biggestrisk

J Darrin Gross

I'd like to ask you, Joel Friedland, what is the BIGGEST RISK?

Joel Friedland  

I'm afraid I can't give you just one. Because there are actually multiple risks. I've been doing this for 40 years, and I can tell you exactly what I struggle with with risk. Number one risk debt. If you have debt and anything goes wrong, you are screwed. So that's why we do our deals, debt free, no mortgage, that's number one. Number two in industrial, vacancy.  When a building's vacant, and it's a single tenant building on a net lease when the tenant leaves. It's either 100% vacant or it's 100%. Leased. So vacancy vacancy vacancy, it's it hurts us so badly. We need to keep our buildings occupied. The third one is your area, which is risks that have to do with losses, trucks hitting the sidewall of a building, which happened to us two weeks ago. Flooding roofs that a tree falls on, you know, those insurable risks. Those are really big for us. So Basically, it's almost as if we are a homeowner. And we have all the same issues as a homeowner, except we have a tenant that pays rent instead of us occupying the house. And that's the fourth risk if you do a deal with a tenant with bad credit collections.

J Darrin Gross

 I'd like to ask you, Ben Spiegel, what is the BIGGEST RISK?

Ben Spiegel  

So, land, like I said, we were talking on our economy. When we started our conversation before the podcast began, landlords are Sue land that landlords sued 25 times more than the next business than the next highest sued business. So we're already in a very elevated risk, risk type of business. So I think the major form of risk obviously, when you have ambulance chasers out there looking to profit off of almost any opportunity they can. And so it depends really, it for example, I own a multifamily in Bridgeport, Connecticut, which is, you know, about an hour away from me, and I found a tenant was putting marbles in the lobby, to try to encourage a slip and fall because she's unhappy about her current lease situation. I mean, I've really, I've seen it all. And so but what I went, I think what it comes down to protecting yourself is, when I first started and to give advice, when I first started in this business, I'm just looking to just minimize expenses, minimize expenses, minimize expenses, go with the lowest cost insurance carrier possible, whoever offered the lowest premium I'm dealing with. Now, after having over having over a decade of experience in this industry, I am more than willing to pay a premium for my insurance provider, knowing not necessarily that my deductible is lower, but knowing that they will be there to cover me. If it's not, it's not if it's when I was going to be sued by a tenant for a slip and fall, or maybe there's asbestos in the building, I don't know about that somehow found there, it really can be a there's 100 different things that can be I'd say that, you know, the, the greatest risk is just, it's just being a landlord and being in the position that provides a you're providing housing to people and that the what I guess what I'd like, you know, is just to really not skimp on insurance expense. And, you know, in terms of just like overall risk, I think we're seeing it right now, especially in syndication, a lot of syndicators, were willing to go with variable rate loans, you know, four or five years ago, just to get a lower rate, you know, overall rate in that in that moment, not looking at the future in terms of how rates could move. So that just comes back to just the general principle of having a longer term hold view of your investment, and really be willing to sacrifice a little bit of cost up Friday to potentially to hedge yourself for the long term environment. So that's what I would say on the I, in addition to just general liability and business replacement, business, income replacement insurance, also just in terms of when you're just kind of have a long term view when you're looking at financing and really tenant selection, and even the build quality when you're doing renovations, when you buy a building that has deferred maintenance Are you just going to put a bandaid on it and move along and just keep chugging along. But what you find with that is, you know, a couple months later, there's 20 More band aids as opposed to just biting the bullet in the beginning. Spending the upfront cost is uncomfortable and it's not it doesn't feel great in the moment of sort of curing all deferred maintenance just immediately after acquisition. But I am telling you, it will save you money in the long run over the long run. And it's in my opinion, it's a huge competitive advantage if you're willing to have have that operating strategy.

J Darrin Gross

I'd like to ask you, Maxwell, Wu, what is the BIGGEST RISK?

