Brandon Giella: Okay.

Josh and Patrick: thousand jobs.

Uh, I think unemployment ticked up 4.2,

but is still really low.

Uh, I mean, that, that's a good,
you know, local indicator too.

What, what's going on in DFW?

And it's still, I mean, everything
is still chugging along.

You know, I, um, on Friday when all
this happened and yields tanked.

Uh, sent an email to, uh, the
broker that will sell one of

our properties that we own.

Hmm.

And one that we would like to
sell when the time is right.

Mm-hmm.

And immediately sent him and said,
Hey, are you seeing buyers, um, come

into the table more aggressively with,
you know, half a point drop in rates,

making financing a lot more favorable?

And his feedback was really good and
wise, and it was basically like that.

That's just gonna take
time to soak through.

Mm-hmm.

And so it's not like there are, um,
groups with millions of dollars who are

waiting for that one, you know, half
point drop in rates to where everything

suddenly makes sense and it's go time.

It's, uh, going to, I think, take a
little bit longer in the private markets

to show that the trajectory is there.

That even when financing is
favorable, that the long-term

outlook is favorable too.

Um, because these guys have to
go raise money to do these deals.

And, um, you, when anyone's skittish
who would be investing, they've

gotta see really strong returns.

Brandon Giella: Yeah.

Yeah, it makes sense.

Everybody I talked to, I just heard
from a, a colleague who owns a, a

marketing agency who was just like, I
just wish things were basically clearer

so that I, I knew what to do or business
would pick up or people would start

having these kind of conversations.

And there's a lot of people I talk to
that are kind of feeling that way, just

kind of waiting for what is happening and
what will happen over the next several

months so that they can make decisions.

So what you guys are saying makes sense.

Even on the, the real estate side.

Well, any, any parting thoughts on,
you know, things that are happening

this week or, or things you'd
encourage folks to, to take note of?

Josh and Patrick: It'll be different
next week, you know, and, and I think we,

Brandon Giella: true.

It's a good point.

Yes.

True.

Josh and Patrick: yeah, I mean, so, and
I think we just, this is, it is kind of

a hard pill to take sometimes, but I.

Like Patrick said in the beginning,
this is where we are, we can't

Brandon Giella: Yeah.

Yeah.

Josh and Patrick: Um,
so trust the process.

Um, the people, the, the leadership that's
involved, uh, they've got a plan here.

Um, I, I think they're all smart people.

Um, they, I think, and they're,
they're ultimately for the good of

the country and for the good of.

Uh, all of us.

So I, I think that, let's just see, let's
just see what, what comes from this.

I think it's also a good opportunity
to talk about, and this is something

that I'm not always great with, but.

You've gotta try to keep the fear
and the anxiety out as best you can.

I mean, on all like media, social
media outlets, you're gonna

be, you know, hit with that.

And, and it's, it's really,
it's what gets attention.

It, it's, it's, um, ultimately what gets
clicks and eyeballs, and I get all that.

So, um, and it's entertaining.

It is, for whatever reason, like
doomsday stuff is, is entertaining.

I mean, I don't know why we, we
feed that, but it, it is something

that we all seem to be drawn to.

But, so, I mean, for me, you know, for
us, for our business, we gotta have

faith that, uh, the, the lord that
we, that we serve is much bigger than

everything here that we're talking about.

I mean, so much bigger.

Um, it ultimately controls,
uh, what happens to us.

And what, what, what
happens to, to everybody.

And so it, it's a good reminder.

It's a good like, kind of faith tester.

Like where's your, where's your trust?

Like, do you have resolve knowing that,
that ultimately, like this life is short,

there's gonna be little stints of turmoil.

There's, it's gonna be painful at times.

I mean, Jesus told us that, like
even to, to his followers, he never

said it's gonna be, you know, easy.

Uh, it is actually gonna be hard.

And so when those, when these things come.

Um, you know, it, it's a good
chance to really see where you

are and for me to see, see where I
am when I wake up in the morning.

Am my am, am am are my thoughts faith
focused or are they fear focused?

And, and that's something that
I've really been, been working on,

um, you know, for, for a while.

I mean, it's an ongoing, probably
working on it for the rest of my life.

Uh, but you know, when, when we're faced
with these challenges and like your friend

said, and like, we want the same thing.

We just want clarity.

We want clarity, and that's when
your faith has gotta be strong.

Because I don't know
that we're gonna get it.

I don't know that we're gonna get it,
but there are things that we can be clear

about and that that's things that, that
we can read in scripture and we can pray

about and, you know, that, that we know
we can get in community and talk about.

There are, there is a lot
of clarity in this life.

Um, but right now, like in, uh, and
I'm, I'm talking about in this life,

in, you know, in, on a spiritual
level, but I, but what we're talking

about right here, I don't know.

We're probably not gonna get the clarity.

So it's just, it's just a
good opportunity for us.

It's a good opportunity for, for
anybody to, to just kinda see what.

See what your foundation is and if
it's getting rocked, then you know, I

don't think life's gonna get easier.

So you look to make sure that
your foundation is strong.

Brandon Giella: Yeah,
no, that's a great word.

It's something that my, my team
here, you know, we're in South

Africa with the whole team.

There's seven of us in a, in a
boardroom all week, just kind of

working through a bunch of stuff.

And we keep saying like, we just
have to take a leap of faith.

Like things right now we're just
unclear and it seems a little slower

than usual, slower than we'd like, but.

We just have to make a bet and
take a, take a leap of faith that

the Lord will provide, that we're
gonna make the right decisions.

Now take, you know, calculated
risks, calculated bets, make

the decisions we need to, while
we have a little bit of time.

And, uh, and just hope that it
works out in the coming months.

So, yeah.

Yeah.

But it's, but it's scary,
you know, doing that.

Josh and Patrick: it is.

Yeah.

And I'm, I want it is for everybody
and anyone who tells you it's

not, is probably not being honest.

I mean, it, it, it just.

Because we don't, we're not in control.

We are not in control, and we
don't know what the future holds.

And as we always want to have, we want to
have clarity and we want to have comfort.

We're, we're made that way,
like to be drawn to it.

Um, so when we don't have it, it is scary.

And, and that's what, and no
one's, no one's beyond that.

It is just, it's just a matter
of where do you go with it?

Brandon Giella: Yeah.

Yeah.

Amen.

Amen.

Well, gent, thank you.

I always appreciate every week talking
through like what you guys are seeing

in the markets, because I don't have
the kind of expertise that you do.

And so having like, uh, having
you talk on the character side of

things, talking about your faith,
talking about fear, talk, fuck,

talking about the hope that you have.

Plus the data and insights and
the expertise that you have on the

investing side is very calming.

And I hope that, um, people feel
that, that they feel that kind of

like, um, that, you know, basically
like everything's gonna be okay.

The Lord will provide.

And there's some stories out
there that may or may not be true,

but here's some things that are
true and that, that look like.

Um, that help us make those decisions
that we need to in the meantime.

So anyway, I'm really grateful that I
get to talk to you guys and, uh, that the

listeners get to hear from you every week.

And so we will have, uh, more
content coming out on this 'cause I

know it's, it is affecting markets.

Um, and so hopefully we'll get
this, um, uh, newsletter coming

out very soon on this topic.

Uh, blog on this topic.

And if you guys ever wanna reach out
to the team, go to alx realestate.com,

subscribe to the newsletter, find
us on social media, ask questions

like, let's, let's all kind of figure
this out together and, and talk

through things and what you guys are
seeing, um, in the markets as well.

So, Josh, Patrick, thank you
and we will see you next week.

Josh and Patrick: Thanks, Brenda.