50: Part II: Business-like approach to investing with Steve Huntzinger, Dunham Lane Capital Partners

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Steve Huntzinger is the co-founder of Dunham Lane Capital Partners and Banyan Real Estate Group. He has extensive experience in the investment industry and has a passion for finding value in both public and private markets.

Summary:
In the part II of this episode, Steve Huntzinger discusses his side business, Banyan Real Estate Group, which focuses on distressed real estate. He shares how the opportunity came about and the process of raising capital and acquiring properties. He also talks about the scalability of the real estate business compared to the investment management business. Steve emphasizes the importance of shared vision and temperament in a successful partnership. He also discusses the impact of rising interest rates on the future value of commercial real estate. Steve provides insights into the growth potential of Floor & Decor, a company he has invested in, and explains their financial opportunity and strategic growth plan. He highlights the advantages of owning publicly traded companies and the potential for share buybacks. Steve concludes by discussing the long-term vision for Dunham Lane Capital and the importance of balancing financial success with a high quality of life.

Key Takeaways:

  • Banyan Real Estate Group focuses on distressed real estate and raised capital from friends and family.
  • The scalability of the real estate business is limited compared to the investment management business.
  • Shared vision and temperament are crucial for a successful partnership.
  • Rising interest rates may have a negative impact on the future value of commercial real estate.
  • Floor & Decor has a strong growth potential with their strategic growth plan and ability to compound earnings.
  • Opening a new Floor & Decor store costs around $9-10 million and generates a 33% return on capital in the first year.
  • Floor & Decor's store unit growth and excess cash flow could lead to share buybacks, increasing shareholder value.
  • Dunham Lane Capital's ten-year vision is focused on generating strong returns and learning more about businesses.
  • Balancing financial success with a high quality of life is important for long-term well-being.

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