Maxwell Wu  

I think the BIGGEST RISK, you know, right now in this market It is price fluctuation, right? investors do not like uncertainty. It's almost like a natural thing that the universe wants some order there. And we don't have a threshold to go off of a baseline they go off of it's very hard to see what the future looks like. What do all those words mean? Right? You know, again, you mentioned insurance. And I think a lot of investors, and I'm sure a lot of your listeners have noticed insurance costs skyrocket 3050 100%, of what it was previously. And that's for a multitude of reasons that, you know, we can drone on about, and maybe that's something you're able to add in here. But besides in middle class materials, labor, unexpected, you know, natural events, natural disasters happening. These are all things where, you know, folks didn't think there'd be such a destructive hailstorm in Texas, right. You know, these are things that truly anomalies, black swan events. Again, market does not like uncertainty. But how do you buttress against that against these headwinds? It's you got to Proform it appropriately and do that scenario analysis. And whether we do that for line item expenses, or really on a more macro basis, what happens if interest rates go up another 50 bibs? 100, VIBs 150 bibs, what to do to the property, right? So, sensitizing is a is a great way that we see the kind of hedge against risk or rather go in eyes wide open and say, if this does happen, what's the result? What can we do, right? To your point, what is preventable weather things that you can transfer risk on. So that's, that's how we view risk. And that's how we assess it. And that's how we had it. But in terms of, again, answering your question, what do we think the biggest risk is, is, you know, the highest levels of uncertainty, right. But if you want to be more specific with regard to real estate insurance is is is certainly out there. And making sure that you have the right folks that has seen have seen, you know, where policies were previously in the high inflationary times. And in times of stress, or for limited credit supply, look, or liquidity in the market, right? All these things inform premiums and cost of really insuring these properties, which any lender you go to any good lender you go to is going to require that you have a very strong insurance policy on the property.

J Darrin Gross

 I'd like to ask you, Matt Brodnik, what is the BIGGEST RISK?

Matt Brodnik  

I mean, I think I mean, I've been harping on tenant demand all this time. And as I mentioned, you know, tenant demand hasn't disappeared, it's, it's still there. I mean, you know, we talked about demand, kind of reverting to the mean. And right now, I'd say demand is fallen below the mean, a little bit, which is expected. I mean, tenants lease a lot of space and 21 and 22 leads to more than it turns out, they may need now, but they, they're not giving it back, they still still need it. And I think what happens in recession, which we haven't seen, we're not in a recession right now. And there's talk right now with the Fed that, that this whole idea of a soft landing, you know, employments near 100% Here, you know, we still have economic strength and growth, and as long as we do tenants are going to need space. And I think the biggest risk for us right now is is is recession, and, you know, tenants actually giving space back like they did during the global financial crisis, and that demand disappeared. And I think then, you know, it's, that's the, that's the big concern, that man going, you know, really, you know, falling through. And, you know, we talked about it, you know, if you talk to an office investor in 2021, during the pandemic, you know, they didn't forecast that this whole return to work thing would, or this work from home thing would last for four years. They didn't even see it as a risk at all. So I think, and that's what's killed the office world, right, is that tenant demand is completely disappearing, and not just disappear, but there could be giving space back, it's going backwards. So that's the risk, we see is this whole integrated environment. You know, maybe there's a another black swan event, something that happened, obviously, we talked about as a black swan event, maybe you can't predict what it is, but it seems like, you know, war in world between Russia and Ukraine and, you know, Israel and everything going on in the world, that is a real risk that something else comes in, there's another shock to the system. So that kind of demand, that's the thing that we you know, we stay up at night thinking about and, and focused on.

J Darrin Gross

 I'd like to ask you, Frank Xia, what is the BIGGEST RISK?

Frank Xia  

I think the biggest risk for me is, I think, interest rate right now, and how I choose to, I don't think I can transfer that. But I think I can minimize it number before for a few for a few strategy. Number one is I just invest less deals, because the less you invest, the less risk you expose, right. But if you don't invest anything, then you have no income. That's not an option. So you have to participate in debate, but you can participate very strategically. So that's number one. Number two is you can use a fixed rate mortgage to alleviate your risk, right. Instead of few years back, everybody is using floating interest rate with two years of recap. So we learned the lesson, we're going to be more conservative using a fixed rate mortgage. So that's number two. Number three is that we are looking for a cheaper price. We're giving us more buffer so that we can tolerate this kind of waste. So these are the three things we're going to be doing. But the biggest risk to us right now our interest rate.

