Author Topic: BAM - Brookfield Asset Management  (Read 511912 times)

villainx

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Re: BAM - Brookfield Asset Management
« Reply #200 on: March 02, 2017, 09:22:45 AM »
That SIRF article resurfaces (and apparently resurfaces again) whenever BAM is analyzed. Last I checked, it didn't feel very compelling to me, as BAM has talked fairly about its business and have been fairly transparent.  Then again, I don't deep dive regularly.



villainx

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Re: BAM - Brookfield Asset Management
« Reply #202 on: May 05, 2017, 08:12:39 AM »
Here's a Bloomberg video interview:

https://www.bloomberg.com/news/videos/2017-05-02/brookfield-s-flatt-excited-about-the-u-s-overall-video

BAM hasn't been my greatest stock investment - though it's hard to keep track with the spinoffs - as I tend to jump in at the temporary peaks.  But it's been pretty good.  However, the lessons I learned from Flatt has shaped a lot of my personal, professional and investing style.  Love the guy.

Aurelius

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Re: BAM - Brookfield Asset Management
« Reply #203 on: May 05, 2017, 08:53:13 AM »
If you'd like to share, I'd be curious to hear what those lessons are?

villainx

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Re: BAM - Brookfield Asset Management
« Reply #204 on: May 05, 2017, 10:20:10 AM »
Sure.  In my pre-30s, I had decent career path that I squandered because I didn't work that hard.  I invested in a way that relied heavily on leverage (options mostly) that I hoped would result in big gains (without doing much due diligence), I was frugal but it was more due to laziness.

Today, I work harder and more than I ever imagined, but it doesn't feel like work, it just feels like a thing that I can excel at doing (related to real estate).  I got more into real estate.  I got more into value-ish, outsider-isa, quality-focused investment - that even though my due diligence skills aren't that great, I have a greater grasp of what and why I'm investing.  I look at cash flow a lot more.  Realizing stabile-ish 12% return is amazing in the long run.

A lot of it is just being mature, hard working, diligent, and so forth.  I'm far from meaningfully successful, though I feel ultimately I will be moderately so.  But the goal is more being mature, hard working, diligent, etc. that success itself.
« Last Edit: May 05, 2017, 10:26:19 AM by villainx »

LesPaul

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Re: BAM - Brookfield Asset Management
« Reply #205 on: May 05, 2017, 11:33:38 AM »
Sure.  In my pre-30s, I had decent career path that I squandered because I didn't work that hard.  I invested in a way that relied heavily on leverage (options mostly) that I hoped would result in big gains (without doing much due diligence), I was frugal but it was more due to laziness.

Today, I work harder and more than I ever imagined, but it doesn't feel like work, it just feels like a thing that I can excel at doing (related to real estate).  I got more into real estate.  I got more into value-ish, outsider-isa, quality-focused investment - that even though my due diligence skills aren't that great, I have a greater grasp of what and why I'm investing.  I look at cash flow a lot more.  Realizing stabile-ish 12% return is amazing in the long run.

A lot of it is just being mature, hard working, diligent, and so forth.  I'm far from meaningfully successful, though I feel ultimately I will be moderately so.  But the goal is more being mature, hard working, diligent, etc. that success itself.

I admire this line of thinking and I personally find purpose and worth in this pursuit as well!

sys

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Re: BAM - Brookfield Asset Management
« Reply #206 on: May 05, 2017, 08:34:26 PM »
i've very gradually been convinced by flatt (although it can still be hard for me to put into practice) that it is often wise to pay up for premium assets - which may never become available cheap.

obviously not a unique insight from bam, but watching them is what has helped convince me.


karthikpm

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Re: BAM - Brookfield Asset Management
« Reply #208 on: May 13, 2017, 10:41:14 AM »
Need many more 245 Park Street kind of deals. Interesting take on retail

LongTermView

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Re: BAM - Brookfield Asset Management
« Reply #209 on: May 13, 2017, 12:05:21 PM »
Need many more 245 Park Street kind of deals.

Ohgodyeah!

For those who haven't yet gone through the letter:
Quote
In 1996, we purchased the property as part of the acquisition of a New York real estate company that was in bankruptcy. At that time, we allocated $430 million of the total purchase price to this property. It came with a $290 million mortgage, meaning that we invested $140 million to acquire the equity. In 2001, the value of the property had increased substantially, due to our renovation and subsequent re-leasing of the property with higher rents and stronger credit tenants. This enabled us to refinance the property with a $500 million mortgage and withdraw $200 million of cash.

In 2003, we sold a 49% equity interest to a client for a further $200 million. At the time, a $900 million total value for the property seemed high, and this allowed us to redeploy the capital elsewhere. Over the years, further leasing success, capital improvements and higher rental rates increased the value of the property further and we increased the mortgage on the property again to $800 million. We received another $150 million of cash from this financing. Finally, in this latest transaction we sold the entire building for $2.2 billion. Net of the $800 million mortgage, we received proceeds of $1.4 billion, which was distributed to us and our client.

In total, we received $1.5 billion of cash from our initial $140 million investment or more than 10 times our initial equity investment. This included refinancing proceeds of $350 million, sale proceeds of $850 million, and $300 million of cash distributions from this property, which are net of tenant inducement and capital expenditures invested back into the property.