J Darrin Gross

Michael Salafia, what is the BIGGEST RISK?

Michael Salafia  

As an investment manager, it's the fluctuations in interest rates are our biggest risks that we are dealing with at the moment. That changes that become very, the changes of interest rates are somewhat predictable to a degree and we'd get communication from the Fed. Our challenge is the market reaction or slow reaction and and kind of gauging how slow the reaction is going to be to the shifts. So getting getting sellers to understand that, you know, interest rates are not at three and a quarter. They're now at seven and a quarter. So your five cap property that you think is worth a five cap is now worth an eight cap and getting them to swallow that pill. That's that's been the biggest challenge.

J Darrin Gross

Mike Merrigan, and Bo Kort, what is the BIGGEST RISK?

Mike Merrigan:
I'll go first, if you're, because you're an insurance, one of the best feelings I've gotten, as far as an insurance thing, and looking at risk is once I had it explained to me, once I did get some assets, an umbrella policy gives me a lot of comfort, never had to use it. But I feel like it's a good investment. So if you're talking about literally insurance, I like the fact that I have an umbrella policy to protect things that I might not be thinking of. So I love having that. And I think it's a good value. And I'm glad to have it, and I don't think I'll ever not have it. On the other side of just generally speaking risk. One of the things that I learned, the biggest risk is not taking a risk, not taking the chance of buying real estate, I don't care, then buying an index fund, throwing your 10% every year, or every month, or whatever. But the biggest risk in life is don't take a risk. And guess where you're going to end up. If you can draw a picture, you're going to be just fine, you're going to be 30 pounds overweight, you're going to have a retirement that's going to be small, and you're going to just live this life, as opposed to take a few risks. Get a little older, take care of yourself, physically eat where you want, stay where you want, live, where you want, do what you want, it's a lot happier life, don't take a risk is the biggest risk and take in my opinion.

Bo Kort:

I agree completely. Gonna be hard to follow that one because I wanted to so Trump. I would say the other thing that I was thinking of is, is that in risk, and in real estate investing, is just staying disciplined and don't get emotional over things. And I think partnerships help in that, you know, like Mike talked about, he's good at one thing I'm good at another. Another thing that we lean on each other about a lot of times is we'll come up with a deal, and we'll have a feeling about it. We'll be in the office, and we'll spend hours just going over it and this and that. Okay, what do you guys want to do. And then one of us usually speaks up and goes to a call tomorrow. Tomorrow, nobody makes a decision that we're supposed to call him tonight. So call them back and let them know, we're not going to talk to him till tomorrow, you know, I mean, just let them know, something came up, whatever it is, and we sleep on it, we come back, and just make sure that we're not being emotional about the decisions that we're making. And because of being like that, and a lot of that is Mike's good about that to hold us all accountable for for things like that. But um, it has saved us tremendously on not making mistakes. And mistakes are good, and you learn from mistakes. And that's why you start small so that you don't have the type of mistakes that crumble you. But you educate yourself from those mistakes and it keeps you to be disciplined and not get too emotional about things. And your old self will be thanking your ass whenever you're whenever you got the money coming to you. Because you were disciplined, persistent 

J Darrin Gross

Weina Zhang, what is the BIGGEST RISK?

Weina Zhang  

So the reason the we crave matrix system, like you said, was 20 years, his parents are from the line, we meet him lies, minimalize excuse the language. A lot of risk already. Right. But still our risk is. So like you said, the Fed. How can I give affordable housing for middle class? Right? The really the interest rate, right? So that's, that's I cannot control ever one problem I need to solve that. Right. So that's the that's really the biggest obstacle. The interest rate See, I solved the parking I solved the HOA, I solved the great location, beautiful glass condo, small, you know, not like super, like super 505,000 square foot. But there's a fed? Yes. That's the risk of I don't know if you call feather risk. Other than that, I think. Yeah, I don't think there's a lot of risk on me. Other developer? Probably, but not me.

J Darrin Gross

I'd like to ask you to DeLisa Guerrier a, what is the BIGGEST RISK?

DeLisa Guerrier   

Well, I think that there is a huge risk in what we do every day by, you know, investing capital into ever changing markets. And, you know, each project is different as to how much capital that is, and, and, you know, it is a risk. I mean, real estate investing is a risk in itself. And that's what, that's what ours isn't, you know, I, I'll tell you how, how I look at it, markets change, just like what we're in right now. And there was this profound lesson that I learned when I was in college, and I'll share it with you. My sister and I were driving from California to Nashville, we just got our brand new cars. It was my second year of college, and my mom was driving the car in front of us. And she and I were taking turns driving mine. And we came through some place in Oklahoma or something, and there was this huge, big storm. So we caught my mom and we said, what do we do, you know, do we pull over and she said, We're gonna keep moving, we're gonna move slow, we're gonna move cautiously. But we're gonna keep moving. And when we got out of it, she said, if we'd stopped, we'd still be in the storm. And that is how I look at market shifts. That is how I look at, you know, our risk taking it's, we move, we move cautiously, we pay attention, and we, you know, don't don't make any sudden, sudden movements. But, um, you know, we keep moving. So

 J Darrin Gross

I'd like to ask you, Mandy McAllister, what is the BIGGEST RISK?

Mandy McAllister  

I really believe that the BIGGEST RISK is doing nothing, that there's risk all around us. And no matter. I'm a very risk adverse person, I have followed the script. I am a farm kid who does stuff the right way. And it wasn't until I realized that no matter what it takes not taking a risk is the is a risk. It's a choice boards, leaning into my money getting eaten by inflation. So there was a book that was kind of all the rage recently through governance women called the psychology of money. And my primary takeaway there is I don't need to be perfect in my decision making. I just need to be reasonable enough. And if I'm reasonable enough in that risk mitigation, and the idea of real estate, everybody always needs a roof over their head. Maslow's hierarchy of needs, tells me that this will have demand till the end of time, right? You don't need to buy a Bitcoin, you don't need to buy a stock certificate, you need a roof over your head. So how can I lean into the thing with the strongest demand ever? And be reasonable enough in the process, so that I am winning, rather than just leaning back in letting inflation eat away at my mouth?

J Darrin Gross

I'd like to ask you, Mark Khuri, what is the BIGGEST RISK?

Mark Khuri  

I'd say today J, a lot of people think economy, recession, downturn, asset values dropping, etc. All of that is top of mind, but it's not the biggest risk for us, the biggest risk has, for many years has been the same. And it remains today and its people. So we are a private equity firm. We are inherently trusting others to operate the assets that we're investing in. And so people risk number one for us, Jay, and one of the hardest to, to mitigate against because people by definition can be mysterious and difficult and hard to understand and complicated. And so a lot of that risk for us is reduced by working with people for a number of years, it takes a long time to get to know them, see if they're really good. And if the business plan wants you to go left, but the economy is telling you to go right what do you do? Do you have the right people that can steer the ship that can adjust in the middle of the the operation and continue to always have the investors best interest in mind? So for us, it's definitely people risk.

J Darrin Gross

I'd like to ask you, Todd Piggott, what is the BIGGEST RISK?

Todd Pigott  

In my opinion, and I evaluate that all the time, what's our biggest risk? I manage $100 million. Right now other people's money throughout our fund, what's the risk that I'm trying to avoid? I can predict the interest rates, I can look at the metrics provided by the GSA for portfolio performance and assess risk there. I can look at absorption rates and assess risk there. I can look at the borrower got good cash down, got good credit backgrounds clean, I can assess risk. They're my biggest concern of risk, and what I do every single day. And I think if there's any time for this to happen, it's it's now my biggest risk that I view as a potential threat to my specific platform, is a calamity outside of housing that will cause housing or real estate to collapse. I believe that housing today is extremely safe. We have 1.8 months of inventory. We have construction. We don't have a wave of foreclosures. We have a shortage of housing and all these point to stability right now except for little pockets here and there down 5% You know you 99% of list prices and my biggest concern. My biggest concern is a calamity outside of housing that will quickly affect housing, a terror attack political dysfunction, a drop in our currency war, war war. You know, everybody can call me a crazy for these things. But I believe that in 2023 The chances of some type of calamity occurring outside of housing or real estate that will affect housing or real estate is as likely. And I think that we're, we're, we're seeing some of that we're seeing things happen politically, society, currency, or even even globally, we're seeing things happen that we've never seen in our lifetime. And so I think if one of those events occurs, that would send housing into an into a spiral. And so that is, here's how I look at this, though, that is something that I don't have control over. I don't know what's gonna happen there. And if it does happen, I tell my investors this, our worst scenario is that we have a classic event outside of housing, that causes a deep decline in asset values across the nation, both in stocks and everything else. So what do we do? I tell them this, at least I've got real estate, I've got a home with a first position lien, we're a borrower with good credit, put down 20%, I can get in my pickup truck, and drive to that property. And we at least have that. So we, he bought it for 400, he put down 60 to 80, we're into it 320, we thought it was gonna be worth 550 and the whole world fell apart. At least we can get in our pickup truck and drive to that property. And I've got a property that somebody has to live in, we will freeze the fund, freeze it. And we will be renting those or holding those for cash flow as as entry level housing until that calamity starts to dissipate. So my investors are coming. So what's the what's the worst thing that can happen? The worst thing that can happen is a calamity outside of housing. At that time, we would at least freeze the fund. And we would at least have assets that we would stabilize with renters for positive cash flow until that calamity dissipates. So that's how I plan on mitigating that that risk threat. And I think that risk threat is potentially real, potentially real, something out there is going to happen five years, 10 years, three years, I don't know it's going to cause a discourse and affect us. I don't have control over that. You don't have control over that. But the best way to protect about that is at least have some type of plan B or extra strategy and we do.

J Darrin Gross

I'd like to ask you, Paul Ross, what is the BIGGEST RISK?

Paul Ross  

I have to say it's context dependent. But if you were to ask me in general broadly, the biggest risk that you can take is to be risk adverse and to need to get absolute clarity before you take an action step. If you're adverse to risk and you need absolute clarity before you act. You then risk can be an emotional risk risking rejection, although I never get rejected, I only discovered the lessons that I didn't know that I had learned. So being risk averse. And as part of that meeting to be certain before you take a step into the unknown, see if you can step into the unknown without needing a guarantee of success and let the other person give them radical permission to have their first response to you. Then something magical opens a doorway to grace the doorway to results that you wouldn't otherwise get if you can get it you need to guarantee.

J Darrin Gross

I'd like to ask you, David Goldfarb, what is the BIGGEST RISK?

David Goldfarb  

So if I'm going to, if I'm going to make this unrelated to let's say, insurance or to anything, from an operational standpoint, I think the biggest risk that we're seeing, or at least I'm seeing in these in picking these locations, is you don't want to go into a location where the mall operate. Operator is like a Slumdog real estate mall operator. So you want to avoid that at all cost. And even though you have a separate entrance, leading into your building, the fact that you're going into a mall, where they are basically treating the property as if it was a warehouse, so to speak, not the way the Simon properties do not the way Washington prime group does. Not not the way you know, some of these, you know, other large mall operators run in this type of environment, I would avoid at all costs. So So you know, there are there are certain certain players out there, and I'm not gonna mention names. But there are certain players out there that have been buying distressed moles. And if you happen to buy a piece of property that's attached to that distress mold, the way they run their operations really is it's unfortunate, because when you're attached to what I would call almost a bad neighborhood, if I'm referencing that, no matter how nice your house is, you're still in a bad neighborhood. So that's what I would avoid at all cost.

 J Darrin Gross

I'd like to ask you, Joseph Woodbury, what is the BIGGEST RISK?

Joseph Woodbury  

Yeah, isn't an easy answer. For me. Ironically, I think most people's largest risk is is is in their industry or in their business itself. And, and I certainly think of risks there. But we've kind of talked about the storage industry, it's it's very robust, it's not going anywhere. It doesn't respond to recessions. You know, during the oh eight recession, when most real estate asset classes contracted by 60%, storage grew by 5%. So it's very, like, counter cyclical and recession proof. And so actually, I identify our biggest risk as a company is, is we're influenced not just by the storage industry, but because we're a software technology company, we're influenced by the venture capital industry. And if you look at other large marketplaces that have gone before us, they've raised a lot of capital to get to where they are. Airbnb is a $80 billion company, they just joined the s&p 500. So they are, you know, one of the most important companies in the United States of America. But they raised about $10 billion in capital to get there. You know, Uber raised north of $15 billion, and capital Instacart and DoorDash have both raised I want to say six or seven or $8 billion in capital. So most major marketplaces raised large amounts of capital today, you know, we operate in every city in all 50 states, we've raised a measly, you know, $65 million in capital. So I often ask myself the question, you know, will we be able to raise, you know, those those billions of dollars in capital, like marketplaces that have gone before us to reach the potential that they have, they have reached as mainstay brands in the United States. I think that's, that's the biggest risk. You know, when I, as the CEO, sit down and think it's not the storage piece. Renters love us hosts love us host earning money. renters are saving money, they keep growing, they keep transacting, they keep coming to the platform. It's, it's, you know, we're dependent on this venture capital industry. And it goes through different cycles. It's in a pretty bear cycle right now. And that'll continue to happen and it'll keep going through bear and bull cycles. But will that affect us, you know, years down the road? You know, what we go through some bear cycle that forces us to use other means of funding and that sort of thing?

J Darrin Gross

 I'd like to ask you Grant Pruitt, what is the BIGGEST RISK?

Grant Pruitt 

Sure, I'll give you the micro first and I'll give you the macro. So from a micro standpoint, with primarily offices in the state of Texas, the biggest risk is the the perceived safety of the cities. As long as the cities in the state of Texas are perceived as relatively safe, we'll continue to see that inbound migration, the schools have always been an issue. And people always talk about schools. But the minute people don't feel safe, that's when you see a flight to other parts of the country where they do perceive that safety. That's the map the micro, from a macro standpoint, it's probably going to be the same concern tomorrow, and next year, 10 years from now, 20 years from now, it's always the lending facilities for me, because I'm in commercial real estate and always quiz people and say, who owns all the real estate in the United States, because the United States is different than some other parts of Europe and so forth. The banks, the banks own the real estate, because they have loans on most of the real estate that's out there. And when we have hiccups in the lending facilities, that's where we have real trouble. We saw it in, you know, the 1980s 2008. Anytime that banks fail, anytime we see issues with lending, potentially alternative vehicles that that create more risk? That is a huge concern.

J Darrin Gross

I'd like to ask you, Joe Moye and Dan Grosswald, what is the BIGGEST RISK?

Joe Moye  

Yeah, I'd be happy to start with that. I think, you know, the the autonomous technology mobility area has done, it's probably done itself a little bit of a disservice of all the lofty expectations of these George Jetson scenarios of vehicles zipping all around our roadways in autonomous mode. And, and I don't think it's because anybody was derelict in their visions, I think it was just the reality that this is a walk before you run technology. You know, one of the things that we've hit on here that's so important, is starting with planned route, controlled speed environments, where you're able to mitigate a lot of the complex interactions, one would typically have one, you know, much more sophisticated or much larger routes for the traveling of a vehicle. You know, it is the technology is getting better and better every day, as you and I talked about before the call even applications, beyond moving people, you know, if you're moving boxes, or luggage or anything else, same type of technology that's being advanced to perceive an environment and be able to navigate a course. And so, you know, I think, I think it's important as an industry, that we, you know, evolve this together in these more controlled environments and not set false expectations of these vehicles will be able to go anywhere, anytime, any speed tomorrow. And I think from a risk perspective, you know, that dramatically reduces, you know, the chance that, you know, something would happen, but, but I'd also say, you know, at the end of the day, and you probably know these statistics better than I but you know, 43,000 people perished on us roadways. Last year alone, you know, incredible tragedy, the property damage associated with that, you know, the quality of life damage associated with that 94% of that caused by human error distraction impairment, these vehicles respond in a scenario three times faster than a human can identifying something and actuating a break, and they're never distracted, right, they're not staring at an iPhone, they're not going into the town center for a couple of drinks and getting behind the wheel. And that's, you know, that can't be lost in this, this is about, you know, saving lives and reducing risk as it relates to one of the biggest threats, you know, in our country today. So, So anyhow, that would be my my soapbox speech on that topic.

Dan Grosswald  

We'd look at it from three perspectives. You know, first, the biggest, the biggest risk, really, from our perspective is human failure, the vehicle itself and the technology itself is, is very good. And as Joe pointed out, is better than a human being in terms of its safety factor. Really, what happens is either for packing a human acting from the outside of the system, you know, crashing into it, or taking advantage of the vehicle is a risk, not the vehicle or the system, or when it's not an autonomous mode, it's actually riskier than when it is in autonomous mode, sometimes the vehicle has to be manually moved. So the risk factor increases slightly, they're over when it's in autonomous mode. But the other the other two things. So we decided purposefully to create the dedicated path for the reasons that Joe mentioned earlier. So that helps us minimize the risk that it's not interacting on an open road or parking lot system as much as otherwise would be if we didn't have the trails. So and we did that for a reason. And finally, we've decided to have the CDD operated, so from a developer point of view, having to do CDD own and operate the vehicles gives us, you know, some sovereign immunity from what we would otherwise be exposed to as a corporation. So that's kind of how we viewed the risk and how we've tried to mitigate or transferred as you mentioned earlier,

J Darrin Gross

I'd like to ask you Owen Barrett, What is the BIGGEST RISK?

Owen Barrett  

Yeah, I think it's easy. It's climate change. I think it's climate change. For a number of reasons. From a utility perspective, I mean, look at the heatwave that we have going on now, in the Southwest US, how are utilities going to keep up with all that demand? Assuming that this is like the new normal. From an from an insurance perspective, we're seeing major insurers pull out of entire states, because the climate risks are too high state farm just pulled out of California due to wildfires, and Florida due to Hurricane risks. So there's so many adverse effects of climate change that are going to just perpetuate through all different pieces of the economy. Agriculture is a huge one too. I mean, thinking about your food supply and how that's gonna get affected. There's just there's so many risks of climate change, that it is just mind boggling to me that it's not everybody's number one priority to do everything in their power, whether as an individual or corporation and institutional investor to solve this as fast as possible, because I think we're moving entirely too slow.

J Darrin Gross

 I'd like to ask you, James Goss, what is the BIGGEST RISK?

James Gosse  

Well, a great question. And certainly, you know, the topic we were just touching on by the way, Darrin, I think, you know, oftentimes, so people are aware interest rate caps are often referred to as insurance policies for your interest rate. So I just found that an interesting aside, the biggest risk for us and this is a good question. You know, it's one of the things that If I'm honest, sort of this probably keeps me up at night more than other things. It's, you know, it's not making people aware of who we are, it's not not being able to get our message out to the right people. Right, that that's the risk I see. And again, we're obviously doing what we can to eliminate, mitigate, minimize all that kind of stuff. That said, you know, to us, that's the biggest risk, obviously, there's, there's other market forces and things like that, but just from what we can control. You know, to me that that's the biggest risk is we have something that when we explain it correctly, and when we have the right, people were talking to light bulbs go on. And when we have the discussion with lender partners, they go, of course, we want to do this with you, right? Of course we'd like so, but it's just a function of the risk is that we don't communicate it right. Or the risk is that we don't communicate it to the right audience or, you know, whatever the case. So, to us, it's a an exposure again, and I see this very much. So we've got a guy, I think the gentleman who set me up to this, Tim, is outstanding, and he's spends all of his time trying to figure out how do we make sure the market is aware of us has the right perception. And again, that's one of the reasons we were so pleased to join CCI M, their member Advantage program? Again, for us, it's a, I would say an exposure or, you know, making sure we get enough exposure is our Biggest Risk.